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OB Midterm #2 Chapter Notes -2
Organizational Behaviour I (Wilfrid Laurier University)
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Chapter 5
Motivation​: the extent to which persistent effort is directed toward a goal
- when a person works hard at his or her own work and directs his or her behaviour toward appropriate
outcomes.
Basic characteristics:
- Effort: the strength of the person’s work-related behaviour or the amount of effort the person
exhibits on the job (loader carries heavier crates)
- Persistence: apply effort constantly and consistently throughout the goal/task/job (carrying heavy
all day)
- Direction: the quality of one’s work, making sure employees channel persistent effort in a
direction that benefits the organization (motivate software designer design software not play video
games)
- Goals: the objective toward which the effort is directed (motivated people act to enhance
organizational objectives, through goals like high productivity, good attendance, creativeness,
etc…)
Extrinsic and Intrinsic motivation
- Intrinsic motivation (quality of performance)​: stems from the direct relationship between the worker and
the task and is usually self-applied. Autonomous motivation - meaning it comes from within the individual
(motivations include achievement, accomplishment, enjoyment, challenges, and competitiveness in the
workplace)
- Sports and hobbies are examples of things that are intrinsically motivated
- Extrinsic motivation (quantity of performance)​: stems from the work environment external to the task
and is usually applied by someone other than the person being motivated. (motivations include pay, fringe
benefits, company policies and various forms of supervision) - examples include vacation subsidies and
company provided trips.
- Relationship between intrinsic and extrinsic motivation​:
- Some motivators can be both intrinsic and extrinsic, for example promotion applied by the boss
(extrinsic) can also be a clear sign of achievement (intrinsic) for the employee.
- Some studies found that extrinsic motivators can reduce intrinsic motivation stemming from a
task.
- Extrinsic rewards depend on performance, then motivating potential of intrinsic rewards
decreases.
- Because of this people believe that making extrinsic rewards contingent on performance makes
individuals feel less in control of their own behaviour (environment is) and they only perform
because of the reward. Therefore intrinsic motivation suffers.
- However​ the negative effect of extrinsic rewards on intrinsic rewards is easily avoided, also
individuals increase their intrinsic motivation to reach the extrinsic rewards and future ones.
- Both related to performance but extrinsic is related to quantity of performance while intrinsic is
related to quality of performance. Intrinsic for complex tasks and extrinsic for mundane tasks.
Motivation and performance
- Performance​: the extent to which an organizational member contributes to achieving the objectives of the
organization
Factors that influence the relationship between motivation and performance​:
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General cognitive ability (intelligence)​: refers to a person’s basic information-processing capacities and
cognitive resources. Individuals overall capacity and efficiency to mentally process, understand and learn
information. (additive theory is better where motivation and cognitive ability are equal to performance).
- Research has found that general cognitive ability predicts learning, training, career success, and
job performance in all kinds of jobs including those that involve both mental and manual tasks.
- General cognitive ability is an even better predictor of performance for more complex and
higher-level jobs that require the use of more cognitive skills and involve more information
processing.
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Emotional intelligence​: an individual’s ability to understand and manage his or her own and other’s
feelings and emotions. It involves an individual's ability to perceive and express emotion, assimilate
emotion in thought, understand reason about emotions and manage emotions in oneself and others. (high
can identify and understand the meanings of emotions and regulate their emotions as a basis for problem
solving, reasoning, etc..)
Research on EI has found that it predicts job performance and academic performance
- Research has also shown that EI is most important for the job performance of individuals with
lower levels of cognitive ability and less important for the job performance of individuals with
high levels of cognitive ability.
The following EI model was created by John Mayer and Peter Salovey
1.
2.
3.
Perceiving emotions accurately in oneself and others: ​this involves the ability to perceive emotions and
to accurately identify one’s own emotions and the emotions of others. An example of this is the ability to
accurately identify emotions in people’s faces and in non-verbal behaviour. This step is the most basic level
of EI and is necessary to be able to perform the other steps in the model
Using emotions to facilitate thinking: ​this refers to the ability to use and assimilate emotions and
emotional experiences to guide and facilitate one’s thinking and reasoning. This means that one is able to
use emotions in functional ways, such as decision making and other cognitive processes (ex. Creativity,
integrative thinking, and inductive reasoning). This stage also involves being able to shift one’s emotions
and generate new emotions that can help one to see things in different ways and from different
perspectives.
Understanding emotions, emotional language, and the signals conveyed by emotions: ​this stage
involves being able to understand emotional information, the determinants and consequences of emotions,
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4.
and how emotions evolve and change over time. At this stage, people understand how different situations
and events generate emotions as well as how they and others are influenced by various emotions. For
example, individuals who are good at this stage know not to ask someone for a favour when they are in a
bad mood, but rather wait until the person is in a better mood,or ask someone else.
Managing emotions so as to attain specific goals: ​this involves the ability to manage one’s own and
others’ feelings and emotions as well as emotional relationships. This is the highest level of EI because it
requires one to have mastered the previous stages. At this stage, an individual is able to regulate, adjust, and
change his or her own emotions as well as others’ emotions to suit the situation. Examples of this include
staying calm when angry or upset, being able to lower another person’s anger, and being able to excite and
enthuse others. To be effective at managing emotions, one must be able to perceive emotions, integrate and
assimilate emotions, and be knowledgeable of and understand emotions.
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Personality​:
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How performance might be low even when motivation is high​:
- Motivation can be high and performance low due to a poor understanding of the task or luck and
chance factors that can damage the performance of the most highly motivated individuals.
- A person with weak motivation may do well due to luck or other external factors, which explains
why some employees may complain that they receive lower performance ratings.
- High motivation will not result in high performance if employees have low cognitive ability and
emotional intelligence, do not understand their jobs, or encounter unavoidable obstacles.
- Motivational interventions such as linking pay to performance simply will not work if employees
are deficient in important skills and abilities.
Needs Theories​ - ​motivation theories that specify the kinds of needs people have and the conditions under which
they will be motivated to satisfy these needs in a way that contributes to performance.
Maslow’s Hierarchy of Needs
- Psychological needs​ - the needs that are necessary for survival such as food, water, oxygen and
shelter. Organizational factors that might satisfy these needs are minimum pay necessary for
survival and working conditions that promote existence.
- Safety needs​ - the needs for security, stability, freedom from anxiety, and a structured and ordered
environment. Organizational conditions that might meet these needs include safe working
conditions, fair and sensible rules and regulations, job security, a comfortable work environment,
pension and insurance plans, and pay above the minimum needed for survival
- Belongingness needs​ - needs for social interaction, affection, love, companionship, and friendship.
Organizational factors that might meet these needs include the opportunity to interact with others
on the job, friendly and supportive supervision, the opportunity for teamwork, and the opportunity
to develop new social relationships.
- Esteem needs​ - needs for feelings of adequacy, competence, independence, strength, and
confidence, and the appreciation and recognition of these characteristics by others. Organizational
factors that might satisfy these needs include the opportunity to master tasks leading to feelings of
achievement and responsibility. Also rewards, promotions, prestigious job titles, professional
recognition, and the like might satisfy these needs when they are felt to be truly deserved.
- Self-actualization needs​ - needs are the most difficult to define. They involve the desire to develop
one’s true potential as an individual to the fullest extent and to express one’s skills, talents, and
emotions in a manner that is most personally fulfilling. Maslow suggests that self-actualizing
people have clear perceptions of reality; accept themselves and others; are independent, creative,
and appreciative of the world around them. Organizational conditions that might provide
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self-actualization include absorbing jobs with the potential for creativity and growth as well as a
relaxation of structure to permit self-development and personal progression.
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The need that has the greatest motivating potential​:
- The lowest-level unsatisfied need category has the greatest motivating potential.
- None are the “best” motivators. Motivation depends on a person's position in the need hierarchy.
