Motivation | From concepts | And With Applications | Organizational Behavior |

Editor's Notes

• #2: Chapter 8 introduces us to the concepts and applications of motivation. These are topics that pervade the workplace providing opportunity for managers and leaders to be more effective and efficient in accomplishing work. So, this is an important set of concepts to focus on.
• #3: The Job Characteristics Model (JCM). JCM proposed that any job may be described by five core job dimensions. Skill variety is the degree to which the job requires a variety of different activities, so the worker can use a number of different skills and talent.Task identify is he degree to which the job requires completion of a whole and identifiable piece of work.Task significance is the degree to which the job has a substantial impact on the lives or work of other people.Autonomy is the degree to which the job provides substantial freedom, independence, and discretion to the individual in scheduling the work and determining the procedures to be used in carrying it out. And, feedback is the degree to which carrying out the work activities required by the job results in the individual obtaining direct and clear information about the effectiveness of his or her performance. The first three dimensions—skill variety, task identity, and task significance—combine to create meaningful work the incumbent will view as important, valuable, and worthwhile. From a motivational standpoint, the JCM proposes that individuals obtain internal rewards when they learn (knowledge of results) that they personally (experienced responsibility) have performed well on a task they care about (experienced meaningfulness).Individuals with a high growth need are more likely to experience the critical psychological states when their jobs are enriched—and respond to them more positively—than are their counterparts with low growth need.
• #4: Motivating potential score (MPS) provide the core dimensions of the JCM. To be high on motivating potential, jobs must be high on at least one of the three factors that lead to experienced meaningfulness, and high on both autonomy and feedback. If jobs score high on motivating potential, the model predicts motivation, performance, and satisfaction will improve and absence and turnover will be reduced.
• #5: Much evidence supports the JCM concept that the presence of a set of job characteristics—variety, identity, significance, autonomy, and feedback—does generate higher and more satisfying job performance. But apparently we can better calculate motivating potential by simply adding the characteristics rather than using the formula. A few studies have tested the job characteristics model in different cultures, but the results aren’t very consistent. One study suggested that when employees are “other oriented” (concerned with the welfare of others at work), the relationship between intrinsic job characteristics and job satisfaction was weaker. The fact that the job characteristics model is relatively individualistic (considering the relationship between the employee and his or her work) suggests job enrichment strategies may not have the same effects in collectivistic cultures as in individualistic cultures (such as the United States).Another study suggested the degree to which jobs had intrinsic job characteristics predicted job satisfaction and job involvement equally well for U.S., Japanese, and Hungarian employees.
• #6: How Can Jobs Be Redesigned? Repetitive jobs provide little variety, autonomy, or motivation. People generally seek out jobs that are challenging and stimulating. An option is Job Rotation, often referred to as cross-training. This is periodic shifting of an employee from one task to another.When activity is no longer challenging, the employee is shifted to a different task.Strengths of job rotation include that it reduces boredom, increases motivation, and helps employees better understand their work contributions. Indirect benefits include employees with wider range of skills give management more flexibility in scheduling, adapting to changes and filling vacancies. Weaknesses include its creating disruptions, extra time for supervisors addressing questions, and training time and efficiencies
• #7: The illustration in Exhibit 8–2 shows guidelines for Job Enrichment. The First guideline is combining tasks that puts fractionalized tasks back together to form a new and larger module of work. Second Is forming natural work units that makes an employee’s tasks create an identifiable and meaningful whole. Establishing client relationships increases the direct relationships between workers and their clients (clients can be internal as well as outside the organization). Expanding jobs verticallygives employees responsibilities and control formerly reserved for management. Opening feedback channelslets employees know how well they are doing and whether their performance is improving, deteriorating, or remaining constant.
• #8: Some newer versions of job enrichment concentrate specifically on improving the meaningfulness of work. One method is to relate employee experiences to customer outcomes, by providing employees with stories from customers who benefitted from the company’s products or services. Researchers recently found that when university fund-raisers briefly interacted with the undergraduates who would receive the scholarship money they raised, they persisted longer, and raised nearly twice as much money, as those who didn’t interact with potential recipients.Another method for improving the meaningfulness of work is providing employees with mutual assistance programs. Employees who can help each other directly through their work come to see themselves, and the organizations for which they work, in more positive, pro-social terms. This, in turn, can increase employee affective commitment
• #9: The evidence on job enrichment shows it reduces absenteeism and turnover costs and increases satisfaction, but not all programs are equally effective. A review of 83 organizational interventions designed to improve performance management showed that frequent, specific feedback related to solving problems was linked to consistently higher performance, but infrequent feedback that focused more on past problems than future solutions was much less effective. Some recent evidence suggests job enrichment works best when it compensates for poor feedback and reward systems. Work design may also not affect everyone in the same way. One recent study showed employees with a higher preference for challenging work experienced larger reductions in stress following job redesign than individuals who did not prefer challenging work.
