Learning – it is defines as a relatively permanent change in
behavior or knowledge due to experience.
Classical conditioning – it is defined as a type of learning in
which a stimulus acquires the capacity to evoke a response
that was originally evoked by another stimulus.
Self-serving bias – is that type of attribution error whereby
people tend to attribute their achievements to their good
inner qualities, whereas they attribute their failures to
adverse factors within the environment.
Distinctiveness – it is the consideration given to how
consistent a person’s behavior is across different situations.
Stimulus – is something that incites action.
Operant Conditioning – it is defined as a type of learning
where people learn to repeat behaviors that bring them
pleasurable outcomes and to avoid behaviors that lead to
uncomfortable outcomes.
Consensus – this refer to the likelihood that all those facing
the same situation will have similar responses.
Consistency – this refer to the measure of whether an
individual responds the same way across time.
Social Learning – it is defined as the process of observing
the behavior of others, recognizing its consequences, and
altering behavior as a result.
Selective perception – it happens when a person
selectively interprets what he sees on the basis of his
interest, background, experience, and attitudes.
Perception – it is defined as the process by which people
select, organize, interpret, retrieve, and respond to
information from their environment.
Halo effect – it occurs when one attribute of a person or
situation is used to develop an overall impression of the
person or situation.
 Halo – refers to that ring of light just above the
head of a saint as we see it in pictures or paintings.
The halo signifies that everything about the saint
is holy.
Perceiver – the person who perceives the target
Target – it is the person, object, or event that is perceived
by another person.
Contrast – perception will be different in a different
situation
Intensity – varies in terms of brightness, color, depth, and
sound.
Figure and its ground – is a factor that may affect visual
perception.
 Figure is the one being looked at, and the Ground
is the background against which it stands.
Size – those that are smaller or larger than the average are
perceived differently. It is matter even in the placement of
company personnel.
Motion – moving objects are perceived differently from
stationary objects
Repetition – when the love at first sight does not work,
familiarity may do the trick
Attribution – it is the process by which people ascribe
causes to the behavior they perceive.
Fundamental attribution error – refer to the tendency to
underestimate the influence of external factors in the
behavior of others.
Contrast effect – it is defined as the evaluation of a
person’s characteristics that are affected by comparisons
with other people recently encountered who rank higher or
lower on the same characteristics.
Projection – is attributing one’s own thoughts, feelings, or
motives to another. It is likely to occur in the
interpretation stage of perception.
Stereotyping – it refers to judging someone on the basis of
one’s perception of the group to which that person
belongs.
2 Change in behavior happens due to any or both of the ff:
1. Learning
2. Other causes such as drugs, injury, disease, and
maturation
3 Theories of learning
1. Classical conditioning
2. Operant conditioning
3. Social Learning
Social learning may be done in three (3) ways:
1. by observing what happens to other people
2. by being told about something,
3. through direct experience.
Three (3) factors influencing PERCEPTION:
1. the perceiver
2. the target
3. the situation
Four (4) Factors that influenced the PERCEPTION OF
PERCEIVER to his target:
1. his past experiences
2. his needs or motives
3. his personality
4. his values and attitudes
Perception may be modified by the following factors which
are typical CHARACTERISTICS OF TARGETS:
1. Contrast
2. Intensity
3. Figure-ground separation
4. Size
5. Motion
6. Repetition or novelty
Three (3) situational factors that affect perception:
1. Time
3. Social setting
2. Work setting
Two (2) classifications of common attribution errors:
1. The Fundamental Attribution Errors
2. The Self-Serving Bias
3 Factors that influence attribution:
1. Distinctiveness
3. Consistency
2. Consensus
Five (5) Shortcuts used in forming impression of others:
1. Selective perception
2. Halo effect
3. Contrast effects
4. Projection
5. Stereotyping
How people learn values
1. Modeling
2. Communication of attitudes
3. Unstated but implied attitudes
4. Religion
Modeling - parents, teachers, friends and other people
oftentimes become models to persons who would later
exhibit good behavior in the workplace
Communication Of Attitudes - When a person often hears
from acquaintances the risk of buying products imported
from a certain country, the person may develop negative
values about the country.
Unstated But Implied Attitudes – values may also be
affected by attitudes that are not stated but are implied by
way of action.
Religion – the just a fair treatment of people is a value that
is taught by priest and minister of various religious sects.
Types of Values
1. Achievement
2. Helping and concern for others
3. Honesty
4. Fairness
Achievement- this is value that pertains to getting things
done and working hard to accomplish goals.
Helping And Concerns For Others- refers to the person’s
concern with other people and providing assistance to
those who need help.
Honesty- this is a value that indicates the person’s concern
for telling the truth and doing what he thinks is right.
