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Chapter 5 Theories of Motivation
L E A R N I N G O B J E C T I V E S
After reading this chapter, you should be able to do the following:
1. Understand the role of motivation in determining employee performance.
2. Classify the basic needs of employees.
3. Describe how fairness perceptions are determined and consequences of these
perceptions.
4. Understand the importance of rewards and punishments.
5. Apply motivation theories to analyze performance problems.
Motivation at Trader Joe’s People in Hawaiian T-shirts. Delicious fresh fruits and vegetables. A place
where parking is tight and aisles are tiny. A place where you will be unable to
find half the things on your list but will go home satisfied. We are, of course,
talking about Trader Joe’s, a unique grocery store headquartered in California
and located in 22 states. By selling store-brand and gourmet foods at
affordable prices, this chain created a special niche for itself. Yet the helpful
employees who stock the shelves and answer questions are definitely a key
part of what makes this store unique and helps it achieve twice the sales of
traditional supermarkets.
Shopping here is fun, and chatting with employees is a routine part of this
experience. Employees are upbeat and friendly to each other and to
customers. If you look lost, there is the definite offer of help. But somehow the
friendliness does not seem scripted. Instead, if they see you shopping for big
trays of cheese, they might casually inquire if you are having a party and then
point to other selections. If they see you chasing your toddler, they are quick to
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tie a balloon to his wrist. When you ask them if they have any cumin, they get
down on their knees to check the back of the aisle, with the attitude of helping
a guest that is visiting their home. How does a company make sure its
employees look like they enjoy being there to help others?
One of the keys to this puzzle is pay. Trader Joe’s sells cheap organic food, but
they are not “cheap” when it comes to paying their employees. Employees,
including part-timers, are among the best paid in the retail industry. Full-time
employees earn an average of $40,150 in their first year and also earn average
annual bonuses of $950 with $6,300 in retirement contributions. Store
managers’ average compensation is $132,000. With these generous benefits
and above-market wages and salaries, the company has no difficulty attracting
qualified candidates.
But money only partially explains what energizes Trader Joe’s employees.
They work with people who are friendly and upbeat. The environment is
collaborative, so that people fill in for each other and managers pick up the
slack when the need arises, including tasks like sweeping the floors. Plus, the
company promotes solely from within, making Trader Joe’s one of few places
in the retail industry where employees can satisfy their career aspirations.
Employees are evaluated every 3 months and receive feedback about their
performance.
Employees are also given autonomy on the job. They can open a product to
have the customers try it and can be honest about their feelings toward
different products. They receive on- and off-the-job training and are
intimately familiar with the products, which enables them to come up with
ideas that are taken seriously by upper management. In short, employees love
what they do, work with nice people who treat each other well, and are
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respected by the company. When employees are treated well, it is no wonder
they treat their customers well on a daily basis.
Sources: Based on information in Lewis, L. (2005). Trader Joe’s adventure.
Chicago: Dearborn Trade; McGregor, J., Salter, C., Conley, L., Haley, F., Sacks,
D., & Prospero, M. (2004). Customers first. Fast Company, 87, 79–88;
Speizer, I. (2004). Shopper’s special. Workforce Management, 83, 51–54.
What inspires employees to provide excellent service, market a company’s
products effectively, or achieve the goals set for them? Answering this
question is of utmost importance if we are to understand and manage the
work behavior of our peers, subordinates, and even supervisors. Put a
different way, if someone is not performing well, what could be the reason?
Job performance is viewed as a function of three factors and is expressed with
the equation below. [1]
According to this equation, motivation, ability, and
environment are the major influences over employee performance.
Motivation is one of the forces that lead to performance. Motivation is defined
as the desire to achieve a goal or a certain performance level, leading to goal-
directed behavior. When we refer to someone as being motivated, we mean
that the person is trying hard to accomplish a certain task. Motivation is
clearly important if someone is to perform well; however, it is not
sufficient. Ability—or having the skills and knowledge required to perform the
job—is also important and is sometimes the key determinant of effectiveness.
Finally, environmental factors such as having the resources, information, and
support one needs to perform well are critical to determine performance. At
different times, one of these three factors may be the key to high performance.
For example, for an employee sweeping the floor, motivation may be the most
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important factor that determines performance. In contrast, even the most
motivated individual would not be able to successfully design a house without
the necessary talent involved in building quality homes. Being motivated is not
the same as being a high performer and is not the sole reason why people
perform well, but it is nevertheless a key influence over our performance level.
So what motivates people? Why do some employees try to reach their targets
and pursue excellence while others merely show up at work and count the
hours? As with many questions involving human beings, the answer is
anything but simple. Instead, there are several theories explaining the concept
of motivation. We will discuss motivation theories under two categories: need-
based theories and process theories.
5.1 Need-Based Theories of Motivation
L E A R N I N G O B J E C T I V E S
1. Explain how employees are motivated according to Maslow’s hierarchy of needs.
2. Explain how the ERG (existence, relatedness, growth) theory addresses the
limitations of Maslow’s hierarchy.
3. Describe the differences among factors contributing to employee motivation and
how these differ from factors contributing to dissatisfaction.
4. Describe need for achievement, power, and affiliation, and identify how these
acquired needs affect work behavior.
The earliest studies of motivation involved an examination of individual
needs. Specifically, early researchers thought that employees try hard and
demonstrate goal-driven behavior in order to satisfy needs. For example, an
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employee who is always walking around the office talking to people may have
a need for companionship, and his behavior may be a way of satisfying this
need. At the time, researchers developed theories to understand what people
need. Four theories may be placed under this category: Maslow’s hierarchy of
needs, ERG theory, Herzberg’s two-factor theory, and McClelland’s acquired-
needs theory.
Maslow’s Hierarchy of Needs
Abraham Maslow is among the most prominent psychologists of the twentieth
century. His hierarchy of needs is an image familiar to most business students
and managers. The theory is based on a simple premise: Human beings have
needs that are hierarchically ranked. [1]
There are some needs that are basic to
all human beings, and in their absence nothing else matters. As we satisfy
these basic needs, we start looking to satisfy higher order needs. In other
words, once a lower level need is satisfied, it no longer serves as a motivator.
Figure 5.3 Maslow’s Hierarchy of Needs
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The most basic of Maslow’s needs are physiological needs. Physiological needs
refer to the need for food, water, and other biological needs. These needs are
basic because when they are lacking, the search for them may overpower all
other urges. Imagine being very hungry. At that point, all your behavior may
be directed at finding food. Once you eat, though, the search for food ceases
and the promise of food no longer serves as a motivator. Once physiological
needs are satisfied, people tend to become concerned about safety needs. Are
they free from the threat of danger, pain, or an uncertain future? On the next
level up, social needs refer to the need to bond with other human beings, be
loved, and form lasting attachments with others. In fact, attachments, or lack
of them, are associated with our health and well-being. [2]
The satisfaction of
social needs makes esteem needs more salient. Esteem need refers to the
desire to be respected by one’s peers, feel important, and be appreciated.
