1. Chapter Copyright© 2004 Thomson Learning All rights reserved 13 Motivation in Multinational Companies

2. Copyright© 2005 South-Western/Thomson Learning All rights reserved Learning Objectives Know how people from different nations perceive the basic functions of working Know how people from different nations view the importance of working Understand how the national context affects the basic processes of work motivation Know how people from different nations perceive the basic functions of working Know how people from different nations view the importance of working Understand how the national context affects the basic processes of work motivation

3. Copyright© 2005 South-Western/Thomson Learning All rights reserved Learning Objectives Be able to apply common theories of work motivation in different national context Be able to design jobs for high motivational potential in different national cultures Be able to apply common theories of work motivation in different national context Be able to design jobs for high motivational potential in different national cultures

4. Copyright© 2005 South-Western/Thomson Learning All rights reserved Motivation in Multinationals Multinational managers must understand how to motivate international employees Multinationals face an array of challenges to motivate a workforce in the face of a rapidly changing labor market Multinational managers must understand how to motivate international employees Multinationals face an array of challenges to motivate a workforce in the face of a rapidly changing labor market

5. Copyright© 2005 South-Western/Thomson Learning All rights reserved Work Values and the Meaning of Work Why do people work? Four major functions of work Providing needed income Security Contact with other people A feeling of accomplishment Why do people work? Four major functions of work Providing needed income Security Contact with other people A feeling of accomplishment

6. Copyright© 2005 South-Western/Thomson Learning All rights reserved Exhibit 13.1: Ratings of Major Functions at Work

7. Copyright© 2005 South-Western/Thomson Learning All rights reserved Why Do People Work? Emphasis differs by country Income a higher priority in: Transition economies (e.g., Azerbaijan and Lithuania) and many of the developing nations (e.g., India) Contact with and a feeling of accomplishment more important in: Many of collective cultures and the social democracies Emphasis differs by country Income a higher priority in: Transition economies (e.g., Azerbaijan and Lithuania) and many of the developing nations (e.g., India) Contact with and a feeling of accomplishment more important in: Many of collective cultures and the social democracies

8. Copyright© 2005 South-Western/Thomson Learning All rights reserved What Do People Value in Work? Work centrality: overall value of work in a person’s life Work compared to other activities such as leisure and family Higher levels of work centrality match average number of hours worked per week High levels of work centrality may lead to dedicated workers Work centrality: overall value of work in a person’s life Work compared to other activities such as leisure and family Higher levels of work centrality match average number of hours worked per week High levels of work centrality may lead to dedicated workers

9. Copyright© 2005 South-Western/Thomson Learning All rights reserved Exhibit 13.2: Differences in Work Centrality in Seven Countries

10. Copyright© 2005 South-Western/Thomson Learning All rights reserved Exhibit 13.3: Ranking of Work Centrality of Selected Countries of the World Values Survey

11. Copyright© 2005 South-Western/Thomson Learning All rights reserved Importance of Work Goals that people hope to achieve from working Ranking of the work characteristics for 50 countries Generous holidays (73%) An opportunity to use initiative (53%) Good hours (53%) Respected job (50%) Responsible job (46%) Goals that people hope to achieve from working Ranking of the work characteristics for 50 countries Generous holidays (73%) An opportunity to use initiative (53%) Good hours (53%) Respected job (50%) Responsible job (46%)

12. Copyright© 2005 South-Western/Thomson Learning All rights reserved Importance of Work 6.Achievement (42%) 7.Interesting (39%) 8.Abilities (36%) 9.Good job security (30%) 10.Good pay (19%) 6.Reward of generous holiday almost universal 7.However, priorities given to different job characteristics vary by country 6.Achievement (42%) 7.Interesting (39%) 8.Abilities (36%) 9.Good job security (30%) 10.Good pay (19%) 6.Reward of generous holiday almost universal 7.However, priorities given to different job characteristics vary by country

13. Copyright© 2005 South-Western/Thomson Learning All rights reserved Exhibit 13.4: Importance Rankings of Work Characteristics in Nine Countries

14. Copyright© 2005 South-Western/Thomson Learning All rights reserved Exhibit 13.4: Importance Rankings of Work Characteristics in Nine Countries

15. Copyright© 2005 South-Western/Thomson Learning All rights reserved Work Values and the Meaning of Work: Conclusions In some societies, work is very central and absorbs much of a person’s life. All people hope to receive certain benefits from work. The first key to successful motivation strategies is understanding the differences regarding how people view work among countries. In some societies, work is very central and absorbs much of a person’s life. All people hope to receive certain benefits from work. The first key to successful motivation strategies is understanding the differences regarding how people view work among countries.