Fairness – this is a value that indicates the person’s
concern for impartiality and fairness for all concerned.
CHAPTER 4: VALUES, ATTITUDES, AND JOB SATISFACTION
Job Satisfaction – is an important concern for both
employer and employees.
Values
 Refer to the importance a person attaches to
things or ideas that serves as guide to action.
 Is enduring beliefs that one’s mode of conduct is
better than the opposite mode of conduct.
 Are made of a set of beliefs.
 May be attached to things or ideas like loyalty,
teamwork, honor, obedience, honesty and the
like.
 Are not inborn, they are learned.
Attitude – form the basis for determining how satisfied
people are with their jobs.
Value Incongruence – occur if the individual’s value is not
in agreement with the organization’s value. As a result,
conflicts may arise over such things as goals or the manner
in which the goals will be achieved.
Effects of Value Congruence and Incongruence
 Organizational Values – when congruent with the
individual’s values = Positive Feelings
 Organizational Values – when incongruent with
the individual’s values = Conflicts
Espoused Values- are what members of the organization
say they value.
How Attitudes are Formed
 Attitudes are formed through learning.
Enacted Values- are reflected in the actual behavior of the
individual members of the organization.
Methods that most influence attitude formation
1. Direct experience
2. Indirect experience
Classification of Values:
1. Terminal Values
2. Instrument Values
Terminal Values- may represent the goals that a person
would like to achieve in his or her lifetime.
Instrumental Values- refer to preferable modes of
behavior or means of achieving the terminal values.
Attitudes
 Are link with perception, learning, emotions and
motivation
 It also forms the basis for job satisfaction in the
workplace.
 Are feelings and beliefs that largely determine
how employees will perceive their environment,
commit themselves to intended actions and
ultimately behave.
 It reflects how one feels about something
Direct Experience - most accessible information stored in
human mind.
Indirect Experience - an unpleasant experience with others
would be negative regardless of other information obtain
from it. Their influence is not as strong as direct
experience.
Attitudes that are formed in an indirect way are the result
of social interactions with the family, peer groups, religious
organizations, and culture.
Work Behavior – is of utmost importance to managers and
superiors.
Most Important Attitudes in the Workplace
1. Job Satisfaction
2. Job Involvement
3. Organizational Commitment
Main Components of Attitudes
1. Cognitive 3. Behavioral
2. Affective
Effects of Employee Attitudes
 Attitudes provide clues to the behavioral
intentions or inclinations of an employee.
Cognitive Component - refers to the opinion or belief
segment.
Employee Attitudes may be classified as:
1. Positive Job Attitudes
2. Negative Job Attitudes
Affective Component - refers to the emotional or feeling
segment.
Behavioral Component - refers to the intention to behave
in a certain way toward something or someone.
Differences in Personal Disposition
1. Positive Affectivity
2. Negative Affectivity
Positive Affectivity – refers to personal characteristic of
employees that inclines them to be predisposed to be
satisfied at work. Usually are optimistic, upbeat, cheerful
and courteous.
Negative Affectivity – is a personal characteristic of
employees that inclines them to be predisposed to be
dissatisfied at work. Generally pessimistic, downbeat,
irritable, and sometimes, abrasive.
Positive Job Attitudes – indicate job satisfaction and are
useful in predicting constructive behaviors like serving
customers beyond official working hours, and performing
excellently in all aspects of their job.
Negative Job Attitudes – are also useful in predicting
undesirable behavior, including those concerning job
dissatisfaction, lack of job involvement, low commitment to
the organization, and strong negative words.
When employees are DISSATISFIED with their jobs, they
will have a strong tendency to engage in any or all of the
following:
1. Psychological withdrawal like daydreaming on the
job
2. Physical withdrawal like unauthorized absences,
early departures, extended breaks or work
slowdowns.
3. Aggression like verbal abuse or dangerous actions
against another employee.
Reward System – one of the various ways of changing
employee attitudes.
Job Satisfaction - the attitude people have about their job.
Positive Feeling - refers about one’s job resulting from an
evaluation of its characteristics.
Negative Feeling - refers to as “job dissatisfaction.”