• #10: Alternative Work Arrangements are used to redesign work. They includeFlextime defined as flexible work hours. This allows employees some discretion over when they arrive at and leave work. Benefits include reduced absenteeism, increased productivity, reduced overtime expense, and reduced hostility toward management, and increased autonomy and responsibility for employees. A major drawback is that it’s not applicable to all jobs.
• #11: Job Sharing allows two or more individuals to split a traditional 40-hour-a-week job. Approximately 19 percent of large organizations now offer job sharing.Reasons it is not more widely adopted are likely the difficulty of finding compatible partners to share a job and the historically negative perceptions of individuals not completely committed to their job and employer.Job sharing allows an organization to draw on the talents of more than one individual in a given job. Many Japanese firms are increasingly considering job sharing—but for a very different reason. Because Japanese executives are extremely reluctant to fire people, job sharing is seen as a potentially humanitarian means of avoiding layoffs due to overstaffing.From the employee’s perspective, job sharing increases flexibility and can increase motivation and satisfaction when a 40-hour-a-week job is just not practical. The major drawback is finding compatible pairs of employees who can successfully coordinate the intricacies of one job.
• #12: Telecommuting. Employees who do their work at home at least two days a week on a computer that is linked to their office.The spread of telecommuting.The U.S. Department of the Census estimated there had been a 25% increase in self-employed home-based workers from 1999 to 2005, and a 20% increase in employed workers who work exclusively from home. One recent survey of over 5,000 HR professionals found that 35 percent of organizations allowed employees to telecommute at least part of the time, and 21 percent allowed employees to telecommute full-time. Well-known organizations that actively encourage telecommuting include AT&T, IBM, American Express, Sun Microsystems, and a number of U.S. government agencies. What kinds of jobs lend themselves to telecommuting? There are three categories: routine information-handling tasks, mobile activities, and professional and other knowledge-related tasks. Writers, attorneys, analysts, and employees who spend the majority of their time on computers or the telephone—such as telemarketers, customer-service representatives, reservation agents, and product-support specialists—are natural candidates. As telecommuters, they can access information on their computers at home as easily as in the company’s office. Reasons for and against Telecommuting.Advantages Larger labor pool Higher productivity Less turnover Improved morale Reduced office-space costs Disadvantages Employer Less direct supervision of employees Difficult to coordinate teamwork Difficult to evaluate non-quantitative performance Employee May not be as noticed for his or her efforts
• #13: There are reasons for and against Telecommuting. The advantages include a larger labor pool of workers, higher productivity, less turnover,Improved morale, and reduced office-space costs.Disadvantages for the employer include less direct supervision of employees, it’s difficult to coordinate teamwork, and it’s difficult to evaluate non-quantitative performance. Disadvantages for the employee include that he or she may not be as noticed for his or her efforts.
• #14: There are several reasons for and against Telecommuting. These include a larger labor pool, higher productivity,Less turnover,Improved morale, and reduced office-space costs.Disadvantage scan be found for both the employer and the employee. For the Employer there is less direct supervision of employees. In addition, it is difficult to coordinate teamwork. Managers for it difficult to evaluate non-quantitative performance. For the Employee, he or she may not be as noticed for his or her efforts.
• #15: Participative Management is the first of the options for employee involvement programs. Common to all participative management programs is joint decision making, This is where subordinates share a significant degree of decision-making power with their immediate superiors.Participative management has, at times, been promoted as a panacea for poor morale and low productivity. But for it to work, employees must be engaged in issues relevant to their interests so they’ll be motivated, they must have the competence and knowledge to make a useful contribution, and trust and confidence must exist among all parties.Studies of the participation–performance relationship have yielded mixed findings. Organizations that institute participative management do have higher stock returns, lower turnover rates, and higher estimated labor productivity, although these effects are typically not large. A careful review of research at the individual level shows participation typically has only a modest influence on employee productivity, motivation, and job satisfaction. Of course, this doesn’t mean participative management can’t be beneficial under the right conditions. But it is not a sure means for improving performance.
