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What are we going to cover
What is motivation
Nature / characteristics of motivation
Classification of motivation
What are motives
Classification of motives
Theories of Work Motivation
Maslow's theory of need hierarchy
Herzberg's two-factor theory
Mc Gregors theory
Vrooms Expectancy theory
Porter Lawler model
Morale - Definition
Relationship with productivity
Morale Indicators
What is motivation?
Motivation is a Latin word, which means to move.
It is the willingness of an individual to respond to

organisational requirements.
Koontz ODonnell defines it as a general term applying

to the entire class of drives, desires, needs wishes &
similar forces that induce an individual or a group of
people at work.
What is motivation?
It can also be defined as a willingness to expend
energy to achieve a goal or a reward. It is a force that
activates dormant energies & sets in motion the
action of people. It is the function that kindles a
burning passion for action among the human beings
of an organisation.
Performance = Ability x Motivation
What is motivation?
It is a process which starts with a physiological or

psychological deficiency or need that activates or a
drive that is aimed at a goal or incentive.
Needs: are created when there is a deprivation or

deficiency. Here, a physiological or psychological
imbalance exists.
Drives or motives: Drives are deficiencies with

direction. They are action oriented & provide a thrust
towards achieving an incentive or goal.
What is motivation?
Incentive or goal: Attaining an incentive will restore the

balance. After achieving the goal, needs & drives will
be reduced.
Needs Drives Incentive

or motives or Goal
1. Unending process: human wants keep changing &
increasing.
2. A psychological concept: deals with the human

mind.
3. Whole individual is motivated: as it is based on

psychology of the individual.
4. Motivation may be financial or non-financial:

Financial includes increasing wages, allowance,
bonus, perquisites etc.
5. Motivation can be positive or negative: positive

motivation means use of incentives - financial or
non-financial. Egs. of positive motivation:
confirmation, pay rise, praise etc. Negative
motivation means emphasizing penalties. It is
based on force of fear. Eg. demotion, termination.
6. Motivation: motivation & job satisfaction are
different. Motivation is goal-oriented behaviour.
Job satisfaction is the outcome of job performance.
Classification of motivation
1. Positive and negative
2. Financial and non financial
3. Extrinsic and intrinsic:
Extrinsic motivation is available only after completion

of the job. Eg. increase in wages, rest periods,
holidays etc.
Intrinsic motivation is available at the time of
performance of a job. Eg. praise, recognition,
delegation of authority & responsibility.
What are motives?
A motive is an inner state that energizes, activates, or
moves & directs, channels behaviour towards goals.
Motives can be classified as:

1. Primary motives
2. General motives
3. Secondary motives
Primary motives:
Also called physiological / biological / unlearned
motives. 2 criteria for the motive to be primary are
that they should be unlearned & physiological.
Eg. hunger, thirst, sleep, avoidance of pain, sex &

material concern.
Primary motives tend to reduce the tension or

stimulation.
General motives:
Are ones which are unlearned but are not
physiologically based.
These needs induce the person to increase the amount

of stimulation.
Eg. curiosity, manipulation, activity & affection
Secondary motives:
These are the most important w.r.t. the study of O.B.
A motive must be learned in order to be a secondary
one.
These drives are closely tied to the learning concepts,

such as motives for power, achievement, affiliation
referred to as n Pow, n Ach, n Aff.
Security & status are also secondary motives.
Examples of key secondary needs:

Need for Achievement:
Doing better than competitors
Attaining a difficult goal
Solving a complex problem
Need for power:

Controlling people & activities
Being in a position of authority over others
Defeating an opponent
Need for affiliation:
Being liked by many people
Working with people who are friendly & co-operative
Participating in pleasant social activities
Need for security:

Having a secure job
Having protection against illness & disability
Avoiding tasks or decision with a risk of failure & blame
Need for status:
Working for the right company in the right job
Having a degree from the right university
Having the right privileges
Maslow's theory of need hierarchy:
Abraham Maslow, an American psychologist, viewed

the motivation of human beings as arising from
levels of hierarchy of needs.
According to him, each one of us is a wanting being.
His basic assumptions were:
1. All human needs cannot be satisfied, because, if
one need is satisfied, another arises.
2. A satisfied need does not motivate behaviour. eg.

need for food motivates only till one gets food.
3. Some needs are innate (natural / inherent) eg. the
need for food & water; while some are acquired
from social experiences eg. need for social esteem.
4. Human beings attempt to satisfy their needs in a

specific order, based on hierarchy.
Maslows hierarchy of needs
Self
actualization
needs
Esteem needs
Social needs
Safety & security needs
Physiological needs
Maslow explained each level of hierarchy as follows:
1. Physiological needs:
These are necessary to sustain life. They include food,
water, clothing, shelter.
These needs have the highest potency for motivation.
A person who lacks these will be motivated by these.
2. Safety needs:
When physiological needs are reasonably satisfied,
safety needs begin to manifest themselves.
These needs include protection from physical dangers,
such as fire or accident.
Economic security, security of income against
contingencies such as sickness, injury, non-hostile
working atmosphere are also safety needs.
3. Social needs:
When physiological & safety needs are reasonably
satisfied, social needs become important
motivators.
Man is a social being & wants to receive & give

acceptance, friendship & affection.
He feels the need for belonging, for being an accepted

member of a formal or an informal group.
4. Esteem needs:
When the first three needs are essentially satisfied,
esteem needs become dominant.
The person must feel important & must also receive
recognition from others, as that recognition
supports the feelings of personal worth.
Thus feelings of self-esteem, self-confidence, prestige &
power are produced which are related to
enhancing competence, knowledge &
achievement.
5. Self actualization needs:
At the summit of the hierarchy is the need to realize
ones potentialities so as to satisfy what Maslow
referred to as the desire to become everything
that one is capable of becoming.
Thus the person becomes interested in self-fulfillment,

self-development, & creativity in the broadest
sense of the term.
Criticisms of Maslows theory:

1. Hierarchy cannot be regarded as rigid. For some
people, the levels may not be clearcut & may tend
to overlap.
2. Some individuals may lack ambition & may remain

at the primary levels of the hierarchy concerned
only with physiological & safety needs.
3. The order suggested by Maslow may not be
applicable to everybody.
4. A single need cannot motivate an individual. There

may be several & that too in combinations,
existing.
Hence the theory may not have universal validity.
To be continued ..
Mc Gregors theory
Porter Lawler model
Morale - Definition
Relationship with productivity
Morale Indicators
Theories of Work Motivation contd.
Mc Gregors theory
Porter Lawler model also imp, not written in syll.
Morale - Definition
Effects of Morale
Relationship of morale with productivity
Morale Indicators
Herzberg's two-factor theory:
Frederick Herzberg, in the late 1950s conducted a study
on motivation. He and his associates used semi-
structured interviews to elicit from 200 engineers
& accountants in Pittsburgh area, the factors which
satisfy or dissatisfy the workers.
His study revealed that factors responsible for job

satisfaction are quite different from those
responsible for job dissatisfaction.
Certain factors give job satisfaction, but absence of

these does not mean job dissatisfaction. It only
means no job satisfaction.
Similarly, certain factors cause job dissatisfaction, but

absence of these does not mean job satisfaction. It
only means no job dissatisfaction.
According to Herzberg, motivational factors are

responsible for job satisfaction; and Hygiene or
Maintenance factors are responsible for job
dissatisfaction.
Motivational factors:
The presence of these factors motivates workers & at
the same time, absence of these does not cause
dissatisfaction.
Hygiene or Maintenance factors:

The presence of these factors maintains motivation at
zero level, but absence of these factors causes
serious dissatisfaction.
In other words, presence of these factors prevents

dissatisfaction.
Maintaining motivation at zero level thus prevents

negative motivation, hence they are called
maintenance factors. http://caindwarka.com/
Motivators Hygiene factors
Achievement Co. policy & admn.