When people are SATISFIED with their jobs, the following
benefits become possible:
1. High Productivity
2. A stronger tendency to achieve customer loyalty
3. Loyalty to the company
4. Low absenteeism and turnover
5. Less job stress and burnout
6. Better safety performance
7. Better life satisfaction
Factors associated with Job Satisfaction
1. Salary
2. Work Itself
3. Promotion Opportunity
4. Quality Of Supervision
5. Relationship With Co-Workers
6. Working Conditions
7. Job Security
Salary- adequacy of salary and perceived equity compared
with others;
Work Itself- the extent to which job tasks are considered
interesting and provide opportunities for learning and
accepting responsibility;
Promotion Opportunity- chance for further advancement
Quality of Supervision- the technical competence and the
interpersonal skills of one’s immediate superior;
Relationship with Co-Workers- the extent to which coworkers are friendly, competent and supportive;
Working conditions- the extent to which the physical work
environment is comfortable and supportive of productivity;
Job Satisfaction- the beliefs that one’s position is relatively
secure and continued employment with the organizations
reasonable expectation.
Ways of Measuring Job Satisfaction
1. The Single Global Rating Method
2. The Summation Score Method
The Single Global Rating Method – where individuals are
asked to respond to a single question.
The Summation Score Method – where individuals indicate
their feelings regarding each key factors of their job.
Jobs Key factors include:
1. Work
2. Supervision
3. Current Salary
4. Promotion Opportunities
5. Relations with co-workers
Job Involvement
 Another positive employee attitude.
 Refers to the degree to which a person identifies
with the job, actively participates in it, and
considers performance important to self- worth.
Positive Self-Image – is a result of a person’s holding a
meaningful job and actively performing it.
People with a high degree of JOB INVOLVEMENT will:
1. Seldom be late or absent
2. Willing to work long hours if necessary
3. Will strive to be high performers.
Organizational Commitment
 Is a third positive employee attitude
 Refers to the degree to which an employee
identifies with a particular organization and its
goals and wishes to maintain membership in the
organization.
 Often reflects the employee’s belief in the
organization, willing ness to expend effort in
accomplishing them, and intentions to continue
working in organization.
Employees who are ORGANIZATIONALLY COMMITTED
have:
1. Good attendance records
2. Show willingness to adhere to the firm’s policies
3. Lower turnover rates
Three dimensions of Organizational Commitment
1. Affective Commitment
2. Continuance Commitment
3. Normative Commitment
Affective Commitment - refers to the employee’s
emotional attachment to the organization and belief in its
values.
Continuance Commitment - refers to the employee’s
tendency to remain in an organization because he cannot
afford to leave.
Normative Commitment - refers to the obligation to
remain with the company for moral or ethical reasons.
Reasons why employees choose to continue employment
with the firm may be classified as:
1. Economic
2. Non-economic
Economic Factors – refer to salary, allowances, and
retirement pension.
Non-Economic Factors – includes participation in decision
making, job security, and certain job characteristics such as
autonomy, responsibility, and interesting work.
to choose a course of action and engage in a
certain behavior.
Key elements of motivation:
1. Intensity
2. Direction
3. Persistence
Intensity – refer to the level of effort provided by the
employee in the attempt to achieve the goal assigned to
him. In simple terms, it refers to how hard a person tries to
do work.
Direction – relates to what an individual chooses to do
when he is confronted with a number of possible choices.
Persistence – is a dimension of motivation which measures
how long a person can maintain effort to achieve the
organization’s goal.
CHAPTER 5: MOTIVATION
Job Performance – is a given requirement in any
organization.
Classification of Theories of Motivation
1. Content theories
2. Process theories
Employee Performance – is a very important concern for
people running organizations.
Content Theories – are those that focus on analyzing the
wants and needs of an individual.
Condition (determinant) of JOB PERFORMANCE:
1. Capacity to perform
2. Opportunity to perform
3. Willingness to perform
Process Theories – explain how people act in response to
the wants and needs that they have.
Capacity To Perform – relates to the degree to which the
employee possesses skills, abilities, knowledge, and
experiences relevant to his job.
Four classifications of Content Theories:
1. Hierarchy of Needs Theory of Abraham Maslow
2. ERG Theory of Clayton Alderfer
3. Acquired Needs Theory of David L. McClelland
4. Two-factor Theory of Frederick Herzberg
Opportunity To Perform – will depend on the work
environment provided to the employee. It also, diminished
by lack of equipment, lack of funds, and insufficient
authority.
Three classifications of Process Theories:
1. Expectancy Theory of Victor Vroom
2. Equity Theory of J. Stacey Adams
3. Goal Setting Theory of Edwin A. Locke
Willingness To Perform – relates to the degree in which an
employee desires and is willing to exert effort to achieve
the goals assigned to him. It also called MOTIVATION.
Hierarchy of Needs Theory – is the idea that human
possess a hierarchy of five needs such that as each need is
substantially satisfied, the next need becomes dominant.