• #16: Representative participation is spreading. Almost every country in Western Europe has some type of legislation requiring it. It is the most widely legislated form of employee involvement around the world. The goal is to redistribute power within an organization, putting labor on a more equal footing with the interests of management and stockholders. The two most common forms include work councils that link employees with management. They are groups of nominated or elected employees who must be consulted when management makes decisions involving personnel. Second is board representatives who are employees who sit on a company’s board of directors and represent the interests of the firm’s employees. The overall influence of representative participation seems to be minimal. The evidence suggests that works councils are dominated by management and have little impact on employees or the organization. If one were interested in changing employee attitudes or in improving organizational performance, representative participation would be a poor choice.
• #17: Rewarding Individual employees through Variable-Pay Programs is becoming more evident in the work place. A number of organizations are moving away from paying solely on credentials or length of service. Piece-rate plans, merit-based pay, bonuses, profit sharing, gain sharing, and employee stock ownership plans are all forms of a variable-pay program, which bases a portion of an employee’s pay on some individual and/or organizational measure of performance. Individual earnings therefore fluctuate up and down.
• #18: The first of the variable pay programs is Piece-Rate Pay Plans. Here workers are paid a fixed sum for each unit of production completed.A pure piece-rate plan provides no base salary and pays the employee only for what he or she produces. Although incentives are motivating and relevant for some jobs, it is unrealistic to think they can constitute the only piece of some employees’ pay.
• #19: The second variable pay method is Merit-Based Pay Plans. These are based on performance appraisal ratings. The main advantage is that it allow employers to differentiate pay based on performance. It creates perceptions of relationships between performance and rewards.Most large organizations have merit pay plans, particularly for salaried employees.Limitations to merit-based plans include that it is based on annual performance appraisal, that merit pool fluctuates based on economic conditions, and that unions typically resist merit pay plans.
• #20: The use of Bonuses is becoming a wider used system in many organizations.An annual bonus is a significant component of total compensation for many jobs. Among Fortune 100 CEOs, the bonus (mean of $1.01 million) generally exceeds the base salary (mean of $863,000). Bonus plans increasingly include lower-ranking employees; many companies now routinely reward production employees with bonuses in the thousands of dollars when profits improve. The incentive effects of performance bonuses should be higher than those of merit pay because, rather than paying for performance years ago, which was rolled into base pay, bonuses reward recent performance. When times are bad, firms can cut bonuses to reduce compensation costs. The downside of bonuses is that employees’ pay is more vulnerable to cuts.
• #21: Skill-based payisalso called competency-based or knowledge-based pay andis an alternative to job-based pay that bases pay levels on how many skills employees have or how many jobs they can do.For employers, the lure of skill-based pay plans is that they increase the flexibility of the workforce: filling staffing needs is easier when employee skills are interchangeable. Skill-based pay also facilitates communication across the organization because people gain a better understanding of each other’s jobs. The disadvantages to skill-based pay are few. But, people can “top out”—that is, they can learn all the skills the program calls for them to learn.Finally, skill-based plans don’t address level of performance. They deal only with whether someone can perform the skill.
• #22: Profit-Sharing Plans are organization-wide programs that distribute compensation based on some established formula centered around a company’s profitability.Compensation can be direct cash outlays or, particularly for top managers, allocations of stock options.Profit-sharing plans at the organizational level appear to have positive impacts on employee attitudes; employees report a greater feeling of psychological ownership.
• #23: The next variable-pay option is Employee Stock Ownership Plans.An employee stock ownership plan (ESOP) is a company-established benefit plan in which employees acquire stock, often at below-market prices, as part of their benefits. Most of the 10,000 or so ESOPs in the United States are in small, privately held companies. Research on ESOPs indicates they increase employee satisfaction and innovation. ESOPs have the potential to increase employee job satisfaction and work motivation, but employees need to psychologically experience ownership. That is, in addition to their financial stake in the company, they need to be kept regularly informed of the status of the business and have the opportunity to influence it in order to significantly improve the organization’s performance. ESOP plans for top management can reduce unethical behavior. CEOs are more likely to manipulate firm earnings reports to make themselves look good in the short run when they don’t have an ownership share, even though this manipulation will eventually lead to lower stock prices. However, when CEOs own a large amount of stock, they report earnings accurately because they don’t want the negative consequences of declining stock prices.
