C H A P T E R
5
Foundations
of employee
motivation
 2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione
Chapter learning objectives
1. Distinguish between content and process theories.
2. Compare the four content theories of motivation.
3. Discuss the practical implications of content
motivation theories.
4. Explain how each component of expectancy
theory influences work effort.
5. Discuss the implications of expectancy theory.
6. Explain how employees react to inequity.
7. Describe the six characteristics of effective goal
setting.
 2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione
2
Challenges of motivating employees
 Changing workforce
 younger generation employees have different needs
and expectations to baby boomers
 people have more diverse values – results in more
variety in what motivates employees
 Cultural values
 globalisation has added to diversity
 2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione
3
Content versus process theories
 Content theories
 explain why people have different needs at different
times
 Process theories
 describe the processes through which needs are
translated into behaviour
 2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione
4
Needs hierarchy theory
Needs hierarchy
theory
Selfactualisation
Esteem
Belongingness
 Maslow arranged five needs in a
hierarchy
 Satisfaction-progression process
 People who experience selfactualisation desire more rather
than less of this need
Safety
Physiological
 2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione
5
ERG theory
Needs hierarchy
theory
ERG
theory
Selfactualisation
Growth
Esteem
Belongingness
Relatedness
 Alderfer’s model has
three sets of needs
 Adds frustrationregression process to
Maslow’s model
Safety
Existence
Physiological
 2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione
6
Content theories of motivation
Needs hierarchy
theory
ERG
theory
Motivatorhygiene McClelland’s
theory
learned needs
Selfactualisation
Need for
achievement
Growth
Motivators
Need for
power
Esteem
Belongingness
Need for
affiliation
Relatedness
Hygienes
Safety
Existence
Physiological
 2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione
7
Creating a company of entrepreneurs
 Companies support entrepreneurship by
 clarifying the firm’s purpose and shared values
 supporting and reinforcing entrepreneurial
behaviour
 creating small businesses within the larger
organisation
 2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione
8
Implications of content theories
 Match rewards with employee needs
 Offer employees a choice of rewards
 people have different needs at different times
 Limit use of financial rewards as a source of
motivation
 2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione
9
Expectancy theory of motivation
E-to-P
expectancy
P-to-O
expectancy
Outcomes
and valences
Outcome 1
+ or -
Effort
Performance
Outcome 2
+ or -
Outcome 3
+ or -
 2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione
10
Expectancy theory in practice
 Increasing E-to-P expectancy
 training, selection, resources, clarify roles, provide
coaching and feedback
 Increasing P-to-O expectancy
 measure performance accurately, explain how rewards
are based on past performance
 Increasing outcome valences
 use valued rewards, individualise rewards, minimise
countervalent outcomes
 2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione
11
Elements of equity theory
 Outcome/input ratio
 inputs  what employee contributes (eg skill)
 outcomes  what employees receive (eg pay)
 Comparison other
 person/people with whom we compare ratio
 not easily identifiable
 Equity evaluation
 compare outcome/input ratio with the comparison
other
 2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione
12
Overreward vs underreward inequity
Comparison
other
Overreward
inequity
Outcomes
Outcomes
Inputs
Underreward
inequity
You
Inputs
Outcomes
Outcomes
Inputs
Inputs
 2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione
13
Consequences of inequity
 Change inputs
 Change outcomes
 Change perceptions
 Leave the field
 Act on the comparison other
 Change the comparison other
 2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione
14
Equity sensitivity
 Benevolents
 tolerant of being underrewarded
 Equity sensitives
 want ratio to be equal to the comparison other
 Entitleds
 prefer receiving proportionately more than others
 2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione
15
Goal setting at ICICI
ICICI embraces goal setting
through its management-byobjectives process. The Indian
financial services company
sets tough corporate-wide
objectives at the beginning of
the year and cascades them
down to each work unit and
employee.
Courtesy of Jennifer Speirs
 2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione
16
Effective goal setting
Specific
Relevant
Challenging
Commitment
Task
effort
Task
performance
Participation
Challenging
 2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione
17
Effect of goal difficulty on performance
Task performance
High
Low
Area of
optimal
goal
difficulty
Moderate
Challenging
Impossible
Goal difficulty
 2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione
18
Overview of the next chapter
 The meaning of money in the workplace
 Advantages and disadvantages of the four
types of rewards
 Five ways to improve reward effectiveness
 Advantages and disadvantages of job
specialisation
 Job characteristics model of job design
 Three strategies to enrich jobs
 Five elements of self-leadership
 2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione
19
C H A P T E R
5
Foundations
of employee
motivation
 2003 McGraw-Hill Australia Pty Ltd PPTs t/a Organisational Behaviour on the Pacific Rim by McShane and Travaglione