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Chapter 14 Motivating Public Service Employees in the Era of the “New Normal”

Gerald T. Gabris Northern Illinois University

Trenton J. Davis Georgia Southern University

Introduction

In 2008, when the authors wrote the previous edition of this chapter, the full impact of the recession on public service organizations was cloudy. At that time, the recession was parleyed as a nasty irritant likely to cycle into a robust economic recovery.

The unfortunate reality is that today’s public service employee often serves as a convenient scapegoat for politicians and the news media alike when assigning blame for the high cost of government. This occurs even though the same politicians have often had a hand in perpetuating the wage and benefit systems they now deplore. For many years, for example, the Illinois state legislature routinely put off paying the state’s share into its public employee pension system, resulting in Illinois having the worst funded state pension system in the country (Munnell 2012). To add fuel to the fire, politicians often allege that public sector unions have been overly influential in securing generous wage and benefit packages that are fiscally unsustainable. In 2012, Wisconsin, Indiana, and Michigan passed legislation severely restricting the scope of public employee collective bargaining rights. Thus, the Great Recession has given rise to draconian measures in how public organizations conduct their business.

Public Service Organization Survival Tactics

Prior to the Great Recession, the public service was already adapting to changes in the role of government through increased privatization, public-private partnering, managed competition, strategic planning, and citizen engagement to name just a few (Denhardt and Denhardt 2011; Kettl 2005; Osborne and Gaebler 1992). To remain financially solvent, many have utilized one or more of the survival tactics shown in Table 14.1 (see Pagano, Hoene, and McFarland 2012: 7).

Many of these tactics have had severe consequences on employee motivation and morale. They have often been deployed in a blunt manner, where the value of minimizing pain has been overwhelmed by the need to just get it done. The use of these tactics has become so pervasive that they constitute the core principles of the new normal.

While these tactics address short-term fiscal needs, they often generate long-term motivation problems. For example, acute downsizing has occurred in many public service organizations in order to balance their budgets. In the city of Elgin, Illinois, over 100 municipal workers lost their jobs during the period 2010–2012. Downsizing of this magnitude can create severe stress for the remaining employees, who are expected to absorb the work of their departed brethren. Early on in the recession, public employees were generally willing not just to accept added responsibilities but to operate in an environment in which no pay raises, reductions in fringe benefits, and the elimination of employee training and development initiatives were commonplace.

This brings us to the central focus of this chapter: We contend that how public organizations ultimately respond to this challenge will go a long way in determining how well they perform. A long-standing literature on public service motivation (PSM) argues that individuals who seek employment in and remain working for public service organizations are influenced by motive forces primarily grounded in public service work (Perry 1996, 2000; Perry and Wise 1990; Wright 2008). Yet much of PSM research is prerecession and was conducted prior to the widening of the political divide concerning the role of government evident in the 2012 and early stages of the 2016 presidential races.

In the discussion to follow, we begin by considering several theories of motivation that may shed light on how public service organizations can motivate their workers in the face of these challenges. We then examine how the new normal might stimulate innovative strategies for using motivation models to benefit both the organization and the individual.

Theories of Motivation: Relevance to the Public Service

We define motivation as the drive individuals experience to satisfy perceived need deficiencies. When watching a television commercial for a juicy hamburger or refreshing soft drink, you may experience a pang of hunger or thirst. This is exactly what product providers hope for—that these nascent needs will lead you to purchase their products. If a need becomes intense enough, you will become restless until it is satisfied. This is a powerful idea because it shows how human behavior can be influenced in a manner preferred by management. By designing effective motivation strategies it becomes possible to tap into the motive forces driving employee behavior and have them achieve important organizational goals while also satisfying employees’ personal needs. While some people choose work in the public service to satisfy their public service motivation needs, PSM theory does not provide clear guidance on how this can be practically applied on a large scale. Consequently, we need to consider the broader spectrum of motivation theories that might lead to practical strategies for moving employees toward the efficient completion of organizational goals.

Content Theories of Motivation

Content theories of motivation attempt to explain what drives individuals to engage in goal directed behavior (Hellriegel, Slocum, and Woodman 1986). For example, money constitutes an extrinsic motivator because it can be easily converted into tangible, externally useful things that drive motivation, whereas self-esteem serves as an intrinsic motivator that can satisfy individual internal needs for self-meaning. One of the best-known content motivation theories is the “hierarchy of needs” model developed by Abraham Maslow (1943). Maslow argues that humans must first satisfy basic physiological needs, such as hunger and thirst, before moving on to more complex needs, such as esteem and self-actualization. These latter needs involve higher psychological states that are more intrinsic than extrinsic.