Finally, at the highest level of the hierarchy, the need for self-
actualization refers to “becoming all you are capable of becoming.” This need
manifests itself by the desire to acquire new skills, take on new challenges, and
behave in a way that will lead to the attainment of one’s life goals.
Maslow was a clinical psychologist, and his theory was not originally designed
for work settings. In fact, his theory was based on his observations of
individuals in clinical settings; some of the individual components of the
theory found little empirical support. One criticism relates to the order in
which the needs are ranked. It is possible to imagine that individuals who go
hungry and are in fear of their lives might retain strong bonds to others,
suggesting a different order of needs. Moreover, researchers failed to support
the arguments that once a need is satisfied it no longer serves as a motivator
and that only one need is dominant at a given time. [3]
Despite the lack of strong research support, Maslow’s theory found obvious
applications in business settings. Understanding what people need gives us
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clues to understanding them. The hierarchy is a systematic way of thinking
about the different needs employees may have at any given point and explains
different reactions they may have to similar treatment. An employee who is
trying to satisfy esteem needs may feel gratified when her supervisor praises
an accomplishment. However, another employee who is trying to satisfy social
needs may resent being praised by upper management in front of peers if the
praise sets the individual apart from the rest of the group.
How can an organization satisfy its employees’ various needs? In the long run,
physiological needs may be satisfied by the person’s paycheck, but it is
important to remember that pay may satisfy other needs such as safety and
esteem as well. Providing generous benefits that include health insurance and
company-sponsored retirement plans, as well as offering a measure of job
security, will help satisfy safety needs. Social needs may be satisfied by having
a friendly environment and providing a workplace conducive to collaboration
and communication with others. Company picnics and other social get-
togethers may also be helpful if the majority of employees are motivated
primarily by social needs (but may cause resentment if they are not and if they
have to sacrifice a Sunday afternoon for a company picnic). Providing
promotion opportunities at work, recognizing a person’s accomplishments
verbally or through more formal reward systems, and conferring job titles that
communicate to the employee that one has achieved high status within the
organization are among the ways of satisfying esteem needs. Finally, self-
actualization needs may be satisfied by the provision of development and
growth opportunities on or off the job, as well as by work that is interesting
and challenging. By making the effort to satisfy the different needs of each
employee, organizations may ensure a highly motivated workforce.
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ERG Theory
Figure 5.4
ERG theory includes existence, relatedness, and growth.
Source: Based on Alderfer, C. P. (1969). An empirical test of a new theory of
human needs. Organizational Behavior and Human Performance, 4, 142–175.
ERG theory, developed by Clayton Alderfer, is a modification of Maslow’s
hierarchy of needs. [4]
Instead of the five needs that are hierarchically
organized, Alderfer proposed that basic human needs may be grouped under
three categories, namely, existence, relatedness, and growth. Existence
corresponds to Maslow’s physiological and safety needs, relatedness
corresponds to social needs, and growth refers to Maslow’s esteem and self-
actualization.
ERG theory’s main contribution to the literature is its relaxation of Maslow’s
assumptions. For example, ERG theory does not rank needs in any particular
order and explicitly recognizes that more than one need may operate at a given
time. Moreover, the theory has a “frustration-regression” hypothesis
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suggesting that individuals who are frustrated in their attempts to satisfy one
need may regress to another. For example, someone who is frustrated by the
growth opportunities in his job and progress toward career goals may regress
to relatedness need and start spending more time socializing with coworkers.
The implication of this theory is that we need to recognize the multiple needs
that may be driving individuals at a given point to understand their behavior
and properly motivate them.
Two-Factor Theory
Frederick Herzberg approached the question of motivation in a different way.
By asking individuals what satisfies them on the job and what dissatisfies
them, Herzberg came to the conclusion that aspects of the work environment
that satisfy employees are very different from aspects that dissatisfy
them. [5]
Herzberg labeled factors causing dissatisfaction of workers as
“hygiene” factors because these factors were part of the context in which the
job was performed, as opposed to the job itself. Hygiene factors included
company policies, supervision, working conditions, salary, safety, and security
on the job. To illustrate, imagine that you are working in an unpleasant work
environment. Your office is too hot in the summer and too cold in the winter.
You are being harassed and mistreated. You would certainly be miserable in
such a work environment. However, if these problems were solved (your office
temperature is just right and you are not harassed at all), would you be
motivated? Most likely, you would take the situation for granted. In fact, many
factors in our work environment are things that we miss when they are absent
but take for granted if they are present.
In contrast, motivators are factors that are intrinsic to the job, such as
achievement, recognition, interesting work, increased responsibilities,
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advancement, and growth opportunities. According to Herzberg’s research,
motivators are the conditions that truly encourage employees to try harder.
Figure 5.5
The two-factor theory of motivation includes hygiene factors and motivators.
Sources: Based on Herzberg, F., Mausner, B., & Snyderman, B. (1959). The
motivation to work. New York: John Wiley and Sons; Herzberg, F. (1965).
The motivation to work among Finnish supervisors. Personnel
Psychology, 18, 393–402.
Herzberg’s research is far from being universally accepted. [6]
One criticism
relates to the primary research methodology employed when arriving at
hygiene versus motivators. When people are asked why they are satisfied, they
may attribute the causes of satisfaction to themselves, whereas when
explaining what dissatisfies them, they may blame the situation. The
classification of the factors as hygiene or motivator is not that simple either.
For example, the theory views pay as a hygiene factor. However, pay may have
symbolic value by showing employees that they are being recognized for their
contributions as well as communicating that they are advancing within the
company. Similarly, the quality of supervision or the types of relationships
employees form with their supervisors may determine whether they are
assigned interesting work, whether they are recognized for their potential, and
whether they take on more responsibilities.
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Despite its limitations, the theory can be a valuable aid to managers because it
points out that improving the environment in which the job is performed goes
only so far in motivating employees. Undoubtedly, contextual factors matter
because their absence causes dissatisfaction. However, solely focusing on
hygiene factors will not be enough, and managers should also enrich jobs by
giving employees opportunities for challenging work, greater responsibilities,
advancement opportunities, and a job in which their subordinates can feel
successful.
Acquired-Needs Theory
Among the need-based approaches to motivation, David McClelland’s
acquired-needs theory is the one that has received the greatest amount of
support. According to this theory, individuals acquire three types of needs as a
result of their life experiences. These needs are the need for achievement, the
need for affiliation, and the need for power. All individuals possess a
combination of these needs, and the dominant needs are thought to drive
employee behavior.
McClelland used a unique method called the Thematic Apperception Test
(TAT) to assess the dominant need. [7]
This method entails presenting research
subjects an ambiguous picture asking them to write a story based on it. Take a
look at the following picture. Who is this person? What is she doing? Why is
she doing it? The story you tell about the woman in the picture would then be
analyzed by trained experts. The idea is that the stories the photo evokes
would reflect how the mind works and what motivates the person.