Motivation
 is one of the requisites of performance. (one of
the requirements of performance)
 defined as the process of activating behavior,
sustaining it, and directing it toward a particular
goal.
 moves people to act and accomplish
 more specifically defined as the set of internal and
external forces that cause a worker or employee
Maslow’s Five Hierarchy of Needs:
1. Physiological Needs
4. Esteem Needs
2. Safety Needs
5. Self-Actualization
3. Social Needs
Physiological Needs – includes hunger, thirst, shelter, sex,
and other bodily needs.
Safety Needs – include security and protection from
physical and emotional harm.
Social Needs – include affection, belongingness,
acceptance, and friendship.
Need for AFFILIATION – refers to the desire to establish
and maintain friendly and warm relations with others.
Esteem Needs – include INTERNAL esteem FACTORS such
as self-respect, autonomy, and achievement, and
EXTERNAL FACTORS such as status, recognition and
attention.
Need for POWER – refers to the desire to control others, to
influence their behavior, or to be responsible for others.
Self-Actualization – refers to the drive to become what one
is capable of becoming, which includes growth, achieving
one’s potential, and self-fulfillment.
ERG Theory – is a need hierarchy theory of motivation that
was developed by Clayton Alderfer.
Clayton Alderfer
 He believed that in motivating people, we are
confronted by THREE SETS OF NEEDS.
 He also believed that individuals progress up the
hierarchy of needs as a result of the satisfaction of
lower order needs. But he maintained, however,
that if a higher order need cannot be satisfied, a
lower order need becomes dominant as a
motivating factor.
 he also thought that, unlike Maslow, more than
one need may be activated at the same time.
Three Sets Of Needs according to Clayton Alderfer:
1. Existence
3. Growth
2. Relatedness
Existence – refer to the needs satisfied by such factors as
food, air, water, pay, and working condition.
Relatedness – refer to the needs satisfied by meaningful
social and interpersonal relationship.
Growth – refer to the needs satisfied by an individual
making creative or productive contributions.
Acquired Needs Theory – was developed as a result of a
research made by David McClelland and his associates.
- They found out that managers are motivated by
THREE FUNDAMENTAL NEEDS.
Three Fundamental Needs according to McClelland and
associates (Acquired Need Theory):
1. need for ACHIEVEMENT
3. need for POWER
2. need for AFFILIATION
David McClelland – he believed that the foregoing needs
are acquired over time as a result of life experiences.
McClelland research findings consist of the following:
1. People who have high achievement needs have
the drive to advance and to overcome challenging
situations such as those faced by entrepreneurs in
introducing innovative new business.
2. An affiliation motivated by person prefers to work
with friends.
3. The need for power drives successful managers.
The Two-Factor Theory
 was developed by Frederick Hezberg that
identifies JOB CONTEXT as source of job
dissatisfaction and JOB CONTENT as the source of
job satisfaction.
 according to this, improving any of the hygiene
factors will not make people satisfied with their
work; it will only prevent them from being
dissatisfied.
 according to this, when the foregoing factors are
not present, there is low job satisfaction among
workers and there is lack of motivation to
perform.
Job Context – or work setting relates more to the
environment in which people work.
Hygiene Factors – are the factors associated with Job
Context.
Eight (8) Hygiene Factors:
1. Base wage or salary
7. Status
2. Quality of supervision
8. Security
3. Working conditions
4. Relation with peers
5. Relation with subordinates
6. Organizational policies
Job Content – relates more to what people actually do in
their work.
Motivator Factors – those that are related to job content.
Need for ACHIEVEMENT - refers to the desire to do
something better or more efficiently, to solve problems, or
to master complex tasks.
Six (6) Motivator Factors:
1. Work itself
2. Achievement
3. Recognition
4. Responsibility
5. Advancement
6. Growth
Expectancy Theories – was developed by Victor Vroom that
sees people as choosing a course of action according to
what they anticipate will give them the greatest rewards.
1.
According to Vroom, motivation is a product of the
following factors:
1. Valence
3. Instrumentality
2. Expectancy
3.
Valence X Expectancy X Instrumentality = Motivation
Valence – how much one wants a reward
Expectancy – one’s estimate of the probability that effort
will result in successful performance. This predicts that
motivation will be high if all the three factors are rated
high.
Instrumentality – one’s estimate that performance will
result in receiving the reward.
Equity Theory
 may be defined as a theory that individuals
compare job inputs and outcomes with those of
others and then respond to eliminate inequities.
 it assumes that employees are motivated by a
desire to be equitably treated at work.
Equity – exist when employees perceive that the ratios of
their inputs (or effort) to their outputs (or rewards) are
equivalent to the ratios of other employees.
Inequality – leads to the experience of tension, and tension
motivates a person to act in a manner to resolve the
inequality.
Two (2) Types Of Inequality:
1. Over Rewarded
2. Under Rewarded
Over Rewarded – when exists, employee will think that
there is an imbalance in their relationship with their
employee.