Clayton Alderfer (1972) simplifies the Maslow construct with his practical ERG model. ERG theory proposes three broad categories of existence, relatedness, and growth needs. When a person can no longer grow in his or her job, growth ceases to function as a motivator. Instead of becoming demotivated, such individuals regress to lower-order need states as their primary motive focal point. For example, maintenance workers in a municipal garage might be motivated by growth if they think they can get promoted into first-level supervisory positions. Yet, once this avenue for growth closes, the workers would likely refocus their need for strong interpersonal relationships (Lazear 1995; Lazear and Rosen 1981). The benefits of becoming a respected in-group member outweigh potential promotions.

Other notable content motivation theories include the motivation-hygiene theory of Frederick Herzberg (with Mausner and Snyderman 1959) and the achievement theory of David McClelland (1961). Herzberg argued that two distinct factors separate extrinsic and intrinsic motive forces and that only intrinsic factors truly motivate people. Workers expect hygiene factors such as pay, equipment, and working conditions to be adequate for carrying out their jobs. If these factors fall below expectations, they serve to dissatisfy workers; however, once improved, they do not serve as primary motivators. Alternatively, intrinsic motivators such as achievement, recognition, autonomy, the work itself, and responsibility appeal to one’s higher psychological needs.

McClelland’s (1961) achievement theory takes a different tack. McClelland’s research, which is based on the Thematic Apperception Test (TAT), found that individuals vary in their need for achievement, affiliation, and power (Stahl 1983). Achievement motivation is perhaps most crucial for job performance. Achievers prefer to set their own goals and tend to avoid extremes by taking on difficult but achievable tasks. Additionally, achievers prefer tasks that provide more rather than less feedback (Hellriegel et al. 1986). These behaviors parallel the more sophisticated thinking associated with goal-setting theory (Locke and Latham 1984) and provide important insights into how techniques such as “management by objectives” may lead to motivation.

One remaining content theory that posits an interesting, albeit controversial, approach to human motivation is Edward Deci and Richard Ryan’s cognitive evaluation theory (1985). According to Deci and Ryan (1985), intrinsic motivation is related to an individual’s need for self-determination (choice) and competence. Self-determination is maximized when individuals can choose among courses of action free from external constraints and receive positive yet noncontrolling feedback. Deci and Ryan’s contention that monetary incentives may actually inhibit intrinsic motivation when the incentive is withdrawn, more so than if the incentive had never been given in the first place, is well known (Locke and Latham 1990). When monetary awards are used to reward high-performing individuals, they may feel that their capacity to be self-determining has been reduced (by external conforming expectations) and their competency called into question due to the absence of other, intrinsic-based motivators that drive feelings of self-determination. Although Deci and Ryan’s propositions regarding how rewards adversely affect individual job performance have not been empirically validated by others (Gerhart and Rynes 2003), their ideas raise questions about the efficacy of merit pay systems.

Process Theories of Motivation

A more sophisticated approach to motivation involves process theories. Theories falling into this category include expectancy theory (Lawler 1973; Vroom 1964), goal-setting theory (Locke and Latham 1984), and the public service motivation (PSM) construct (Perry and Wise 1990). Process motivation theories explore how different motivational forces (both extrinsic and intrinsic) interact in ways that motivate individuals.

Expectancy theory is based on three primary assumptions (Lawler 1973; Vroom 1964). First, individuals must believe that their behavior is related or will lead to certain outcomes (rewards). This is known as the performance-outcome expectancy. Second, individuals place different values on outcomes. Third, individuals change or alter their behavior based on the perceived probability of success. This is known as the effort-performance expectancy. For example, an employee seeking a raise (outcome) may alter her work ethic (behavior). However, if the employee does not believe that a raise is obtainable or the employee is simply not very motivated by monetary rewards, then she is likely to remain unmotivated. Thus, the expectancy process would entail altering both the way an individual’s performance is measured as well as the reward system itself. Such changes help ensure organizational members place an appropriate value on any rewards they receive and that the link between performance and outcomes is clearly defined (Burke 2002).

