NETA PowerPoint Slides

to accompany

Prepared by
Cheryl Dowell,
Algonquin College,
and
Greg Cole,
Saint Marys University

Chapter 3

A Behavioural Framework
for Compensation

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Education Ltd.

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Chapter Learning Objectives

1. Identify the three main types of reward
problems that can afflict organizations.
2. Define the three key employee behaviours
desired by employers.
3. Identify three key job attitudes and explain
their roles in determining employee
behaviour.
4. Describe the causes and consequences of
reward dissatisfaction.
5. Explain how to generate membership
behaviour.
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Chapter Learning Objectives

6. Explain how to generate membership
behaviour.
7. Outline the process through which task
behaviour
is motivated.
8. Explain how to generate organizational
citizenship behaviour.
9. Discuss the role that managerial strategy
plays in determining the type of employee
attitudes and behaviour needed by an
organization.
10.Describe
the implications of the behavioural
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framework for designing effective reward

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Types of Reward Problems

Failure to produce desired behaviour

Production of desired behaviour and

undesirable consequences

Production of reward dissatisfaction

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Three Key Employee Behaviours

1. Membership behaviour occurs when
employees decide to join and remain with a firm.
2. Task behaviour occurs when employees
perform the specific tasks that have been
assigned to them.
3. Organizational citizenship behaviour occurs
when employees voluntarily undertake special
behaviours beneficial to the organization that go
beyond simple membership.
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Three Key Attitudes

1. Job satisfaction, the attitude one holds toward ones
job and workplace, either positive or negative
2. Work motivation, the attitude one holds toward good
job performance, either positive or negative. Essentially,
it is the strength of an employees desire to perform his
or her job duties well.
3. Organizational identification consists of three
interrelated elements: a sense of shared goals and
values with the organization, a sense of membership or
belongingness, and an intention to remain a member of
the organization.
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Perceived Inequity
Equity theory: employees base
perceptions of equity (fairness) on a
comparison of their contributions/rewards
ratio to the ratios of others perceived as
being similar

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Relative Deprivation Crosby Theory

Employees experience dissatisfaction with pay
when:
1

there is a discrepancy between the outcome they want and what

they actually receive.

they see that a comparison other receives more than they do.

past experience has led them to expect more than they now
receive

future expectancies for achieving better outcomes are low.

they feel that they are entitled to more.

they absolve themselves of personal responsibility for the lack of

better outcomes.

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Organizational Justice
Distribu
tive
justice

Procedu
ral
justice
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Procedural Justice:
The Pay System Must Be
consistent

procedures are applied uniformly to

different jobs and time periods

free of bias

personal interests do not enter into

application of the procedures

flexible

there must be procedures for

employees to appeal pay system
decisions

accurate

application of procedures must be

based on factual information

ethical

accepted moral principles must guide

application of the procedures

representati all affected employees must have an

ve
opportunity to express their
concerns, which are given serious
consideration by the organization
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Consequences of Reward Dissatisfaction:

Attempt to Increase Rewards
Find more rewarding job
Acquire illicit rewards
Demand higher pay / unionize
Increase effort / performance
Demand improved job duties

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Consequences of Reward Dissatisfaction:

Attempt to Reduce Contributions
Demand reduced job
duties
Reduce effort /
performance
Increased absenteeism
Find less demanding job

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Membership Behaviour: Statistics Canada

Canadian Labour Force

not interested; 30%

employed; 63%

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Causes of Membership Behaviour

Job
satisfaction

Job
attitud
es
Organizational
identification

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Organizational Commitment
Affective commitment, attachment to an
organization based on positive feelings toward the
organization
Continuance commitment, attachment to an
organization based on perceived lack of better
alternatives
Research shows no relationship between continuance
commitment and affective commitment or
between continuance commitment and job satisfaction.
However, affective commitment and job
satisfaction are related.

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Theories of Motivation
Content
Theories
theories that focus on
understanding
motivation by
identifying underlying
human needs

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Process
Theories
theories that focus on
understanding
motivation by
determining the
process humans use
to make choices about
the specific actions
they will take
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Two-Factor Theory
Job
content

Hygienes

Extrinsic
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Job
context

Motivators

Intrinsic
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Job Characteristics Theory

Task identity

the extent to which a worker performs a complete

cycle of job activities

Task
significance

the perceived importance or social value of a given

task

Skill variety

the variety of skills required for task completion

Job autonomy

the degree of freedom workers have in deciding

how to perform their jobs

Job feedback

the extent to which the job itself provides feedback

on worker performance

Job
enrichment

the process of redesigning jobs to incorporate more

of the five core dimensions of intrinsically satisfying
work

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Reinforcement Theories
A behaviour will be repeated if valued
outcomes flow from that behaviour or if
performing the behaviour reduces
undesirable outcomes.
Positive reinforcement takes place when a reward
follows a valued behaviour.
Negative reinforcement takes place when an
undesirable consequence occurs whenever the
valued behaviour does not occur.
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Expectancy Theory
1.
2.
3.

Is the task worth doing?

Do the rewards exceed the costs? Is net
valence positive?
Will I actually receive the rewards if I
accomplish
the task?
Is the instrumentality clear?
Will I actually be able to accomplish the task
if I exert the effort ?
Is my expectancy strong?

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Attribution and
Economic Theories of Motivation
Attribution theory: theory of motivation
arguing that humans often act without
understanding their motives for their behaviour
and afterward attempt to attribute motives for
their actions
Economic theory: assumes that people are
motivated only by extrinsic (economic) rewards,
and they will always seek to maximize these
rewards while minimizing their contributions to
the organization
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Agency Theory and

Money as the Motivator
Agency theory: Agents (employees) will pursue
their own self-interests rather than the interests
of their principals (employers) unless they are
closely monitored or their interests are aligned
with the interests of
their principals.
Noncash employee recognition program: a
program that provides noncash rewards to
employees in recognition of employee
accomplishments or actions
that are valued by the organization
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Causes of Citizenship Behaviour

Shared
organization
al goals

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Feelings of
membership

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Creating Citizenship Behaviour

Trust
Security

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Behavioural Implications
Define the
necessary
employee
behaviour
Determine the
necessary
employee
attributes

Task
Membership
Organizational citizenship
Personal competencies
Values
Characteristics

Identify salient
employee needs

Demographic characteristics

Ensure a
positive reward
valence

Tangible, physical
Psychological and opportunity

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Discussion Questions
1. Discuss the three main types of reward
problems. Have you ever encountered any of
these problems?
2. Discuss how employee job attitudes serve as the
link between reward systems and employee job
behaviour.
3. Discuss how reward systems can be used to
generate task behaviour, membership
behaviour, and citizenship behaviour.

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