If the story you come up with contains themes of success, meeting deadlines,
or coming up with brilliant ideas, you may be high in need for achievement.
Those who have high need for achievement have a strong need to be
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successful. As children, they may be praised for their hard work, which forms
the foundations of their persistence. [8]
As adults, they are preoccupied with
doing things better than they did in the past. These individuals are constantly
striving to improve their performance. They relentlessly focus on goals,
particularly stretch goals that are challenging in nature. [9]
They are
particularly suited to positions such as sales, where there are explicit goals,
feedback is immediately available, and their effort often leads to success. In
fact, they are more attracted to organizations that are merit-based and reward
performance rather than seniority. They also do particularly well as
entrepreneurs, scientists, and engineers. [10]
Are individuals who are high in need for achievement effective managers?
Because of their success in lower level jobs where their individual
contributions matter the most, those with high need for achievement are often
promoted to higher level positions. [11]
However, a high need for achievement
has significant disadvantages in management positions. Management involves
getting work done by motivating others. When a salesperson is promoted to be
a sales manager, the job description changes from actively selling to
recruiting, motivating, and training salespeople. Those who are high in need
for achievement may view managerial activities such as coaching,
communicating, and meeting with subordinates as a waste of time and may
neglect these aspects of their jobs. Moreover, those high in need for
achievement enjoy doing things themselves and may find it difficult to
delegate any meaningful authority to their subordinates. These individuals
often micromanage, expecting others to approach tasks a particular way, and
may become overbearing bosses by expecting everyone to display high levels
of dedication. [12]
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If the story you created in relation to the picture you are analyzing contains
elements of making plans to be with friends or family, you may have a high
need for affiliation. Individuals who have a high need for affiliation want to be
liked and accepted by others. When given a choice, they prefer to interact with
others and be with friends. [13]
Their emphasis on harmonious interpersonal
relationships may be an advantage in jobs and occupations requiring frequent
interpersonal interaction, such as a social worker or teacher. In managerial
positions, a high need for affiliation may again serve as a disadvantage
because these individuals tend to be overly concerned about how they are
perceived by others. They may find it difficult to perform some aspects of a
manager’s job such as giving employees critical feedback or disciplining poor
performers. Thus, the work environment may be characterized by mediocrity
and may even lead to high performers leaving the team.
Finally, if your story contains elements of getting work done by influencing
other people or desiring to make an impact on the organization, you may have
a high need for power. Those with a high need for power want to influence
others and control their environment. A need for power may in fact be a
destructive element in relationships with colleagues if it takes the form of
seeking and using power for one’s own good and prestige. However, when it
manifests itself in more altruistic forms such as changing the way things are
done so that the work environment is more positive, or negotiating more
resources for one’s department, it tends to lead to positive outcomes. In fact,
the need for power is viewed as an important trait for effectiveness in
managerial and leadership positions. [14]
McClelland’s theory of acquired needs has important implications for the
motivation of employees. Managers need to understand the dominant needs of
their employees to be able to motivate them. While people who have a high
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need for achievement may respond to goals, those with a high need for power
may attempt to gain influence over those they work with, and individuals high
in their need for affiliation may be motivated to gain the approval of their
peers and supervisors. Finally, those who have a high drive for success may
experience difficulties in managerial positions, and making them aware of
common pitfalls may increase their effectiveness.
K E Y T A K E A W A Y
Need-based theories describe motivated behavior as individuals’ efforts to meet
their needs. According to this perspective, the manager’s job is to identify what
people need and make the work environment a means of satisfying these needs.
Maslow’s hierarchy describes five categories of basic human needs, including
physiological, safety, social, esteem, and self-actualization needs. These needs are
hierarchically ranked, and as a lower level need is satisfied, it no longer serves as a
motivator. ERG theory is a modification of Maslow’s hierarchy, in which the five
needs are collapsed into three categories (existence, relatedness, and growth). The
theory recognizes that when employees are frustrated while attempting to satisfy
higher level needs, they may regress. The two-factor theory differentiates between
factors that make people dissatisfied on the job (hygiene factors) and factors that
truly motivate employees (motivators). Finally, acquired-needs theory argues that
individuals possess stable and dominant motives to achieve, acquire power, or
affiliate with others. The type of need that is dominant will drive behavior. Each of
these theories explains characteristics of a work environment that motivates
employees. These theories paved the way to process-based theories that explain the
mental calculations employees make to decide how to behave.
E X E R C I S E S
1. Many managers assume that if an employee is not performing well, the reason must
be a lack of motivation. Do you think this reasoning is accurate? What is the problem
with the assumption?
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2. Review Maslow’s hierarchy of needs. Do you agree with the particular ranking of
employee needs?
3. How can an organization satisfy employee needs that are included in Maslow’s
hierarchy?
4. Which motivation theory have you found to be most useful in explaining why people
behave in a certain way? Why?
5. Review the hygiene and motivators in the two-factor theory of motivation. Do you
agree with the distinction between hygiene factors and motivators? Are there any
hygiene factors that you would consider to be motivators?
6. A friend of yours demonstrates the traits of achievement motivation: This person is
competitive, requires frequent and immediate feedback, and enjoys accomplishing
things and doing things better than she did before. She has recently been promoted
to a managerial position and seeks your advice. What would you tell her?
5.2 Process-Based Theories
L E A R N I N G O B J E C T I V E S
1. Explain how employees evaluate the fairness of reward distributions.
2. Describe the three types of fairness that affect employee attitudes and behaviors.
3. List the three questions individuals consider when deciding whether to put forth
effort at work.
4. Describe how managers can use learning and reinforcement principles to motivate
employees.
A separate stream of research views motivation as something more than action
aimed at satisfying a need. Instead, process-based theories view motivation as
a rational process. Individuals analyze their environment, develop thoughts
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and feelings, and react in certain ways. Process theories attempt to explain the
thought processes of individuals who demonstrate motivated behavior. Under
this category, we will review equity theory, expectancy theory, and
reinforcement theory.
Equity Theory
Imagine that you are paid $10 an hour working as an office assistant. You have
held this job for 6 months. You are very good at what you do, you come up
with creative ways to make things easier around you, and you are a good
colleague who is willing to help others. You stay late when necessary and are
flexible if requested to change hours. Now imagine that you found out they are
hiring another employee who is going to work with you, who will hold the
same job title, and who will perform the same type of tasks. This particular
person has more advanced computer skills, but it is unclear whether these will
be used on the job. The starting pay for this person will be $14 an hour. How
would you feel? Would you be as motivated as before, going above and beyond
your duties? How would you describe what you would be feeling?
Figure 5.7
Equity is determined by comparing one’s input-outcome ratio with the input-
outcome ratio of a referent. When the two ratios are equal, equity exists.
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Source: Based on Adams, J. S. (1965). Inequity in social exchange. In L.