Work itself Interpersonal relations
Recognition Supervision
Responsibility Money
Advancement Job security
Possibility of growth Status
Working conditions
Herzbergs framework is compatible with Maslows

need hierarchy. Maslows lower order needs are
analogous to Herzbergs hygiene factors & his upper
level needs correspond to Herzbergs motivators.
Herzbergs theory was also challenged by the thought

that there exists a tendency of people to attribute
good results to their own effort & blame others for
poor results.
Douglas Mc Gregors X & Y theory:

Theory X :
This theory assumes that most people prefer to be
directed, are not interested in assuming
responsibility & want safety above all.
Accompanying this philosophy is the belief that work is

inherently distasteful to most people & people are
motivated by money & the threat of punishment.
Managers who accept Theory X assumptions, attempt
to structure, control & closely supervise their
subordinates.
Theory Y:
This theory assumes that people are not by nature lazy
& unreliable. Man can be self-directed & creative at
work, if properly motivated.
Managers who accept this theory, attempt to help their
employees mature, by exposing them to
progressively less control, allowing them to assume
more self-control.
Employees are able to achieve the satisfaction of social

esteem & self-actualization needs with this kind of
environment.
Theory X Theory Y
1. Workers dislike to work
1. Workers feel that work
by themselves. is as natural as play.
2. Workers are not ready2. Workers are ready to
to accept responsibility.
accept responsibility if
proper motivation is
available to them.
3. Workers prefer to be 3. Workers are directed by
directed by others. themselves.
Theory X Theory Y
4. Workers are 4. Workers are ambitious.
unambitious.
5. Workers by nature 5. Workers are ready to
resist change & want cope up with changes.
security.
6. Workers lack creativity 6. Workers have a high
& fail to solve degree of creativity &
organisational problems. succeed in solving
organisational problems.
Theory X Theory Y
7. Focus is on the lower 7. Focus is on both the
level needs of workers i.e. lower level needs & higher
physiological & safety level needs of workers i.e.
social, esteem & self-
actualisation.
8. Strict control is 8. Workers exercise self-
necessary to achieve control & self-direction to
organisational objectives. achieve organisational
objectives.
Theory X Theory Y
9. Authority is not 9. Authority is delegated.
delegated.
10. Autocratic leadership 10. Democratic leadership
is followed. is followed.
Vrooms Expectancy theory:

The model is built around the concepts of valence,
instrumentality & expectancy & is commonly called
VIE theory.
By valence, Vroom means the strength of an

individuals preference for a particular outcome.
Valence is positive when a person prefers attaining the
outcome to not attaining it.
Valence is zero when the individual is indifferent

towards the outcome.
Valence is negative when a person prefers not attaining

the outcome to attaining it.
Another major input into the valence is the
instrumentality of the first level outcome in obtaining
a desired second level outcome.
Eg. person would be motivated towards superior

performance because of the desire to be promoted.
The superior performance (first level outcome) is
seen as being instrumental in obtaining a promotion
(second level outcome).
Another important variable is Expectancy. It relates
efforts to first level outcomes; while instrumentality
relates first level & second level outcomes.
So, expectancy is the probability (ranging from 0 to 1)
that a particular action or effort will lead to a
particular first level outcome.
Instrumentality refers to the degree to which a first
level outcome will lead to a desired second level
outcome.
Strength of motivation to perform a certain act will
depend on the algebraic sum of the products of the
valences of outcome (which include instrumentality)
times the expectancies.
Motivational force F:
F = Valence x Expectancy
VIE theory Instrumentalities
Expectancy
Second level
First level outcomes
outcomes
Outcome 1 a
Outcome 1
Outcome 1 b
Motivational
Force F Outcome 2 a
Outcome 2 Outcome 2 b
Outcome 2 c
Eg. of VIE Instrumentalities
theory Expectancy
that the Second level
workers First level outcomes
will achieve outcomes
the orgnal Personal goals
goals Production i.e. money,
standard recognition,
Motivation i.e. the security
Of organisational
workers goal
This model can clarify the relationship between

individual & organisational goals. Eg. suppose
workers are given a certain standard of production.
By measuring the workers output, mgt can determine

how imp. their personal goals are, the
instrumentality of the organisational goal in attaining
their personal goals & the workers expectancies that
their effort & ability will accomplish the
organisational goals.
If the output is below standard, it may be that workers

do not give high importance to the second level
outcome;
or they may not see the first level outcome being
instrumental in achieving the second level outcome;
or they may think that their efforts will not accomplish
the first level outcome.
Anyone or a combination of these possibilities will

result in low motivation, according to Vroom.
Morale
What is Morale?
The dictionary meaning is mood & spirit. High morale
means an enthusiastic, confident feeling with respect
to individual or group achievement.
In employment, morale refers to the participative

attitudes towards achievement of organisational
objectives. It means team spirit & togetherness of
people for a common purpose.
What is Morale?
It is defined as the capacity of a group of people to pull
together persistently (i.e. tirelessly, patiently) &
consistently (again & again) in the pursuit of a
common purpose.
What is Morale?
It consists of 3 different aspects:
1. Feeling of being accepted by ones work group

2. Sharing common goals with ones group
3. Having confidence in the desirability of these goals.
What is Morale?
Individual & group morale:
An individuals morale is related with knowing ones
expectations & living up to them.
It reflects the individuals attitude towards life.
Group morale reflects the group feeling a group

assessment of conditions esprit de corps (team
spirit)
Effects of Morale
Relationship of morale with productivity:
There are various schools of thought on this concept.
Some believe that high morale is related to high

productivity & vice-versa.
Some believe that morale is not related to productivity.

Effects of Morale
Miller & Form have given 4 combinations of morale &
productivity:
1. High productivity high morale

2. Low productivity high morale
3. High productivity low morale
4. Low productivity low morale
Effects of Morale
High productivity high morale: this situation occurs

when group goals (pride in work group, group
recognition) & individual goals (freedom on work,
good wages, job interest) are satisfied leading to
high motivation, high productivity & high morale.
Effects of Morale
Low productivity high morale: individual goals only

are satisfied. Individual behaviour is determined by
informal groups causing restriction of output,
where supervisors lack technical & administrative
skills & where workers lack adequate skills.
Effects of Morale
High productivity low morale: in this situation,
supervisor is only able to increase productivity
through his skills or planning ability by use of
penalty (loss of pay or loss of job) rather than
motivating the workers.
Low productivity low morale: occurs when opposite

factors to situation 1 arise.
Morale Indicators
1. Organisation itself: goals, public reputation,

organisational structure
2. Nature of work: routine or specialised, stress
3. Level of satisfaction: is determined by

opportunity for advancement, job security,
opportunity to learn, use new ideas, co-operation
of fellow employees, working hours, recognition,
communication.
Morale Indicators
4. Supervision received: high rate of turnover

indicates a poor leadership.
5. Perception of the self: Morale of employees who

lack self-confidence or who suffer from a poor
physical or mental health is generally low.
6. Employees perception of past awards & future

opportunities for rewards: whether fair,
satisfactory
Morale Indicators
7. Employees age: Earlier belief was that there exists

a U shaped relation between age & morale
initially high, then low & again high.
But, today it is believed that there is a direct

relationship high morale with high age, because
of stability, serious attitude towards work,
reliability, less absenteeism, sense of responsibility.
Morale Indicators
8. Employees educational level & occupational level:

Inverse relation exists between educational level &
morale. Higher the education, less satisfaction
because employee compares his attainment with
others.
But a high educational level gives the opportunity to be

high in the ladder, hence satisfaction must be
derived by the individual.
Morale Indicators
Occupational level: also influences morale. Eg.

executives are more satisfied than managers,
managers are more satisfied than the subordinates
etc.
To sum up..
A managers success depends on how well he

can motivate his subordinates & boost
their morale to give their best & also keep
them satisfied.
Motivation is one of the key tools for the

success of any enterprise.
McClelland Achievement
Motivation Theory
What is Motivation?
The word 'motivation' comes from the
Latin word meaning 'to move
External motivation: bonus, work conditions

(getting the office with the window)
An inner (self-motivation) or outer drive to
meet a need or goal
Why is Motivation Important?
It is one of the three key elements in
performance
Performance = f {Ability x Motivation x

Opportunity}
Ability refers to a natural talent to do something mental
or physical
Motivation is not a stable individual characteristic.
Motivation is not a trait.
Opportunity refers to the different situations that
workers may find themselves in.
McClelland's Achievement
Motivation
McClelland's Achievement Motivation
Theory is based upon the idea that people
have an achievement need. An
achievement need is the need to be
successful and to receive recognition for
your success.
3 characteristics of people
1. Need for Achievement - doing innovative,
new, interesting and challenging things.
2. Need for Affiliation - the need for
feedback / contact with others.
3. Need for Power - the need for
responsibility, or to be responsible for
others.
McClelland's experiment
-- The Thematic Apperception Test (TAT) --
It consisted of showing individuals a series of
pictures and asking them to give brief
descriptions of what was happening in the
pictures. The responses were analysed in terms
of the presence or absence of certain themes.
The themes McClelland and his associates were
looking for revolved around the following
motivators: achievement, affiliation and power.
THEMATIC APPERCEPTION TEST
The Thematic Apperception Test or TAT is

amongst the most widely used, researched, and
taught psychological tests
TAT was developed by the American psychologist

