questions

Week 4 Motivation

1. Basics of motivation

Definition: Motivation is the set of forces that initiates, directs and makes people persist in their efforts to accomplish a goal.

1) Effort and performance

Job performance = Motivation × Ability × Situational constraints

Motivation, as defined above, is effort: the degree to which someone works hard to do the job well. Ability is the degree to which workers possess the knowledge, skills and talent needed to do a job well. Situational constraints are factors beyond the control of individual employees, such as the tools, equipment, policies and resources that have an effect on job performance.

2) Need satisfaction

Effort leads to job performance, what leads to effort? Determining employee needs.

Needs are the physical or psychological requirements that must be met to ensure survival and wellbeing. (Example: if you normally skip breakfast, but then have to work through lunch, the chances are you’ll be so hungry by late afternoon that the only thing you’ll be motivated to do is find something to eat.) People are motivated by unmet needs, managers must learn what those unmet needs are and address them.

· Abraham Maslow developed his Hierarchy of Needs theory: physiological (food and water), safety (physical and economic), belongingness (friendship, love and social interaction), esteem (achievement and recognition) and self-actualisation (realising your full potential) needs.

· McClelland’s Learned Needs theory: people are motivated by the need for affiliation (to be liked and accepted), the need for achievement (to accomplish challenging goals) or the need for power (to influence others).

· Alderfer’s ERG Needs theory: existence (The basics of life), relatedness (The needs for family and friends), growth (the need to stretch and challenge one’s self).

lower-order needs are concerned with safety and with physiological and existence requirements, whereas higher-order needs are concerned with relationships (belongingness, relatedness and affiliation), challenges and accomplishments (esteem, self-actualisation, growth and achievement) and influence (power). Studies generally show that higher-order needs will not motivate people as long as lower-order needs remain unsatisfied.

3) Extrinsic and intrinsic rewards

Extrinsic rewards are tangible and visible to others and are given to employees contingent on the performance of specific tasks or behaviours. External agents (managers, for example) determine and control the distribution, frequency and amount of extrinsic rewards, such as pay, company stock, benefits and promotions.

(Example: In 2018, Australia-based QBE Insurance Group was reported to be paying its employees an average of more than $8000 each in annual bonuses on top of salaries. Bonuses and awards do indeed provide extrinsic financial rewards, but they can also be an important source of positive feedback to recipients, telling them that they are doing the right thing.)

The reason of need extrinsic rewards: Companies use extrinsic rewards to motivate people to perform four basic behaviours: join the organisation, regularly attend their jobs, perform their jobs well and stay with the organisation.

Intrinsic rewards are the natural rewards associated with performing a task or activity for its own sake. For example, besides the external rewards management offers for doing something well, employees often find the activities or tasks they perform interesting and enjoyable. Examples of intrinsic rewards include a sense of accomplishment or achievement, a feeling of responsibility, the chance to learn something new or interact with others, or simply the fun that comes from performing an interesting, challenging and engaging task. (Example: at work, people trained via video games learn more information, remember it longer and progress to higher skill levels.)

4) What practical steps can managers take to motivate employees to increase their effort?

· Asking people what their needs are

· Satisfy lower-order needs first

· Managers should expect people’s needs to change

· Managers should also expect needs to change as people mature. (Example: For older employees, benefits like retirement planning and the size of the company contribution to pensions and superannuation schemes are as important as pay, which is always ranked as more important by younger employees.”

· As needs change and lower-order needs are satisfied, create opportunities for employees to satisfy higher-order needs. (Example: Providing challenging work, encouraging employees to take greater responsibility for their work and giving employees the freedom to pursue tasks and projects they find naturally interesting.)

2. Equity theory

Equity theory says that people will be motivated at work when they perceive that they are being treated fairly. (Example: the Royal Commission into the Australian banking industry, which has revealed poor behaviour and advice from major banks, has led to calls for removal of bonuses for senior banking executives.)

1) Components of equity theory

· Inputs (the contributions employees make to the organisation--education and training, intelligence, experience, effort, number of hours worked and ability.)