Berkowitz (Ed.), Advances in experimental social psychology: Vol. 2 (pp. 267–
299). New York: Academic Press.
If your reaction to this scenario is along the lines of “this would be unfair,”
your behavior may be explained using equity theory. [1]
According to this
theory, individuals are motivated by a sense of fairness in their interactions.
Moreover, our sense of fairness is a result of the social comparisons we make.
Specifically, we compare our inputs and outcomes with other people’s inputs
and outcomes. We perceive fairness if we believe that the input-to-outcome
ratio we are bringing into the situation is similar to the input-to-outcome ratio
of a comparison person, or a referent. Perceptions of inequity create tension
within us and drive us to action that will reduce perceived inequity.
What Are Inputs and Outcomes?
Inputs are the contributions people feel they are making to the environment.
In the previous example, the person’s hard work; loyalty to the organization;
amount of time with the organization; and level of education, training, and
skills may have been relevant inputs. Outcomes are the perceived rewards
someone can receive from the situation. For the hourly wage employee in our
example, the $10 an hour pay rate was a core outcome. There may also be
other, more peripheral outcomes, such as acknowledgment or preferential
treatment from a manager. In the prior example, however, the person may
reason as follows: I have been working here for 6 months. I am loyal, and I
perform well (inputs). I am paid $10 an hour for this (outcomes). The new
person does not have any experience here (referent’s inputs) but will be paid
$14 an hour. This situation is unfair.
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We should emphasize that equity perceptions develop as a result of a
subjective process. Different people may look at the same situation and
perceive different levels of equity. For example, another person may look at
the same scenario and decide that the situation is fair because the newcomer
has computer skills and the company is paying extra for those skills.
Who Is the Referent?
The referent other may be a specific person as well as a category of people.
Referents should be comparable to us—otherwise the comparison is not
meaningful. It would be pointless for a student worker to compare himself to
the CEO of the company, given the differences in the nature of inputs and
outcomes. Instead, individuals may compare themselves to someone
performing similar tasks within the same organization or, in the case of a
CEO, a different organization.
Reactions to Unfairness
The theory outlines several potential reactions to perceived inequity.
Oftentimes, the situation may be dealt with perceptually by altering our
perceptions of our own or the referent’s inputs and outcomes. For example,
we may justify the situation by downplaying our own inputs (I don’t really
work very hard on this job), valuing our outcomes more highly (I am gaining
valuable work experience, so the situation is not that bad), distorting the other
person’s inputs (the new hire really is more competent than I am and deserves
to be paid more), or distorting the other person’s outcomes (she gets $14 an
hour but will have to work with a lousy manager, so the situation is not
unfair). Another option would be to have the referent increase inputs. If the
other person brings more to the situation, getting more out of the situation
would be fair. If that person can be made to work harder or work on more
complicated tasks, equity would be achieved. The person experiencing a
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perceived inequity may also reduce inputs or attempt to increase outcomes. If
the lower paid person puts forth less effort, the perceived inequity would be
reduced. Research shows that people who perceive inequity reduce their work
performance or reduce the quality of their inputs. [2]
Increasing one’s
outcomes can be achieved through legitimate means such as negotiating a pay
raise. At the same time, research shows that those feeling inequity sometimes
resort to stealing to balance the scales. [3]
Other options include changing the
comparison person (e.g., others doing similar work in different organizations
are paid only minimum wage) and leaving the situation by
quitting. [4]
Sometimes it may be necessary to consider taking legal action as a
potential outcome of perceived inequity. For example, if an employee finds out
the main reason behind a pay gap is gender related, the person may react to
the situation by taking legal action because sex discrimination in pay is illegal
in the United States.
Table 5.1 Potential Responses to Inequity
Reactions to inequity Example
Distort perceptions
Changing one’s thinking to believe that the referent actually is more skilled than previously thought
Increase referent’s inputs Encouraging the referent to work harder
Reduce own input
Deliberately putting forth less effort at work. Reducing the quality of one’s work
Increase own outcomes
Negotiating a raise for oneself or using unethical ways of increasing rewards such as stealing from the company
Change referent Comparing oneself to someone who is worse off
Leave the Quitting one’s job
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Reactions to inequity Example
situation
Seek legal action Suing the company or filing a complaint if the unfairness in question is under legal protection
Source: Based on research findings reported in Carrell, M. R., & Dittrich, J.
E. (1978). Equity theory: The recent literature, methodological considerations,
and new directions. Academy of Management Review, 3, 202–210; Goodman,
P. S., & Friedman, A. (1971). An examination of Adams’s theory of
inequity. Administrative Science Quarterly, 16, 271–288; Greenberg, J. (1993).
Stealing in the name of justice: Informational and interpersonal moderators of
theft reactions to underpayment inequity. Organizational Behavior and
Human Decision Processes, 54, 81–103; Schmidt, D. R., & Marwell, G. (1972).
Withdrawal and reward reallocation as responses to inequity. Journal of
Experimental Social Psychology, 8, 207–211.
Overpayment Inequity
What would you do if you felt you were over-rewarded? In other words, how
would you feel if you were the new employee in our student-worker scenario?
Originally, equity theory proposed that over-rewarded individuals would
experience guilt and would increase their effort to restore perceptions of
equity. However, research does not provide support for this argument.
Instead, it seems that individuals experience less distress as a result of being
over-rewarded. [5]
It is not hard to imagine that individuals find perceptual
ways to deal with a situation like this, such as believing they have more skills
and bring more to the situation compared to the referent person. Therefore,
research does not support equity theory’s predictions with respect to people
who are overpaid. [6]
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Individual Differences in Reactions to Inequity
So far, we have assumed that once people feel a situation is inequitable, they
will be motivated to react. However, does inequity disturb everyone equally?
Researchers have identified a personality trait that explains different reactions
to inequity and named this trait as equity sensitivity. [7]
Equity-sensitive
individuals expect to maintain equitable relationships, and they experience
distress when they feel they are over-rewarded or under-rewarded. At the
same time, there are some individuals who are benevolents, those who give
without waiting to receive much in return, and entitleds, who expect to receive
substantial compensation for relatively little input. Therefore, the theory is
more useful in explaining the behavior of equity-sensitive individuals, and
organizations will need to pay particular attention to how these individuals
view their relationships.
Fairness Beyond Equity: Procedural and Interactional Justice
Equity theory looks at perceived fairness as a motivator. However, the way
equity theory defines fairness is limited to fairness of rewards. Starting in the
1970s, research on workplace fairness began taking a broader view of justice.
Equity theory deals with outcome fairness, and therefore it is considered to be
a distributive justice theory. Distributive justice refers to the degree to which
the outcomes received from the organization are perceived to be fair. Two
other types of fairness have been identified: procedural justice and
interactional justice.