Locke and Latham (1990: 4) suggest, “Goal setting theory assumes that human action is directed by conscious goals and intentions [. . .] but does not assume that all human action is under direct conscious control.” Goal-setting theory makes several important assumptions regarding how goals motivate people. First, goals should be difficult but achievable. If a goal is perceived as too difficult, achieving it may be attributed more to luck than skill. Similarly, if a goal is seen as too easy, then skill is still not a factor. It is when goals balance skill with extraordinary effort that they convey a sense of genuine achievement. Second, goals should be proximate rather than distal. Individuals must perceive that by exerting effort a goal can be achieved quickly rather than 10 years later. Third, specific goals are more motivational than broad, abstract goals (Locke and Latham 1990).

A fourth and more controversial component of goal-setting theory involves the notion of participation. Some research supports the proposition that employee participation in goal setting helps motivate workers to exert more effort (Earley 1985; Erez 1986; Erez and Kanfer 1983; Latham and Saari 1979; Likert 1967). Goals are more likely to be accepted when not imposed by an external authority. Yet research by Latham and others indicates there is little difference in goal performance between assigned versus participative goals (Carroll and Tosi 1970; Dossett, Latham, and Mitchell 1979; Latham, Mitchell, and Dosset 1978; Latham and Yukl 1975). Goal-setting theory opens the door to many practical applications for public sector managers, which will be touched upon during our discussion of motivation strategies that follows.

In 1990, James Perry and Lois Wise coined the phrase “public service motivation” (PSM), defining PSM as “an individual’s predisposition to respond to motives grounded primarily or uniquely in public institutions or organizations” (1990: 368). According to Perry and Wise, there are three motives primarily associated with an individual’s decision to enter into public service: rational, normative, or affective. PSM theory has been sharpened over time by refining the conceptual components in Perry and Wise’s study.

The key to formalizing a theory of PSM derives substantially from one’s sociohistorical context or what Perry (2000: 480) calls antecedents. Here, an individual’s family, schooling, religion, and professional training all combine to influence broader institutions. These institutions reinforce our quickening self-concept and provide a set of self-regulatory processes. It is our self-concept that strongly influences our individual behavior regarding what kinds of careers we choose, what kinds of rules we follow, and what kinds of obligations and commitments we have toward our vocations. 1

There has been a substantial volume of research devoted to understanding PSM’s derivations and what role it may play within public organizations. The empirical research focusing on public service motivation has been generally supportive; PSM appears to have at least prima facie value for helping us understand why some individuals are attracted to public service. A summary of the key themes drawn from this research is provided below.

In a study of federal employees using a large sample, Naff and Crum (1999) found evidence to support the proposition that public employees with high levels of PSM reported receiving higher performance ratings than their counterparts with lower PSM levels. Kim (2005) also found that PSM positively influenced organizational performance, confirming the findings of both Naff and Crum (1999) and Brewer and Selden (2000). However, when taking person-organization fit into account, Bright (2007) did not find a significant impact on employee performance. Bright (2007) argued that while PSM may, in fact, influence the performance of public employees to a degree, these influences are mediated by an employee’s compatibility or fit with his or her organization. Camilleri (2009) noted, however, that the model fit depicting this argument is weak.

In another study of federal employees, Brewer and Selden (1998) found a linkage between whistle-blowing behavior and PSM scores. They averred that whistle-blowers behave in ways consistent with PSM theory and, therefore, are motivated strongly by the public interest, are high performers, and exhibit high job satisfaction (Brewer and Selden 1998). Bright (2005) examined attributes consistent with high PSM scores as well as how those attributes might influence other administrative issues, such as organizational role, rank, education, and monetary incentives. Bright (2005) found higher PSM scores to be associated with higher levels of education and gender, but not significantly associated with age or minority status. Importantly, he found that higher PSM scores were related to managerial status.

Using data drawn from the National Administrative Studies Project (NASP-II), Scott and Pandey (2005) examined whether PSM scores are associated with attitudes toward red tape. In general, they found PSM scores and perceptions of red tape to be negatively correlated. Scott and Pandey (2005) asserted that individuals with higher PSM scores are more likely to see rules as legitimate, rather than an impediment to their job. Another possibility, however, is that individuals scoring high on the PSM scale are likely to be higher-ranking managers (Bright 2005) and thus may simply be better situated to evade or game red tape obstacles in ways that lower-level employees are not.

Similar to Perry (2000), Moynihan and Pandey (2007) provide yet another glimpse on how organizational variables may associate with and influence PSM. They suggest that sociohistorical experiences, such as education, professional group membership, and group culture, influence a person’s attitude toward public service motivation. Specifically, Moynihan and Pandey (2007) hypothesize that highly educated individuals who join professional management associations are more likely to develop self-concepts that embrace values consistent with PSM.