· Outcomes (what employees receive in exchange for their contributions to the organisation--pay, fringe benefits, status symbols and job titles, and assignments.)

· Referents (others with whom people compare themselves to determine if they have been treated fairly.)

The comparison of outcomes to inputs is called the outcome/input (O/I) ratio.

When people perceive that their O/I ratio is equal to the referent’s O/I ratio, they conclude that they are being treated fairly.

The two forms of inequity: Under-reward occurs when your O/I ratio is worse than your referent’s O/I ratio. (anger or frustration)

Over-reward occurs when your O/I ratio is better than your referent’s O/I ratio. (guilt)

2) The react to perceived inequity

They may try to restore equity by reducing inputs, increasing outcomes, rationalising inputs or outcomes, changing the referent or simply leaving.

(Example: during a recent state election in Victoria, the Labor Party was strongly supported in its election campaign by firefighters and ambulance paramedics. The paramedics, who had been engaged in a long and difficult negotiation with the former state government, were able to bargain for a 6 per cent increase in 2014 with a further 3 per cent in 2015 and 3 per cent in 2016 with the new regime. The firefighters found themselves being offered 5 per cent in 2015 plus 2.5 per cent in 2016 and 2017. Despite the offer being in line with other public sector pay outcomes, the firefighters felt betrayed and turned their energies to helping Labor win the election.)

3) Motivating with equity theory

· Managers should look for and correct major inequities.

· Managers can reduce employees’ inputs.

· Increasing outcomes is often the first and only strategy that companies use to restore equity, yet reducing employee inputs is just as viable a strategy.

· Managers should make sure decision-making processes are fair.

Example: According to Chinese labour laws, employees may not work more than 36 hours of overtime per month, or no more than nine overtime hours per week. However, one company, Foxconn, broke this law after a catastrophic plant explosion and a series of employee suicides disrupted production at a factory in China. Factory employees, who assemble everything from iPads to laptop computers, worked 80 to 100 overtime hours each month on top of their 174 regular hours to make up for the production shortfalls. During this time, employees regularly worked 12-hour shifts, six days a week, which amounted to 60 hours a month over the legal limit. As a result of pressure from Apple and from international workers’ rights groups, Foxconn agreed to immediately increase pay as much as 25 per cent and limit the number of hours an employee works to 49 per week.

3. Expectancy theory

1) Components of expectancy theory

Expectancy theory holds that people make conscious choices about their motivation. The three factors that affect those choices are valence, expectancy and instrumentality.

Valence is the attractiveness or desirability of various rewards or outcomes to the individuals involved. (Example: Consultant Carol Schultz spent nine years working for a company where the boss rewarded top-performing employees with five-day trips to expensive resorts, with the company paying for the flight, hotel and one dinner, leaving employees to pay for the rest of their food and all of their drinks and resort activities. Said Schultz, ‘It always irked me that they’d fly us to some expensive resort and expect us to pay for everything outside of our flight and hotel room. To me, this was no “reward”’. In other words, when Schultz assessed her personal valence in relation to the work rewards, the positive valence of an expensive resort trip could not overcome the negative valence of getting stuck with large food, drink and resort expenses.

Expectancy is the perceived relationship between effort and performance. When expectancies are strong, employees believe that their hard work and efforts will result in good performance, so they work harder.

Instrumentality is the perceived relationship between performance and rewards. When instrumentality is strong, employees believe that improved performance will lead to better and more rewards, so they choose to work harder.

Motivation = Valence × Expectancy × Instrumentality

2) Motivating with expectancy theory

· Managers can systematically gather information to find out what employees want from their jobs.

· Managers can take specific steps to link rewards to individual performance in a way that is clear and understandable to employees.

· Managers should empower employees to make decisions if management really wants them to believe that their hard work and effort will lead to good performance.

4. Reinforcement theory

1) Components of reinforcement theory

Reinforcement contingencies are the cause-and-effect relationships between the performance of specific behaviours and specific consequences.

Reinforcement contingencies:

· Positive reinforcement strengthens behaviour (i.e. increases its frequency) by following behaviours with desirable consequences.