Figure 5.8 Dimensions of Organizational Justice
23
Let’s assume that you just found out you are getting a promotion. Clearly, this
is an exciting outcome and comes with a pay raise, increased responsibilities,
and prestige. If you feel you deserve to be promoted, you would perceive high
distributive justice (your getting the promotion is fair). However, you later
found out upper management picked your name out of a hat! What would you
feel? You might still like the outcome but feel that the decision-making
process was unfair. If so, you are describing feelings of procedural justice.
Procedural justice refers to the degree to which fair decision-making
procedures are used to arrive at a decision. People do not care only about
reward fairness. They also expect decision-making processes to be fair. In fact,
research shows that employees care about the procedural justice of many
organizational decisions, including layoffs, employee selection, surveillance of
24
employees, performance appraisals, and pay decisions. [8]
People also tend to
care more about procedural justice in situations in which they do not get the
outcome they feel they deserve. [9]
If you did not get the promotion and later
discovered that management chose the candidate by picking names out of a
hat, how would you feel? This may be viewed as adding insult to injury. When
people do not get the rewards they want, they tend to hold management
responsible if procedures are not fair. [10]
Why do employees care about procedural justice? There are three potential
reasons. [11]
First, people tend to believe that fairness is an end in itself and it is
the right thing to do. Second, fair processes guarantee future rewards. If your
name was picked out of a hat, you have no control over the process, and there
is no guarantee that you will get future promotions. If the procedures are fair,
you are more likely to believe that things will work out in the future. Third,
fairness communicates that the organization values its employees and cares
about their well-being.
Research has identified many ways of achieving procedural justice. For
example, giving employees advance notice before laying them off, firing them,
or disciplining them is perceived as fair. [12]
Advance notice helps employees
get ready for the changes facing them or gives them an opportunity to change
their behavior before it is too late. Allowing employees voice in decision
making is also important. [13]
When designing a performance-appraisal system
or implementing a reorganization, it may be a good idea to ask people for their
input because it increases perceptions of fairness. Even when it is not possible
to have employees participate, providing explanations to employees is helpful
in fostering procedural justice. [14]
Finally, people expect consistency in
treatment. [15]
If one person is given extra time when taking a test while
another is not, individuals would perceive decision making as unfair.
25
Now let’s imagine the moment your boss told you that you are getting a
promotion. Your manager’s exact words were, “Yes, we are giving you the
promotion. The job is so simple that we thought even you can handle it.” Now
what is your reaction? The feeling of unfairness you may now feel is explained
by interactional justice. Interactional justice refers to the degree to which
people are treated with respect, kindness, and dignity in interpersonal
interactions. We expect to be treated with dignity by our peers, supervisors,
and customers. When the opposite happens, we feel angry. Even when faced
with negative outcomes such as a pay cut, being treated with dignity and
respect serves as a buffer and alleviates our stress. [16]
OB Toolbox: Be a Fair Person! When distributing rewards, make sure you pay attention to different
contribution levels of employees. Treating everyone equally could be unfair if
they participated and contributed at different levels. People who are more
qualified, skilled, or those who did more than others expect to receive a
greater share of rewards.
Sometimes you may have to disregard people’s contributions to distribute
certain rewards. Some rewards or privileges may be better distributed equally
(e.g., health insurance) or based on the particular employee’s needs (such as
unpaid leave for health reasons).
Pay attention to how you make decisions. Before making a decision, ask
people to give you their opinions if possible. Explain your decisions to people
who are affected by it. Before implementing a change, give people advance
notice. Enforce rules consistently among employees.
Pay attention to how you talk to people. Treat others the way you want to be
treated. Be kind, courteous, and considerate of their feelings.
26
Remember that justice is in the eye of the beholder. Even when you feel you
are being fair, others may not feel the same way, and it is their perception that
counts. Therefore, pay attention to being perceived as fair.
People do not care only about their own justice level. They also pay attention
to how others are treated as well. Therefore, in addition to paying attention to
how specific employees feel, creating a sense of justice in the entire
organization is important.
Sources: Adapted from ideas in Colquitt, J. A. (2004). Does the justice of the
one interact with the justice of the many? Reactions to procedural justice in
teams. Journal of Applied Psychology, 89, 633–646; Cropanzano, R., Bowen,
D. E., & Gilliland, S. W. (2007). The management of organizational
justice. Academy of Management Perspectives, 21, 34–48.
Employers would benefit from paying attention to all three types of justice
perceptions. In addition to being the right thing to do, paying attention to
justice perceptions leads to outcomes companies care about. Injustice is
directly harmful to employees’ psychological health and well-being and
contributes to stress. [17]
High levels of justice create higher levels of employee
commitment to organizations, and they are related to higher job performance,
higher levels of organizational citizenship (behaviors that are not part of one’s
job description but help the organization in other ways, such as speaking
positively about the company and helping others), and higher levels of
customer satisfaction. Conversely, low levels of justice lead to retaliation and
support of unionization. [18]
Expectancy Theory
According to expectancy theory, individual motivation to put forth more or
less effort is determined by a rational calculation in which individuals evaluate
27
their situation. [19]
According to this theory, individuals ask themselves three
questions.
Figure 5.9 Summary of Expectancy Theory
Sources: Based on Porter, L. W., & Lawler, E. E. (1968). Managerial
attitudes and performance. Homewood, IL: Irwin; Vroom, V. H. (1964). Work
and motivation. New York: Wiley.
The first question is whether the person believes that high levels of effort will
lead to outcomes of interest, such as performance or success. This perception
is labeled expectancy. For example, do you believe that the effort you put forth
in a class is related to performing well in that class? If you do, you are more
likely to put forth effort.
The second question is the degree to which the person believes that
performance is related to subsequent outcomes, such as rewards. This
perception is labeled instrumentality. For example, do you believe that getting
a good grade in the class is related to rewards such as getting a better job, or
gaining approval from your instructor, or from your friends or parents? If you
do, you are more likely to put forth effort.
Finally, individuals are also concerned about the value of the rewards awaiting
them as a result of performance. The anticipated satisfaction that will result
from an outcome is labeled valence. For example, do you value getting a better
28
job, or gaining approval from your instructor, friends, or parents? If these
outcomes are desirable to you, your expectancy and instrumentality is high,
and you are more likely to put forth effort.
Expectancy theory is a well-accepted theory that has received a lot of research
attention. [20]
It is simple and intuitive. Consider the following example. Let’s
assume that you are working in the concession stand of a movie theater. You
have been selling an average of 100 combos of popcorn and soft drinks a day.
Now your manager asks you to increase this number to 300 combos a day.
Would you be motivated to try to increase your numbers? Here is what you
may be thinking:
Expectancy: Can I do it? If I try harder, can I really achieve this number? Is
there a link between how hard I try and whether I reach this goal or not? If
you feel that you can achieve this number if you try, you have high
expectancy.
Instrumentality: What is in it for me? What is going to happen if I reach
300? What are the outcomes that will follow? Are they going to give me a
2% pay raise? Am I going to be named the salesperson of the month? Am I
going to receive verbal praise from my manager? If you believe that
performing well is related to certain outcomes, instrumentality is high.
