Motivating
Employees
11
This may sound soft and mushy,
but happy people are better for
business. They are more creative
and productive, they build
environments where success is
more likely, and you have a
much better chance of keeping
your best players.
—Shelly Lazarus, CEO,
Ogilvy & Mather Worldwide
McGraw-Hill/Irwin
Copyright © 2008 by The McGraw-Hill Companies, Inc. All rights reserved.
Learning Objectives
1. Identify the relationship between motivation and
performance.
2. Describe content theories of motivation.
3. Describe process theories of motivation.
4. Explain when financial incentives are likely to motivate
employees.
5. Describe pay plans using financial incentives.
6. Discuss the pros and cons of keeping pay information
secret.
7. Identify ways supervisors can motivate their employees.
11-2
How Does Motivation Work?
Motivation + Ability = Performance
• Familiarity with the best-known theories can
help supervisors think of ways to motivate
employees.
• None of the theories are perfect, but all give
supervisors some guidance.
11-3
Content Theories
• Content theories focus on the content of the
motivators.
• Three researchers whose content theories of
motivation are widely used:
• Abraham Maslow
• David McClelland
• Frederick Herzberg
11-4
Maslow’s Hierarchy of Needs
11-5
Share of 945 U.S. Companies
Offering Flexible Work Options
11-6
McClelland’s Achievement-PowerAffiliation Theory
1. The need for achievement – the desire to
do something better than it has been done
before.
2. The need for power – the desire to control,
influence, or be responsible for other
people.
3. The need for affiliation – the desire to
maintain close and friendly personal
relationships.
11-7
Herzberg’s Two-Factor Theory
• Hygiene Factors
• Company policy and
administration
• Supervision
• Relationship with
supervisor
• Relationship with peers
• Working conditions
• Salary and benefits
• Relationship with
subordinates
• Motivating Factors
• Opportunity for
achievement
• Opportunity for
recognition
• Work itself
• Responsibility
• Advancement
• Personal growth
11-8
Process Theories
• Process theories look at the process of
motivation instead of specific motivators.
• Two major process theories:
• Vroom’s expectancy-valency theory
• Skinner’s reinforcement theory
11-9
Vroom’s ExpectancyValence Theory
• Victor Vroom decided that the degree to which
people are motivated to act in a certain way
depends on two things:
• Valence – the value a person places on the outcome of a
particular behavior.
• Expectancy – the perceived probability that the
behavior will lead to the outcome.
Strength of Motivation =
Perceived Value of Outcome x
Perceived Probability of Outcome Resulting
11-10
Skinner’s Reinforcement Theory
• The reinforcement theory maintains that
people’s behavior is influenced largely by
the consequences of their past behavior.
• Reinforcement theory implies that
supervisors can encourage or discourage a
particular kind of behavior by the way they
respond to the behavior.
• Reinforcement
• Punishment
11-11
Motivation Theories and the Law
• Federal laws set requirements for
overtime pay, rest breaks, health insurance
for retirees, and many other areas.
• The Family and Medical Leave Act can
pose a significant challenge to planning
and scheduling because of an employee’s
leave.
11-12
Money as a Motivator
• When money motivates
• Money motivates people when it meets their
needs.
• Pay plans using financial incentives
• Piecework system
• Production bonus system
• Commissions
• Payments for suggestions
11-13
Group Incentive Plans
• Profit-sharing plan
Group incentive plan
• Under this kind of plan, the company
sets aside a share of its profits earned A financial incentive
during a given period and divides these plan that rewards a
team of workers for
profits among the employees.
• Gainsharing
meeting or exceeding
an objective.
• The company encourages employees
to participate in making suggestions
and decisions about improving the way
the company or work group operates.
As performance improves, employees
receive a share of the greater earnings.
11-14
Secrecy of Wage and
Salary Information
• In private (nongovernment) organizations,
employees generally do not know one another’s
earnings.
• Government employees’ earnings are public
information.
• In private organizations, a typical compromise
between maintaining privacy and sharing
information is for the organization to publish pay
ranges so employees know what they can
potentially expect to earn.
11-15
How Supervisors Can Motivate
• Making work interesting
• Job rotation
• Job enlargement
• Job enrichment
• Having high expectations
• Pygmalion effect
• Providing rewards that are valued
• The content theories of motivation indicate that a
variety of rewards may motivate, but that not all
employees will value the same rewards at the same time
11-16
How Supervisors Can
Motivate (continued)
• Relating rewards to performance
• The rewards a supervisor uses should be linked to employee
performance.
• Rewards are most likely to motivate employees when the
employees view them as achievable.
• Treating employees as individuals
• A supervisor who wishes to succeed at motivating has to
remember that employees will respond in varying ways.
• When a particular type of motivation does not seem to work
with an employee, a supervisor should try some other
motivator to see if it better matches the employee’s needs.
11-17
Job Characteristics Rated
Important by U.S. Workers
11-18
How Supervisors Can
Motivate (continued)
• Encouraging employee participation
• Employees tend to feel more committed when they can
contribute to decisions and solutions.
• Asking subordinates for their advice about how tasks
should be accomplished is another way to increase their
involvement.
• Providing feedback
• Part of a supervisor’s job is to give employees feedback
about their performance.
• Praise is an important kind of feedback.
11-19
Summary
• To perform well, employees must be motivated.
• Content theories of motivation attempt to identify
what motivates people.
• Maslow’s hierarchy of needs
• McClelland’s achievement-power-affiliation theory
• Herzberg’s two-factor theory
• Process theories explain how motivation works
through its process.
• Money motivates people when it meets their
needs.
11-20
Summary (continued)
• The way a pay plan is structured can influence the degree
to which employees are motivated to perform well. Some
pay plans offer bonuses, commissions, or other kinds of
pay for meeting or exceeding objectives.
• Supervisors can motivate employees by making work
interesting, having high expectations of employees,
providing rewards that are valued, relating rewards to
performance, treating employees as individuals,
encouraging employee participation, and providing
feedback, including praise.
• By publishing pay ranges, employees do not know how
much specific individuals earn, but the ranges show what
they can expect to earn if they get a raise, promotion, or
transfer to another position.
11-21