Henry A. Murray and Christina D. Morgan at
during the 1930s to explore the underlying
dynamics of personality, such as internal
conflicts, dominant drives and interests and
motives.
It uses a standard series of 31 provocative yet
ambiguous pictures about which the subject
must tell a story.
A subject is asked questions such as: What
dialogue might be carried on between
characters? How might the "story" continue after
the picture shown?
For this reason, the TAT is also known as the

'picture interpretation technique'.
Today, the TAT is widely used as a tool for
research around areas of psychology such as
dreams, fantasies and what motivates people to
choose their occupation.
Sometimes it is used in a psychiatric context to

assess disordered thinking, in forensic
examinations to evaluate crime suspects or to
screen candidates for high-stress occupations.
THE NEXT FEW SLIDES WILL CONTAIN SOME
PICTURES.
THEIR MEANING WILL DIFFER FROM PERSON TO
PERSON AS THEY WILL BE INTEPRETED ACOORDING
TO INDIVIDUAL PERCEPTION
Achievement
The need for achievement is characterised by the

wish to take responsibility for finding solutions to
problems, master complex tasks, set goals, get
feedback on level of success.
THE NEED FOR ACHIEVEMENT (N-ACH)
The n-ach person is 'achievement motivated'

and therefore:
seeks achievement,
attainment of realistic but challenging goals,
advancement in the job.
There is a strong need for feedback as to
achievement and progress, accompained with
a need for a sense of accomplishment.
Affiliation
The need for affiliation is characterised by
a desire to belong, an enjoyment of
teamwork, a concern about interpersonal
relationships, and a need to reduce
uncertainty.
THE NEED FOR AFFILIATION (N-AFFIL)
The n-affil person is 'affiliation motivated',
He has a need for friendly relationships and is
motivated towards interaction with other
people.
The affiliation driver produces motivation and
need to be liked and held in popular regard.
These people are team players.
Power (Influence)
The need for power is characterised by a
drive to control and influence others, a
need to win arguments, a need to
persuade and prevail.
THE NEED FOR AUTHORITY AND POWER (N-
POW)
The n-pow person is 'authority motivated'. This
driver produces a need to be
influential,
effective
to make an impact.
There is a strong need to lead and for their ideas to
prevail.
There is also motivation and need towards increasing
personal status and prestige.
TYPES OF POWER
A persons need for power is of two types
PERSONAL POWER
Those who need Personal Power want to
direct others, which is often perceived as
undesirable.
INSTITUTIONAL POWER
Persons who need Institutional power or

Social Power want to organise the efforts of
others to further the goals of the organisation.
Managers with high need for institutional
power tend to be more effective managers as
compared to those with high Personal Power.
Need for Achievement and
Entrepreneurship
McClelland further described the profile of
an entrepreneur as someone high in
achievement motivation and low in power
motivation, while good managers have
high power motivation and low
achievement motivation.
What Is Motivation?
Direction
Intensity Persistence
Why Rewards Often Fail to Motivate
Too much emphasis on monetary rewards
Rewards lack an appreciation effect
Extensive benefits become entitlements
Counterproductive behavior is rewarded
Too long a delay between performance and
rewards
Too many one-size-fits-all rewards
Use of one-shot rewards with a short-lived
motivational impact
Continued use of demotivating practices
such as layoffs, across-the-board
raises and cuts, and excessive
executive compensation
Contingent Consequences in Operant Conditioning
Nature of Consequences
Positive or Pleasing Negative or Displeasing

Behavior-Consequence Relationship
Positive Reinforcement Punishment

Contingent Behavioral outcome: Behavioral outcome:
Presentation Target behavior occurs Target behavior occurs
more often. less often.
Punishment Negative Reinforcement

Contingent (Response Cost) Behavioral outcome:
Withdrawal Behavioral outcome: Target behavior occurs
Target behavior occurs more often.
less often.
(no contingent consequence)
Extinction
Behavioral outcome:
Target behavior occurs less often
Schedules of Reinforcement
Schedule Description
Continuous Reinforcer follows every response
(CRF)
Intermittent Reinforcer does not follow every response
Fixed ratio (FR) A fixed number of responses must be

emitted before reinforcement occurs.
Variable ratio (VR) A varying or random number of responses

must be emitted before reinforcement occurs.
Fixed interval (FI) The first response after a specific period of

time has elapsed is reinforced
Variable interval (VI) The first response after varying or random

periods of time have elapsed is reinforced.
Maslows
Hierarchy
Self
of Needs
Esteem
Social
Safety
Physiological
Herzbergs Two-Factor Theory
Hygiene Factors Motivational Factors

Quality of supervision Career Advancement
Rate of pay Personal growth
Company policies
Recognition
Working conditions
Relations with others Responsibility
Job security Achievement
High Job Dissatisfaction 0 Job Satisfaction High

Alderfers ERG Theory
Existence Growth
Relatedness
Need for The Theory
Achievement
(nAch) of Needs
Need for
Power
(nPow)
Need for David

Affiliation McClelland
(nAff)
Cognitive Evaluation
Intrinsic Extrinsic
Motivators Motivators
The Job Characteristics Model
Core job Critical

characteristics psychological Outcomes
states
*Skill variety *Experienced *High internal

*Task identity meaningfulness of the work
*Task work motivation
significance *Experienced *High growth
responsibility for satisfaction
*Autonomy outcomes of the work *High general
*Feedback from *Knowledge of the actual job satisfaction
job results of the work *High work
activities effectiveness
Moderators
1. Knowledge and skill
2. Growth need strength
3. Context satisfactions
Approaches to Job Design
1. The Mechanistic Approach focuses on identifying the
most efficient way to perform a job. Employees are trained
and rewarded to perform their jobs accordingly.
2. Motivational Approaches these techniques (job
enlargement, job rotation, job enrichment, and job
characteristics) attempt to improve employees affective and
attitudinal reactions and behavioral outcomes.
3. Biological and Perceptual- Motor Approaches
Biological techniques focus on reducing employees physical
strain, effort, fatigue, and health complaints. The Perceptual-
Motor Approach emphasizes the reliability of work outcomes
by examining error rates, accidents, and workers feedback
about facilities and equipment.
Skills and Best Practices: Applying the Job
Characteristics Model
1. Diagnose the level of employee motivation and

job. satisfaction and consider redesigning jobs
when motivation ranges from low to moderate.
2. Determine whether job redesign is appropriate in a
given context.
3. Redesign jobs by including employees input.
Equity Theory
Ratio Employees
Comparison* Perception
Outcomes A < Outcomes B Inequity (Under-Rewarded)
Inputs A Inputs B
Outcomes A = Outcomes B Equity
Inputs A Inputs B
Outcomes A > Outcomes B Inequity (Over-Rewarded)
Inputs A Inputs B
*Where A is the employee, and B is a relevant other or referent.

Negative and Positive Inequity
A. An Equitable Situation
Other
Self
$2 $4
= $2 per hour = $2 per hour
1 hour 2 hours
Negative and Positive Inequity (cont)
B. Negative Inequity
Self Other
$2 $3
1 hour 1 hour
Negative and Positive Inequity (cont)
C. Positive Inequity
Other
Self
$3 $2
1 hour 1 hours
Organizational Justice
Distributive Justice: The perceived fairness of

how resources and rewards are distributed.
Procedural Justice: The perceived fairness of the
process and procedures used to make allocation
decisions.
Interactional Justice:
The perceived fairness of
the decision makers
behavior in the process of
decision making.
Research into Equity
Distributive Procedural
Justice Justice
Amount and Perceived

Allocation Fairness of the
of Rewards Distribution Process
Equity Sensitivity
Equity Sensitivity is an individuals tolerance for
negative and positive equity.
Benevolents
Sensitives
Entitleds
Motivation Theories
Are Culture Bound
Hierarchy Need for

of Needs Achievement
Equity Theory
Expectancy Theory
Individual 1 Individual 2 Organizational

Effort Performance Rewards
1. Effort-performance relationship
Personal
2. Performance-rewards relationship
Goals
3. Rewards-personal goals relationship
Vrooms Expectancy Theory Concepts
Expectancy: Belief that effort leads to a specific

level of performance
Instrumentality: A performance outcome

perception.
Valence: The Value of a reward or outcome

Managerial Implications of
Expectancy Theory
Determine the outcomes employees value.

