Motivation and Performance Chapter Thirteen Motivation and Performance

The Nature of Motivation The psychological forces that determine the direction of a person’s behavior in an organization, a person’s level of effort, and a person’s level of persistence Explains why people behave the way they do in organizations Performance is function of ability, effort, situational factors 2

The Nature of Motivation Intrinsically Motivated Behavior Behavior that is performed for its own sake. Extrinsically Motivated Behavior Behavior that is performed to acquire material or social rewards or to avoid punishment. Prosocially motivated behavior behavior performed to benefit or help others Intrinsically Motivated Behavior Behavior that is performed for its own sake. The source of the motivation that comes from actually performing the behavior. The sense of accomplishment and achievement derived from doing the work itself Extrinsically Motivated Behavior Behavior that is performed to acquire material or social rewards or to avoid punishment. The source of the motivation is the consequences of the behavior and not the behavior itself. 3

Outcomes and Inputs Outcome Input Anything a person gets from a job or an organization Pay, job security, autonomy, accomplishment Input Anything a person contributes to his or her job or organization Time, effort, skills, knowledge, work behaviors 4

The Motivation Equation Figure 13.1

Expectancy, Instrumentality, and Valence Figure 13.2

Need Theories Need Theories Need People are motivated to obtain outcomes at work that will satisfy their needs Need A requirement or necessity for survival and well-being. Managers must determine what needs a worker wants satisfied and ensure that a person receives the outcomes when performing well. 7

Maslow’s Hierarchy of Needs Self- actualization Realize one’s full potential Use abilities to the fullest Esteem Feel good about oneself Promotions and recognition Belongingness Social interaction, love Interpersonal relations, parties Safety Security, stability Job security, health insurance Physiological Food, water, shelter Basic pay level to buy items Needs Description Examples Lower-level needs must be satisfied before higher-level needs are addressed. Highest-level needs Lowest-level needs Table 13.1 8

Adequate pay for necessities Alderfer’s ERG Theory After lower level needs satisfied, person seeks higher needs. When unable to satisfy higher needs, lower needs motivation is raised. Growth Self-development, creative work Continually improve skills Relatedness Interpersonal relations, feelings Good relations, accurate feedback Existence Food, water, clothing, and shelter Adequate pay for necessities Needs Description Examples Highest-level needs Lowest-level needs As lower level needs become satisfied, a person seeks to satisfy higher-level needs A person can be motivated by needs at more than one level at the same time When people experience need frustration they will focus on satisfying the needs at the next-lowest level Table 13.2 9

Herzberg’s Motivation-Hygiene Theory Focuses on outcomes that lead to higher motivation and job satisfaction, and those outcomes that can prevent dissatisfaction. Unsatisfied hygiene needs create dissatisfaction; satisfaction of hygiene needs does not lead to motivation or job satisfaction. 10

Herzberg’s Motivation-Hygiene Theory Motivator needs relate to the nature of the work itself—autonomy, responsibility, interesting work. Hygiene needs are related to the physical and psychological context of the work—comfortable work environment, pay, job security.

McClelland’s Needs for Achievement, Affiliation, and Power Need for Achievement A strong need to perform challenging tasks well and meet personal standards for excellence

McClelland’s Needs for Achievement, Affiliation, and Power Need for Affiliation Concerned about establishing and maintaining good interpersonal relations, being liked, and having the people around him get along with each other Need for Power A desire to control or influence others

Equity Theory Equity Theory Focuses on people’s perceptions of the fairness (or lack of fairness) of their work outcomes in proportion to their work inputs. A relative outcome to input ratio comparison to oneself or to another person (referent) perceived as similar to oneself. Equity exists when a person perceives that their outcome/input ratio to be equal to the referent’s ratio. If the referent receives more outcomes, they should also give more inputs to achieve equity. Inequity exists when worker’s outcome/input ratio is not equal to referent. Underpayment inequity: ratio is less than the referent. Workers feel they are not getting the outcomes they should for their inputs. Overpayment inequity: ratio is higher than the referent. Workers feel they are getting more outcomes than they should for their inputs. Restoring Equity: Inequity creates tension in workers causing them to attempt to restore equity. In underpayment, workers may reduce input levels to correct (rebalance) the ratio or seek a raise. In overpayment, workers may change the referent person and readjust their ratio perception. If inequity persists, workers will often choose to leave the organization. 14

Outcomes < Outcomes Outcomes > Outcomes Equity Theory Condition Person Referent Example Equity Outcomes = Outcomes Inputs Inputs Worker contributes more inputs but also gets more outputs than referent Underpayment Outcomes < Outcomes gets the same outputs as referent Overpayment Outcomes > Outcomes same inputs but also Table 13.3