• #24: Do variable-pay programs increase motivation and productivity? The answer is a qualified “yes.”Studies generally support the idea that organizations with profit-sharing plans have higher levels of profitability than those without them.Gain sharing has been found to improve productivity in a majority of cases and often has a positive impact on employee attitudes. Another study found that whereas piece-rate pay-for performance plans stimulated higher levels of productivity, this positive affect was not observed for risk-averse employees. You’d probably think individual pay systems such as merit pay or pay-for-performance work better in individualistic cultures such as the United States or that group-based rewards such as gain sharing or profit sharing work better in collectivistic cultures. Unfortunately, there isn’t much research on the issue. One recent study did suggest that employee beliefs about the fairness of a group incentive plan were more predictive of pay satisfaction in the United States than in Hong Kong. One interpretation is that U.S. employees are more critical in appraising a group pay plan, and therefore it’s more critical that the plan be communicated clearly and administered fairly.
• #25: When Developing a Benefits Package the idea is to allow each employee to choose a benefit package that is individually tailored to his/her own needs and situation. Average fringe benefits are designed for a male with a wife and two children at home. Less than 10 percent of employees now fit this stereotype. Traditional programs do not tend to meet their needs: Some facts: Twenty-five percent of today’s employees are single.A third are part of two-income families without any children. An organization sets up a flexible spending account for each employee, usually based on some percentage of his or her salary, and then a price tag is put on each benefit.
• #26: There are three basic types of programs: Modular Plans: Pre-designed with each module put together to meet the needs of a specific group of employees. Core-plus Plans: A core of essential benefits and a menu like selection of other benefit options. Flexible Spending Plans: Employees set aside a specific dollar amount for benefits tax-free and draw against the account for medical and dental services as needed. Today, almost all major corporations in the United States offer flexible benefits. And they’re becoming the norm in other countries, too. A recent survey of 211 Canadian organizations found that 60% offer flexible benefits, up from 41% in 2005. And a similar survey of firms in the United Kingdom found that nearly all major organizations were offering flexible benefits programs, with options ranging from private supplemental medical insurance to holiday trading, discounted bus travel, and childcare vouchers.
• #27: Intrinsic Rewards are used in Employee Recognition Programs. Organizations are increasingly recognizing that important work rewards can be both intrinsic and extrinsic. Rewards are intrinsic in the form of employee recognition programs and extrinsic in the form of compensation systems. Employee recognition programs range from a spontaneous and private thank-you to widely publicized formal programs in which specific types of behavior are encouraged and the procedures for attaining recognition are clearly identified. Some research suggests financial incentives may be more motivating in the short term, but in the long run it’s nonfinancial incentives. A few years ago, research found that recognition, recognition, and more recognition was key to employee motivation.
• #28: As illustrated in Exhibit 8-4, Phoenix Inn, a West Coast chain of small hotels, encourages employees to smile by letting customers identify this desirable behavior and then recognizing winning employees with rewards and publicity. An obvious advantage of recognition programs is that they are inexpensive, since praise is free! Part of the incentive is simply to receive recognition, but there are also drawings for prizes based on the number of cards a person receives. Managers are trained to use the programs frequently and effectively to reward good performance. Another study found that recognition programs are common in both Canadian and Australian firms as well.Despite the increased popularity of employee recognition programs, critics argue they are highly susceptible to political manipulation by management. When applied to jobs for which performance factors are relatively objective, such as sales, recognition programs are likely to be perceived by employees as fair. However, in most jobs, the criteria for good performance aren’t self- evident, which allows managers to manipulate the system and recognize their favorites. Abuse can undermine the value of recognition programs and demoralize employees.
• #29: In summary and with Implications for managers, although it’s always dangerous to synthesize a large number of complex ideas, the following suggestions summarize what we know about motivating employees in organizations.Recognize Individual Differences Managers should be sensitive to individual differences. For example, employees from Asian cultures prefer not to be singled out as special because it makes them uncomfortable. Spend the time necessary to understand what’s important to each employee. This allows you to individualize goals, level of involvement, and rewards to align with individual needs. Design jobs to align with individual needs and maximize their motivation potential. Use Goals and Feedback Employees should have firm, specific goals, and they should get feedback on how well they are faring in pursuit of those goals.
• #30: Allow employees to participate in decisions that affect them. Employees can contribute to setting work goals, choosing their own benefits packages, and solving productivity and quality problems. Participation can increase employee productivity, commitment to work goals, motivation, and job satisfaction. Link rewards to performance. Rewards should be contingent on performance, and employees must perceive the link between the two. Regardless of how strong the relationship is, if individuals perceive it to be weak, the results will be low performance, a decrease in job satisfaction, and an increase in turnover and absenteeism.Check the system for equity. Employees should perceive that experience, skills, abilities, effort, and other obvious inputs explain differences in performance and hence in pay, job assignments, and other obvious rewards.