Identify good performance so appropriate behaviors
can be rewarded.
Make sure employees can achieve targeted
performance levels.
Link desired outcomes to targeted levels of
performance.
Make sure changes in outcomes are large enough
to motivate high effort.
Monitor the reward system for inequities.
Organizational Implications of
Expectancy Theory
Reward people for desired performance, and do not keep
pay decisions secret.
Design challenging jobs.
Tie some rewards to group accomplishments to build
teamwork and encourage cooperation.
Reward managers for creating, monitoring, and maintaining
expectancies, instrumentalities, and oucomes that lead to
high effort and goal attainment.
Monitor employee motivation through interviews or
anonymous questionnaires.
Accommodate individual differences by building flexibility
into the motivation program.
Goal-Setting Theory
Specificity Commitment
Challenge Self-efficacy
Feedback Characteristics
Participation Culture
Insights from Goal-Setting Research
Difficult Goals Lead to Higher Performance.
- Easy goals produce low effort because the goal is too easy to
achieve.
- Impossible goals ultimately lead to lower performance
because people begin to experience failure.
Specific Difficult Goals Lead to Higher Performance for Simple
Rather Than Complex Tasks.
- Goal specificity pertains to the quantifiability of a goal.
- Specific difficult goals impair performance on novel, complex
tasks when employees do not have clear strategies for
solving these types of problems.
Feedback Enhances The Effect of Specific, Difficult Goals.
- Goals and feedback should be used together.
Insights from Goal-Setting Research
(continued)
Participative Goals, Assigned Goals, and Self-Set Goals Are
Equally Effective.
- Managers should set goals by using a contingency approach.
Different methods work in different situations.
Goal Commitment and Monetary Incentives Affect Goal-
Setting Outcomes.
- Difficult goals lead to higher performance when employees
are committed to their goals.
- Difficult goals lead to lower performance when employees
are not committed to their goals.
- Goal based incentives can lead to negative outcomes for
employees in complex, interdependent jobs requiring
cooperation.
Guidelines for Writing SMART
Goals
Specific
Measurable
Attainable
Results oriented
Time bound
An Integrative Model of Motivation
High
nAch
Equity
Ability
Comparison
Opportunity Performance O O
Appraisal Criteria IA IB
Individual Individual Organization Personal

Effort Performance Rewards Goals
Performance Reinforcement Dominant

Appraisal Needs
System
Goals Direct
Behavior
Special Motivation Issues
Professionals
Contingent workers
Diversified workforce
Low-skilled service workers
Highly repetitive tasks

MOTIVATION
What is motivation ?
It is a result of interaction between the
individual and the situation
The word Motivation has been derived
from a Latin word movere meaning to
move.
Stephen Robbins defines motivation as
the process that accounts for an
individuals intensity, direction and
persistence of effort towards attaining a
goal
Intensity How hard?
Direction Where are the efforts going ?
Persistence How long?
According to Fred Luthans motivation is
a process that starts with physiological and
psychological deficiency or need that
activates a behavior or a drive that is aimed
at a goal or incentive
Needs : are created where there is
physiological or psychological imbalance.
Drives : or motives are set up to alleviate
needs
Incentives : are anything that will
alleviate a need & reduce the drive.
Types of motives
Primary Motives
General Motives
Secondary Motives
Primary Motives
Primary Motives are unlearned and
physiologically based.
These motives not necessarily take
precedence over general and secondary
motive.
E.g. Hunger, thirst, avoidance of
pain, maternal concerns and physical
needs.
General Motives
General Motives are unlearned but
not physiologically based.
Unlike primary motives, they induce
the amount of stimulation.
E.g. Curiosity, manipulation, activity
and affection.
Secondary Motives
Secondary Motives are learned and
not physiologically based.
E.g. Power, achievement, affiliation
security and status.
Secondary Motive Power motive
Need for power
Influencing people to change their
attitudes or behavior
Controlling people and activities
Being in a position of authority over
others.
Gaining control over information &
resources
Defeating an opponent or enemy.
Secondary Motive Achievement motive
Need for achievement
Doing better than competitors
Attaining or surpassing a difficult goal
Solving a complex problem
Carrying out a challenging assignment
successfully
Developing a better way to do
something.
Secondary Motive Affiliation motive
Need for affiliation
Being liked by many people
Being accepted as a part of the group /
team
Maintaining harmonious relations and
avoiding conflicts
Participating in pleasant social activities.
Secondary Motive Security motive
Need for security
Having a secure job
Being protected against loss of income
Having protection against illness or
disability
Avoiding tasks or decisions with a risk of
failure and blame.
Security is basically based on fear or
loss of something.
Secondary Motive Status motive
Status is defined as relative ranking
that a person holds in the group,
organization or society.
Status may be high or low
Secondary Motive Status motive
Need for status
Having the right car and clothes
Working for the right job and right
company
Having a degree from the right
university
Living in the right neighborhood and
having the membership of the right club
Having executive privileges.
THEORIES
OF
MOTIVATION
Maslows hierarchy of needs Theory.
Herzbergs two-factor theory.
Victor Vrooms theory.
Porter and Lawlers theory.

Abraham Maslows
hierarchy of needs theory
It is based on the following propositions;
Man is a wanting being
Satisfied need is not a motivator
The needs of a man has hierarchy or
importance.
Abraham Maslows
hierarchy of needs theory
Lower
Self
order Actualization
needs
Esteem needs
Social Needs
Safety Needs
Physiological Needs
Few weaknesses
It states that lower level people are able to
satisfy lower order needs and higher level
people are able to satisfy higher order needs
It ignores the fact that an act may be

motivated by several needs and not any
single need.
Fredrick Herzbergs
Two-factor Theory
He conducted a motivational study on 200
accountants and engineers
He made use of critical incident method
for analyzing data
Questions :
When did you feel particularly good about
your job?
When did you feel exceptionally bad about
your job ?
Frederick Herzbergs
Two-factor Theory
The good feelings = Job experience / job
content
The bad feelings = Job surroundings / job
context
Job content factors = Motivators
Job context factors = Hygiene
Hygiene Factors Motivators
Company policy and Achievement
administration Recognition
Supervision Work itself
Salary Responsibility
Interpersonal Advancement.
relationships
Working conditions.
Hygiene factors prevent dissatisfaction, but do not

lead to satisfaction.
Few weaknesses
There is always a question regarding the
samples used by Herzberg
Low-complexity job workers
Age
The varied situations may affect
preferences for motivators.
Victor Vrooms
Expectancy theory of motivation
Expectancy theory An employee will be
argues that the motivated to exert high
strength of the level of effort when
tendency to act in a
certain way depends he/she believes that the
on effort will lead to a good
performance appraisal;
the strength of an that a good appraisal will
expectation that the lead to organizational
act will be followed rewards such as a bonus,
by a given outcome salary increments or
and promotion;
on the attractiveness
of that outcome to the and that the rewards will
individual. satisfy the employees
personal goals.
This theory focuses on three relationships;

Valence : Effort performance
Expectancy : Performance reward
Instrumentality : Rewards personal goals
Let us see the applicability
If I give a max. effort, will it be recognized in my
performance appraisal?
If I get a good performance appraisal, will it
lead to organizational rewards?
if I am rewarded, are the rewards the ones that I
find personally attractive?
Weakness
Like other theories, this too is a model
that helps managers understand certain
aspects of motivation, but
it does not give practical solutions to
solve motivational problems.
EXTRINSIC INTRINSIC
Pay Feeling of
Benefits responsibility
Promotions Achievement
Transfers Constant learning
Insurance Taking challenges
Perceived
Value of
Abilities Equitable
reward
rewards
Intrinsic
Performance rewards
Effort (accomplish Satisfaction
-ments)
Extrinsic
rewards
Perceived
Role
effort-reward
perception
probability
Chapter 4
Motivating
Self and Others
Theories of Motivation
1. What is motivation?
2. How do needs motivate people?
3. Are there other ways to motivate people?
4. Do equity and fairness matter?
5. How can rewards and job design motivate
employees?
6. What kinds of mistakes are made in reward
systems?
What is Motivation?
Motivation
The processes that account for an individuals
intensity, direction, and persistence of effort
toward attaining a goal
Theory X and Theory Y
Theory X
Theory Y
Motivators
Intrinsic
Extrinsic
Needs Theories of Motivation
Basic idea:
Individuals have needs that, when unsatisfied, will
result in motivation
Maslows Hierarchy of Needs
Motivation-Hygiene theory
Alderfers ERG theory
McClellands Theory of Needs
Physiological
Safety
Social
Esteem
Self-actualization
Exhibit 4-1
Self-
actualization
Esteem
Social
Safety
Physiological
Herzbergs Motivation-Hygiene Theory
Hygiene factors - necessary, but not sufficient,
for healthy adjustment
Extrinsic factors; context of work
Motivators - the sources of satisfaction
Intrinsic factors; content of work
Comparison of Satisfiers and Dissatisfiers
Source: Reprinted by permission

of Harvard Business Review. An
exhibit from Frederick
Herzberg, One More Time:
How Do You Motivate
Employees? Harvard Business
Review 81, no. 1 (January 2003),
p. 90. Copyright 1987 by the
President and Fellows of
Harvard College; all rights
reserved.
Criticisms of Motivation-Hygiene
Theory
The procedure that Herzberg used is limited by its
methodology
The reliability of Herzbergs methodology is
questioned
Herzberg did not really produce a theory of
motivation
No overall measure of satisfaction was used
The theory is inconsistent with previous research
Existence
Relatedness
Growth
Need for Achievement
Need for Power
Need for Affiliation
Exhibit 4-4 Summarizing the Various
Needs Theories
Maslow Alderfer Herzberg McClelland