- In the hierarchy though, individuals are motivated to satisfy their psychological needs first, then
safety and so on.
- When a need is not met, it exerts a powerful effect on the individual’s thinking and behavior.
- As they move through the hierarchy when one is satisfied it is no longer a motivator.
How self-actualization differs​:
- Self-actualization needs are different from the rest as they actually become stronger as they are
met, defined as “growth” needs.
Alderfer’s ERG Theory
- E - Existence needs​: needs that are satisfied by some material substance or condition. (closely
related to Maslow's psychological needs and safety needs that are satisfied by material conditions,
not interpersonal relations - such as shelter, pay, and safe working conditions).
- R - Relatedness needs​: needs that are satisfied by open communication and the exchange of
thoughts and feelings with other organizational members. (Correspond well with Maslow’s
belongingness needs and those esteem needs that involve feedback from others). It differed from
Maslow’s in the sense that Alderfer stresses that relatedness needs are satisfied by open, accurate
and honest interaction/communication rather than by uncritical pleasantness.
- G - Growth needs​: needs that are fulfilled by strong personal involvement in the work setting.
They involve the full utilization of one’s skills and abilities and the creative development of new
skills and abilities. (Growth needs correspond to Maslow’s need for self-actualization and the
aspects of his esteem needs that concern achievement and responsibility).
How it agrees with Maslow
- Alderfer agrees with Maslow that as lower-level needs are satisfied, the desire to have higher-level needs
satisfied will increase. Thus, as existence needs are fulfilled, relatedness needs become more motivating.
- Alderfer also agrees with Maslow that the least concrete needs (growth needs) become more compelling
and more desired as they are fulfilled.
Key difference between ERG theory and Maslow’s theory
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Unlike the need hierarchy, the ERG theory does not assume that a lower level need must be gratified before
a less concrete need becomes operative
ERG theory assumes that if the higher-level needs are ungratified, individuals will increase their desire for
the gratification of lower-level needs.
This a big difference as Maslow believed that once low level needs are satisfied the individual will not go
back to them, but Alderfer holds that the frustration of satisfying higher-level needs will cause people to
drop down the hierarchy
Thus, according to Alderfer an apparently satisfied need can act as a motivator by substituting for an
unsatisfied need.
Mcclelland’s Theory of Needs - ​needs reflect relatively stable personality characteristics that one acquires through
early life experiences and exposure to selected aspects of one’s society.
- How it differs from the previous two: McClelland is not interested in a hierarchy relationship, but rather he
is more concerned with the specific behavioural consequences of needs.
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The characteristics of different types of people:
- High in need for achievement (nAch)​: they have a strong desire to perform challenging tasks well.
They exhibit a preference for situations in which personal responsibility can be taken for
outcomes, have a tendency to set moderately difficult goals that provide calculated risks and desire
performance feedback.
- High in need for affiliation (nAff)​: they have a strong desire to establish and maintain friendly,
compatible interpersonal relationships. They want to be liked by others and they like others. They
have an ability to learn social networking more quickly and a tendency to communicate frequently
with others. They also avoid conflict and competition and conform to others wishes to be liked.
- High in need for power (nPow)​: they strongly desire to have influence over others, making a
strong impact or impression. They seek out social settings where they can be influential, they are
attention-getters and advocate risky positions.
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Prediction with respect to motivation:
- McClelland predicts that people will motivated to seek and perform well in jobs that match their
needs
- Thus, people with high ​n ​ach should be strongly motivated by sales jobs or entrepreneurial
positions.
- This is because these jobs offer feedback, personal responsibility, and opportunity to set goals
- People who are high in ​n ​aff will be motivated by jobs such as social worker or customer relations
because these jobs require establishing good relations with others
- High ​n ​pow will result in high motivation for jobs that enable one to have a strong impact on
others. For example, journalism and management
- McClelland found that most effective managers have a low need for affiliation, a high need for
power, and the ability to direct power toward organizational goals.
Research support and managerial implications
- Maslow’s need hierarchy suggest two main hypotheses:
1. Specific needs should cluster into the five main need categories that Maslow proposes
2. As the needs in a given category are satisfied, they should become less important, while the needs
in the adjacent higher-need category should become more important.
- In general research support for these hypothesis is weak or negative
- This is probably due to the rigidity of the theory which says that all people experience the same
needs in the same hierarchical order
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On the other hand, research support for Alderfer’s ERG model is much better
Several tests confirm the expected change in need strength that is predicted by this theory
Research confirms that frustration of relatedness needs increases the strength of existence needs
Overall, the simplicity and flexibility of the ERG model seem to capture the human need structure better
than the greater complexity and rigidity of Maslow’s theory.
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In terms of McClelland’s need theory, research has shown that particular needs are motivational when the
work setting permits the satisfaction of these needs.
Managerial Implications of need theories
- The need theories have some important things to say about managerial attempts to motivate employees
Appreciative diversity
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The lack of support for the rigid theories (Maslow) says that managers must evaluate the needs of each
individual employee and offer incentives or goals that correspond to each employees unique needs
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- Making stereotypes about needs will reduce the effectiveness of chosen motivational strategies
Appreciate Intrinsic Motivation
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The need theories also serve the valuable function of alerting managers to the existence of higher-order
needs
- The recognition of these needs is important for two main reasons:
1. The basic conditions for organizational survival is the expression of some creative and innovative
behaviour on the part of members. Such behaviour seems most likely to occur during the pursuit of
higher-order need fulfillment and ignorance of this factor can cause the demotivation of the people who
have the most to offer the organization
2. Observation and research evidence support Alderfer’s idea that the frustration of higher-order needs
prompts demands for greater satisfaction of lower-order needs. This can lead to a vicious motivational
cycle that is, because the factors that gratify lower-level needs are fairly easy to administer (pay and fringe
benefits). Management has grown to rely on them to motivate employees. In turn, some employees
deprived of higher-order need gratification, come to expect more and more of these extrinsic factors in
exchange for their services. Thus, a cycle of deprivation, regression, and temporary gratification continues,
at a great cost to the organization.
How Can Organizations benefit from the intrinsic motivation that is inherent in strong high-order needs?
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First, It is important to note that such needs will fail to develop for most employees unless lower level
needs are reasonably well gratified.
Thus, very poor pay, job insecurity, and unsafe working conditions will preoccupy most workers at the
expense of higher-order outcomes.
Second, if basic needs are met, jobs can be “enriched” to be more stimulating and challenging and to
provide feelings of responsibility and achievement.
Finally, organizations could pay more attention to designing career paths that enable interested workers to
progress through a series of jobs that continue to challenge their higher-order needs. Managers could also
assign tasks to employees with this goal in mind.
Self-Determination Theory - ​relates the satisfaction of 3 basic psychological needs to autonomous or controlled
motivation.
- How it differs from Maslow and Alderfer - unlike those theories, SDT considers needs to be universal
necessities for psychological health and well-being and does not consider needs to be hierarchical.
- Three basic psychological needs​:
- C - Competence​: the feeling of mastery and being effective in one’s own environment
- A - Autonomy​: having a choice and feeling volitional in one’s behaviour
- R - Relatedness​: the feeling that you are connected to others
- Autonomous vs controlled motivation
- Autonomous​: self-motivation (intrinsic) that occurs when people feel they are in control of their
motivation. (They are performing a task because they find it interesting and chose to do it).
- Controlled​: people are motivated to obtain a desired consequence or extrinsic rewards.
Individuals feel they are pressured and have no choice to engage in a task (motivation externally
motivated).
- The extent to which a person’s motivation is autonomous or controlled depends on the satisfaction
of the three basic psychological needs.
- When people have their basic psychological needs for competence, autonomy, and relatedness
satisfied, their motivation will be autonomous.
- When these needs are not satisfied, motivation will be controlled.
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Thus, the basic premise of SDT is that work environments that lead to the satisfaction of the three
psychological needs will promote autonomous motivation, which will then lead to more effective
performance and positive work outcomes.