16. Copyright© 2005 South-Western/Thomson Learning All rights reserved The Basic Work-Motivation Process Motivation: a psychological process resulting in goal- directed behavior that satisfies human needs Need: feeling of deficit or lacking Goal-directed behavior: one that people use with the intention of satisfying a need Motivation: a psychological process resulting in goal- directed behavior that satisfies human needs Need: feeling of deficit or lacking Goal-directed behavior: one that people use with the intention of satisfying a need

17. Copyright© 2005 South-Western/Thomson Learning All rights reserved Work Motivation and the National Context Reinforcement: reactions to a person’s behavior that encourage the person to continue the behavior E.g., bonus pay to encourage behavior Punishment: consequences of a person’s behavior that discourage the behavior E.g., docking pay to discourage behavior Reinforcement: reactions to a person’s behavior that encourage the person to continue the behavior E.g., bonus pay to encourage behavior Punishment: consequences of a person’s behavior that discourage the behavior E.g., docking pay to discourage behavior

18. Copyright© 2005 South-Western/Thomson Learning All rights reserved Exhibit 13.5: The Basic Work Motivation Process and the National Context

19. Copyright© 2005 South-Western/Thomson Learning All rights reserved National Context and Work Motivation Culture and social institution influence They influence the priority people attach to work They define what behaviors are legitimate ways to satisfy goals National context also influences reactions to goal- directed behaviors at work Culture and social institution influence They influence the priority people attach to work They define what behaviors are legitimate ways to satisfy goals National context also influences reactions to goal- directed behaviors at work

20. Copyright© 2005 South-Western/Thomson Learning All rights reserved Theories of Work Motivation in the Multinational Context Two basic types of motivational theories Need theory: assumes that people can satisfy basic human needs in the work setting Process theory: arising from needs and values combined with an individual’s beliefs regarding the work environment Two basic types of motivational theories Need theory: assumes that people can satisfy basic human needs in the work setting Process theory: arising from needs and values combined with an individual’s beliefs regarding the work environment

21. Copyright© 2005 South-Western/Thomson Learning All rights reserved Theories of Work Motivation in the Multinational Context Four need theories of motivation Maslow’s Hierarchy of Needs ERG theory Motivator-hygiene theory Achievement motivation theory Four need theories of motivation Maslow’s Hierarchy of Needs ERG theory Motivator-hygiene theory Achievement motivation theory

22. Copyright© 2005 South-Western/Thomson Learning All rights reserved Exhibit 13.6: Need Theories of Motivation

23. Copyright© 2005 South-Western/Thomson Learning All rights reserved Maslow’s Hierarchy of Needs Theory States that people have five basic types of needs Physiological, Security, Affiliation, Esteem, and Self-actualization The needs follow a basic hierarchy People first seek to satisfy lower needs Once lower need is satisfied, it no longer motivates People try to satisfy higher needs States that people have five basic types of needs Physiological, Security, Affiliation, Esteem, and Self-actualization The needs follow a basic hierarchy People first seek to satisfy lower needs Once lower need is satisfied, it no longer motivates People try to satisfy higher needs

24. Copyright© 2005 South-Western/Thomson Learning All rights reserved Exhibit 13.7: Maslow’s Hierarchy of Needs and Country Level Measures

25. Copyright© 2005 South-Western/Thomson Learning All rights reserved Alderfer’s ERG Theory Simplified hierarchy of needs, including existence needs, relatedness needs, and growth needs Frustration of a need motivates behavior to satisfy the need. People seek to satisfy higher and lower level needs. If people cannot satisfy higher needs, they will try to satisfy lower level needs. Simplified hierarchy of needs, including existence needs, relatedness needs, and growth needs Frustration of a need motivates behavior to satisfy the need. People seek to satisfy higher and lower level needs. If people cannot satisfy higher needs, they will try to satisfy lower level needs.