Self-Actualization
Growth Motivators Need for Achievement
Esteem
Need for Power
Affiliation Relatedness
Hygiene
Security Factors
Existence
Physiological
Summary: Hierarchy of Needs
Maslow
Herzberg
Alderfer
McClelland
Summary: Impact of Theory
Maslow
Herzberg
Alderfer
McClelland
Summary: Support and Criticism of
Theory
Maslow
Herzberg
Alderfer
McClelland
Process Theories of Motivation
Look at the actual process of motivation
Expectancy theory
Goal-setting theory
Expectancy Theory
The theory that individuals act depending on whether
their effort will lead to good performance, whether good
performance will be followed by a given outcome, and
whether that outcome is attractive to them.
Expectancy Relationships
The theory focuses on three relationships:
Effort-performance relationship
Performance-reward relationship
Rewards-personal goals relationship
Exhibit 4-5 How Does Expectancy
Theory Work?
My professor offers me $1 million if I memorize the textbook by tomorrow morning.
Expectancy Instrumentality Valence
Effort Performance Link Performance Rewards Link Rewards Personal Goals Link
No matter how much effort My professor does not look There are a lot of wonderful things
I put in, probably not possible like someone who has $1 million I could do with $1 million
to memorize the text in 24 hours
E=0 I=0 V=1
Conclusion: Though I value the reward, I will not be motivated to do this task.
Exhibit 4-6
Steps to Increasing Motivation, Using
Expectancy Theory
Improving Expectancy Improving Instrumentality Improving Valence
Improve the ability of the Increase the individuals belief that Make sure that the reward is
individual to perform performance will lead to reward meaningful to the individual
Make sure employees have skills Observe and recognize performance Ask employees what rewards they
for the task Deliver rewards as promised value
Provide training Indicate to employees how previous Give rewards that are valued
Assign reasonable tasks and goals good performance led to greater
rewards
Goal-Setting Theory
The theory that specific and difficult goals lead to
higher performance.
Goals tell an employee what needs to be done and how much
effort will need to be expended.
Specific hard goals produce a higher level of output than does
the generalized goal of do your best.
How Does Goal Setting Motivate?
Goals:
Direct attention
Regulate effort
Increase persistence
Encourage the development of strategies and
action plans
Chapter 4, Nancy Langton and Stephen

P. Robbins, Fundamentals of
Organizational Behaviour, Third
Canadian Edition
4-178
Goals Should Be SMART
For goals to be effective, they should be
SMART:

Canadian Edition
4-179
Exhibit 4-7 Lockes Model of
Goal Setting
Directing attention
Goals Regulating effort

Task
motivate
performance
by . . . Increasing persistence
Encouraging the development

of strategies and action plans
Source: Adapted from E. A. Locke and G. P. Latham, A Theory of Goal Setting and Task
Performance (Englewood Cliffs, NJ: Prentice Hall, 1980). Reprinted by permission of Edwin A.
Locke.

Canadian Edition
4-180
Contingency Factors in
Goal Setting
Self-efficacy
An individuals belief that he or she is capable of
performing a task.

Canadian Edition
4-181
Management by Objectives
A program that encompasses
Specific goals
Participative decision-making
Explicit time period
Performance feedback
XYZ Company
Overall
Organizational
Objectives
Cascading
Objectives Divisional
Objectives
Consumer Products Industrial Products
Division Division
Departmental Sales
Objectives
Production Customer Marketing Develop
Service Research
Individual
Objectives
Responses to the Reward System
Equity Theory
Fair Process
Equity Theory
Main points
Individuals compare their job inputs and
outcomes with those of others and then
respond so as to eliminate any inequities.
Equity theory recognizes that individuals are
concerned not only with the absolute amount
of rewards for their efforts, but also with the
relationship of this amount to what others
receive.
Exhibit 4-7 Equity Theory
Ratio of Output to Input Person 1s Perception
Person 1
Inequity, underrewarded
Person 2
Person 1
Equity
Person 2
Person 1
Inequity, overrewarded
Person 2
Responses to Inequity
Change Inputs
Change Outcomes
Adjust Perceptions of Self
Adjust Perceptions of Others
Choose a Different Referent
Leave the Field
Fair Process and Treatment
Historically, equity theory focused on:
Distributive justice
However, equity should also consider
Procedural justice
Distributive Justice
Procedural Justice
Interactional Justice
Motivators
Intrinsic
Extrinsic
Four Key Rewards to Increase Intrinsic
Motivation
1. Choice
2. Competence
3. Meaningfulness
4. Progress
Exhibit 4-9 Building Blocks for Intrinsic
Rewards
Leading for Choice Leading for Competence
Delegated authority Knowledge

Trust in workers Positive feedback
Security (no punishment) for honest mistakes Skill recognition
A clear purpose Challenge
Information High, non-comparative standards
Leading for Meaningfulness Leading for Progress
A noncynical climate A collaborative climate

Clearly identified passions Milestones
An exciting vision Celebrations
Relevant task purposes Access to customers
Whole tasks Measurement of improvement
Source: Reprinted with permission of the publisher. From Intrinsic Motivation at Work: Building Energy and
Commitment. Copyright K. Thomas. Berrett-Koehler Publishers Inc., San Francisco, CA. All rights reserved.
www.bkconnection.com.
Variable-Pay Programs
A portion of an employees pay is based on
some individual and/or organizational
measure of performance.
Individual-based
Group-based
Organizational-based
Exhibit 4-11 Comparing Various Pay
Programs
Designing Motivating Jobs
Job Characteristic Model (JCM) is a model that identifies five
core job dimensions and their relationship to personal and
work outcomes.
Job Enrichment
JCM Core Job Dimensions
Skill variety
Task identity
Task significance
Autonomy
Feedback
JCM Critical Psychological States
Experienced meaningfulness
Experienced responsibility for outcomes
Knowledge of the actual results
Exhibit 4-12 Examples of High and
Low Job Characteristics
Skill Variety
Task Identity
Task Significance
Autonomy
Feedback
Exhibit 4-13 The Job
Characteristics Model
Core job Critical Personal and

dimensions psychological states work outcomes
Skill variety Experienced High internal

Task identity meaningfulness work motivation
Task significance of the work
High-quality
Experienced work performance
Autonomy responsibility
for outcomes
High satisfaction
of the work
with the work
Knowledge of the Low absenteeism

Feedback actual results of Source: J. R. Hackman, G. R.
and turnover
the work activities Oldham, Work Design (excerpted
from pages 78-80). Copyright
1980 by Addison-Wesley
Publishing Co. Reprinted by
Employee growth- permission of Addison-Wesley
Longman.
need strength
Beware the Signals That Are Sent By
Rewards
Often reward systems do not reflect
organizational goals:
Individuals are stuck in old patterns of rewards
and recognition.
Organizations dont look at the big picture.
Management and shareholders focus on short-
term results.
Exhibit 4-10
Management Reward Follies
We hope for: But we reward:

Teamwork and collaboration The best individual team members
Innovative thinking and risk taking Proven methods and no mistakes
Development of people skills Technical achievements and
accomplishments
Employee involvement and
empowerment Tight control over operations,
resources
High achievement
Another years efforts
Long-term growth
Quarterly earnings
Commitment to total quality
Shipment on schedule, even with
Candor defects
Reporting good news
Why Do Managers Engage in Reward
Follies?
Stuck in old patterns of rewards and
recognition
Dont look at the big picture
Focus on short-term results
Caveat Emptor: Apply Motivation
Theories Wisely
Motivation Theories Are Culture-Bound
Canada and US rely on extrinsic rewards more
than other countries.
Japan and Germany rarely use individual
incentives.
China is more likely to give bonuses to everyone.
Can We Just Eliminate Rewards?
Alfie Kohn suggests that organizations should focus less
on rewards, more on creating motivating environments:
Abolish Incentives.
Re-evaluate Evaluation.
Create Conditions for Authentic Motivation.
Encourage Collaboration.
Enhance Content.
Provide Choice.
Putting It All Together
What we know about motivating employees in organizations:
Recognize individual differences.
Employees have different needs.
Dont treat them all alike.
Spend the time necessary to understand whats important to each
employee.
Use goals and feedback.
Allow employees to participate in decisions that affect them.
Link rewards to performance.
Check the system for equity.
Summary and Implications
1. What is Motivation?
Motivation is the process that accounts for an
individuals intensity, direction, and persistence
of effort toward reaching the goal.
All needs theories of motivation propose a
similar idea: individuals have needs that, when
unsatisfied, will result in motivation.

