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Motivation and Reward System

Motivation is a general term which may be applied to an entire class of drives, decicions,
needs, wishes and similar forces. Managers motivate their employees to do things that they
hope will satisfy their drives and desires and induce the subordinates to act in a desired
manner. According to Curtis W. Cook “motivating employees is one of the most consistent
challenges any manager faces” Motivation results from a person’s attitude reacting to a
specific situation. It is the strength of the drive toward an action. Perhaps we can infer that a
few human activities occur without motivation, while nearly all conscious behavior is
motivated or caused. A manager’s job is to identify employees drives and needs and to
channel their behavior, to motivate them toward task performance.
Motivational Drives
People in all walks of life tend to develop certain motivational drives as a product of a cultural environment in
which they live. These drive affect the way people view their jobs; and consequently, affect their lives. These
motivational drives reflect the various elements of the culture in which they were shaped – their family, the
schools, the church , their work environment, to a certain extent, the books they read.

• Achievement Motivation – Achievement motivational is a drive to accomplish objectives and get ahead, A
person with this kind of drive would like to achieve objectives and advance up the ladder of success.
Accomplishment is seen as important primarily for his own advantage, not for the immediate rewards that
accompany it. He will work harder when be perceives that he will receive personal credit for this effort.
Achievement motivation is similar to the Japanese cultural value placed in kaizen. Many successful Japanese
industrialists constantly drive themselves to seek ways of improving everything around them.
• Affiliation Motivation – Affiliation motivation is a drive to relate to effectively. The comparisons between
achievement-motivated employees and affiliation-motivated: Motivation employees show how the two
patterns influence behavior, achievement-oriented people normally work harder when their superiors provide
detailed evaluations of their work behavior. It is observed that people with affiliation motives work better
when they are complimented for their favorable attitudes and cooperation.

The Need-Want-Satisfaction Chain

Human needs, such as the physiological requirements for food, clothing, shelter, water and air, are the basic
aspects for human survival. These needs vary in intensity and the motivation involves a chain reaction. Felt
needs give rise wants or goals sought, which cause tensions, if desire are not fulfilled. These are eventually give
rise to action towards achieving goals which ultimately results in satisfaction.


gives rise to which cause which give rise which results

wants tensions To actions In satisfactions

The explanation of the chain may be complex. It may be assumed that, in the first place, except for
physiological needs, such as food, needs are not independent of a persons environment. Many physiological
needs are stimulated by environmental factors. For instance, the smell of food may cause hunger or a sight of a
bottle of cold drink may cause thirst.

The Carrot and the Stick Theory

Leading theories of motivations and motivators seldom make reference to the carrot and the stick. This
metaphor relates to the use of rewards and penalties in order to induce desired behavior. It merely
originated from the old story that, to make the donkey move, one must put a carrot in front of the animal
or a jab it with a stick from behind. It may be inferred that despite the many researches and theories of
Motivation that have come to the force, reward and punishment are still considered strong motivators .
For many years, they were often thought of us the only force that could motivate people.
In all theories of motivation, the inducement of “carrots” are recognized and most often,
the “carrot” is the money in the form of pay or bonuses. It is observed that, even though
money is not only the motivating force, it has been and will continue to be and important
factor. The trouble with the money – “carrot” approach, is that, in most cases, everyone gets
a carrot, regardless of performance; by way of salary increases and promotion by seniority
which are not based on individual performance.
On the other hand, the “stick” in the form of fear – fear of loss of job, loss of income, reduction of bonus,
demotion and some other penalty has been and will continue to be a strong motivator, although admittedly
not the best kind of motivator. This kind of approach often gives rise to defensive and retaliatory behavior, such
as unionism, poor quality performance, executive indifference, weakness of manager to take any risk in
decision-making, or to some extent, dishonesty. Fear of penalty cannot be set aside. Whether managers are
firsts-level supervisors or chief executives, the power of their position and authority to give or withhold
rewards or impose penalties of various kinds give them the capacity to control, to a large extent, the economic
and social being of their subordinates. It is not surprising that, in many organizations, many subordinates are
“yes-sayers” by virtually agreeing with their superiors instead of using their rational judgement.

Directing Motivating and Productivity

The directing function of managing and the leadership tasks it imposes are very complex and no single theory
or model can adequately represent all situations. For this reasons, we shall look at four different approaches,
each of which has proven to be very useful in a wide range of management situations, and yet not one of which
can solve all leadership problems. The following are some of the approaches :
In managing people to obtain maximum productivity, there are three general objectives :

• To improve the performance of subordinates on their present job in terms of results accomplished
• To prepare subordinates to accept increasing responsibility in present jobs
• To help subordinates grow and develop in terms of higher level jobs.

