C H A P T E R
4
F O U R
.
Applied Motivation
Practices
McGraw-Hill Ryerson
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© The McGraw-Hill Companies, Inc. 2001
IKEA’s Big Thank-You Bonus
Stephen Benson (shown) and
other IKEA employees
received a large bonus when
the company pledged an
entire day’s sales revenue to
employees. The event also
doubled previous sales
records at the Scandinavian
home furnishings retailer.
McGraw-Hill Ryerson
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S. Oatway, Calgary Herald
© The McGraw-Hill Companies, Inc. 2001
The Meaning of Money
• Money and employee needs
– affects existence, relatedness,
growth needs, as well as need for
achievement and power
• Money and attitudes
– Money ethic -- not evil, represents
success, should be budgeted
carefully
• Money and self-identity
– Partly defines who we are
© Corel Corp. With permission
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© The McGraw-Hill Companies, Inc. 2001
Types of Organizational Rewards
• Membership and senioritybased rewards
• Job status-based rewards
• Competency-based
rewards
• Performance-based
rewards
© Corel Corp. With permission
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© The McGraw-Hill Companies, Inc. 2001
Membership/Seniority Based Rewards
• Fixed wages, seniority increases
• Advantages
– guaranteed wages may attract job
applicants
– seniority-based rewards reduce turnover
• Disadvantages
– doesn’t motivate job performance
– discourages poor performers from leaving
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Job Status-Based Rewards
• Includes job evaluation and status perks
• Advantages:
– job evaluation tries to maintain pay equity
– motivates competition for promotions
• Disadvantages:
– employees exaggerate duties, hoard
resources
– creates psychological distance across
hierarchy
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Competency-Based Rewards
• Underlying characteristics that lead to
superior performance
• Skill-based pay
– pay increases with skill modules learned
• Advantages
– More flexible work force, better quality,
consistent with employability
• Disadvantages
– Potentially subjective, higher training costs
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Performance-Based Rewards
Organizational
rewards
• Share ownership
• Share options
• Profit sharing
Team
rewards
• Gainsharing
• Special bonuses
•
Individual •
rewards •
•
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Piece rate
Commissions
Merit pay
Bonuses
© The McGraw-Hill Companies, Inc. 2001
Performance Reward Effectiveness
• Positive effects
• Create an “ownership culture”
• Adjusts pay with firm's prosperity
• Negative effects
•
•
•
•
Rewards undermine intrinsic motivation
Rewards rupture relationships
Rewards are quick fixes
Rewards discourage risk taking
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Improving Reward Effectiveness
• Link rewards to performance
• Ensure rewards are relevant
• Team rewards for
interdependent jobs
• Ensure rewards are valued
• Beware of unintended
consequences
© Corel Corp. With permission
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© The McGraw-Hill Companies, Inc. 2001
Job Design
• Assigning tasks to a job, including the
interdependency of those tasks with other
jobs
• Technology doesn’t determine job scope
• Employees expected to perform a variety of
work (employability)
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Evaluating Job Specialization
Advantages
Disadvantages
• Job boredom
• Less time changing
tasks
• Discontentment pay
• Lower training costs
• Lower quality
• Job mastered quickly
• Lower motivation
• Better person-job
matching
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Job Characteristics Model
Core Job
Characteristics
Critical
Psychological
States
Outcomes
Work
motivation
Skill variety
Task identity
Task significance
Meaningfulness
Autonomy
Responsibility
General
satisfaction
Feedback
from job
Knowledge
of results
Work
effectiveness
Growth
satisfaction
Individual
differences
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James Walton’s Work Motivation
As founder of Vancouver-based
Storm Brewing Ltd., James
Walton has plenty of motivational
potential in his job. He performs
a variety of tasks, has a lot of
autonomy, completes work from
beginning to end, sees the value
of his product in the marketplace,
and gets feedback from the work
itself.
McGraw-Hill Ryerson
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Ian Lindsay, Vancouver Sun
© The McGraw-Hill Companies, Inc. 2001
Job Design Strategies
• Job rotation
– Moving from one job to
another
• Job enlargement
– increasing number of tasks
performed within a job
• Job enrichment
– Increasing employee
autonomy and the resulting
feelings of responsibility
McGraw-Hill Ryerson
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Ian Lindsay, Vancouver Sun
© The McGraw-Hill Companies, Inc. 2001
Job Rotation vs
vs.. Job Enlargement
Job Rotation
Job 1
Operate Camera
Job 2
Operate Sound
Job 3
Report Story
Job Enlargement
Job 1
Job 2
Job 3
Operate Camera
Operate Sound
Report Story
Operate Camera
Operate Sound
Report Story
Operate Camera
Operate Sound
Report Story
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© The McGraw-Hill Companies, Inc. 2001
Job Enrichment Strategies
• Empowering employees
– giving employees more autonomy
– feeling of control and self-efficacy
• Forming natural work units
– completing an entire task
– assigning employees to specific clients
• Establishing client relationships
– employees put in direct contact with clients
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Obstacles to Job Design
• Difficult to accurately measure job
characteristics
• More team than individual job design
• Resistance to change
• Problem finding optimal level of
enrichment and specialization
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Elements of Self-Leadership
Personal
Goal Setting
Constructive
Thought
Patterns
Designing
Natural
Rewards
SelfMonitoring
SelfReinforcement
• Personal goal setting
– Employees set their own goals
– Apply effective goal setting practices
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© The McGraw-Hill Companies, Inc. 2001
Elements of Self-Leadership
Constructive
Personal
Thought
Goal Setting
Patterns
Designing
Natural
Rewards
SelfMonitoring
SelfReinforcement
• Positive self-talk
– Talking to ourselves about thoughts/actions
– Potentially increases self-efficacy
• Mental imagery
– Mentally practising a task
– Visualizing successful task completion
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© The McGraw-Hill Companies, Inc. 2001
Elements of Self-Leadership
Constructive
Personal
Thought
Goal Setting
Patterns
Designing
Natural
Rewards
SelfMonitoring
SelfReinforcement
• Finding ways to make the job itself more
motivating
– eg. altering the way the task is
accomplished
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© The McGraw-Hill Companies, Inc. 2001
Elements of Self-Leadership
Constructive
Personal
Thought
Goal Setting
Patterns
Designing
Natural
Rewards
SelfMonitoring
SelfReinforcement
• Keeping track of your progress toward
the self-set goal
– Looking for naturally-occurring feedback
– Designing artifical feedback
McGraw-Hill Ryerson
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© The McGraw-Hill Companies, Inc. 2001
Elements of Self-Leadership
Constructive
Personal
Thought
Goal Setting
Patterns
Designing
Natural
Rewards
SelfMonitoring
SelfReinforcement
• “Taking” a reinforcer only after
completing a self-set goal
– eg. Watching a movie after writing two more
sections of a report
– eg. Starting a fun task after completing a
task that you don’t like
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C H A P T E R
4
F O U R
.
Applied Motivation
Practices
McGraw-Hill Ryerson
24
© The McGraw-Hill Companies, Inc. 2001