What research says about the theory and managerial implications
- A key predictor variable is autonomy support from one’s direct supervisor
- Autonomy support: ​involves providing employees with choice and encouragement for personal
initiative.
- Managers provide employees with autonomy support when they give a meaningful rationale for
performing an activity or task, emphasize and enable some choice rather than control, and
understand and acknowledge employees to take initiative and convey confidence in employees’
abilities.
- Research has found that autonomy support is positively related to the satisfaction of the needs for
competence, relatedness, and autonomy as well as autonomous motivation.
- The satisfaction of the 3 psychological needs has been found to be positively related to job
attitudes, work engagement, well-being, performance, and autonomous motivation.
In addition, autonomous motivation is related to more effective job performance, especially on
complex tasks.
- It is also associated with more positive job attitudes—such as organizational commitment, job
satisfaction, and psychological well-being—while controlled motivation is associated with
negative outcomes—such as psychological distress and turnover intentions.
- The most important managerial implication of SDT is that organizations need to create work
environments that will satisfy employees’ basic psychological needs for competence, autonomy,
and relatedness and facilitate autonomous motivation.
- Thus, managers should provide employees with autonomy support as well as jobs that are
interesting and challenging and that allow employees some choice.
- There is even some evidence that managers can be trained to provide employees with autonomy
support. Structuring work to allow interdependence among employees can also facilitate
autonomous motivation by satisfying the need for relatedness.
Process Theories​ - motivation theories that specify the details of how motivation occurs
Expectancy Theory ​- motivation is determined by the outcomes that people expect to occur as a result of their
actions on the job.
- Elements of expectancy theory:
- Expectancy​: the probability that the worker can actually achieve a particular first-level outcome
(ex: effort to average productivity or high productivity).
- Instrumentality​: the probability that a particular first level outcome (such as high productivity) will
be followed by a particular second level outcome (such as pay).
- Valence​: the expected value of outcomes (extent to which they are attractive or not to the
individual). Basically, increased pay may be more or less attractive to each individual.
- First-level outcomes​: consequences that may follow certain work behaviours.
- Second-level outcomes​: consequences that follow the achievement of a particular first level
outcome
- Force​: the end product of the other components of the theory, representing a relative degree of
effort that will be directed towards various first-level outcomes. (first level valence x expectancy)
- Individuals attempt to direct their effort toward which first-level outcomes?
- A person will direct their effort towards the first level outcome that has the largest force product.
- Managerial implications of this theory:
- One of the most basic things managers can do is ensure that their employees ​expect​ to be able to
achieve first-level outcomes that are of interest to the organization.
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Managers should also attempt to ensure that the paths between first and second level outcomes are
clear.
Obviously, it might be difficult for managers to change the valences that employees attach to
second-level outcomes. Individual preferences for high pay, promotion, interesting work, and so
on, are the product of a long history of development and are unlikely to change rapidly.
However, managers would do well to analyze the diverse preferences of particular employees and
attempt to design individualized “motivational packages” to meet their needs.
Equity Theory
- asserts that workers compare the inputs that they invest in their jobs and the outcomes that they receive
against the inputs and outcomes of some other relevant person or group.
- When these ratios are equal, the worker should feel that a fair and equitable exchange exists with the
employing organization. Such fair exchange contributes to job satisfaction (motivation).
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How it is a theory of motivation: ​individuals are motivated to maintain an equitable exchange relationship
5 options individuals have for restoring a sense of fairness
1. Change your perception of your own inputs or outcomes
2. Change your perception of the inputs of outcomes of the comparison person or group
3. Choose another comparison person or group
4. Alter one’s inputs or alter one’s outcomes
5. Leave the exchange relationship
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Gender equality research
It is extremely interesting to learn that both women and men have some tendency to choose
same-sex comparison persons—that is, when judging the fairness of the outcomes that they
receive, men tend to compare themselves with other men, and women tend to compare themselves
with other women.
- This might provide a partial explanation for why women are paid less than men, even for the same
job. If women restrict their equity comparisons to (lesser-paid) women, they are less likely to be
motivated to correct what we observers see as wage inequities.
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What does the research say about equity theory? - ​ M
​ ost research on equity theory has been restricted to
economic outcomes and has concentrated on the alteration of inputs and outcomes as a means of reducing
inequity. In general, this research is very supportive of the theory when inequity occurs because of
underpayment​ - leading to resignation, less productivity, etc...
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What are the managerial implications of equity theory? - perceived underpayment will have a variety of
negative motivational consequences for the organization, including low productivity, low quality, theft,
turnover, etc… There has to be an equitable balance (overpaying may not lead to increased motivation). For
this, management must understand that employees control the equity equation and be sensitive to others.
Goal Setting Theory ​- g​ oals are motivational when they are specific and challenging, when organizational members
are committed to them, and when feedback about progress toward goal attainment is provided.
- Do employees usually have an accurate understanding of their goals? - Goals are most motivational when they are:
1. Directing attention toward goal-relevant activities
2. Lead to a greater effort
3. Increase and prolong persistence
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4. Lead to the discovery and use of task-relevant strategies for goal attainment
What exactly do goals do?
1. Direct attention toward goal-related activities
2. Lead to a greater effort
3. Increase and prolong persistence
4. Lead to the discovery and use of task-relevant strategies for goal attainment
Goal commitment​: individuals must be committed to specific, challenging goals if the goals are to have
effective motivational properties (performance strongest when individuals have high goal commitment).
Why feedback is important: it enables the person to compare current performance with the goal
Factors that enhance goal commitment:
1. Participation - increases or decreases performance. If goal commitment is a problem then
participation is beneficial, while if there is trust that the employees reach their goals it may be
unnecessary.
2. Rewards - (money and other extrinsic rewards) usually increases goal commitment, however goal
goal setting does not require monetary rewards/incentives.
3. Management support - when supervisors behave in a cohesive manner to encourage goal
accomplishment, they can badly damage employee goal commitment. They must actually assist
employees in accomplishing goals and remain supportive (no threats/punishments).
Goal orientation​: an individual’s goal preferences in achievement situations.
- Learning goal orientation: a preference to learn new things and develop competence in an activity by
acquiring new skills and mastering new situations.
- Performance-prove goal orientation: a preference to obtain favourable judgements about the outcome of
one’ performance.
- Performance-avoid goal orientation: a preference to avoid negative judgements about the outcomes of one’s
performance.
- How learning goal orientation and performance goal orientation relate to performance: learning goal
orientation is positively related to learning, task, job performance. Performance-avoid orientation is
negatively related to learning and lower taska and job performance. Performance-prove orientation is not
related to learning or performance outcomes.
Goal proximity​:
- Effects of distal and proximal goals: distal is a long-term or end goal (achieving a certain level of sales),
while proximal goals are short-term that is instrumental for achieving a distal goal.
- Research on goal setting theory found that it is one of the most valid and practical theories of employee
motivation.
- Managerial implications of goal setting theory: set specific and challenging goals and provide ongoing
feedback so individuals can compare their performance with a goal.
- The performance impact of specific, challenging goals is stronger for simpler jobs than for more
complex jobs, such as engineering
- Thus, when a task is complex and individuals need to acquire new knowledge and skills for good
performance, setting a specific learning goal will be more effective than setting a
high-performance goal.
- Setting a high-performance goal will be most effective when individuals already have the ability to
perform a task effectively
- Proximal goals should be set with distal goals when employees are learning a new task or
performing a complex one.
Motivation Theories Translation Across Cultures
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It is safe to assume that most theories that revolve around human needs will come up against cultural
limitations to their generality
For example, both Maslow and Alderfer suggest that people pass through a social stage (belongingness,
relatedness) on their way to a higher-level personal growth or self-actualization stage. However, it is well
established that there are differences in the extent to which societies value a more collective or a more
individualistic approach to life.