In additional to the managers approach ad his skill in planning, the following factors play a part in
determining employee motivation and productivity:

• The attitude which the employee brings to the job in the first place
• The social organizational climate with respect to policies, procedure, rules, regulations, and other
factors that affects job performance.
• Specific environmental aspects other than physical conditions, such as the system of awards, promotion,
and opportunities
It is within this more structured organizational framework that the manager performs his directing function. To
the extent that he must overcome employee pressure and perhaps dissatisfaction with these factors, his job is
made more difficult. This is especially true when he has no control of influence over the factors. Generally
speaking, the lower a manger is on the managerial ladder, the less control he has over the broader aspects of
job climate and, paradoxically, the more subject he is to bearing such pressure if they exist. In other words, a
manager exercise leadership within a total climate and framework, and his effectiveness is, to some degree,
influenced by elements beyond hid control.

Difference and Perception

It is possible, for example, to ask a manager if he delegates responsibility and get an affirmative response.
When his subordinates are asked the same question, they may disagree, or else feel that his delegation is very
limited and closely controlled. Similarly, a manager may believe that communications within a department or
organization are good but when asked about them, employees may consider them to be only fair. The crucial is
that the way a subordinate perceives and understands his total climate is an important determinant of his
response. Whether or not his perception and understanding are reasonable is a separate issue.
McGregor’s Theory X and Theory Y

Douglas McGregor was one of the first management writers to pay attention to managerial models. He
presented a convincing argument that most management actions flow directly from whatever theory of human
behavior managers have. He held that management philosophy controls practice in an organizations. The
assumptions may be inferred from observing the kinds of actions that managers take.

Theory X is a traditional set of assumptions about people in an organizational setting. This theory assumes that
most people dislike work and will try to avoid it if they can. Workers are seen as being inclined to restrict work
output, having little ambition, and avoiding responsibility, if possible. These types of workers are believed to be
relatively self-centered, indifferent to organizational needs and most often, resistant to change. Common
rewards seem not to overcome this natural dislike for work. What management has to do is to force, control
and threaten employees to obtain satisfactory performances.

Theory Y implies a more humanistic and supportive approach to management for it assumes that workers are
not inherently lazy. The theory assumes that, if management will only provide the proper environment to
release their potential, work for them will become natural and spontaneous like a play, rest or relaxation.
Under this theory, management believes that workers will exercise self-direction and self-control in the service
of objectives to which they are committed.
Theory X Theory Y

• The typical person dislike work and will avoid it, if • Work is a natural as play or rest.
possible. • People are not inherently lazy. They have
• The typical person lacks responsibility, has little become that way as a result of experience.
ambition, and seeks security above all. • People will exercise self-direction and self-
• Most people must be coerced, controlled and control in the service of objectives to which they
threatened with punishment to get them to are committed.
work. • People have potential. Under proper conditions,
they learn to accept and seek responsibility. They
have imagination, ingenuity, and creativity that
can be applied to work.

Which these assumptions, the managerial role is to Which these assumptions, the managerial role is to
coerce and control workers. develop the potential in employees and help them
release that potential toward common objectives.

Theory X

1. Central principle of organization derived from theory X is that of direction and control through exercise of
2. Organizational requirements take precedent over needs of members. In return for rewards offered, the
individual will accept external direction and control.
3. We do not recognize the existence of potential in people and therefore, there is no reason to devote
time, effort, and money to discover how to realize full potential.

Theory Y

1. Central principle derived from Theory Y is integration: the creation of conditions such that members of
the organizations can achieve their own goals best by directing their effort toward the success of the
2. The organizations will be more effective in achieving its objectives if adjustment are made to the needs
and goals of its members.
3. We are challenged to innovate, to discover new ways of organizing and directing human effort.
The Hierarchy of Needs Theory
The hierarchy of needs theory is considered one of the most widely identified theories of motivation put forth
by psychologist Abraham Maslow. Maslow saw human needs in the context of hierarchy, ascending from the
lowest to the highest. He further concluded that when one set of needs is satisfied, this kind of need ceases to
be a motivation.


Need for

Esteem needs

Affiliation or acceptance
Security or safety needs

Physiological needs
1. Physiological needs – These are the basic needs for sustaining life such as food, water, air, shelter and

2. Security or safety needs – these are the needs to be free of any physical danger and of the fear of losing a
job shelter.

3. Affiliation or Acceptance needs – people are social beings; and therefore, they need to belong and to be
accepted by others

4. Esteem needs – Maslow views that once people begin to satisfy their need to belong, they aspire to be
held in esteem both by themselves and by others. This type of need produces satisfaction such as power,
prestige, status, self-confidence and self-worth

5. Need for self-actualization – Maslow regard this need as the apex of all needs in the hierarchy. This is a
desire and aspiration of an individual to become what one is capable of becoming – to maximize one’s potential
and to accomplish something that is worthy of recognition.

Edward Lawler and J. Lloyd Suttle – They noted that there were two levels of needs – biological and other
needs . Other needs would emerge only when biological needs are satisfied.
Behavior Modification

Content theory – Content theory focuses on the content or nature of items that motivate an individual. It
relates to the individuals inner self and how that individuals internal state of needs determine behavior. One
major difficulty with content model of motivation is that the needs of people are not subject to observation by
managers or to accurate measurement for monitoring purposes.