Process theories focus on the broader picture of how
someone can set about motivating another individual.
Process theories include expectancy theory and goal-
setting theory (and its application, management by
objectives).
Individuals look for fairness in the reward system.
Rewards should be perceived by employees as related
to the inputs they bring to the job.
5. How can rewards and job design motivate employees?
Recognition helps employees feel that they matter. Employers
can use variable-pay programs to reward performance.
Employers can use job design to motivate employees. Jobs that
have variety, autonomy, feedback, and similar complex task
characteristics tend to be more motivating for employees.
6. What kinds of mistakes are made in reward systems?
Often reward systems do not reward the performance that is
expected. Also, reward systems sometimes do not recognize that
rewards are culture-bound.
Summary
Need Theories
Be aware that individuals differ in their levels and types of
needs
Goal Setting Theory
Clear and difficult goals lead to higher levels of employee
productivity.
Expectancy Theory
Offers a relatively powerful explanation of employee
productivity, absenteeism, and turnover.
Summary
Equity Theory
Strongest when predicting absence and turnover behaviours.
Weakest when predicting differences in employee
productivity.
Cognitive Evaluation Theory
When you give extrinsic rewards for behaviour that had been
previously intrinsically rewarded this can result in a decrease
in the overall level of motivation.
Chapter 4
Motivating
Self and Others
Motivating Self and Others
Questions for Consideration

1. What is motivation?
5. Are there tips for motivating people for different goals?
6. How do you motivate for individual differences?
7. What kinds of mistakes are made in reward systems?
8. Do motivational theories work the same in every country?
9. Could rewards be overrated?
What is Motivation?
Motivation
The processes that account for an individuals
intensity, direction, and persistence of effort
toward attaining a goal
Intensity: how hard a person tries
Direction: where effort is channeled
Persistence: how long effort is maintained
Theory X and Theory Y
Theory X
The assumption that employees dislike work, will attempt
to avoid it, and must be coerced, controlled, or threatened
with punishment if they are to perform.
Theory Y
The assumption that employees like work, are creative,
seek responsibility, and can exercise self-direction and self-
control.
Motivators
Intrinsic
A persons internal desire to do something, due to
such things as interest, challenge, and personal
satisfaction.
Extrinsic
Motivation that comes from outside the person,
such as pay, bonuses, and other tangible rewards.
Needs Theories of Motivation
Basic idea:
Individuals have needs that, when unsatisfied, will
result in motivation
Maslows hierarchy of needs
Herzbergs two factor theory (motivation-hygiene
theory)
Alderfers ERG theory
McClellands theory of needs
Physiological
Includes hunger, thirst, shelter, sex and other
bodily needs
Safety
Includes security and protection from physical
and emotional harm
Social
Includes affection, belongingness, acceptance,
and friendship
Esteem
Includes internal esteem factors such as self-
respect, autonomy, and achievement; and
external esteem factors such as status,
recognition, and attention
Self-actualization
The drive to become what one is capable of
becoming; includes growth, achieving ones
potential, and self-fulfilment
Exhibit 4-1
Self-
actualization
Esteem
Social
Safety
Physiological
Hygiene factors - necessary, but not sufficient,
for healthy adjustment
Extrinsic factors; context of work
Company policy and administration
Unhappy relationship with employee's supervisor
Poor interpersonal relations with one's peers
Poor working conditions
Motivators - the sources of satisfaction

Intrinsic factors; content of work
Achievement
Recognition
Challenging, varied or interesting work
Responsibility
Advancement
Exhibit 4-2 Contrasting Views of
Satisfaction and Dissatisfaction
Traditional view
Dissatisfaction Satisfaction
Herzberg's view
Motivators
No Satisfaction Satisfaction
Hygiene Factors
Dissatisfaction No dissatisfaction
Criticisms of Motivation-Hygiene
Theory
The procedure that Herzberg used is limited by its
methodology
The reliability of Herzbergs methodology is
questioned
Herzberg did not really produce a theory of
motivation
No overall measure of satisfaction was used
The theory is inconsistent with previous research
Existence
Concerned with providing basic material existence
requirements
Relatedness
Desire for maintaining important interpersonal
relationships
Growth
Intrinsic desire for personal development
Need for Achievement
The drive to excel, to achieve in relation to a set of
standards, to strive to succeed
Need for Power
The need to make others behave in a way that they would
not have behaved otherwise
The desire for friendly and close interpersonal
relationships
Exhibit 4-4 Summarizing the Various
Needs Theories
Maslow Alderfer Herzberg McClelland

Self-Actualization
Growth Motivators Need for Achievement
Esteem
Need for Power
Affiliation Relatedness
Hygiene
Security Factors
Existence
Physiological
Summary: Hierarchy of Needs
Maslow: Argues that lower-order needs must be satisfied before one
progresses to higher-order needs.
Herzberg: Hygiene factors must be met if person is not to be
dissatisfied. They will not lead to satisfaction, however. Motivators
lead to satisfaction.
Alderfer: More than one need can be important at the same time. If a
higher-order need is not being met, the desire to satisfy a lower-level
need increases.
McClelland: People vary in the types of needs they have. Their
motivation and how well they perform in a work situation are related
to whether they have a need for achievement, affiliation, or power.
Summary: Impact of Theory
Maslow: Enjoys wide recognition among practising managers.
Most managers are familiar with it.
Herzberg: The popularity of giving workers greater responsibility
for planning and controlling their work can be attributed to his
findings. Shows that more than one need may operate at the
same time.
Alderfer: Seen as a more valid version of the need hierarchy.
Tells us that achievers will be motivated by jobs that offer
personal responsibility, feedback, and moderate risks.
McClelland: Tells us that high need achievers do not necessarily
make good managers, since high achievers are more interested
in how they do personally.
Summary: Support and Criticism of
Theory
Maslow: Research does not generally validate the theory.
In particular, there is little support for the hierarchical
nature of needs. Criticized for how data were collected and
interpreted.
Herzberg: Not really a theory of motivation: Assumes a link
between satisfaction and productivity that was not
measured or demonstrated.
Alderfer: Ignores situational variables.
McClelland: Mixed empirical support, but theory is
consistent with our knowledge of individual differences
among people. Good empirical support, particularly on
needs achievement.
Process Theories of Motivation
Look at the actual process of motivation
Expectancy theory
Goal-setting theory
Expectancy Theory
The strength of a tendency to act in a certain way
depends on the strength of an expectation that the
act will be followed by a given outcome and on the
attractiveness of that outcome to the individual.
Expectancy Relationships
The theory focuses on three relationships:
Effort-performance relationship
The perceived probability that exerting a given amount of effort
will lead to performance.
Performance-reward relationship
The degree to which the individual believes that performing at a
particular level will lead to a desired outcome.
Rewards-personal goals relationship
The degree to which organizational rewards satisfy an individuals
personal goals or needs and are attractive to the individual.
Exhibit 4-5 How Does Expectancy
Theory Work?
My professor offers me $1 million if I memorize the textbook by tomorrow morning.
Expectancy Instrumentality Valence
Effort Performance Link Performance Rewards Link Rewards Personal Goals Link
No matter how much effort My professor does not look There are a lot of wonderful things
I put in, probably not possible like someone who has $1 million I could do with $1 million
to memorize the text in 24 hours
E=0 I=0 V=1
Conclusion: Though I value the reward, I will not be motivated to do this task.
Exhibit 4-6
Steps to Increasing Motivation, Using
Expectancy Theory
Improving Expectancy Improving Instrumentality Improving Valence
Improve the ability of the Increase the individuals belief that Make sure that the reward is
individual to perform performance will lead to reward meaningful to the individual
Make sure employees have skills Observe and recognize performance Ask employees what rewards they
for the task Deliver rewards as promised value
Provide training Indicate to employees how previous Give rewards that are valued
Assign reasonable tasks and goals good performance led to greater
rewards
Goal-Setting Theory
The theory that specific and difficult goals lead to
higher performance.
Goals tell an employee what needs to be done and how much
effort will need to be expended.
Specific goals increase performance
Difficult goals, when accepted, result in higher performance than
do easy goals
Feedback leads to higher performance than does nonfeedback.
Specific hard goals produce a higher level of output than does
the generalized goal of do your best.
The specificity of the goal itself acts as an internal stimulus.
Management by Objectives
A program that encompasses
Specific goals
Participative decision-making
Explicit time period
Performance feedback
Responses to the Reward System
Equity Theory
Fair Process
Equity Theory
Main points
Individuals compare their job inputs and
outcomes with those of others and then
respond so as to eliminate any inequities.
Equity theory recognizes that individuals are
concerned not only with the absolute amount
of rewards for their efforts, but also with the
relationship of this amount to what others
receive.
Exhibit 4-7 Equity Theory
Ratio of Output to Input Person 1s Perception
Person 1
Inequity, underrewarded
Person 2
Person 1
Equity
Person 2
Person 1
Inequity, overrewarded
Person 2
Equity Comparisons
Self-inside
Self-outside
Other-inside
Other-outside
Responses to Inequity
Change Inputs
Change Outcomes
Adjust Perceptions of Self
Adjust Perceptions of Others
Choose a Different Referent
Leave the Field
Historically, equity theory focused on:
Distributive justice
However, equity should also consider
Procedural justice
Fair Process
Distributive Justice
Perceived fairness of the amount and allocation of rewards
among individuals
Procedural Justice
Perceived fairness of the process used to determine the
distribution of rewards
Interactional Justice
The quality of the interpersonal treatment received from
another
Motivating to Show People Matter
Employee Recognition Programs
Programs that use multiple sources and recognizes both
individual and group accomplishments.
Linking Programs and Reinforcement Theory
Consistent with reinforcement theory, rewarding a
behaviour with recognition immediately following that
behaviour is likely to encourage its repetition.
Employee Recognition Programs in Practice
In contrast to most other motivators, recognizing an
employees superior performance often costs little or no
money, making them highly attractive to industry.
Variable Pay Programs
A portion of an employees pay is based on some
individual and/or organizational measure(s) of
performance.
Individual-based
Piece-rate wages, bonuses
Workers are paid a fixed sum for each unit of production
completed.
Group-based
Gainsharing: an incentive plan where improvements in group
productivity determine the total amount of money that is
allocated.
Variable Pay Programs
Organizational-based
Profit-sharing: organization wide programs that distribute
compensation based on some established formula designed
around a companys profitability.
Employee stock ownership plans (ESOPs): company-established
benefit plans in which employees acquire stock as part of their
benefits.
Exhibit 4-8 Comparing Various Pay
Programs
Approach Strengths Weaknesses
Variable Motivates for performance. Individuals do not always have