· Negative reinforcement strengthens behaviour by withholding an unpleasant consequence when employees perform a specific behaviour. (Example: at a small florist business, the Florist Network, company management instituted a policy of requiring good attendance for employees to receive their annual bonuses. Employee attendance has improved significantly now that excessive absenteeism can result in the loss of $1500 or more.)

· Punishment weakens behaviour (i.e. decreases its frequency) by following behaviours with undesirable consequences.

· Extinction is a reinforcement strategy in which a positive consequence is no longer allowed to follow a previously reinforced behaviour. By removing the positive consequence, extinction weakens the behaviour, making it less likely to occur.

2) Schedules for delivering reinforcement

A schedule of reinforcement is the set of rules regarding reinforcement contingencies, such as which behaviours will be reinforced, which consequences will follow those behaviours, and the schedule by which those consequences will be delivered.

Continuous reinforcement schedules: a consequence follows every instance of a given behaviour. (Example: employees working on a piece-rate pay system earn money (consequence) for every part they manufacture (behaviour). The more they produce, the more they earn.)

Intermittent reinforcement schedules: consequences are delivered after a specified or average time has elapsed or after a specified or average number of behaviours has occurred.

· fixed interval reinforcement schedules (Example: most people receive their pay on a fixed interval schedule (e.g. once or twice per month).)

· variable interval reinforcement schedules (Example: On a 90-day variable interval reinforcement schedule, you might receive a bonus after 80 days or perhaps after 100 days, but the average interval between performing your job well (behaviour) and receiving your bonus (consequence) would be 90 days.)

· fixed ratio reinforcement schedules (Example: a car salesperson might receive a $1000 bonus after every 10 sales. Therefore, a salesperson with only nine sales would not receive the bonus until he or she finally sold a 10th car.)

· variable ratio reinforcement schedules (Example: With a 10-car variable ratio reinforcement schedule, a salesperson might receive the bonus after seven car sales or after 12, 11 or nine sales, but the average number of cars sold before receiving the bonus would be 10 cars.

3) Motivating with reinforcement theory

· Identify (identifying critical, observable, performance-related behaviours)

· Measure (measuring the baseline frequencies of these behaviours/ find out how often workers perform them)

· Analyse (analysing the causes and consequences of these behaviours)

· Intervene (changing the organisation by using positive and negative reinforcement to increase the frequency of these critical behaviours)

· Evaluate critical performance-related behaviours (evaluating the extent to which the intervention actually changed workers’ behaviour)

Three other key things:

· Don’t reinforce the wrong behaviours.

· Managers should also correctly administer punishment at the appropriate time.

· Managers should choose the simplest and most effective schedule of reinforcement. (need to balance effectiveness against simplicity)

5. Goal-setting theory

1) Components of goal-setting theory

· Goal specificity is the extent to which goals are detailed, exact and unambiguous. (Example: Specific goals, such as ‘I’m going to have a Distinction average this semester’, are more motivating than general goals, such as ‘I’m going to get better grades this semester’.)

· Goal difficulty is the extent to which a goal is hard or challenging to accomplish. (Difficult goals are more motivating than easy goals.)

· Goal acceptance is the extent to which people consciously understand and agree to goals.

· Performance feedback is information about the quality or quantity of past performance and indicates whether progress is being made toward the accomplishment of a goal.

Goal-setting theory says that people will be motivated to the extent to which they accept specific, challenging goals and receive feedback that indicates their progress toward goal achievement.

2) Motivating with goal-setting theory

· Motivate workers is to assign them specific, challenging goals.

· Managers should make sure workers truly accept organisational goals.

· They must trust management and believe that managers are using goals to clarify what is expected from them rather than to exploit or threaten them.

· Participative goal setting, in which managers and employees generate goals together, can help increase trust and understanding and therefore acceptance of goals.

· Providing workers with training can help increase goal acceptance, particularly when workers don’t believe they are capable of reaching the organisation’s goals.

· Managers should provide frequent, specific, performance-related feedback.