Over Rewarded Employee will seek to restore the balance
through any of the following:
1. They might work harder
2. They might discount the value of the rewards
3. They could try to convince other employees to ask
for more rewards
4. They might choose someone else for comparison
purpose
Under Rewarded Employees will seek to reduce their
feelings of inequality through any of the following:
2.
4.
5.
They might lower the quality or quantity of their
productivity.
They could inflate the perceived value of the
rewards received
They could find someone else to compare
themselves
They could bargain for more rewards
They might quit
Goal Setting Theory
 it may be defined as the theory that specific and
difficult goals, with feedback lead to higher
performance.
 This is based on the premise that behavior is
regulated by values and goals.
Goal – is the specific target that an individual is trying to
achieve.
Edwin A. Locke and associates – who developed a
comprehensive framework linking goals to performance.
Findings of Edwin Locke and associates about goals
includes the following:
1. Specific goals lead to a higher performance than
generalized goals.
2. Performance generally increases in direct portion
to goal difficulty.
3. For goals to improve performance, they must be
accepted by the workers.
4. Goals are more effective when they are used to
evaluate performance.
5. Goals should be linked to feedback.
Four (4) Motivational Method And Programs:
1. Motivation Through Job Design
2. Organizational Behavior Modification
3. Motivation Through Recognition And Pride
4. Motivation Through Financials Incentives
Job Design
 One way of motivating employees is to make their
job challenging so that the worker who is
responsible for it enjoys doing it. When it is
undertaken, some useful benefits will accrue to
the organization.
 It may be defined as the way the elements in a job
are organized.
Three (3) Important Concepts In Designing Jobs.
1. Job enrichment
2. Job characteristics model
3. Job crafting
Job Enrichment – refer to the practice of building
motivating factors like responsibility, achievement and
recognition into job content.
Nine (9) characteristics of enriched job (job enrichments):
1. Control Over Method
2. Control Over Scheduling
3. Control Over Resource
4. Client Relationship
5. Direct Feedback
6. Direct Communication Authority
7. New Learning
8. Personal Accountability
9. Unique Experience
Skill Variety – is the degrees to which there are many skills
to perform.
Task Identity – is the degree to which one worker is able to
do a complete job, from beginning to end, with the
tangible and possible outcome.
Task Significance – is the degree to which the job has a
substantial impact on the lives or work of other people.
Autonomy – is the degree which the job gives the
employee substantial freedom, independence, and
discretion in scheduling the work and determining the
procedures used in carrying it out.
Direct Feedback – means employees receive immediate
feedback of their work.
Feedback – is the degree to which a job provides direct
information about performance.
Client Relationship – means an employee is given a chance
to serve an external or internal client.
Job Crafting – refer to the physical and mental changes
workers make in the task or relationship aspect of their
jobs.
New Learning – means that the employee acquires new
knowledge while doing his work.
Control Over Method – means that the employee has
some control over which method to choose to accomplish a
task.
Control Over Scheduling – means the employee has the
ability to schedule his work.
Unique Experience – means the job has unique qualities or
features like the opportunity to see the world.
Direct Communication Authority – means the job provides
the employee the opportunity to communicate directly
with people who use their output.
Control Over Resources – means the employee has some
control over resources such as money, material and people.
Personal Accountability – means the employee is
responsible for his or her result.
Job Characteristic Model
 Refer to the method of job design that focuses on
the task and interpersonal demands of a job.
 This emphasizes the interaction between the
individual and the specific attributes of the job.
Five CORE JOB CHARACTERISTICS are defined as follow:
1. Task Identity
4. Task significance
2. Autonomy
5. Skill variety
3. Feedback
Three (3) COMMON TYPES OF JOB CRAFTING:
1. Changing the number and type of job tasks
2. Changing the interaction with others on the job
3. Changing one’s view of the job
Organizational Behavior Modification – is the application
of reinforcement theory in motivating people at work.
Reinforcement Theory – defined as the contention that
behavior is determined by its consequences.
Five-Step Problem Solving Model of a typical
organizational behavior modification program:
1. Identifying critical behaviors that make a
significant impact on the employee’s job
performance.
2. Developing baseline data which is obtained by
determining the number of times the identified
behavior is occurring under present conditions.
3. Identifying behavioral consequences of
performance
4. Developing and implementing an intervention
strategy to strengthen desirable performance
behaviors and weaken undesirable behaviors.
5. Evaluating performance improvement.
Benefits of ORGANIZATIONAL BEHAVIOR MODIFICATION
are:
1. Improvement of employee productivity
2. Reduction or errors, absenteeism, tardiness, and
accident rates.