pay Cost-effective. control over factors that affect
productivity.
Makes a clear link between
organizational goals and individual Earnings vary from year to year.
rewards. Can cause unhealthy competition
among employees.
Team- Encourages individuals to work Difficult to evaluate team

based pay together effectively. performance sometimes.
Promotes goal of team-based Equity problems could arise if all
work. members paid equally.
Skill-based Increases the skill levels of Employers may end up paying for
pay employees. unneeded skills.
Increases the flexibility of the Employees may not be able to
workforce. learn some skills, and thus feel
Can reduce the number of demotivated.
employees needed.
Variable-Pay Programs
Linking variable-pay plans and expectancy theory
Evidence supports the importance of this linkage,
especially for operative employees working under piece-
rate systems.
Group and organization wide incentives reinforce and
encourage employees to sublimate personal goals for the
best interests of their department or organization.
Rewards for Other Types of
Performance
Commissions beyond sales
Customer satisfaction and/or sales team outcomes, such as
meeting revenue or profit targets.
Leadership effectiveness
Employee satisfaction, or how the manager handles his or
her employees.
New goals
All employees who contribute to specific organizational
goals, such as customer satisfaction, cycle time, or quality
measures.
Rewards for Other Types of
Performance
Knowledge workers in teams
Performance of knowledge workers and/or professional
employees who work on teams.
Competency and/or skills
Abstract knowledge or competenciesfor example,
knowledge of technology, the international business
context, customer service, or social skills.
Motivating Specific Groups
Professionals
Contingent workers
Low-skilled service workers
Unionized employees
Public sector employees
Motivating Professionals
How are professionals different?
Receive a great deal of intrinsic satisfaction from
their work.
Strong and long-term commitment to their field of
expertise
Well paid/ Chief reward is work itself.
Value support
More focused on work as central life interest.
Motivating Professionals
How do we motivate professionals?
Provide challenging projects
Give them autonomy in follow interests and
structure work.
Reward with educational opportunities.
Recognize their contributions.
Motivating Contingent Workers
No simple solutions to motivating contingent
workers.
Contingent or temporary workers have little or no job
security/stability, therefore they dont identify with the
organization or display the commitment of permanent
employees.
Contingent or temporary workers are typically provided
with little or no health care, pensions, or similar benefits.
Motivating Contingent Workers
Greatest motivating factor is the opportunity
to gain permanent employment.
Motivation is also increased if the employee
sees that the job he or she is doing for the
firm can develop salable skills.
Motivating Low-Skilled Service
Workers
Many 15- to 24-year-olds have McJobs with pay
levels near minimum wage
To motivate
Employees want more respect
Make jobs more appealing
Raise pay levels
Find unusual ways to motivate:
Flexible work schedules
Broader responsibility for inventory, scheduling, and hiring
Creation of a family atmosphere among employees
Motivating Unionized Employees
Constraints of contract affect some forms of rewards
Some unions against pay-for-performance
Additional ideas
Create better work environments
Show appreciation
Provide opportunities for training and advancement
Listen to employees concerns
Motivating Public Sector Employees
Special challenge
Much work is service-oriented, harder to measure
productivity
Hard to link rewards to performance
What to do
Goal setting helps
Goal difficulty and goal specificity help improve
motivation
Exhibit 4-10
Management Reward Follies
We hope for: But we reward:

Teamwork and collaboration The best individual team members
Innovative thinking and risk taking Proven methods and no mistakes
Development of people skills Technical achievements and
accomplishments
Employee involvement and
empowerment Tight control over operations,
resources
High achievement
Another years efforts
Long-term growth
Quarterly earnings
Commitment to total quality
Shipment on schedule, even with
Candor defects
Reporting good news
Why Do Managers Engage in Reward
Follies?
Stuck in old patterns of rewards and
recognition
Stick to rewarding things that can be easily
measured
Dont look at the big picture
Subunits compete with each other
Focus on short-term results
Cross-Cultural Differences in
Motivation
Canada and US rely on extrinsic rewards more
than other countries
Japan and Germany rarely use individual
incentives
Japan emphasizes group rewards
China more likely to give bonuses to everyone
Exhibit 4-11 Snapshots of Cultural
Differences in Motivation
Japan:Sales representatives preferred being members of a successful

team with shared goals and values, rather than financial rewards.
Russia:Cotton mill employees given either valued extrinsic rewards

(North American T-shirts with logos, childrens sweatpants, tapes of
North American music, etc.) or praise and rewards were more productive.
However, rewards did not help for those who worked on
Saturdays.
China: Bonuses often given to everyone, r egardless of individual

productivity. Many employees expect jobs for life, rather than jobs based
on performance.
Mexico: Employees prefer immediate feedback on their work. Therefore

daily rewards for exceeding quotas are preferred.
Canada and the United States:Managers rely more heavily on extrinsic