This suggests that there might be no superiority to self-actualization as a motive in more collective cultures.
Also, cultures differ in the extent to which they value achievement as is defined in North America, and
conceptions of achievement might be more group orientated in collective cultures than in individualistic
North America
Similarly, the concept of intrinsic motivation might be more relevant to wealthy societies than to
developing societies
Research on self-determination theory across various cultures however has been largely supportive.
For example, a study of SDT in 9 different countries found that the three psychological needs are positively
related to autonomous motivation, although the size of the relationships varied across cultures, which
suggest the importance of the 3 needs might differ across cultures.
The satisfaction of basic psychological needs and motivation type matters across cultures and
organizational contexts, and SDT has been found to be cross-culturally valid.
With respect to equity theory, it is more effective in individualistic cultures than collective cultures
In collective cultures, there is a tendency to favour reward allocation based on equality rather than equity.
So, everyone should receive the same outcomes despite individual differences in productivity, and group
solidarity is a dominant motive.
Trying to motivate employees with a fair reward system might backfire in collective cultures
In terms of expectancy theory, because it is so flexible, it is very effective cross-culturally.
Finally, setting specific and challenging goals should also be motivational when applied cross-culturally
and in fact goal setting has been found to predict, influence, and explain behaviour in numerous countries
worldwide
However, for this to be successful, the goal setting process should be adjusted for each culture.
For example, individual goal setting is not going to be accepted in collective cultures
Also in cultures with high power distance, it would be more motivational and accepted to have goals
assigned by superiors.
Appreciating cultural diversity is critical in maximizing motivation
Chapter 6
Money as a Motivator
- Is pay an effective motivator? Do managers and employees usually think that pay is an important
motivator?
- Pay is a very important motivator in an organization, made up of pay and various fringe benefits
such as sick leave, insurance, and vacation time. Managers often underestimate the importance of
pay on motivation for performance.
- How does pay relate to Maslow and Alderfers’ theories of motivation?
- According to Maslow and Alderfer, pay should prove especially motivational to people who have
strong lower-level needs. Meaning pay can be exchanged for food, shelter and other necessities of
life. A raise shows your boss like you which leads to other increasing factors such as social,
self-esteem, and self-actualization needs.
- How does pay fit into expectancy theory ?
- Expectancy theory shows that if pay can satisfy a variety of needs, it should be highly valent, and
it should be a good motivator to the extent that it is ​clearly tied to performance​.
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What does the research on pay and financial incentives show?
- It is consistent with the predictions of need theory and expectancy theory that financial incentives
and pay-for-performance plans have been found to increase performance and lower turnover
(positive effects on both individual and group based performance). Pay also provides a
competitive advantage for attracting, motivating, and retaining employees and Canadian
organizations are increasingly using financial incentives.
Variable pay​: a portion of employees’ pay that is based on a measure of performance
Linking Pay to Performance
- Piece rate​: a pay system in which individual workers are paid a certain sum of money for each unit of
production completed.
- Wage incentive plans​: various systems that link pay to performance on production jobs.
- Potential problems with wage incentives:
1. Lowered quality 2. Differential opportunity - some workers will be at an unfair disadvantage compared to
other workers due to the resources they may have at the end.
3. Reduced cooperation - to maintain a high wage rate, machinists might hoard raw
materials or refuse to engage in peripheral tasks, such as keeping the shop clean or
unloading supplies.
4. Incompatible job design - as team size increases, the linkage between your performance
and your pay is erased, removing the intended incentive effect.
5. Restriction of productivity - the artificial limitation of work output that can occur under
wage incentive plans. This can decrease the expected benefits of the incentive system.
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Linking pay to performance in white-collar jobs
- Merit pay​: systems that attempt to link pay to performance on white-collar jobs (pay over and
above salary for their good performance).
- How common it is - it is a very common form of motivation nowadays and more
common than wage-incentive plans.
- How effective merit pay is - it is more effective in a tight labour market to attract and
retain employees instead of wage increases. However in a majority of cases it has been
deemed ineffective.
- Potential problems with merit pay plans:
1. Low discrimination: being unable or unwilling to discriminate between good
performers and poor performers.
2. Small increases: merit increases are simply too small to be effective motivators.
The motivational impact is sometimes reduced for merit pay because it is spread
out over a year or the organization fails to communicate how much of a raise is
for merit and how much is for cost of living. EX:
a. Lump sum bonus - merit pay that is awarded in a single payment and
not built into the base pay. This has become a common method to
motivate and retain employees at all levels of an organization.
3. Pay secrecy: extreme secrecy that surrounds salaries in most organizations,
leading to employees “inventing” salaries for others.
a. If performance evaluation systems are inadequate and poorly
implemented, a more open pay policy will simply expose the
inadequacy of the merit system and lead managers to evaluate
performance in a manner that reduces conflict.
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Using Pay to Motivate Teamwork
- Profit sharing​: the return of some company profit to employees in the form of a cash bonus or a retirement
supplement.
- Is it motivational? - some forms may be motivational, however the problem is that too many
factors beyond the control of the workforce (such as the general economy) can affect profits, no
matter how well people perform their jobs. Also in large firms it is difficult to see the impact of
one’s own actions on profits.
- Employee stock ownership plans​: incentive plans that allow employees to own a set amount of a
company’s shares and provide employees with a stake in the company’s future earnings and success.
- Why they are believed to be motivational - they increase loyalty and motivation because they align
employees’ goals and interests with those of the organization and create a sense of legal and
psychological ownership.
- Why they are likely to be most effective in motivating employees ​- they increase loyalty and
motivation because they align employees’ goals and interests with those of the organization and
create a sense of legal and psychological ownership. It can also increase employee retention and
profitability. They work best in small organizations that regularly turn a profit.
- Gainsharing​: group incentive plan based on productivity or performance improvements over which the
workforce has some control. (these plans include reductions in the cost of labour, material or supplies).
- When gainsharing plans are most effective - they are most effective when using committees that
include extensive workforce participation. This in turn builds trust and commitment to the
formulas that are used to convert gains to bonuses.
- Scanlon plans: the plan stresses participatory management and joint problem solving between employees
and managers, but it also stresses using the pay system to reward employees for this cooperative behaviour.
- Skill-based pay​: a system in which people are paid according to the number of job skills they have
acquired
- Advantages: encourages employees to learn new skills, greater flexibility in task assignments, and
provides employees with a broader picture of the work process.
- Disadvantages: increases the cost of training, labour costs can increase as employees acquire more
skills.
Teamwork pay plans chart:
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Job Design as a Motivator
- Job design​: the structure, content, and configuration of a person’s work tasks and roles.
- Traditional view of job design emphasized
Job Scope:​ the breadth and depth of a job.
- Breadth: the number of different activities performed in a job.
- Depth: the degree of discretion or control the worker has over how these tasks are performed.
- Job scope relation to intrinsic motivation: high-scope jobs provide more intrinsic motivation than low scope
jobs.
- Stretch assignments: challenging assignments and projects that are larger in scope than one’s current job
and involve more responsibility.
- Job rotation: rotating employees to different tasks and jobs in an organization
Job Characteristics Model​ - provides a framework for using job design as a motivator
-
5 core job characteristics:
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Skill variety: corresponds closely with job breadth - the opportunity to do a variety of job activities
using various skills and talents.
Task identity: the extent to which a job involves doing a complete piece of work, from beginning
to end.
Task significance: the impact that a job has on other people.
Autonomy: the freedom to schedule one’s own work activities and decide work procedures.
Feedback from job: information about the effectiveness of one’s work performance.
-
Motivating potential score​: Through a Job Diagnostic Survey (JDS), it requires job holders to report the
amount of the various core characteristics contained in their jobs. The JDS profiles reveal that the
managerial jobs are consistently higher on the core characteristics than other keypunching jobs.