Organizational behavior modification or OB Mod, is the application in organizations of the principles of behavior
modifications, which evolved from the work of the principles of behavior of B.F Skinner. OB Mod and objective
setting are two process – theories of motivation, since they provide perspective on the dynamics by which
employees can be motivated.

Law of Effect

OB Mod is based on the idea that behavior depends on its consequences. It is this premise that it is possible for
managers to control a number of employee behaviors by manipulating their consequences. OB Mod relies on
the law of effect. This states that a person tends to repeat behavior that is accompanied by favorable
The law of effect comes from the learning theory which implies that we learn best under a pleasant
environment. While the content theory argues an internal needs to behavior, OB Mod states that external
consequences tend to determine behavior.

Alternative Consequences- OB Mod puts great emphasis on the use of rewards and alternative
consequences to sustain behavior. It is important that manager must decide whether they wish to increase
the probability of a person’s continued behavior or to decrease it by applying OB Mod.

Punishment- This is the administration of an unfavorable consequences that discourage a certain behavior.
While punishment may be necessary occasionally to discourage an undesirable behavior, it needs to be used
with certain caution because of some limitations.
Money as a Means of Rewarding Employees

Money is any circulating medium that has a social value. Money is important to employee for a number of
reason. It is very valuable for the goods and services that it will purchase to make one comfortable.

Extrinsic and Intrinsic reward- Money is essentially an extrinsic reward. It is easily administrated in
behavior modifications program, although it also has some limitations of extrinsic benefits.

An extrinsic reward is a tangible and visible reward given to an individual or an employee for achieving
something. They usually have monetary value such as a salary hike, bonus, award, or public recognition.

Intrinsic reward An outcome that gives an individual personal satisfaction such as that derived from a job
well done. Because intrinsic motivation exists within the individual, achieving it does not depend on others.
Some people believe that the most powerful rewards come from inside a person.
Organization Behavior and Performance Appraisal – Organization require that there should be a
consistent level of high performance from their employees in order to survive in a highly competitive
environment. A number of companies use some form of result oriented planning and control system.
Management by objectives is a cyclical process that consists of four steps as a guide to achieve desired result as

1. Objective Setting – There should be a joint determination by manager and employee of appropriate
levels of future performance for the employee, within the context of overall unit objectives and resources
set for next calendar year.
2. Action Planning – This is the participative planning stage by employee as to how to accomplish the
desired objective. Providing some degree of autonomy to employees is valuable for they are likely to their
creativity and ingenuity and be more committed to the overall plan’s success
3. Periodic Reviews – there should be a joint assessment of progress toward objective by manager and
employee, performed informally
4. Annual Evaluation – This should be an annual formal assessment of success in accomplishing the
employee annual objective coupled with a renewal of the planning cycle.

Performance has a very important role in the reward system. This is the process of evaluating the
performance of employees, sharing that information with them and seeking for the ways to improve their
There are certain reason for Employee appraisal. These are :
1. Allocate resources in a dynamic environment.
2. Motivate and reward employee.
3. Give employees feedback about their work.
4. Maintain fair relationship with groups.
5. Coach and develop employees.
6. Comply with regulations

Appraisal system are indeed necessary for proper management and for employee development.

Job of Enrichment

*Various researches on motivation point to the importance of making jobs challenging and meaningful.
*Job enrichment attempts to make a job more varied by removing the dullness and monotony associated with
repetitive operation. It simply means enlarging the scope of the job by adding similar tasks without enhancing
Weakness of Job Enrichment

There are certain weakness in the application of job enrichment as claimed by its supporter and one of
these is technology. Another weakness is cost. The weakness of job enrichment apply mainly to jobs
requiring low skill level.

Elements of Objective Settings

Goal Setting- as a motivational tool, becomes very effective when all its major elements are present.
These are goal acceptance, specificity, challenge, and performance monitoring and feedback.

Goal Acceptance – effective goals have to be understood and accepted. It is important to bear in mind
that simply assigning objective to employees may not result in their commitment to those objectives,
especially if the objectives will be difficult to accomplish.

Specificity – It is assumed that objective should be specific, definite, clean and measurable so that
employees will know when these objectives are accomplished.
Challenged – it may be surprising to know that most employee work harder when they have difficult to do
rather than easy ones. Challenging objectives induce them to double their effort to accomplish the task ahead
of time.

Performance monitoring and feedback – There are still other closely related steps that are important to
complete the process in objective setting even after the employees have participated and this is referred to as
performance monitoring and feedback. This monitoring increase their awareness of the role they play in
contributing to organizational effectiveness.

Tips for Building Employee Self-Efficacy

1. Don’t imply that employee are incompetent

2. Don’t talk down to them about their job
3. Don’t find petty faults with their results
4. Don’t criticize their work in front of their peers
5. Don’t belittle the importance of their jobs or tasks
6. Do praise them for their appropriate effort
7. Don’t ask for their input
8. Do listen carefully to their ideas for improvement
9. Do share positive feedback from their peers with them
10.Do provide formal recognition of their achievement.