Valence: How do I feel about the outcomes in question? Do I feel that a 2%
pay raise is desirable? Do I find being named the salesperson of the month
attractive? Do I think that being praised by my manager is desirable? If
your answers are yes, valence is positive. In contrast, if you find the
outcomes undesirable (you definitely do not want to be named the
salesperson of the month because your friends would make fun of you),
valence is negative.
29
If your answers to all three questions are affirmative—you feel that you can do
it, you will get an outcome if you do it, and you value the reward—you are
more likely to be motivated to put forth more effort toward selling more
combos.
As a manager, how can you motivate employees? In fact, managers can
influence all three perceptions. [21]
Influencing Expectancy Perceptions
Employees may not believe that their effort leads to high performance for a
multitude of reasons. First, they may not have the skills, knowledge, or
abilities to successfully perform their jobs. The answer to this problem may be
training employees or hiring people who are qualified for the jobs in question.
Second, low levels of expectancy may be because employees may feel that
something other than effort predicts performance, such as political behaviors
on the part of employees. If employees believe that the work environment is
not conducive to performing well (resources are lacking or roles are unclear),
expectancy will also suffer. Therefore, clearing the path to performance and
creating an environment in which employees do not feel restricted will be
helpful. Finally, some employees may perceive little connection between their
effort and performance level because they have an external locus of control,
low self-esteem, or other personality traits that condition them to believe that
their effort will not make a difference. In such cases, providing positive
feedback and encouragement may help motivate employees.
Influencing Instrumentality Perceptions
Showing employees that their performance is rewarded is going to increase
instrumentality perceptions. Therefore, the first step in influencing
instrumentality is to connect pay and other rewards to performance using
30
bonuses, award systems, and merit pay. However, this is not always sufficient,
because people may not be aware of some of the rewards awaiting high
performers. Publicizing any contests or award programs is needed to bring
rewards to the awareness of employees. It is also important to highlight that
performance, not something else, is being rewarded. For example, if a
company has an employee of the month award that is rotated among
employees, employees are unlikely to believe that performance is being
rewarded. This type of meritless reward system may actually hamper the
motivation of the highest performing employees by eroding instrumentality.
Influencing Valence
Employees are more likely to be motivated if they find the reward to be
attractive. This process involves managers finding what their employees value.
Desirable rewards tend to be fair and satisfy different employees’ diverging
needs. Ensuring high valence involves getting to know a company’s employees.
Talking to employees and surveying them about what rewards they find
valuable are some methods to gain understanding. Finally, giving employees a
choice between multiple rewards may be a good idea to increase valence.
Figure 5.10 Ways in Which Managers Can Influence Expectancy,
Instrumentality, and Valence
31
Reinforcement Theory
Reinforcement theory is based on the work of Ivan Pavlov on behavioral
conditioning and the later work of B. F. Skinner on operant
conditioning. [22]
According to reinforcement theory, behavior is a function of
its outcomes. Imagine that even though no one asked you to, you stayed late
and drafted a report. When the manager found out, she was ecstatic and took
you out to lunch and thanked you genuinely. The consequences following your
good deed were favorable, and therefore you are more likely to demonstrate
similar behaviors in the future. In other words, your taking initiative was
reinforced. Instead, if your manager had said nothing about it and everyone
ignored the sacrifice you made, you are less likely to demonstrate similar
behaviors in the future.
Reinforcement theory is based on a simple idea that may be viewed as
common sense. Beginning at infancy we learn through reinforcement. If you
have observed a small child discovering the environment, you will see
reinforcement theory in action. When the child discovers manipulating a
faucet leads to water coming out and finds this outcome pleasant, he is more
32
likely to repeat the behavior. If he burns his hand while playing with hot
water, the child is likely to stay away from the faucet in the future.
Despite the simplicity of reinforcement, how many times have you seen
positive behavior ignored, or worse, negative behavior rewarded? In many
organizations, this is a familiar scenario. People go above and beyond the call
of duty, yet their actions are ignored or criticized. People with disruptive
habits may receive no punishments because the manager is afraid of the
reaction the person will give when confronted. Problem employees may even
receive rewards such as promotions so they will be transferred to a different
location and become someone else’s problem. Moreover, it is common for
people to be rewarded for the wrong kind of behavior. Steven Kerr has labeled
this phenomenon “the folly of rewarding A while hoping for B.” [23]
For
example, a company may make public statements about the importance of
quality. Yet, if they choose to reward shipments on time regardless of the
amount of defects contained in the shipments, employees are more likely to
ignore quality and focus on hurrying the delivery process. Because people
learn to repeat their behaviors based on the consequences following their prior
activities, managers will need to systematically examine the consequences of
employee behavior and make interventions when needed.
Reinforcement Interventions
Reinforcement theory describes four interventions to modify employee
behavior. Two of these are methods of increasing the frequency of desired
behaviors, while the remaining two are methods of reducing the frequency of
undesired behaviors.
Figure 5.11 Reinforcement Methods
33
Positive reinforcement is a method of increasing the desired behavior. [24]
Positive reinforcement involves making sure that behavior is met with positive
consequences. For example, praising an employee for treating a customer
respectfully is an example of positive reinforcement. If the praise immediately
follows the positive behavior, the employee will see a link between the
behavior and positive consequences and will be motivated to repeat similar
behaviors.
Negative reinforcement is also used to increase the desired behavior. Negative
reinforcement involves removal of unpleasant outcomes once desired behavior
is demonstrated. Nagging an employee to complete a report is an example of
negative reinforcement. The negative stimulus in the environment will remain
present until positive behavior is demonstrated. The problem with negative
34
reinforcement is that the negative stimulus may lead to unexpected behaviors
and may fail to stimulate the desired behavior. For example, the person may
start avoiding the manager to avoid being nagged.
Extinction is used to decrease the frequency of negative behaviors. Extinction
is the removal of rewards following negative behavior. Sometimes, negative
behaviors are demonstrated because they are being inadvertently rewarded.
For example, it has been shown that when people are rewarded for their
unethical behaviors, they tend to demonstrate higher levels of unethical
behaviors. [25]
Thus, when the rewards following unwanted behaviors are
removed, the frequency of future negative behaviors may be reduced. For
example, if a coworker is forwarding unsolicited e-mail messages containing
jokes, commenting and laughing at these jokes may be encouraging the person
to keep forwarding these messages. Completely ignoring such messages may
reduce their frequency.
Punishment is another method of reducing the frequency of undesirable
behaviors. Punishment involves presenting negative consequences following
unwanted behaviors. Giving an employee a warning for consistently being late
to work is an example of punishment.