Applied Motivation Strategies for the New Normal

To focus attention, this section will highlight motivation strategies intended to address the survival tactics employed by public organizations in response to the Great Recession (see Table 14.1 ). The motivation strategies that may offset the demotivational consequences of specific new normal survival tactics are summarized in Table 14.2 .

It should be noted that these strategies derive largely from mainstream theories of motivation. While most of these strategies are not new, they have also never been subjected to widespread practice in the public sector. Given the lasting impact of the Great Recession, we contend that the timing for their broader application is ripe. With thoughtful and well-designed deployment, they can target anticipated negative consequences on employee morale associated with new normal survival tactics. However, before tackling the reasons why these strategies make sense for today’s public service, we will first address two motivational techniques that may no longer be efficacious.

Merit pay as a strategy for motivating individual performance has become very difficult to implement effectively given current scarce resources. While many politicians espouse merit pay as a panacea for public service problems, few public service organizations have the resource capacity to meaningfully fund a merit pay initiative. Merit pay has never been easy to implement even during the best of times (Bowman 1994; Gabris and Mitchell 1986; Heneman 1992; Perry 1992; Thayer 1978), and in the present economic climate its chances for success are dismal. Second, in 2008, we made the case that public organizations might benefit from using an efficiency wage to motivate employees (Davis and Gabris 2008; Gerhart and Rynes 2003). An efficiency wage compensates employees with above average market rates, for the purpose of recruiting and retaining a better workforce. A broad literature (Yellen 1984; Gerhart and Rynes 2003) on efficiency wage models provides support for its effectiveness, and other research suggests it positively associates with municipal service performance (Davis and Gabris 2008). Nonetheless, current economic conditions are too politically fragile for recommending the efficiency wage as a motivational tool for today’s public service organizations.

External Pay Equity: Salary Does Matter

Near the heart of the current debate over the role of government is the question of what constitutes fair pay for public service employees. Wallace and Fay (1988) make the case that one of the most important beliefs an organization can inculcate in its workforce is that workers are receiving a fair wage in exchange for their labor, or external equity. When we provide our labor to produce a product for an organization we expect a fair return on investment (Becker 1975). While pay may not be the primary reason many individuals choose public service careers (Moynihan and Pandy 2007; Perry, Mesch, and Paarlberg 2006; Perry and Wise 1990), to assume that money plays no strategic role in influencing this choice would be folly (Lawler 1983). This issue is exacerbated by new normal assertions that public sector employees are often overpaid in relation to their private sector peers.

Therefore, public service organizations today, more than ever, may need to use monetary compensation as an extrinsic motivator for acknowledging the real value of their employees. This may also counteract the demotivational side effects connected with downsizing, increased workloads, and greater scrutiny of performance. So how can public service use external pay equity as a motivational strategy?

A postrecession belief avers that public employees are overpaid in relation to private sector workers. The latter may no longer have defined pensions, may lack health insurance, and may receive lower pay than prior to the recession. Thus, since private sector workers have taken so many hits, some politicians and the media claim that public sector employees also need to sacrifice by giving back what many perceive as overly generous pay and benefits that are not financially sustainable. Research exists that both confirms and denies their claims (Baker 2012; GAO 2012; Schumpeter 2011; Traub 2012). As a general principle we argue that public and private sector jobs, while similar in specific job content and requirement characteristics (Bemis, Belenky, and Soder 1983), derive from qualitatively distinct labor markets, where comparing the compensation patterns between the sectors does not address the practical compensation needs that public service organizations must answer. In other words, public and private sector wage markets are contextually separate because they operate on different assumptions.

Public service organizations need to attract qualified workers who can staff public service jobs at high proficiency levels over the course of a long career. Comparatively, private sector jobs involve more frequent turnover, where employees leave for better paying jobs as markets and the demand for labor shift. Public organizations hire employees for the long haul. This means that public service workers primarily receive internal pay raises that slowly increment their salaries upward over time. In good economic times, the odds are high that private sector workers can make substantially more income in contrast to public service employees, whose salary stability may look more attractive during economic downturns. Thus, private sector markets display much greater elasticity of demand (Wallace and Fay 1988) than the public sector equivalent.