-
The higher the motivational potential score, the more motivating the job is and vice versa
Critical psychological states​:
- What outcomes are affected by critical psychological states?
- Work will be intrinsically motivating when it is perceived as meaningful, when the other
worker feels responsible for the outcomes of the work, and when the worker feels
responsible for the outcomes of the work, and when the worker has knowledge about his
or her work progress.
Outcomes
●
●
The main outcome of the psychological states is high intrinsic motivation
When the worker is truly in control of a challenging job that provides good feedback about performance,
the key prerequisites for intrinsic motivation are present.
● The relationship between the worker and the work will allow the worker to draw motivation from the work
itself. This will result in high-quality productivity.
● Workers will also report satisfaction with high-order needs (growth needs) and general satisfaction with the
job itself, which will reduce absenteeism and turnover.
Moderators
-
One of the key moderators is job-relevant knowledge and skill of the worker.
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Another proposed moderator is ​growth needs strength ​which refers to the extent to which people desire to
achieve higher-order satisfaction by performing their jobs.
Those with high growth needs should be more responsive to challenging work.
Workers who are dissatisfied with the context factors surrounding the job (pay, supervision, and company
policy) will be less responsive to challenging work than those who are reasonably satisfied with context
factors..
Job Enrichment​: the design of jobs to enhance intrinsic motivation, quality of working life, and job involvement.
- Job involvement​: a cognitive state of psychological identification with one’s job and the importance of
work to one’s total self-image.
Job enrichment typically involves​:
1. Combining Tasks
a. assigning tasks that might be performed by different workers to a single individual
b. increases the variety of skills employed and might contribute to task identity as each worker
approaches doing a unified job from start to finish
2. Establishing External Client Relationships
a. putting employees in touch with people outside the organization who depend on their products or
services
b. use of new interpersonal skills and increase the identity and significance of the job, and increase
feedback about one’s performance
3. Establishing Internal Client Relationships
a. putting employees in touch with people who depend on their products or services within the
organization
b. similar to those for establishing external client relationships
4. Reducing Supervision or Reliance on Others
a. increases autonomy and control over one’s own work
5. Forming Work Teams
a. an alternative to a sequence of “small” jobs that individual workers perform when a product or
service is too large or complex for one person to complete alone
b. leads to the formal and informal development of a variety of skills and increase the identity of the
job
6. Making Feedback More Direct
a. permit workers to be identified with their “own” product or service
Potential problems with job enrichment​:
1. Poor Diagnosis
a. Job Enlargement
i.
Increasing job breadth by giving employees more tasks at the same level to perform but
leaving other core characteristics unchanged
ii.
workers are simply given more boring, fragmented, routine tasks to do
2. Lack of Desire or Skill
a. some workers do not desire enriched jobs and the extra responsibility
3. Demand for Rewards
a. workers ask that greater extrinsic rewards, like pay, accompany their redesigned jobs
4. Union Resistance
a. Fewer job classifications mean more opportunities for flexibility by combining tasks and using
team approaches.
5. Supervisory Resistance
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a.
even when enrichment schemes are carefully implemented, they might fail because of their
unanticipated impact on other jobs or other parts of the organizational system
Work Design
- Characteristics​ - attributes of the task, job, and social and organizational environment.
- Motivational characteristics​:
- Task characteristics: (listed in chart)
- Knowledge characteristics: (listed in chart)
- Social characteristics​: the interpersonal and social aspects of work and include social support,
interdependence, interaction outside of the organization, and feedback from others.
- Work context characteristics​: context within which work is performed and consist of
ergonomics, physical demands, work conditions, and equipment use.
Relational Job Design​ - Relational Architecture of Jobs
- The structural properties of work that shape employees’ opportunities to connect and interact with
other people
- Prosocial Motivation
- The desire to expend effort to benefit other people
- it is possible to improve employee motivation and performance by redesigning jobs to emphasize
their social impact
- Aims at increasing what type of motivation? - tries to increase employee motivation to make a difference in
other people’s lives
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Research on relational job design has shown that there was an increase in persistence and performance
when people are provided with a brief exposure to a scholarship recipient who had benefits from their
work.
Job Crafting​ - self-initiated changes that employees make in their job demands and job resources to improve the fit
or match between characteristics of their job and their personal abilities and needs
- 4 dimensions of job crafting
1. Increasing social job resources - involves asking for feedback, advice, and support from
supervisors and colleagues
2. Increasing structural job resources - involves behaviors to increase job characteristics such as
autonomy and skill variety
3. Increasing challenging job demands - involves behaviours such as asking for more responsibilities
and volunteering for special projects
4. Decreasing hindering job demands - involves behaviours to minimize physical, cognitive, and
emotional demands such as reducing one’s workload or work-family conflict
- Personality traits linked to job crafting include agreeableness, conscientiousness, extraversion, openness to
experience, proactive personality, and general self-efficacy and are all positively related to job crafting.
- Characteristics linked to job crafting include increased job characteristics such as autonomy, workload, and
skill variety.
- Outcomes associated with job crafting: jab satisfaction, work engagement, and job performance and
negatively related to job strain and burnout.
Management by Objectives (MBO)​: an elaborate, systematic, ongoing program designed to facilitate goal
establishment, goal accomplishment, and employee development.
- The role top management plays is developing objectives for the organization and then diffused through the
organization through the MBO process.
- Typical MBO involves these 4 steps:
1. The manager meets with individual workers to develop and agree on employee objectives for the
coming months. Objectives, time frames, and priorities are put in writing.
2. There are periodic meetings to monitor employee progress in achieving objectives.
3. An appraisal meeting is held to evaluate the extent to which the agreed-upon objectives have been
achieved.
4. The MBO cycle is repeated
- Research on MBO
-
The evidence shows that MBO programs result in clear productivity gains.
There are also lots of factors associated with the failure of MBO programs. They are elaborate,
difficult, time-consuming, and its implementation must have full commitment from top
management.
Even with the best intentions, setting specific, quantifiable objectives can be a difficult process.
This might lead to an overemphasis on measurable objectives at the expense of more qualitative
objectives.
Excessive short-term orientation can be a problem with MBO.
Even if reasonable objectives are established, MBO can still be subverted if the performance
review becomes an exercise in punishing employees for failure to achieve objectives.
Flexible Work Agreement​: work options that permit flexibility in terms of “where” and/or “when” work is
completed. The purpose is to meet diverse workforce needs, promote job satisfaction
- Flex-time: an alternative work schedule in which arrival and departure times are flexible.
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-
-
-
It is well suited to meeting the needs of a diverse workforce, since it allows employees to tailor
arrival and departure times to their own transportation and child care situations.
Compressed Workweek: an alternative work schedule in which employees work fewer than the normal five
days a week but still put in a normal number of hours per week.
- Possibility of reduced customer service, negative effects of fatigue, positive effect on job
satisfaction and work schedule satisfaction (therefore no effect on absenteeism and productivity they even out).
Job and work Sharing: job sharing is an alternative work schedule in which two part-time employees divide
the work of a full-time job. While work sharing involves reducing the number of hours employees work to
avoid layoffs when there is a reduction in normal business activity.
Telecommuting: a system in which employees are able to work at remote locations, but stay in touch with
their offices through the use of information and communication technology.
- Distributed work programs are also becoming more common as it allows employees to have a
combination of home office, business office and satellite office.
- Positive effect on perceived autonomy and lower work-family conflict.
Motivational Practices in Perspective
●
●
●
the choice of motivational practice requires a
thorough diagnosis of the organization and the
needs and desires of employees
​the most effective approach will depend on a
combination of factors, including:
○ ​employee needs
○ ​the nature of the job
○ ​characteristics of the organization
○ ​the outcome that the organization
wants to achieve
​The most effective way: performance based pay
+ job enrichment
Chapter 7
Group
●
●
●
Two or more people interacting interdependently to achieve a common goal
Interdependence simply means that group members rely to some degree on each other to accomplish goals
Groups are important because they are the social mechanisms by which we acquire many beliefs, values,
attitudes, and behaviors, and because groups provide a context in which we are able to exert influence on
others.