Reinforcement Schedules
In addition to types of reinforcements, researchers have focused their
attention on schedules of reinforcement as well. [26]
Reinforcement is
presented on a continuous schedule if reinforcers follow all instances of
positive behavior. An example of a continuous schedule would be giving an
employee a sales commission every time he makes a sale. In many instances,
continuous schedules are impractical. For example, it would be difficult to
praise an employee every time he shows up to work on time. Fixed-
35
ratio schedules involve providing rewards every nth time the right behavior is
demonstrated. An example of this would be giving the employee a bonus for
every tenth sale he makes. Variable ratio involves providing the reinforcement
on a random pattern, such as praising the employee occasionally when the
person shows up on time. In the case of continuous schedules, behavioral
change is more temporary. Once the reward is withdrawn, the person may
stop performing the desired behavior. The most durable results occur under
variable ratios, but there is also some evidence that continuous schedules
produce higher performance than do variable schedules. [27]
OB Toolbox: Be Effective in Your Use of Discipline As a manager, sometimes you may have to discipline an employee to eliminate
unwanted behavior. Here are some tips to make this process more effective.
Consider whether punishment is the most effective way to modify behavior.
Sometimes catching people in the act of doing good things and praising or
rewarding them is preferable to punishing negative behavior. Instead of
criticizing them for being late, consider praising them when they are on time.
Carrots may be more effective than sticks. You can also make the behavior
extinct by removing any rewards that follow undesirable behavior.
Be sure that the punishment fits the crime. If a punishment is too harsh, both
the employee in question and coworkers who will learn about the punishment
will feel it is unfair. Unfair punishment may not change unwanted behavior.
Be consistent in your treatment of employees. Have disciplinary procedures
and apply them in the same way to everyone. It is unfair to enforce a rule for
one particular employee but then give others a free pass.
Document the behavior in question. If an employee is going to be disciplined,
the evidence must go beyond hearsay.
36
Be timely with discipline. When a long period of time passes between
behavior and punishment, it is less effective in reducing undesired behavior
because the connection between the behavior and punishment is weaker.
Sources: Adapted from ideas in Ambrose, M. L., & Kulik, C. T. (1999). Old
friends, new faces: Motivation research in the 1990s. Journal of
Management, 25, 231–292; Guffey, C. J., & Helms, M. M. (2001). Effective
employee discipline: A case of the Internal Revenue Service. Public Personnel
Management, 30, 111–128.
A systematic way in which reinforcement theory principles are applied is
called Organizational Behavior Modification (or OB Mod). [28]
This is a
systematic application of reinforcement theory to modify employee behaviors
in the workplace. The model consists of five stages. The process starts with
identifying the behavior that will be modified. Let’s assume that we are
interested in reducing absenteeism among employees. In step 2, we need to
measure the baseline level of absenteeism. How many times a month is a
particular employee absent? In step 3, the behavior’s antecedents and
consequences are determined. Why is this employee absent? More
importantly, what is happening when the employee is absent? If the behavior
is being unintentionally rewarded (e.g., the person is still getting paid or is
able to avoid unpleasant assignments because someone else is doing them),
we may expect these positive consequences to reinforce the absenteeism.
Instead, to reduce the frequency of absenteeism, it will be necessary to think of
financial or social incentives to follow positive behavior and negative
consequences to follow negative behavior. In step 4, an intervention is
implemented. Removing the positive consequences of negative behavior may
be an effective way of dealing with the situation, or, in persistent situations,
37
punishments may be used. Finally, in step 5 the behavior is measured
periodically and maintained.
Studies examining the effectiveness of OB Mod have been supportive of the
model in general. A review of the literature found that OB Mod interventions
resulted in 17% improvement in performance. [29]
Particularly in
manufacturing settings, OB Mod was an effective way of increasing
performance, although positive effects were observed in service organizations
as well.
K E Y T A K E A W A Y
Process-based theories use the mental processes of employees as the key to
understanding employee motivation. According to equity theory, employees are
demotivated when they view reward distribution as unfair. Perceptions of fairness
are shaped by the comparisons they make between their inputs and outcomes with
respect to a referent’s inputs and outcomes. Following equity theory, research
identified two other types of fairness (procedural and interactional) that also affect
worker reactions and motivation. According to expectancy theory, employees are
motivated when they believe that their effort will lead to high performance
(expectancy), when they believe that their performance will lead to outcomes
(instrumentality), and when they find the outcomes following performance to be
desirable (valence). Reinforcement theory argues that behavior is a function of its
consequences. By properly tying rewards to positive behaviors, eliminating rewards
following negative behaviors, and punishing negative behaviors, leaders can increase
the frequency of desired behaviors. These three theories are particularly useful in
designing reward systems within a company.
E X E R C I S E S
1. Your manager tells you that the best way of ensuring fairness in reward distribution
is to keep the pay a secret. How would you respond to this assertion?
38
2. When distributing bonuses or pay, how would you ensure perceptions of fairness?
3. What are the differences between procedural, interactional, and distributive justice?
List ways in which you could increase each of these justice perceptions.
4. Using examples, explain the concepts of expectancy, instrumentality, and valence.
5. Some practitioners and researchers consider OB Mod unethical because it may be
viewed as a way of manipulation. What would be your reaction to such a criticism?
5.3 The Role of Ethics and National Culture
L E A R N I N G O B J E C T I V E S
1. Consider the role of motivation for ethical behavior.
2. Consider the role of national culture on motivation theories.
Motivation and Ethics
What motivates individuals to behave unethically? Motivation theories have
been applied to explain this interesting and important question. One theory
that has been particularly successful in explaining ethical behavior is
reinforcement theory. Just like any other behavior such as performance or
cooperation, ethical behavior is one that is learned as a result of the
consequences following one’s actions. For example, in an experiment
simulating the job of a sales manager, participants made a series of decisions
using a computer. Partway through the simulation, subjects were informed
that salespeople reporting to them were giving kickbacks to customers.
Subjects in this experiment were more likely to cut the kickbacks if there was a
threat of punishment to the manager. On the other hand, subjects playing the
sales manager were more likely to continue giving away the kickbacks if they
39
made a profit after providing the kickbacks. [1]
In a separate study highlighting
the importance of rewards and punishments, researchers found that the
severity of expected punishment was the primary predictor of whether
subjects reported inclination to behave unethically. In addition to the severity
of the punishment, the perceived likelihood of punishment was also a major
influence of ethical behavior. [2]
These findings highlight the importance of
rewards and punishments for motivating unethical behaviors.
There are many organizational situations in which individuals may do
unethical things but then experience positive consequences such as being
awarded promotions for meeting their sales quotas. For example, in many
hotels, staff members routinely receive kickbacks from restaurants or bars if
they refer customers to those locations. [3]
Similarly, sales staff rewarded with
spiffs (product-specific sales incentives) may give customers advice that goes
against their own personal beliefs and in this sense act unethically. [4]
As long
as unethical behavior is followed by positive consequences for the person in
question, we would expect unethical behavior to continue. Thus, in order to
minimize the occurrence of unethical behavior (and in some instances legal
problems), it seems important to examine the rewards and punishments that
follow unethical behavior and remove rewards following unethical behavior
while increasing the severity and likelihood of punishment.