3. Improvement of friendliness toward customers.
Recognition – is a natural human need and it is a strong
motivator.
Steps in Motivation through recognition and pride :
1. Identify a meritorious behavior
2. Recognize the behavior with an oral, written, or
material reward.
Five Points Need To Consider For A Better Understanding
And Implementation Of Reward And Recognition
Program:
1. Feedback is an essential part of recognition
2. Praise is one of the most powerful forms of
recognition.
3. Reward and recognition programs should be
limited to organizational goals
4. Identification of the type of rewards and
recognition that the workers will value.
5. It is important to evaluate the effectiveness of the
reward and recognition program.
Pride – is also a motivator, but one that is intrinsic. The
feeling satisfies the need for self-esteem and selffulfillment. This provides managers with a clue on what
concrete actions could be done to motivate workers.
Financial Incentives – are powerful tools of motivation.
They are monetary rewards paid to employees because of
the output they produce, skills, knowledge, and
competencies or a combination of these factors.
Five (5) Financial Incentives take the form of any or
combination of the following:
1. Time rates
2. Payment by results
3. Performance and profit related pay
4. Skill/ competency based pay
5. Cafeteria or flexible benefits system.
Time Rates – is a type of monetary reward which use the
number of hours worked as a means of determining
rewards.
Classification of TIME RATES:
1. Hourly rate
3. Monthly salary
2. Weekly wage
Four (4) ADVANTAGES OF TIME RATES:
1. It is open to inspection and equitable because
employees doing the same job will be on the same
grade level.
2. It encourages the retention of human resources by
stability and this is because of the gradual
increases in rewards within the given grades.
3. It is relatively easy to administer and allows labor
cost to be predicted.
4.
It does not emphasize quantity of output to the
detriment of quality.
Payment By Results – this scheme links pay to the quantity
of the individual’s output.
Three (3) ADVANTAGES OF PAYMENT BY RESULT:
1. The employee is motivated to put extra effort
because by doing so, he or she will receive
additional income.
2. There is fairness because the level of reward is
related to the level of output.
3. There are likely to be cost advantages since wages
are directly linked to production and less
supervision is required.
Performance by related pay – this scheme considers
results or outputs plus actual behavior in the job.
Reward – consists of a lump sum, or a bonus as a
percentage of basic salary.
Bonus – is a reward given to employees for recent
performance rather than historical performance.
Three (3) ADVANTAGES OF PERFORMANCE RELATED PAY:
1. It increases employee beliefs that reward will
follow high performance.
2. Those that perform better are rewarded more.
3. It is comparatively objective and verifiable.
Profit Related Pay – is a scheme where pay is linked to
company profits. It takes the form of direct cash outlay, or
allocation of stock options.
Stock Option – is a financial incentive that gives employees
the right to purchase a certain number of company shares
at a specified price, generally the market price of the stock
on the day the option is granted.
Six (6) ADVANTAGES OF PROFIT RELATED PAY:
1. Employees identify more closely with the success
of the organization.
2. There is a breaking down or removal of the
communication barrier between management and
employees.
3. Cooperation and working together for mutual
benefit is encouraged.
4. Awareness of the link between performance and
organizational profitability leads to a greater
awareness of cost and their impact on
performance.
5. When profits fall, the decline in pay is a preferable
alternative to laying off employees.
6. Group pressure could raise the performance levels
of poor performers.
Skill Based Pay – also known as competency based or
knowledge based pay.
- this is a pay plan that sets pay levels on the basis of how
many skills employees have or how many jobs they can do.
Three (3) advantages of skill based pay:
1. It provides strong motivation for employees to
develop their work-related skills.
2. It reinforces an employee’s sense of self-esteem
3. It provides the organization with a highly flexible
workforce that can fill in when someone is absent.
Cafeteria or flexible benefit system – is a benefit plan that
allows each employee to put together a benefit package
individually tailored to his or her own needs and situation.
Four (4) ADVANTAGES OF CAFETERIA OR FLEXIBLE BENEFIT
SYSTEM:
1. It enables employees to choose options that best
fit their own needs.
2. Deciding among the various options makes
employees more aware of the benefits, giving
them a real sense of the value of the benefits their
employers provide.
3. Flexible benefit plan can lower compensation
costs because employers no longer have to pay for
unwanted benefits.
4. Employers and employees can save on taxes.
CHAPTER VI COMMUNICATION
Communication
 is a requirement for survival and growth not only
of people but also organization.
 May be defined as the transfer of information
including feelings and ideas from one person to
another.
 Goal is to have the receiver understand the
message as it was intended.
 It is a two-way process in which a sender reaches a
receiver with a message.