26. Copyright© 2005 South-Western/Thomson Learning All rights reserved Motivator-Hygiene Theory Assumption that a job has two basic characteristics: motivators and hygiene factors Job content—motivating factors E.g., challenging job Job context—hygiene factors E.g., good benefits Assumption that a job has two basic characteristics: motivators and hygiene factors Job content—motivating factors E.g., challenging job Job context—hygiene factors E.g., good benefits

27. Copyright© 2005 South-Western/Thomson Learning All rights reserved Achievement-motivation Theory Suggestion that only some people have the need to win in competitive situations or to exceed a standard of excellence Three key needs: achievement, affiliation, and power High achievement people have needs to win and to set own goals and seek challenging situations Suggestion that only some people have the need to win in competitive situations or to exceed a standard of excellence Three key needs: achievement, affiliation, and power High achievement people have needs to win and to set own goals and seek challenging situations

28. Copyright© 2005 South-Western/Thomson Learning All rights reserved Needs and the National Context: Lessons People from different nations do not give the same priorities to the needs that might be satisfied at work Even with similar needs, they may not give the same level of importance of satisfying these needs People from different nations do not give the same priorities to the needs that might be satisfied at work Even with similar needs, they may not give the same level of importance of satisfying these needs

29. Copyright© 2005 South-Western/Thomson Learning All rights reserved Exhibit 13.8: Rankings of the Importance of Job-Related Sources of Need Satisfaction for Seven Countries

30. Copyright© 2005 South-Western/Thomson Learning All rights reserved Exhibit 13.9: Hofstede’s Dimensions of National Culture and Motivators at Work

31. Copyright© 2005 South-Western/Thomson Learning All rights reserved Applying Need Theories in Multinational Settings Identify the basic functions of work in the national or local culture Identify the needs considered most important by workers in the national or local culture Sources of need fulfillment may differ for the same needs Understand limitations of available jobs to satisfy needs Identify the basic functions of work in the national or local culture Identify the needs considered most important by workers in the national or local culture Sources of need fulfillment may differ for the same needs Understand limitations of available jobs to satisfy needs

32. Copyright© 2005 South-Western/Thomson Learning All rights reserved Process and Reinforcement Theories of Motivation: Expectancy Theory Expectancy theory Assumes that part of motivation is an individual’s desire to satisfy needs People’s beliefs regarding how much their efforts at work will eventually satisfy their needs Expectancy theory Assumes that part of motivation is an individual’s desire to satisfy needs People’s beliefs regarding how much their efforts at work will eventually satisfy their needs

33. Copyright© 2005 South-Western/Thomson Learning All rights reserved Expectancy Theory Three factors Expectancy: an individual’s belief that his or her effort will lead to some result Valence: the value attached to the outcome of efforts Instrumentality: the links between early and later results of the work effort Motivation = Expectancy x Valence x Instrumentality Three factors Expectancy: an individual’s belief that his or her effort will lead to some result Valence: the value attached to the outcome of efforts Instrumentality: the links between early and later results of the work effort Motivation = Expectancy x Valence x Instrumentality

34. Copyright© 2005 South-Western/Thomson Learning All rights reserved Applying Expectancy Theory in Multinational Settings Two key issues Identify valued outcomes of work Use culturally appropriate ways to convince employees that their efforts will lead to desirable ends Two key issues Identify valued outcomes of work Use culturally appropriate ways to convince employees that their efforts will lead to desirable ends

35. Copyright© 2005 South-Western/Thomson Learning All rights reserved Equity Theory Focuses on the fairness that people perceive in the rewards that they receive for their efforts at work There are no absolute standards for fairness in the input/output (effort/reward) equation. People compare themselves to others and adjust their input (effort). Focuses on the fairness that people perceive in the rewards that they receive for their efforts at work There are no absolute standards for fairness in the input/output (effort/reward) equation. People compare themselves to others and adjust their input (effort).

36. Copyright© 2005 South-Western/Thomson Learning All rights reserved Applying Equity Theory in Multinational Settings Equity norms vary Three principles of allocating rewards The principle of equity (based on contributions) Prevails in individualistic cultures The principle of equality (based on equal division of rewards) More likely in collectivistic cultures The principle of need (based on individual needs) Equity norms vary Three principles of allocating rewards The principle of equity (based on contributions) Prevails in individualistic cultures The principle of equality (based on equal division of rewards) More likely in collectivistic cultures The principle of need (based on individual needs)

37. Copyright© 2005 South-Western/Thomson Learning All rights reserved Exhibit 13.10: Rewards from Peers for Contributions to a Student Group Project

38. Copyright© 2005 South-Western/Thomson Learning All rights reserved Goal Setting Theory Assumption that the mere existence of a goal is motivating The principles of goal setting Set clear and specific goals Assign difficult but achievable goals Increase employee acceptance of goals Provide incentives to achieve goals Give feedback on goal attainment Assumption that the mere existence of a goal is motivating The principles of goal setting Set clear and specific goals Assign difficult but achievable goals Increase employee acceptance of goals Provide incentives to achieve goals Give feedback on goal attainment

39. Copyright© 2005 South-Western/Thomson Learning All rights reserved Applying Goal-Setting Theory in Multinational Settings Goal setting works to some degree, regardless of location. Cultural expectations vary—managers must know Is it better to set goals for groups or for individuals? Goal setting works to some degree, regardless of location. Cultural expectations vary—managers must know Is it better to set goals for groups or for individuals?