Motivation Around the Globe
Motivation is a culturally bound topic. In other words, the factors that
motivate employees in different cultures may not be equivalent. The
motivation theories we cover in this chapter are likely to be culturally bound
because they were developed by Western researchers and the majority of the
research supporting each theory was conducted on Western subjects.
40
Based on the cultural context, Maslow’s hierarchy of needs may require
modification because the ranking of the needs may differ across cultures. For
example, a study conducted in 39 countries showed that financial satisfaction
was a stronger predictor of overall life satisfaction in developing nations
compared to industrialized nations. In industrialized nations, satisfaction with
esteem needs was a more powerful motivator than it was in developing
nations. [5]
People around the world value justice and fairness. However, what is
perceived as fair may be culturally dependent. Moreover, people in different
cultures may react differently to perceived unfairness. [6]
For example, in
cross-cultural studies, it was found that participants in low power distance
cultures such as the United States and Germany valued voice into the process
(the opportunities for explanation and appealing a decision) more than those
in high power distance cultures such as China and Mexico. At the same time,
interactional justice was valued more by the Chinese subjects. [7]
There is also
some evidence indicating that equity (rewarding employees based on their
contributions to a group) may be a culture-specific method of achieving
fairness. One study shows that Japanese subjects viewed equity as less fair and
equality-based distributions as more fair than did Australian
subjects. [8]
Similarly, subjects in different cultures varied in their inclination
to distribute rewards based on subjects’ need or age, and in cultures such as
Japan and India, a person’s need may be a relevant factor in reward
distributions. [9]
K E Y T A K E A W A Y
Motivation theories are particularly useful for understanding why employees behave
unethically. Based on reinforcement theory, people will demonstrate higher
unethical behaviors if their unethical behaviors are followed by rewards or go
41
unpunished. Similarly, according to expectancy theory, if people believe that their
unethical actions will be rewarded with desirable outcomes, they are more likely to
demonstrate unethical behaviors. In terms of culture, some of the motivation
theories are likely to be culture-bound, whereas others may more readily apply to
other cultures. Existing research shows that what is viewed as fair or unfair tends to
be culturally defined.
E X E R C I S E S
1. What is the connection between a company’s reward system and the level of ethical
behaviors?
2. Which of the motivation theories do you think would be more applicable to many
different cultures?
5.4 Conclusion In this chapter we have reviewed the basic motivation theories that have been
developed to explain motivated behavior. Several theories view motivated
behavior as attempts to satisfy needs. Based on this approach, managers
would benefit from understanding what people need so that the actions of
employees can be understood and managed. Other theories explain motivated
behavior using the cognitive processes of employees. Employees respond to
unfairness in their environment, they learn from the consequences of their
actions and repeat the behaviors that lead to positive results, and they are
motivated to exert effort if they see their actions will lead to outcomes that
would get them desired rewards. None of these theories are complete on their
own, but each theory provides us with a framework we can use to analyze,
interpret, and manage employee behaviors in the workplace.
42
5.5 Exercises
E T H I C A L D I L E M M A
Companies are interested in motivating employees: Work hard, be productive,
behave ethically—and stay healthy. Health care costs are rising, and employers are
finding that unhealthy habits such as smoking or being overweight are costing
companies big bucks.
Your company is concerned about the rising health care costs and decides to
motivate employees to adopt healthy habits. Therefore, employees are given a year
to quit smoking. If they do not quit by then, they are going to lose their jobs. New
employees will be given nicotine tests, and the company will avoid hiring new
smokers in the future. The company also wants to encourage employees to stay
healthy. For this purpose, employees will get cash incentives for weight loss. If they
do not meet the weight, cholesterol, and blood pressure standards to be issued by
the company, they will be charged extra fees for health insurance.
Is this plan ethical? Why or why not? Can you think of alternative ways to motivate
employees to adopt healthy habits?
I N D I V I D U A L E X E R C I S E
Your company provides diversity training programs to ensure that employees realize
the importance of working with a diverse workforce, are aware of the equal
employment opportunity legislation, and are capable of addressing the challenges of
working in a multicultural workforce. Participation in these programs is mandatory,
and employees are required to take the training as many times as needed until they
pass. The training program lasts one day and is usually conducted in a nice hotel
outside the workplace. Employees are paid for the time they spend in the training
program. You realize that employees are not really motivated to perform well in this
program. During the training, they put in the minimum level of effort, and most
43
participants fail the exam given at the conclusion of the training program and then
have to retake the training.
Using expectancy and reinforcement theories, explain why they may not be
motivated to perform well in the training program. Then suggest improvements in
the program so that employees are motivated to understand the material, pass the
exam, and apply the material in the workplace.
G R O U P E X E R C I S E
A Reward Allocation Decision
You are in charge of allocating a $12,000 bonus to a team that recently met an
important deadline. The team was in charge of designing a Web-based product for a
client. The project lasted a year. There were five people in the team. Your job is to
determine each person’s share from the bonus.
Devin: Project manager. He was instrumental in securing the client, coordinating
everyone’s effort, and managing relationships with the client. He put in a lot of extra
hours for this project. His annual salary is $80,000. He is independently wealthy,
drives an expensive car, and does not have any debt. He has worked for the company
for 5 years and worked for the project from the beginning.
Alice: Technical lead. She oversaw the technical aspects of the project. She resolved
many important technical issues. During the project, while some members worked
extra hours, she refused to stay at the office outside regular hours. However, she
was productive during regular work hours, and she was accessible via e-mail in the
evenings. Her salary is $50,000. She is a single mother and has a lot of debt. She has
worked for the company for 4 years and worked for the project for 8 months.
Erin: Graphic designer. She was in charge of the creative aspects of the project. She
experimented with many looks, and while doing that she slowed down the entire
44
team. Brice and Carrie were mad at her because of the many mistakes she made
during the project, but the look and feel of the project eventually appealed to the
client, which resulted in repeat business. Her salary is $30,000. She is single and lives
to party. She has worked for the company for 2 years and worked for this project
from the beginning.
Brice: Tester. He was in charge of finding the bugs in the project and ensuring that it
worked. He found many bugs, but he was not very aggressive in his testing. He
misunderstood many things, and many of the bugs he found were not really bugs but
his misuse of the system. He had a negative attitude toward the whole project, acted
very pessimistically regarding the likelihood of success, and demoralized the team.
His salary is $40,000. He has accumulated a large credit card debt. He has worked for
the company for 3 years and worked for the project in the last 6 months.
Carrie: Web developer. She was in charge of writing the code. She was frustrated
when Erin slowed down the entire project because of her experimentation. Carrie
was primarily responsible for meeting the project deadline because she put in a lot
of extra work hours. Her salary is $50,000. Her mother has ongoing health issues,
and Carrie needs money to help her. She worked for the company for the past year
and was involved in this project for 6 months.