motivators.
Japan and Germany:Firms rarely give rewards based on individual

performance.
Are Rewards Overrated? Cognitive
Evaluation Theory
Allocating extrinsic rewards for behaviour that
had been previously intrinsically rewarded
tends to decrease the overall level of
motivation.
Abolishing Rewards
Alfie Kohn suggests that organizations should focus
less on rewards, more on creating motivating
environments
Abolish incentives
Re-evaluate evaluation
Create conditions for authentic motivation
Collaboration
Content
Choice
Summary
Need Theories
Be aware that individuals differ in their levels and types of
needs
Goal Setting Theory
Clear and difficult goals lead to higher levels of employee
productivity.
Expectancy Theory
Offers a relatively powerful explanation of employee
productivity, absenteeism, and turnover.
Summary
Equity Theory
Strongest when predicting absence and turnover
behaviours.
Weakest when predicting differences in employee
productivity.
When you give extrinsic rewards for behaviour that had
been previously intrinsically rewarded this can result in a
decrease in the overall level of motivation.
Implications
Recognize Individual Differences
Employees have different needs.
Dont treat them all alike.
Spend the time necessary to understand whats
important to each employee.
Use Goals and Feedback
Allow Employees to Participate in Decisions
That Affect Them
Implications
Link Rewards to Performance
Employees must perceive a clear linkage.
Check the System for Equity
OB at Work
For Review
1. What are the implications of Theories X and Y for
motivation practices?
2. Identify the variables in expectancy theory.
3. Relate goal-setting theory to the MBO process. How
are they similar? Different?
4. What are the pluses and minuses of variable-pay
programs from an employees viewpoint? From
managements viewpoint?
For Review
5. What is an ESOP? How might it positively influence
employee motivation?
6. What motivates professional employees?
7. What motivates contingent employees?
8. Explain cognitive evaluation theory. How applicable
is it to management practice?
9. What can firms do to create more motivating
environments for their employees?
For Critical Thinking
1. Identify three activities you really enjoy. Next, identify
three activities you really dislike. Using the expectancy
model, analyze why some activities stimulate your effort
while others dont.
2. Identify five different criteria by which organizations can
compensate employees. Based on your knowledge and
experience, is performance the criterion most used in
practice? Discuss.
For Critical Thinking
3. Recognition may be motivational for the moment but it doesnt have any
staying power. Why? Because they dont take recognition at Safeway or
The Bay! Do you agree or disagree? Discuss.
4. Performance cant be measured, so any effort to link pay with
performance is a fantasy. Differences in performance are often caused by
the system, which means the organization ends up rewarding the
circumstances. Its the same thing as rewarding the weather forecaster for
a pleasant day. Do you agree or disagree with this statement? Support
your position.
5. Your text argues for recognizing individual differences. It also suggests
paying attention to members of diverse groups. Does this view contradict
the principles of equity theory? Discuss.
OB at Work
Breakout Group Exercises
Form small groups to discuss the following topics:
1. One of the members of your team continually arrives late for meetings
and does not turn drafts of assignments in on time. Choose one of the
available theories and indicate how the theory explains the members
current behaviour and how the theory could be used to motivate the
group member to perform more responsibly.
2. You are unhappy with the performance of one of your instructors and
would like to encourage the instructor to present more lively classes.
Choose one of the available theories and indicate how the theory
explains the instructors current behaviour. How could you as a
student use the theory to motivate the instructor to present more
lively classes?
Breakout Group Exercises
3. Harvard University recently changed its grading policy to recommend
to instructors that the average course mark should be a B. This was the
result of a study showing that more than 50 percent of students were
receiving an A or A- for coursework. Harvard students are often
referred to as the best and the brightest, and they pay $27 000 (US)
for their education, so they expect high grades. Discuss the impact of
this change in policy on the motivation of Harvard students to study
harder.
Exhibit 4-12
2002 Compensation of Canadas Five Best-
Paid CEOs
2002 Compensation of Canadas Five Best-Paid CEOs

Rank on share return
CEO and Company 2002 To tal Compensation past 3 years
($000s) (out of 150)
1. Jozef Straus 229 122 148

JDS Uniphase Corp.
2. Eugene Melnyk 122 481 28

Biovail Corp.
3. Gerald Schwartz 49 266 46
Onex Corp.
4. Peter C. Godsoe 20 365 40

Scotiabank
5. Firoz A. Rasul 19 354 137

Ballard Power Systems Inc.
Supplemental Material
Slides for activities I do in my own

classroom
Exercise on Motivation Theories
Jesse has been underperforming at work, coming in
late, and causing some problems with the other
workers. Previously Jesse has been one of your star
employees. Using the theory assigned to your group,
explain what steps you might take to motivate Jesse
to perform better.
Describe the plan
Indicate how the plan relates to the theory
Theories to Apply
Herzberg Motivation-Hygiene (Two-Factor)
Theory
Expectancy
Goal-Setting Theory
Equity
Motivation and
Emotion
Internal processes that:

1.
G uide
2.
A ctivate
Chapter
3. 10
S ustain
Motivation
Physiological
Hunger
Sexual motivation
Cognitive
Expectancy
Self-fulfillment
Theories of Motivation
Drive Theory
Arousal Theory
Expectancy Theory
Goal-Setting Theory
p. 377
Drive Theory
Biological needs arising within our
bodies create unpleasant states of
arousal
Hunger, thirst, fatigue, etc.
Homeostasis- balanced
physiological state
Motivation is basically a process in
which various biological needs
PUSH us to actions
Drive Theory: An
Overview
Biological need
(need for food, water, oxygen, etc.
Drive state
(hunger, thirst, etc.)
Activation of many different behaviors
Behaviors that do not reduce drive are weakened Behaviors that reduce drive are strenghtened
Arousal Theory
Optimization NOT
Minimization
Arousal: our general level
of activation
May fluctuate
Biological influences??
Sensation seekers
Yerkes-Dodson law
Yerkes-Dodson law
There is a relationship
between, optimal
performance and the level
of arousal necessary.
Behavior is Expectancy
determined by Theory
expectations (desirable outcomes).
Thoughts about future PULL your
behavior.
Incentives: almost anything we have
learned to value.
Goal-Setting
Wood & Locke(1990)
Specific
Challenging
Attainable
Feedback can improve

performance.
Take life in strides
Maslows Needs
Hierarchy
An arrangement of needs from the most basic to those at the highest levels.
Self-actualization Needs
Need for self-fulfillment
Esteem Needs
Need to develop self-respect, gain the approval of others, and achieve success.
Deficiency needs
(basic needs)
Social Needs
Need to have friends, be loved and appreciated and to belong.
Safety needs
Neesd for feeling safe and secure (in one's life)
Physiological needs
Food, water, oxygen, and SLEEP!!!
Emotions
1.Physiological responses
2.Subjective feelings
3.Expressive reactions
How do we respond?
Cannon Bard
Earliest theory
Simultaneous occurrence .
James Lange
More preferred
Interpretations determine emotions
Facial feedback hypothesis
Why go to scary movies?
Schacter Singer
Two stage theory
Dutton & Aron (1974)
Opponent-Process
Every action has an equal and opposite
reaction
The Emotional Brain
Anterior vs. Posterior
Pleasant Unpleasant
Arousal
Right vs. Left

Avoidence withdrawl
Positive affect - Rewards
Speaking without
Words
1. Nonverbal
Cues
2. Gestures
3. Body language
Check out more great forwards at
vparakhiya@rediffmail.com
vasant_parakhiya@yahoo.com

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Motivation is a Latin word, which means to move.

It is the willingness of an individual to respond to

Koontz ODonnell defines it as a general term applying

Performance = Ability x Motivation

It is a process which starts with a physiological or

Needs: are created when there is a deprivation or

Drives or motives: Drives are deficiencies with

Incentive or goal: Attaining an incentive will restore the

Needs Drives Incentive

2. A psychological concept: deals with the human

3. Whole individual is motivated: as it is based on

4. Motivation may be financial or non-financial:

5. Motivation can be positive or negative: positive

1. Positive and negative

2. Financial and non financial

3. Extrinsic and intrinsic:

Extrinsic motivation is available only after completion

Motives can be classified as:

Eg. hunger, thirst, sleep, avoidance of pain, sex &

Primary motives tend to reduce the tension or

These needs induce the person to increase the amount

Eg. curiosity, manipulation, activity & affection

These drives are closely tied to the learning concepts,

Examples of key secondary needs:

Need for power:

Need for security:

Abraham Maslow, an American psychologist, viewed

According to him, each one of us is a wanting being.

2. A satisfied need does not motivate behaviour. eg.

4. Human beings attempt to satisfy their needs in a

Safety & security needs

Maslow explained each level of hierarchy as follows:

Man is a social being & wants to receive & give

He feels the need for belonging, for being an accepted

Thus the person becomes interested in self-fulfillment,

Criticisms of Maslows theory:

2. Some individuals may lack ambition & may remain

4. A single need cannot motivate an individual. There

Hence the theory may not have universal validity.

His study revealed that factors responsible for job

Certain factors give job satisfaction, but absence of

Similarly, certain factors cause job dissatisfaction, but

According to Herzberg, motivational factors are

Hygiene or Maintenance factors:

In other words, presence of these factors prevents

Maintaining motivation at zero level thus prevents

Motivators Hygiene factors

Achievement Co. policy & admn.

Herzbergs framework is compatible with Maslows

Herzbergs theory was also challenged by the thought

Douglas Mc Gregors X & Y theory:

Accompanying this philosophy is the belief that work is

Employees are able to achieve the satisfaction of social

Vrooms Expectancy theory:

By valence, Vroom means the strength of an

Valence is zero when the individual is indifferent

Valence is negative when a person prefers not attaining

Eg. person would be motivated towards superior

This model can clarify the relationship between

By measuring the workers output, mgt can determine

If the output is below standard, it may be that workers

Anyone or a combination of these possibilities will

Skill variety Experienced *High internal