Another feature distinguishing public sector jobs is that they have become more demanding since the recession. Hence, the market for establishing pay schedules adequate for meeting the external equity expectations of both current and future public employees is, by necessity, similar public service organizations, as these organizations are competing for the same talent pool (Thurow 1975; Lazear and Rosen 1981). To motivate candidates to apply for job openings, and to retain its trained workforce, public organizations must design entry-level and retention salaries on what the market will bear. The only efficient and effective way for public organizations to do this is by defining their market as comprising the comparable public service organizations competing for the same candidates. Consequently, the public sector must use wage markets that satisfy the compensation needs they require, rather than market models that appease a shorter-term political agenda.

Building on this argument, we contend that public service organizations need to emphasize the external market competitiveness of their starting salaries in order to attract qualified job applicants (Gerhart and Rynes 2003). Due to scarce financial resources, public organizations are unlikely to have sizeable pools of discretionary income available to fund viable merit pay programs. Thus, initial starting salaries should be more important because there will likely be fewer opportunities to increase pay once a person has been hired.

Job Redesign

Through downsizing and reductions in force, public service organizations now expect remaining employees to absorb many of the duties performed by departed coworkers. If this were only a short-term trend the great majority of public employees would pick up any slack without complaint. However, this rapid expansion of job duties in many public service jobs has long-term implications. Generally, public organizations want their employees to perform this new work as though nothing really has changed. So how might public managers use job redesign to acknowledge this increased workload and to further motivate the remaining lean workforce?

Hackman and Oldham (1980) argue that job motivation largely hinges on appealing to an employee’s intrinsic psychological needs and that money is not a huge part of this equation. They further contend that three psychological states—meaningfulness of work, experienced responsibility, and knowledge of results—serve as moderators that can result in higher internal or intrinsic job satisfaction, while also addressing an employee’s need for growth. To assess attitudes toward job satisfaction, Hackman and Oldham (1980) devised the job diagnostic survey (JDS), which measures such key job characteristics as skill variety, task identity, task significance, autonomy, and feedback, as well as growth need and various work context factors such as salary. When employees score their jobs on these indices, a measure called the motivational potential score (MPS) results. High MPS scores are interpreted as conveying high levels of job satisfaction.

The motivational opportunities for using job redesign are plentiful. First, employees want recognition for assuming new task responsibilities associated with leaner, smaller workforces. Employees will also likely want more autonomy coupled with better-developed feedback mechanisms associated with end users, supervisors, and the work itself. Thus, instead of acting as though nothing has changed, public organizations should take advantage of the current need to expand workloads as a means for increasing the motivational potential of the job itself. The initial cost to perform such job upgrades would be minimal. Public service organizations will likely need to increase the autonomy and range of discretion granted to their employees, if employees are to perceive their expanded roles as an authentic opportunity for growth. Public organizations that maintain very tight control over employees may result in employees’ perceiving themselves as less in control of their jobs and becoming more disillusioned or burned out (Golembiewski, Munzenrider, and Stevenson 1986).

Semiautonomous Work Teams

Another challenge facing public service organizations in the new normal involves the silo mentality connected with the traditional bureaucratic model (Golembiewski 1977, 1995). Bureaucratic structure lends itself to dysfunctional processes and degenerative interpersonal relations patterns (Blake and Mouton 1984; Golembiewski 1985, 1995; Hammer and Champy 1993; Nadler and Tushman 1988). To improve workflow, however, employees doing different specialized jobs might serve on cross-functional teams that facilitate interunit collaboration necessary for solving problems. As public service organizations have downsized, the probability increases that specialized units have found themselves short-handed and unable to effectively accomplish their goals and missions. As bureaucratic units become leaner, they should utilize semiautonomous work teams more frequently as a tool for accomplishing unit goals.

Semiautonomous teams enable lean organizations to address intraunit goals and issues that transcend specialized unit boundaries. Semiautonomous work teams overcome this dilemma by providing the diverse expertise necessary for effectively dealing with both cross-disciplinary and intraunit goals and problems (Hackman and Oldham 1980; Lawler 1984, 1992). Participation on such teams can provide another valuable source of intrinsic motivation (Dyer 1987; Golembiewski and Kiepper 1988; Lawler 1992). Team-based structures downplay positional power and emphasize group problem solving where all members have a voice in decisional outcomes. Effective teams are characterized by high interpersonal trust, open and frequent communications, loyalty to the group cause, a sense of contributing to a larger purpose, an acceptance of common goals, and an expectation of high standards, all within a mutually supportive atmosphere (Blake and Mouton 1984; Golembiewski 1985; LaFasto and Larson 2001; Zacarro, Rittman, and Marks 2001).