Goal Setting Theory Goal What a person is trying to accomplish through his efforts and behaviors Must be specific and difficult Goals point out what is important to the firm. Workers should be encouraged to develop action plans to attain goals. Focuses on motivating workers to contribute their inputs to their jobs and organizations Considers how managers can ensure that workers focus their inputs in the direction of high performance and the achievement of organizational goals. Goals motivate people to contribute more inputs to their jobs Goals help people focus their inputs in the right direction 16

Learning Theories Managers can increase employee motivation and performance by the ways they link the outcomes that employees receive to the performance of desired behaviors in an organization and the attainment of goals Learning A relatively permanent change in person’s knowledge or behavior that results from practice or experience. 17

Operant Conditioning Theory People learn to perform behaviors that lead to desired consequences and learn not to perform behaviors that lead to undesired consequences. Linking specific behaviors to the attainment of specific outcomes can motivate high performance and prevent behaviors that detract from organizational effectiveness. 18

Operant Conditioning Tools Positive Reinforcement Gives people outcomes they desire when they perform organizationally functional behaviors Negative Reinforcement Eliminating undesired outcomes once the functional behavior occurs Positive Reinforcement Gives people outcomes they desire when they perform organizationally functionally behaviors Positive reinforcers: Pay, praises, or promotions Negative Reinforcement Eliminating undesired outcomes once the functional behavior occurs Negative reinforcers: criticisms, pay cuts, suspension 19

Operant Conditioning Tools Extinction Curtailing the performance of a dysfunctional behavior by eliminating whatever is reinforcing it. Punishment Administering an undesired/negative consequence to immediately stop a dysfunctional behavior. Manager administers an undesired consequence to worker (verbal reprimand, demotion, pay cut). 20

Avoiding Side Effects of Punishment Downplay the emotional element involved Try to punish dysfunctional behaviors as soon as they occur Try to avoid punishing someone in front of others

Organizational Behavior Modification Managers systematically apply operant conditioning techniques to promote the performance of organizationally functional behaviors and discourage the performance of dysfunctional behaviors Used to improve productivity, efficiency, attendance, punctuality, safe work practices, and customer service Sometimes questioned because of lack of relevance to certain work behaviors To critics it is overly controlling and robs workers of their dignity, individuality, freedom of choice and creativity 22

Steps in Organizational Behavior Modification Figure 13.4

Social Learning Theory Proposes that motivation results not only from direct experience of rewards and punishments but also from a person’s thoughts and beliefs 24

Social Learning Theory Vicarious Learning (Observational Learning) Occurs when a person becomes motivated to perform a behavior by watching another person perform the behavior and be positively reinforced for doing so 25

Social Learning Theory Self-reinforcement Any desired or attractive outcome or award that a person can give himself or herself for good performance. Self-efficacy A person’s belief about his or her ability to perform a behavior successfully. 26

Pay and Motivation Pay as a Motivator Expectancy: Instrumentality, the association between performance and outcomes, must be high for motivation to be high. Need Theories: pay is used to satisfy many needs. Equity Theory: pay should be given in relation to inputs. 27

Pay and Motivation Pay as a Motivator Goal Setting Theory: pay should be linked to attainment of goals. Learning Theory: outcomes (pay) should be distributed upon performance of functional behaviors.

Merit Pay and Performance Merit Pay Plan A compensation plan that bases pay on performance. Clarification: Merit pay typically based on individual performance, as assessed via performance appraisal Typically results in base-pay increase Pay-for-performance plans can be based on individual, group, or organizational performance Can result in base-pay increases or one-time payments One-time payments likely to have more motivational value than base-pay increases Regardless, requires performance measurement to be valid to have motivational value (expectancy theory) Merit Pay Plan Group plan: when group that works closely together is measured and rewarded as a group. Organization plan: when group or individual outcomes not easily measured. Piece-rate Pay Employee’s pay is based on the number of units that the employee produces. Commission Pay Employee’s pay is based on a percentage of sales that the employee makes. Organization-based Merit Plans Scanlon plan—focuses on reduced expenses or cutting costs Profit sharing—employees receive a share of an organization’s profits 29

Awards and Performance

Salary Increase or Bonus? Employee Stock Option A financial instrument that entitles the bearer to buy shares of an organization’s stock at a certain price during a certain period of time or under certain conditions. Uses To attract high-level managers To motivate employee performance through ownership in the firm 31