Formal Work Groups
●
●
Groups that are established by organizations to facilitate the achievement of organizational goals.
Other types of formal workgroups include task forces, project teams, and committees. Task forces and
project teams are temporary groups that meet to achieve particular goals or to solve particular problems,
such as suggesting productivity improvements
○ Committees are usually permanent groups that handle recurrent assignments outside the usual
workgroup structures
Informal Groups
●
Groups that emerge naturally in response to the common interests of organizational members
○ May help or hurt an organization
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Their membership often cuts across formal groups
Stages of Group Development
●
●
●
●
●
●
●
Each stage presents the members with a series of challenges they must master to achieve the next stage
Forming
○ At this early stage, group members try to orient themselves by “testing the waters.” What are we
doing here? What are the others like? What is our purpose? The situation is often ambiguous, and
members are aware of their dependency on each other.
Storming
○ conflict often emerges. Confrontation and criticism occur as members determine whether they will
go along with the way the group is developing. Sorting out roles and responsibilities is often at
issue here. Problems are more likely to happen earlier, rather than later, in group development.
Norming
○ members resolve the issues that provoked the storming, and they develop social consensus.
Compromise is often necessary. Interdependence is recognized, norms are agreed to, and the group
becomes more cohesive
Performing
○ With its social structure sorted out, the group devotes its energies toward task accomplishment.
Achievement, creativity, and mutual assistance are prominent themes of this stage.
Adjourning
○ At this adjourning stage, rites and rituals that affirm the group’s previous successful development
are common (such as ceremonies and parties). Members often exhibit emotional support for each
other.
The process applies mainly to new groups that have never met before. Well-acquainted task forces and
committees can short-circuit these stages when they have a new problem to work out
Punctuated Equilibrium Model
●
A model of group development that describes how groups with deadlines are affected by their first
meetings and crucial midpoint transitions.
● Phase 1
○ begins with the first meeting and continues until the midpoint in the group’s existence.
○ The first meeting is critical in setting the agenda. Assumptions, approaches, and precedents that
members develop in the first meeting end up dominating the first half of the group’s life.
○ Group makes little visible progress toward the goal
○ As long as people are working, do not look for radical progress during Phase 1.
● Midpoint Transition
○ halfway point in time toward the group’s deadline
○ The transition marks a change in the group’s approach, and how the group manages the change is
critical for the group to show progress
○ group may seek outside advice
○ it crystallizes the group’s activities for Phase 2 just as the first meeting did for Phase 1
● Phase 2
○ decisions and approaches adopted at the midpoint get played out in Phase 2. It concludes with a
final meeting that reveals a burst of activity and a concern for how outsiders will evaluate the
product.
Group Structure and its Consequences
●
refers to the characteristics of the stable social organization of a group—the way a group is “put together.”
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Group Size
○ 300-400 members is the limit. In practice, most work groups, including task forces and
committees, usually have between 3 and 20 members.
○ larger groups might perform better as groups, but their individual members tend to be less efficient
(Additive and Disjunctive)
○ Size and Satisfaction
■ members of larger groups report less satisfaction.
■ More members with different viewpoints prompt conflict and dissention.
■ Time available for verbal participation by each member decreases. Individual members
identify less easily with the success and accomplishments of the group.
○ Size and Performance
■ Do large groups perform tasks better than small groups? Depends on the exact task that
the group needs to accomplish and on how we define good performance
■ Additive tasks - Tasks in which group performance is dependent on the sum of the
performance of individual group members.
● for additive tasks, the potential performance of the group increases with group
size.
■ Disjunctive Tasks - Tasks in which group performance is dependent on the performance
of the best group member.
■ Process Losses - Group performance difficulties stemming from the problems of
motivating and coordinating larger groups.
● actual performance = potential performance – process losses.
■ Conjunctive Tasks - Tasks in which group performance is limited by the performance of
the poorest group member.
●
Diversity of Group Membership
○ Negative effects of surface diversity (can find out quickly) in age, gender, or race seem to wear off
over time.
○ Deep diversity (takes time to uncover) in attitudes toward work or how to accomplish a goal can
badly damage cohesiveness.
●
Group Norms
○ Collective expectations that members of social units have regarding the behaviour of each other.
○ changing norms is one way to change people’s behaviour
○ Norm Development
■ important function that norms serve is to provide regularity and predictability to
behaviour
■ Why do individuals tend to comply with norms? Compliance occurs because the norm
corresponds to privately held attitudes. Even when norms support trivial niceties (i.e.
when to shake hands), they often save time and prevent social confusion.
○ Some Typical Norms
■ Dress Norms
■ Reward Allocation Norms
● Equity - reward according to inputs, such as effort, performance, or seniority.
● Equality - reward everyone equally.
● Reciprocity - reward people the way they reward you.
● Social responsibility - reward those who truly need the reward.
■ Performance Norms
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Roles
○
○
○
○
○
○
●
work groups provide their members with potent cues about what an appropriate
level of performance is
Positions in a group that have a set of expected behaviours attached to them
Assigned roles - formally prescribed by an organization as a means of dividing labor and
responsibility to facilitate task achievement. Indicate who does what and who can tell others what
to do
Emergent roles - develop naturally to meet the social emotional needs of group members or to
assist in formal job accomplishment, i.e. class clown, office gossip, etc.
Role Ambiguity
■ Lack of clarity of job goals or methods.
■ Practical consequences of role ambiguity: job stress, dissatisfaction, reduced
organizational commitment, lowered performance, and intentions to quit
Role Conflict
■ A condition of being faced with incompatible role expectations.
■ Intrasender Role Conflict
● A single role sender provides incompatible role expectations to a role occupant.
■ Intersender Role Conflict
● Two or more role senders provide a role occupant with incompatible
expectations.
■ Interrole Conflict
● Several roles held by a role occupant involve incompatible expectations.
■ Person-role Conflict
● Role demands call for behaviour that is incompatible with the personality or
skills of a role occupant.
Managers can help prevent employee role conflict by avoiding self-contradictory messages,
conferring with other role senders, being sensitive to multiple role demands, and fitting the right
person to the right role.
Status
○ The rank or social position accorded to group members in terms of prominence, prestige, and
respect.
○ when a status system works smoothly, the group will exhibit clear norms about who should be
accorded higher or lower status.
○ Formal Status Systems
■ management’s attempt to publicly identify those people who have higher status than
others. Application of status symbols: tangible indicators of status, like titles, pay
packages, physical working environment, work schedules, etc.
■ status and the symbols connected to it serve as powerful magnets to induce members to
aspire to higher organizational positions. And status differentiation reinforces the
authority hierarchy in work groups and the organization as a whole, since people pay
attention to high-status individuals.
○ Informal Status Systems
■ are not well advertised, and they might lack the conspicuous symbols and systematic
support that people usually accord the formal system
■ Ex. Some managers who perform well early in their careers are identified as “fast
trackers” and given special job assignments that correspond to their elevated status
■ Consequences of Status Differences:
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●
if status differences are large, people can be inhibited from communicating
upward. These opposing effects mean that much communication gets stalled.
status also affects the amount of various group members’ communication and
their influence in group affairs
Group Cohesiveness (Ex. Pg. 258)
●
●
The degree to which a group is attractive to its members.
What makes some groups more cohesive than others?
○ Threat and Competition’
■ external threats to the survival of the group increases cohesiveness
■ Honest competition with another group can also promote cohesiveness
■ Groups feel a need to improve communication and coordination so that they can better
cope with the situation at hand
○ Success
■ A group becomes more attractive to its members when it has successfully accomplished
some important goal, such as defending itself against threat or winning a prize
■ By the same token, cohesiveness will decrease after failure
○ Member Diversity
■ if a group is in agreement about how to accomplish some particular task, its success in
performing the task will often outweigh dissimilarities in determining cohesiveness
○ Group Size
■ bigger groups should have a more difficult time becoming and staying cohesive
○ Toughness of Initiation
■ groups that are tough to get into should be more attractive than those that are easy to join.