Skill-Based Pay

As we have already suggested, competitive external market salaries may prove critical for generating external pay equity that is necessary for recruiting and retaining a quality public service workforce. But this may not be enough. As many public service organizations continue to struggle with funding a meaningful merit pay pool, they need more creative options for rewarding individual employee achievement. Skill-based pay represents one solution to this puzzle.

Skill-based pay is a compensation technique garnering renewed interest in the public sector as motivating tool (Gupta 1997; Gupta et al. 1992; Lawler 1994; Murray and Gerhart 1998; Thompson and Lehew 2000). Whereas most job-based pay derives from the compensatory value that a competitive market places on the job itself, skill-based pay rewards employees for acquiring new skills that provide value added after a person has been working in a job for a period of time. Skill-based pay addresses internal and individual pay equity needs by rewarding workers whose job performance adds value to the work organization (Wallace and Fay 1988). A maintenance worker, for instance, requires a basic set of job-related knowledge and skill to effectively carry out the requirements of the job. As work complexity increases, the mastery of new, more advanced competencies may be required. As the maintenance worker expands his skill set, he becomes more valuable to the organization. For most public organizations, recognizing skill-based pay requires a demonstration of advanced competencies with corresponding pay increments. 2

Skill-based pay dovetails nicely with Herzberg’s (1966) job enlargement strategy and Hackman and Oldham’s (1980) concept of skill variety, where the responsibilities of an employee are expanded and rewarded in a way that leverages both intrinsic and extrinsic motivation. Edward Lawler (1983) makes a similar case regarding how pay can be used to motivate. Skill-based pay recognizes the expanded job duties many public service employees are experiencing due to downsizing. As public employees are increasingly expected to take on new tasks, to learn new skills, and to work in a leaner, less costly workforce, then it stands to reason they should be compensated for developing the requisite skill sets necessary for performing these expanded jobs. Skill-based pay can be precisely targeted, and once employees receive it, it does not require time-consuming annual performance evaluations. Moreover, it provides additional extrinsic monetary motivation to offset increases in work-related stress that employees are experiencing from their expanded workloads. Finally, skill-based pay may be politically tenable because public workforces are providing more output with fewer employees.

Gainsharing

One technique showing promise as a motivational tool for intact work groups is gainsharing (GrahamMoore and Ross 1995; Hatcher and Ross 1991). Gainsharing can be defined as a monetary reward program connected with “collective” or intact work group performance. Assume that a forestry division within a city public works department has a budget of $10,000 for planting trees along city parkways. Through careful purchasing coupled with an improved planting technique, the forestry division completes this task by spending only $7,500—resulting in a $2,500 savings. Gainsharing would involve a formula for rewarding the efficiency of the work group by sharing a portion of the savings with them. In this way, the organization benefits by spending less to accomplish its stated goals, and individuals benefit by being rewarded for team efficiency and innovation. While gainsharing offers intriguing motivational possibilities, few public sector organizations utilize this technique (GrahamMoore and Ross 1995). Nevertheless, as public service organizations become more market driven, the use of gainsharing models may acquire more popularity for this sector over time.

By financially rewarding work group efficiency, gainsharing would appear to complement new normal expectations for public service organizations. Units that save money and reduce costs should be rewarded, thus incentivizing them to continue searching for cost containment strategies. A potential drawback is that political officials might attribute any cost savings to fat in the budget rather than to employee innovation.

Nonmonetary Incentives (NMIs)

For public service organizations facing the austerity of the new normal, nonmonetary incentives (NMIs) may offer an untapped source of motivational opportunity (Allen and Helms 2002; Balantine et al. 2012; Gabris 2011; Gabris and Giles 1983). Before developing a nonmonetary incentive process, we first need to clarify what the term means. The all-purpose extrinsic incentive is money. Money incentivizes behavior and, due to its efficiency, it can be converted into anything else of value. An NMI, therefore, provides something of value that appeals to both the extrinsic and intrinsic motive needs of a worker—extra time off for high performance could be an NMI under this definition.