Individual member of organization must know important
concern such as:
1. What their ORGANIZATION is
2. What OBJECTIVE THEIR ORGANIZATION wants to
achieve
3. What THEIR ROLES in achieving the organization’s
objectives
4. How they will ACHIEVE THOSE OBJECTIVES
5. Who the INDIVIDUAL MEMBERS of the
organization are
Importance of Communication:
1. Without communication, organization cannot
exist.
2. Organization can relate with its external
environment which include customers, suppliers,
competitor and the government.
3. Communication is essential for the coordination of
business.
Six components of an effective communication:
1. A communication source or sender
2. A message
3. A channel
4. A receiver
5. Feedback
6. The environment
The Sender – is a person who makes the attempt to send a
message which could be spoken, written, in sign language,
or nonverbal to another person or a group of persons.
The Message – is a purpose or an idea to be conveyed in a
communication event. It is the actual physical product as a
result of encoding.
Factors that may INFLUENCE THE MESSAGE:
1. Clarity of message
2. Alertness of message
3. Complexity and length of the message
4. How the information is organized
Two Components of Message:
1. The thought or conceptual component of the
message
2. The feeling or emotional component of the
message
Thought or conceptual component of the message – is
contained in the words, ideas, symbols, and concepts
chosen to relay the message.
Feeling or emotional components of the message – is
contained in the intensity, force, demeanor, and
sometimes the gesture of the communicator or sender.
This enriches and clarifies the message.
The Channel – is the medium through which the message
travels.
Types of Channel:
1. Face-to-face – most effective
2. Telephone and cell phones
3. e-mail
4. written memos and letters
5. posted notices – least effective
6. bulletins – least effective
Two classification of channel:
1. Formal
2. Informal

Formal – belong the communication of policies, procedures
and other official announcement.

Informal – do not follow the chain of command.
Grapevine – is a type of informal communication that
transfers information through networks of friendship and
acquaintances.
 Advantages is that it transmit information quickly
and efficiently
 Disadvantages is that it can transmit incorrect and
untimely information
The Receiver – the person receiving the message. He must
interpret and understand the message.
Factors that INFLUENCE THE RECEIVER:
1. Age
2. Gender
3. Beliefs
4. Past experiences
5. Cultural influences
6. Individual needs
The Feedback – refers to the process of communicating
how one feels about something another person has done
or said. This also provides a clue to the sender of
information whether the message he sent was received as
intended.
The Environment – refers to the circumstances in which
messages are transmitted and received. In an environment
of trust and confidence, message are easily transmitted
The Noise – refers to anything that disrupts
communication, including attitudes and emotions of the
receiver.
Example of Noise:
1. Loud music
2. The feeling about a sick relative
3. Children playing in the background
Three basic methods of interpersonal communication:
1. Verbal
2. Written
3. Nonverbal communication
Verbal Communication
 is a major means of sending messages.

The delivery is quick and it provides the
opportunity for a quick feedback
Major disadvantage is the distortion of the
message when it passes to several people.
Example of verbal communication:
1. One-on-One meeting
2. Speeches
3. Grapevine
4. Telephone
5. Departmental or interdepartmental
meetings
6. Presentation
Verbal communication is the appropriate method if the
sender:
1. Wants to appear informal
2. Wants to invite suggestions and ideas which are
more likely to spark off a discussion
3. Is explaining something complex and people might
need to ask for clarification as he goes along.
4. Has important news to impact, such as
retrenchment
5. Needs to be very diplomatic and feels he will be
more effective face-to-face than in writing
6. Has something highly confidential to say and
putting it in writing is risky.
Verbal communication is not appropriate when the
sender:
1. Wants to maintain formality or distance from the
other person or a group of people.
2. Wants a permanent record of what has been said
3. Needs receiver’s comments to be in writing for
legal reason
4. Wants to avoid further discussion of the subject by
signaling that the matter is closed.
Written Communication
 Examples of written communication:
1. Memos
2. Notice-boards
3. Letters to staff
4. Emails
5. Faxes
6. Internal newspaper
7. Instant messaging
Advantages of written communication:
1. It is formal and authoritative
2. It provides a permanent record of ehat have been
said
3. It provides a document useful for legal purposes
4. A number of people will receive exactly the same
information
5.
6.
7.
8.