Consequences of Cohesiveness
●
●
●
More Participation in Group Activities
○ Because members wish to remain in the group, voluntary turnover from cohesive groups should be
low
More Conformity
○ highly cohesive groups are in a superb position to induce conformity to group norms.
○ Members of cohesive groups are especially motivated to engage in activities that will keep the
group cohesive
More Success
○ cohesive groups are good at achieving their goals
■ reciprocal relationship between success and cohesiveness.
○ coordinated effort pays dividends to the group.
Social Loafing
●
●
●
●
●
The tendency to withhold physical or intellectual effort when performing a group task.
Social loafing is a motivation problem
Free rider effect - people lower their effort to get a free ride at the expense of their fellow group members
Sucker effect, people lower their effort because of the feeling that others are free riding, that is, they are
trying to restore equity in the group
Ways to Counteract Social Loafing
○ Make individual performance more visible
■ Small groups make performance more visible of individuals
○ Make sure that the work is interesting
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Increase feelings of Indispensability
■ Slack off because they feel their inputs are unnecessary, so provide members with unique
inputs
○ Increase performance feedback
○ Reward group performance
What is a Team?
●
●
●
Unless interdependence is not medium to high, a group is not a team
Collective Efficacy
○ Shared beliefs that a team can successfully perform a given task.
Team Reflexivity
○ The extent to which teams deliberately discuss team processes and goals and adapt their behaviour
accordingly.
■ Such conscious, deliberate reflection enhances team coordination and avoids the
problems that derive from a lack of clear communication
J. Richard Hackman - A work group is effective when:
1.
2.
3.
its physical or intellectual output is acceptable to management and to the other parts of the organization that
use this output,
group members’ needs are satisfied rather than frustrated by the group, and
The group experience enables members to continue to work together.
Self-Managed Work Teams
●
●
●
●
Work groups that have the opportunity to do challenging work under reduced supervision.
Tasks for Self-Managed Teams
○ Tasks should be complex and challenging, highly interdependent, high in task significance, skill
variety, and task identity.
Composition of Self-Managed Teams
○ Stability
■ group membership must be fairly stable. Rotating members into and out of the group will
cause it to fail to develop a true group identity
○ Size
■ should be as small as is feasible
○ Expertise
■ should have a high level of expertise about the task at hand. Everybody does not have to
know everything, but the group as a whole should be very knowledgeable about the task
○ Diversity
■ should have members who are similar enough to work well together and diverse enough
to bring a variety of perspectives and skills to the task at hand
Supporting Self-Managed Teams
○ Training
■ Technical training
■ Social skills
■ Language skills
■ Business training
○ Rewards
■ tied to team accomplishment
○ Management
■ liaison, facilitator of group reflection
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Cross-Functional Teams
●
Work groups that bring people with different functional specialties together to better invent, design, or
deliver a product or service.
● People have to be experts in their own area but able to cooperate with others.
Principle of Effectiveness - Cross-Functional Teams
●
●
●
●
●
●
Composition
○ all relevant specialties are necessary, do not overlook anyone.
Superordinate Goals
○ Attractive outcomes that can be achieved only by collaboration.
Physical Proximity
○ team members have to be located close to each other to facilitate informal contact
Autonomy
○ need some independence from larger organization to prevent micromanaging by upper level
​ Rules and procedures
○ to prevent anarchy
​Leadership
○ Because of strong potential for conflict, we need leaders with strong people skills in addition to
task expertise.
Shared Mental Models
●
●
Team members share identical information about how they should interact and what their task is
they are a particular challenge to instill in cross-functional teams due to the divergent backgrounds of the
team members
Virtual Teams
●
Work groups that use technology to communicate and collaborate across time, space, and organizational
boundaries.
Advantages of Virtual Teams
● around the clock work, reduced travel time and cost, larger talent pool
Challenges of Virtual Teams
● trust, miscommunication, isolation, management issues
Lessons Concerning Virtual Teams
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recruit carefully, invest in training, encourage personalization, set goals and ground rules
Chapter 11
Decision making
●
The process of developing a commitment to some course of action
○ involves making a choice among several action alternatives
○ is a process that involves more than simply the final choice among alternatives
○ “commitment” refers to the dedication of resources such as time, money, or personnel
Problem
● A perceived gap between an existing state and a desired state.
Well-Structured Problems
●
A problem for which the existing state is clear, the desired state is clear, and how to get from one state to
the other is fairly obvious
Program
● A standardized way of solving a problem
● Programs usually go under labels such as rules, routines, standard operating procedures, or rules of thumb
Ill-Structured Problem
●
A problem for which the existing and desired states are unclear and the method of getting to the desired
state is unknown
○ tend to be complex and involve a high degree of uncertainty
Perfect Rationality
● A decision strategy that is completely informed, perfectly logical, and oriented toward economic gain
Bounded Rationality
●
A decision strategy that relies on limited information and that reflects time constraints and political
considerations
Framing
● Aspects of the presentation of information about a problem that are assumed by decision makers
Cognitive Biases
●
Tendencies to acquire and process information in an error-prone way
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These biases constitute assumptions and shortcuts that can improve decision-making efficiency,
but they frequently lead to serious errors in judgment
Problem Identification and Framing (Ex. Pg. 407)
●
●
●
●
Perceptual Defence
Problem defined in terms of functional speciality
Problem defined in terms of solution
Problem diagnosed in terms of symptoms
Information Search
●
●
Too Little Information
○ Confirmation bias
■ The tendency to seek out information that conforms to one’s own definition of or solution
to a problem
■ this ceremonial information search leads to “decision-based evidence making” rather than
evidence-based decision making
○ Not-invented-here bias
■ The tendency to ignore or harbor negative attitudes toward ideas from outside one’s own
organization or project team
Too Much Information
○ Information Overload
■ The reception of more information than is necessary to make effective decisions
■ can lead to errors, omissions, delays, and cutting corners
■ people have a cognitive bias to value advice for which they have paid over free advice of
equal quality
Alternative Development, Evaluation and Choice
●
Maximization
○ The choice of the decision alternative with the greatest expected value
● Anchoring Effect
○ The inadequate adjustment of subsequent estimates from an initial estimate that serves as an
anchor
● It is possible to reduce some of these basic cognitive biases by making people more accountable for their
decisions. This might include requiring reasoned reports, formal presentations of how the decision was
reached
● Satisficing
○ Establishing an adequate level of acceptability for a solution to a problem and then screening
solutions until one that exceeds this level is found.
○ decision maker working under bounded rationality frequently “satisfices” rather than maximizes
Solution Implementation
●
in organizations, decision makers are often dependent on others to implement their decisions, and it might
be difficult to anticipate their ability or motivation to do so
Solution Evaluation
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Justification
○ Sunk costs
■ Permanent losses of resources incurred as the result of a decision
○ Escalation of Commitment
■ The tendency to invest additional resources in an apparently failing course of action
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people high on neuroticism and negative affectivity are less likely to escalate since they
try to avoid stressful predicaments
groups are more prone than individuals to escalate commitment
■
Hindsight
○ The tendency to review the decision-making process to find what was done right or wrong
○ often reflects a cognitive bias
○ form of faulty hindsight is the tendency to take personal responsibility for successful decision
outcomes while denying responsibility for unsuccessful outcomes
How Emotions and Mood Affect Decision Making
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people do not like to be wrong, and they often become emotionally attached to a failing course of action
Strong emotions frequently figure in the decision-making process that corrects ethical errors
○ “blinded by emotion” - people experiencing strong emotions are often self-focused and distracted
from the actual demands of the problem at hand
plenty of evidence that mood affects what and how people think when making decisions
○ has its greatest impact on uncertain, ambiguous decisions of the type that are especially crucial for
organizations
Group Decision Making
● comes into play when problems are ill structured
Why Use Groups?