Most public service organizations already utilize various NMIs to motivate their workers on an informal, ad hoc basis; however, few have developed formal, systemic NMI inventories for motivating their workforces in a consistent, predictable manner. One possible exception is the U.S. Department of Agriculture’s Farm Service Agency (USDA 2012). Since not all employees are motivated by the same NMIs, a public service organization would need to construct an NMI inventory that would appeal to a large segment of its workforce. 3

NMIs do have real dollar costs; they are not free and should not be conceived as a wholesale replacement for monetary rewards. What they provide is a lower-cost, partial supplement to organizational incentives when monetary incentives are fiscally tight. However, since most NMIs involve indirect costs and are flexible, they are easier to absorb on a tight budget. Additionally, part of the value of an NMI is the intrinsic and not just extrinsic value associated with it. Rewarding high performers with a cafeteria-style selection of NMIs is a type of formal recognition. It addresses the psychological need for recognition and also satisfies needs associated with individual equity. Still, comparably NMIs are relatively inexpensive. Paying for advanced training, awarding extra time off, or providing an employee with a flexible work schedule involve indirect costs that can be spread out over time and cost less than direct monetary rewards. In fact, NMI costs may not even appear in formal budgets because they are fungible.

Once sustainable funding for NMIs has been identified, public service organizations can use them as a formal tool for motivating employees. By having a menu of NMIs to choose from, employees can select the NMI that best satisfies an extrinsic need or has intrinsic personal value. NMIs should be based on merit and have enough consistency so that employees know they can rely on them if they meet performance expectations (Lawler 1973, 1990).

Defined Pension Benefits

While the new normal questions whether public organizations can afford existing defined pension benefits, we argue for the retention of defined pensions on the grounds that they play an integral role in recruiting, retaining, and motivating public service employees. Next to competitive salaries, defined pension benefits serve as a powerful extrinsic incentive that also conveys intrinsic appreciation for the work public service employees provide. 4

With the exception of the recent recession, the rule of thumb has been that private sector jobs pay better than government or nonprofit sector work. It was largely accepted that individuals who pursued careers in teaching, municipal government, state service, nonprofits, or federal agencies would earn less money. The expectation was that public service employees would contribute to their pension systems (augmented by employer contributions) and, upon retirement, the defined payout would ensure a livable wage for the remainder of the retiree’s life. For many public service employees, these pensions are their sole source of retirement income because they receive no Social Security. The fact that public service organizations have historically provided secure retirement is a major reason why many individuals choose to enter and remain in public service careers.

Beginning in the 1990s, many private sector firms began eliminating defined pension plans by switching over to defined contribution systems in the form of 401(k)s. By 2000, 66% of private sector pensions were in 401(k) plans, and only 10% remained in defined pension systems (The Week 2012). Essentially, the private sector has stopped providing retirement benefits for most of its workforce, and attention has now turned to whether the public service should do the same. To retain a corps of highly trained public service employees, who are doing more for less, without the promise of a decent retirement, is a recipe for disaster.

A pension guarantee is the incentive public sector employees rely on most when economic times get tough. It serves as the foundation stone around which other incentives are built. Without decent pensions, public sector work becomes less attractive because one could work in the private sector, earn more money over a career, and have a much heftier 401(k) to retire on.

Rising to the Challenge: The New Public Service Motivation

A central theme permeating this chapter suggests the role of government in providing public services is profoundly changing. No longer is government seen through the lens of interest group liberalism, as defined by Theodore Lowi (1969: 51). “It is liberalism because it is optimistic about government, expects to use government in a positive and expansive role, is motivated by the highest sentiments, and possesses a strong faith that what is good for government is good for society.”

That view of government started to change substantially when Ronald Reagan began articulating a substantially diminished role for government in his first inaugural address in 1981 when he claimed, “Government is not the solution to our problem, government is the problem.” This movement to deconstruct the administrative state became a focal point during the 1990s through the application of business practices and efforts to privatize and outsource government operations to the private sector. This eclectic cocktail of business techniques is called the new public management (NPM) (Boston et al. 1996; DiIulio 1994; Kaboolian 1998; Osborne and Gaebler 1992). A core NPM principle avers that the more we expose government to market competition, performance expectations, and market incentives, the more efficiently it will respond to market and customer demands. This trend of transferring government service functions to the private sector has been sharply accelerated by the Great Recession. Public organizations have adapted to these revenue losses by deploying the survival tactics we have labeled the new normal.

The puzzle facing today’s public service organizations concerns how public sector employees can remain highly motivated given the paradigmatic shift in the core values of public administration. If PSM diminishes as a motive force driving individuals to enter or remain in the public service for primarily intrinsic reasons, the new normal may further necessitate reliance on extrinsic motivation strategies to secure the same ends. Table 14.3 summarizes a number of key trends associated with the new normal.