It is useful in communicating something
complicated
It is sometimes quicker
It avoid a lengthy discussion
Words can be chosen carefully
Written communication is NOT appropriate when:
1. The receiver needs to ask question or seek
clarification
2. More discussion is needed before facts are
established
3. A friendly and informal atmosphere is needed
4. The message is very important
5. The message is confidential
6. The information may be upsetting to the receiver
Nonverbal Communication
 It reveals what the sender really mean or thinking
 Example:
1. Facial expression
2. Body movements
3. Eye contact
4. Physical gesture
Commonly accepted interpretations of various forms of
body language:
 Facial expression:
1. Frown – displeasure, unhappiness
2. Smile – friendliness, happiness
3. Raised eyebrows disbelief, amazement
4. Narrowed eyes, pursed lips – anger



Four (4) function of communication:
1. Information function – communication provides
information needed in decision making.
2.
Motivation function – communication is a means
used to encourage commitment to organizational
objectives.
3.
Control function – communication clarifies duties,
authority, and responsibilities, thereby permitting
control.
4.
Emotive function – communication permits the
expression of feelings and the satisfaction of social
needs.
Basic goals of effective communication:
1. To gain goodwill
2. To inquire
3. To inform
4. To persuade
Nine (9) Barriers of communication
1. Filtering
2. Selective perception
3. Information overload
4. Emotions
5. Language
6. Communication apprehension
7. Absence of feedback
8. Physical separation
9. Lack of credibility of the sender
Eye contact:
1. Glancing – interest
2. Steady – active listening, interest,
seduction
Filtering – refers to the manipulation of information so that
is will be seen more favorable by the receiver.
Gesture
1. Pointing finger – authority, displeasure,
lecturing
2. Folded arms – not open to change,
preparing to speak
3. Arms at side – open to suggestions,
relaxed
4. Hands uplifted outward – disbelief,
puzzlement, uncertainty
Information overload – refers to the condition in which
information inflow exceeds an individual’s processing
capacity.
Body Postures
1. Fidgeting, doodling – boredom
2. Hands on hips – anger, defensiveness
3. Shrugging shoulders – indifference
4. Squared stance of shoulders – problem
solving, concerned, listening
5. Biting lips, shifting, jingling money –
nervousness
Selective perception – receivers selectively see and hear
messages based on their needs, motivations, experience,
background, and other personal characteristics.
Emotions – the receiver’s feelings affect this ability to
understand any message sent to him.
Language – words do not always mean the same thing to
different people.
Communication Apprehension – refers to the undue
tension and anxiety about oral communication, written
communication or both.
Absence of feedback – does not provide the sender the
opportunity to correct misimpressions about the message
sent. Without feedback, the sender will not know if the
message was received at all.
Feedback – is an essential component of effective
communication.
Physical separation – refers to interferences to effective
communication occurring in the environment where the
communication is undertaken.
1. Distances between people
2. Walls
3. An office that is not conducive to communication
4. An intimidating person posted near the door
5. Wrong timing
Lack of Credibility of the sender – if the sender has low
credibility, the message, even if it gets through, will likely
be ignored. This is the type of barrier that should be
overcome by leaders of organizations.
Kinds of communication flow
1. Downward
2. Upward
3. Horizontal
Downward communication – refers to message flows from
higher levels to lower levels.
Purpose of downward communication:
1. To give instructions
2. To provide information about policies and
procedures
3. To give feedback about performances
4. To indoctrinate or motivate
Various techniques used in downward communication:
1. Letters, meeting, and the telephone or cell phone
2. Manuals
3. Handbooks
4. Newsletter
Upward Communication – refers to messages from
persons in lower level position to persons in higher
positions.
Purpose of upward communication:
1. To provide feedback
2. To inform higher-ups of progress towards goals
3. To relay current problems
Techniques used in upward communication:
1. Performance reports
2. Suggestion systems
3. Informal gripe sessions
4. Open-door policy
5. Exit interviews
Horizontal Communication – refers to messages sent to
individuals or groups from another of the same
organizational level or position.
Purpose of Horizontal communication:
1. To coordinate activities between departments
2. To persuade others at the same level of
organization
3. To pass on information about activities or feelings
Techniques appropriate for horizontal communication:
1. Memos
2. Telephones or cell phones
3. Picnics
4. Dinners and other social affairs
Areas of concern in message flows:
 Downward communication
1. Implementation of goal, strategies,
objectives
2. Job instructions and rationale procedures
and practices
3. Indoctrination

Upward communication
1. Problems and expectations
2. Suggestions for improvement
3. Performance reports
4. Grievance and disputes
5. Financial and accounting information

Horizontal communication
1. Intradepartmental problem solving
2. Interdepartmental coordination
3. Staff advice to the departments
Ineffective communication – can affect people involved in
it negatively. It can cause the following:
1. Hurt feelings
2. Waste of time and valuable resources
Useful tips to avoid unwanted effects:
1. The message should be improved so it could be
easily understood.
2. The receiver must improve his skill in
understanding the messages sent to him.