40. Copyright© 2005 South-Western/Thomson Learning All rights reserved Exhibit 13.11: Cultural Effects on Performance by the Degree of Participation in Goal Setting

41. Copyright© 2005 South-Western/Thomson Learning All rights reserved Reinforcement Theory Operant conditioning: model proposes that behavior is a function of its consequences Positive reinforcement—response with rewarding consequence Pleasurable consequence = behavior continues Punishment—negative consequence Unpleasant consequence = behavior stops Operant conditioning: model proposes that behavior is a function of its consequences Positive reinforcement—response with rewarding consequence Pleasurable consequence = behavior continues Punishment—negative consequence Unpleasant consequence = behavior stops

42. Copyright© 2005 South-Western/Thomson Learning All rights reserved Exhibit 13.12: Management Examples of Operant-Conditioning Process and Types of Consequences

43. Copyright© 2005 South-Western/Thomson Learning All rights reserved Applying Reinforcement Theory in Multinational Settings Positive reinforcement works Difficulty is in identifying appropriate rewards as reinforcers National context defines acceptable and legitimate rewards Positive reinforcement works Difficulty is in identifying appropriate rewards as reinforcers National context defines acceptable and legitimate rewards

44. Copyright© 2005 South-Western/Thomson Learning All rights reserved Exhibit 13.13: Effects of Positive Reinforcement and Types of Rewards in a Russian Cotton Mill

45. Copyright© 2005 South-Western/Thomson Learning All rights reserved Multinational Applications of Process/Reinforcement Theories Expectancy theory: key is identifying nationally appropriate rewards that have positive valence Equity theory: assess meaning and principle of equity in national context Goal-setting theory: should goals be assigned to groups or individuals? Reinforcement theory: what people value at work will influence the types of reinforcers that can be used Expectancy theory: key is identifying nationally appropriate rewards that have positive valence Equity theory: assess meaning and principle of equity in national context Goal-setting theory: should goals be assigned to groups or individuals? Reinforcement theory: what people value at work will influence the types of reinforcers that can be used

46. Copyright© 2005 South-Western/Thomson Learning All rights reserved Motivation and Job Design: U.S. Perspectives The job-characteristic model approach Work is more motivating when managers enrich core job characteristics, such as by increasing number of skills a job requires. The job-characteristic model approach Work is more motivating when managers enrich core job characteristics, such as by increasing number of skills a job requires.

47. Copyright© 2005 South-Western/Thomson Learning All rights reserved Job-Characteristics Model Three critical psychological states as motivating A person must believe that his or her job is meaningful. A person must believe that he or she is responsible or accountable for the outcome of work. A person must understand how well he or she has performed. Three critical psychological states as motivating A person must believe that his or her job is meaningful. A person must believe that he or she is responsible or accountable for the outcome of work. A person must understand how well he or she has performed.

48. Copyright© 2005 South-Western/Thomson Learning All rights reserved Core Characteristics of Job Skill variety Task identity Task significance Autonomy Feedback Skill variety Task identity Task significance Autonomy Feedback

49. Copyright© 2005 South-Western/Thomson Learning All rights reserved Exhibit 13.14: A Motivating Job in the Job-Characteristics Model

50. Copyright© 2005 South-Western/Thomson Learning All rights reserved Motivation and Job Design: European Perspective Sociotechnical systems (STS) approach: focuses on designing motivating jobs by blending the social system with different technologies Autonomous work group: team or unit that has nearly complete responsibility for a particular task Team’s task rather than individual task is focus of job enrichment Sociotechnical systems (STS) approach: focuses on designing motivating jobs by blending the social system with different technologies Autonomous work group: team or unit that has nearly complete responsibility for a particular task Team’s task rather than individual task is focus of job enrichment

51. Copyright© 2005 South-Western/Thomson Learning All rights reserved Choosing Job-Enrichment Techniques in Multinational Settings Distinction between individualistic and collectivist cultures should determine the choice of job-enrichment U.S.—individual Japan—team Social loafing: term used when people expend less effort when they work in groups Distinction between individualistic and collectivist cultures should determine the choice of job-enrichment U.S.—individual Japan—team Social loafing: term used when people expend less effort when they work in groups

52. Copyright© 2005 South-Western/Thomson Learning All rights reserved Exhibit 13.15: Comparing the Performance of Chinese, U.S., and Israeli Managers Working Alone and in Groups