The dominant paradigm of public administration up until the mid-1990s emphasized the role of government as an active, positive force for addressing and resolving complex social problems. H. George Frederickson (2010) even makes the case that social equity is the third pillar of public administration. This meshes with Perry’s contention (1996, 1997) that PSM consists of subscales: (1) attraction to public making, (2) commitment to the public interest/civic duty, (3) compassion, and (4) self-sacrifice. Moreover, PSM would appear to resonate well with the justice-as-fairness doctrine of John Rawls (1971) whose difference principle explains why the egalitarian distribution of public goods makes ethical sense. It would not be much of a stretch to suggest that the principles appearing in Table 14.4 underpin the motivation philosophy associated with conventional PSM theory (Perry and Vandenabeele 2008).

The difficult question becomes whether this kind of optimistic, positive, progovernment public philosophy that embraces social equity can realistically coexist with the survival tactics of the new normal and the shifting paradigm of public administration. This new paradigm appears to embrace a set of values that envision a more minimalist role for government in the provision and distribution of public goods and services. By adopting more business practices, and embracing market competition for the provision of services, public service organizations should become better at satisfying end user service needs at a lower cost. While not an explicit NPM principle, it would seem implicit that a smaller, leaner government that outsources most of its operations would have a lesser impact on social equity issues. This may help explain the rapid rise of the nonprofit sector as an alternative to government for addressing social equity issues.

In an email exchange with a Chicago area city manager on the topic of alternative service delivery, the manager related: “I am becoming more and more concerned that managers are really turning into maintainers, and losing the ability to connect with the new wave of elected officials.” This manager is concerned that the new normal may be placing so much emphasis on alternative service delivery (ASD) that it is becoming more of a political ideology that elected officials see as an all-purpose panacea, rather than a carefully targeted strategy to use only where most appropriate. If taken to the extreme, reliance on ASD models could transform the traditional role of a public manager from an administrator responsible for the direct provision of public services delivered by a highly trained governmental workforce to that of a monitor of service contracts—where actual services are delivered by external providers.

Anecdotal evidence obtained from a conference on ASD found the elected official participants articulating a type of new public service motivation or NPSM that they would like their professional managers to espouse. The values associated with this NPSM are summarized in Table 14.5 .

How might current and aspiring public service professionals, seeking to satisfy traditional PSM needs, adapt to the NPSM orientation? We believe that individuals entering or currently working in higher-level professional public service jobs will still find ample opportunities for satisfying traditional PSM drives. Yet, even at these higher professional levels, as public service organizations further utilize new normal survival tactics and techniques, employees may become gradually less motivated by the PSM drives that initially attracted them to the public service. Consequently, public service organizations will need to develop, and make available, secondary motivation strategies (or a Plan B, if you will) that rely more on extrinsic motivators for recruiting and retaining the best and the brightest. These secondary motivation strategies will depend more on extrinsic motivators such as compensation based incentives and fringe benefits to offset the intrinsic motivation losses by diminishing PSM values. Over time, traditional PSM and NPSM may converge into an even newer synthesis regarding how public service motivates individuals. This futuristic PSM will likely incorporate motive forces that reflect an increasingly fuzzy public-private interface, where the primary strategies for motivating public sector employees will become eerily similar to those found in the private sector, and public service motivation becomes a secondary (intrinsic) motivational strategy.

Notes

1. Consider the following situation: A student in the final stages of her undergraduate degree may rationally determine that securing a full-time job is the next logical step toward financial security. This individual strongly believes that nonprofit programs offer a great opportunity for helping people and for doing the normatively “right thing.” So, our nascent public servant applies for a job with a human services agency. In this instance, the perceived need to help others may be influenced by her antecedent experiences that infuse her with a core set of values that she accepts as her own and also serve to define her “self-concept.” The longer she works in the nonprofit sector, the more she identifies with its values and preferences. These are learned preferences that she internalizes and uses to define herself as a member of the nonprofit community. Ultimately, PSM is the result of a complex series of processes that begin influencing an individual in childhood and continue throughout adult life.

2. For example, advancement from a clerical I (entry level position) to a clerical II job reflects this kind of increased competency. By allowing employees to grow horizontally in this manner, rewarded by corresponding increments in pay, public organizations can continue motivating employees without having to rely on infrequent vertical promotions or logistically complicated merit pay.

3. There are a number of nonmonetary incentives that may have broad appeal, including (1) extra time off, (2) flexible working hours, (3) advanced training programs, (4) educational tuition grants, and (5) special parking privileges, just to name a few.

4. While we realize that pension systems need reform to ensure long-term financial viability, an analysis of such reform is beyond the scope of this chapter. Our goal is to briefly explain why defined pension benefits remain so crucial for motivating today’s public workforce.

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