Intrinsic and Extrinsic
Needs and Rewards
• Intrinsic - Higher needs, Internal

Accomplishment, competence, fulfillment,
self-determination received from the process of
action
• Extrinsic - Lower needs, External
–Material comfort, safety, security given by another person
Content vs. Process Motivation
Theories

Content theories


explain why people have different needs at
different times
Process theories

describe the processes through which needs
are translated into behavior. Process theories
try to explain why and how people are
motivated.
Basic Model of Motivation
Needs Hierarchy Theory
Needs Hierarchy
Theory
SelfActualization

Esteem

Belongingness
Safety
Physiological

Maslow arranged five needs in
a hierarchy
Satisfaction-progression
process
People who experience selfactualization desire more
rather than less of this need
Maslow’s Hierarchy of Needs
Acquired Needs Theory
by David McClelland

Need for Achievement -Desire to
accomplish something difficult, attain high
standards of success, master complex tasks,
surpass others


Need for Affiliation -Desire to form close
personal relationships and friendships, avoid
conflict
Need for Power -Desire to influence or
control others, be responsible and have
authority over others
Frederick
Highly
Satisfied
Herzberg Two-Factor Theory
Motivators
Achievement
Recognition
Responsibility
Work itself
Personal growth
Motivators
influence level
of satisfaction
Neither
Hygiene
Factors
Highly
Dissatisfied
Work Conditions
Pay/security
Company Policy
Supervisors
Interpersonal Rel.
Hygiene factors
influence level of
dissatisfaction
Implications of Content Theories


Balance competition/cooperation by
rewarding individual achievement and
teamwork
Offer employees a choice of rewards



people have different needs at different
times
Support the drive to learn by
providing new learning opportunities
Don’t rely too much on financial
rewards
Key Elements of
Expectancy Theory
E -- P expectancy
Effort ----- Performance
P -- O expectancy
Performance ----- Outcomes
Valance - value of outcomes
(Pay, recognition, other rewards)
MOTIVATION
Will putting effort into the
task lead to the desired
performance?
Will high performance lead
to the desired outcome?
Are the available outcomes
highly valued?
Assumptions - Expectancy



Workers are motivated to receive positive
outcomes and avoid negative ones
Workers are rational, careful processors of
information
Workers can make choices about how they
behave, act, and how much effort they
exert
Expectancy Theory in Practice

Increasing the E-to-P expectancy


Increasing the P-to-O expectancy


training, selection, resources, clarify roles,
provide coaching and feedback
Measure performance accurately, explain how
rewards are based on past performance
Increasing outcome valences

Use valued rewards, individualize rewards,
minimize countervalent outcomes
Equity Defined


A State of psychological comfort
Exists when an individual’s input to
outcome ratio is equal to the ratio of the
comparison other
Elements of Equity Theory

Outcome/input ratio



Comparison other



inputs -- what employee contributes (e.g. skill)
outcomes -- what employees receive (e.g. pay)
person/people we compare ratio with
not easily identifiable
Equity evaluation

compare outcome/input ratio with
the comparison other
Overreward vs Underreward
Inequity
Comparison
Other
Overreward
Inequity
Outcomes
Outcomes
Inputs
Underreward
Inequity
You
Inputs
Outcomes
Outcomes
Inputs
Inputs
Consequences of Inequity






Change inputs
Change outcomes
Change perceptions
Leave the field
Act on the comparison other
Change the comparison other
Equity Sensitivity

Benevolents


Equity Sensitives


Tolerant of being underrewarded
Want ratio to be equal to the
comparison other
Entitleds

Prefer receiving proportionately
more than others
Goals are Motivational




Because you can choose where you want
to go
You know exactly what to do
Can provide short and long term vision
Fosters planning and resource evaluation
Effective Goal Setting
Specific
Relevant
Challenging
Commitment
Participation
Challenging
Task
Effort
Task
Performance
Effect of Goal Difficulty on
Performance
Task Performance
High
Low
Area of
Optimal
Goal
Difficulty
Moderate
Challenging
Goal Difficulty
Impossible
Outcomes of Goal Setting






Greater productivity and sales
Improved performance
Improved self-confidence
Increases motivation to achieve
Increases pride and satisfaction
Helps reduce negative attitudes toward
work/increases morale
Research Suggests: Those who
use Goal Setting





Suffer less from stress and anxiety
Concentrate better
Show more self-confidence
Perform better
Are more satisfied with their jobs
Behavior Modification

We “operate” on the environment



Alter behavior to maximize positive and minimize
adverse consequences. Behavior is a function of its
consequences
Operant means voluntary or learned behavior as
opposed to reflexive or unlearned behavior
Law of effect

Likelihood that an operant behavior will be repeated
depends on its consequences
A-B-Cs of Behavior Modification
Antecedents
Behavior
Consequences
What happens
before behavior
What person
says or does
What happens
After behavior
Employee
attends
scheduled
work
Employee
receives
attendance
bonus
Example
Attendance
bonus system
is announced
Reinforcement Perspective
on Motivation




Positive Reinforcement – increase strength and
frequency of a behavior by providing something
pleasing
Negative Reinforcement – increase strength and
frequency of a behavior by the removal or avoidance of
a consequence (stop criticizing and good performance
results)
Punishment – decrease strength and frequency of a
behavior by giving the employee something displeasing
or taking away something pleasing
Extinction – decrease strength and frequency of a
behavior by providing no consequence
Contingencies of Reinforcement
Consequence
is Introduced
Behavior
Increases/
Maintained
Positive
reinforcement
Behavior
Decreases
Punishment
No
Consequence
Consequence
is Removed
Negative
reinforcement
Extinction
Punishment
Behavior Modification
Limitations

Can’t reinforce nonobservable behavior

Reinforcer tends to wear off


Variable ratio schedule is a form of
gambling
Ethical concerns about perceived
manipulation
Organizationwide
Motivational Programs

Employee ownership - Psychological,
stock

Pay for knowledge - Skills possessed

Gainsharing - Teamwork

Pay for performance - Results

Job enrichment - High level, more tasks
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Intrinsic and Extrinsic Needs and Rewards