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Decision Quality
○ groups or teams can make higher-quality decisions than individuals
■ Groups are more vigilant than individuals are—more people are scanning the
environment.
■ Groups can generate more ideas than individuals can.
■ Groups can evaluate ideas better than individuals can
Decision Acceptance and Commitment
○ groups are often used to make decisions on the premise that a decision made in this way will be
more acceptable to those involved
Diffusion of Responsibility
○ The ability of group members to share the burden of the negative consequences of a poor decision
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Groups should perform better than individuals when
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​The group members differ in relevant skills and abilities, as long as they do not differ so much that conflict
occurs
​Some division of labour can occur
​Memory for facts is an important issue
Individual judgments can be combined by weighting them to reflect the expertise of the
various members
Disadvantages of Group Decision Making
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Time
○
Groups seldom work quickly or efficiently compared with individuals because of process losses
and group size.
Conflict
○ Participants in group decisions have their own personal axes to grind or their own resources to
protect. When this occurs, decision quality may take a back seat to political wrangling and
infighting.
​Domination
○ Advantages of group decision making will be seldom realized if meetings
are dominated by
a single individual or a small coalition.
Groupthink
○ The capacity for group pressure to damage the mental efficiency, reality testing, and moral
judgment of decision making groups
Groupthink symptoms
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​Illusions of invulnerability
○ overconfident and willing to assume great risks. Ignore obvious danger signals.
Rationalization
○ Problems and counterarguments that members cannot ignore are rationalized away. Seemingly
logical but improbable excuses are given.
Illusions of morality
○ The decisions the group adopts are perceived as morally correct
Stereotypes of outsiders
○ The group constructs unfavorable stereotypes of those outside the group who are targets of their
decisions
Pressure for conformity
○ Members pressure each other to fall in line and conform with the group’s views
Self Censorship
○ Members convince themselves to avoid voicing opinions contrary to the group.
Illusions of unanimity
○ Members perceive that unanimous support exists for their chosen course of action
Mindguards
○ Some group members may adopt the role of protecting the group from information that goes
against its decisions.
Devils Advocate
●
A person appointed to identify and challenge the weaknesses of a proposed plan or strategy
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The controversy promoted by the devil’s advocate improves decision quality. However, to be effective, the
advocate must present his or her views in an objective, unemotional manner.
How Do Groups Handle Risk?
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Risky Shift
○ The tendency for groups to make riskier decisions than the average risk initially advocated by their
individual members
Conservative Shift
○ The tendency for groups to make less risky decisions than the average risk initially advocated by
their individual members
Evidence-Based Management
●
Making decisions through the conscientious, explicit, and judicious use of the best available evidence from
multiple sources
● What is good evidence? If available for a particular problem, scientifically conducted peer-reviewed
research is the gold standard
● most useful at the information search and solution evaluation stages of the decision cycle
Crowdsourcing
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Outsourcing aspects of a decision process to a large collection of people
Low-cost information technology and the rise of social media have contributed to the growth of
crowdsourcing as a decision aid
Analytics
● Finding meaningful patterns in large datasets
Big Data
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Copious amounts of information that are often collected in real time and can come from a wide variety of
sources, particularly digital
three Vs—high volume, velocity, and variety
Chapter 13
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Negotiation​: a decision-making process among interdependent parties who do not share identical preferences.
Formal process of bargaining between two opposing views that constitutes conflict management in an attempt to
either prevent conflict or resolve existing conflict.
- Distributive negotiation​ ​(compromise): a zero-sum, win-lose situation in which a fixed pie is divided
between the parties.
- Target point: where you ideally want to make
- Resistance point: the lowest thing that you are willing to take (at the end of the settlement range)
- Settlement range and why it’s important: where both could come to agreement one max’s low
acceptance of pay and the others max that they would pay. That range is the settlement range. It's
important because each dollar that one party earns is a dollar cost for the other.
- Tactics
- Threats and promises - threat is implying that you will punish the other party if he or she
does not concede to your position (if you don’t lower the price you will terminate its
business with the consulting company). While promises are pledges that concessions will
lead to rewards in the future (promise future consulting contracts if lowered price). A
promise implies a threat, should no concession be made.
- Threats should be made at a position of power, and no anticipated deals to be
made in the future. If you have equal power, a counter-threat could be made and
scuttle negotiations despite that both parties would be satisfied with the
settlement range/
- A Promise is better when you lack power and anticipate future negotiations with
the other party.
- Firmness versus concessions - firmness is where you stick to your target position,
offering few concessions and waiting for the other party to give in (superior, tactic),
while concessions are appropriate, using face-saving techniques to explain themselves
(making something web-based rather than paper-based.
- Persuasion - (changing the attitudes of the other party toward your target position) It is a
two prong attack of negotiation. One asserts the technical merits of the party’s position,
for example justifying a target price by saying“we have the most qualified staff.” The
second prong asserts the fairness of the target position, for example making a speech
about the expenses the company would incur doing a survey.
-
Integrative negotiation​: a mutual problem solving can result in a win-win situation in which the pie is
actually enlarged before distribution. Mutual problem solving can enlarge the assets to be divided between
parties. (axis between avoiding and collaborating, tending towards the latter)
- Why trust is required for integrative negotiation: for advancements intersections of both parties,
trust is required. Trust is often rewarded with superior negotiation outcomes. (trust should be built
slowly)
- Why creativity is required for integrative negotiation: without creativity, negotiators are often
more likely to use distributive negotiation.
- Tactics
- Copious information exchange - give away some non-critical information to the other
party to get the ball rolling. Also ask the other party many questions and listen to their
responses. If used correctly, both parties will begin to reveal their true interests, not just
current positions, leading to a more integrative negotiation.
- Framing differences as opportunities - differences can often swerve as a basis for
integrative agreements because they contain information that can telegraph each party’s
real interests. (if one person wants to finish a project early and one wants to just on time,
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then split the work so that one works on it early, while the other finishes his part just in
time to satisfy both parties fully - not a compromise.)
Cutting costs - if you cut costs that the other party associates with an agreement,
integrative settlement increases. This is a strategy if you are getting to a stalemate, what
will cut costs for the other side.
Increasing resources - two parties together have twice the amount of access to resources
(expand the pie)
Superordinate goals - (attractive outcomes that can only be achieved by collaboration).
High level goals that both parties share in common, but can only be accomplished if they
work together. (Eg: remind kids that we both want the house clean, so we have to work
together to get it done). They change the entire landscape of the negotiation episode.
Conflict - when two opposing views collide. It is not always a bad thing as it can promote positive change in the
workplace.
- Constructive conflict​: a conflict where the benefits outweigh the costs.
- It most likely occurs when the tendency to avoid conflict is suppressed and parties engage in
open-minded discussion of their differences.
- Promotes good decisions and positive organizational change
- How conflict stimulation can foster change: conflict stimulation is a strategy of increasing conflict to
motivate change, by increasing the amount of conflict in an organization's environment to create positive
change.
- Why a manager might want to stimulate conflict in these scenarios:
- “Friendly rut” - when peaceful relationships take precedence over organizational goals.
- Parties withdraw - when parties interacting closely withdraw from each other to avoid conflict.
- Conflict is suppressed - when conflict is suppressed or downplayed by denying differences,
ignoring controversy, and exaggerating points of agreement.
What is a BATNA? - ​your best alternative to a negotiated agreement
- Your next best option
- If you don’t come to agreement what is your next best option that you can fall back on
- Examples:
- The better your BATNA, the more power you have
- If you don’t have a good BATNA, you may be desperate for any deal
- Determine your BATNA
- Try to figure out the other party’s BATNA
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