THE 3RD CORE MANAGEMENT
FUNCTION: LEADING
What is LEADING?
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Motivate subordinates(lower positions)
Help resolve group conflicts
Influence individuals or teams as they work
Select the most effective communication channel
Deal with employee behavior issues
Leading Process
Leadership
Motivation
Performance
5 Sources of Leader Power
1.
2.
3.
4.
5.
Legitimate Power: influencing behavior because
of one’s formal position
Reward Power: influencing behavior by promising
or giving rewards
Coercive Power: influencing behavior by
threatening or giving punishment
Expert Power: influencing behavior because of
one’s expertise
Referent Power: influencing behavior because of
one’s personal attraction
What is MOTIVATION?
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The process by which a person’s efforts are
energized, directed, and sustained toward attaining
a goal
The psychological processes that arouse and direct
goal-directed behavior
Motivation Model: People have certain needs that
motivate them to perform specific behaviors for
which they receive rewards that feed back and
satisfy the original need
Why is motivation important?

You want to motivate people to…
 Join
your organization
 Stay with your organization
 Show up for work at your organization: no absenteeism
or lateness
 Perform better for your organization: high productivity
 Do extra for your organization: not only their duty but
also be organizational “good citizens”
Motivation Theories
III.
Maslow’s Hierarchy of Needs
McGregor’s Theory X and Theory Y
Herzberg’s Two-Factor Theory
IV.
McClelland’s Three-Needs Theory
I.
II.
I. Maslow’s Hierarchy of Needs: 5
Levels
Higherorder
needs =
internal
Lowerorder
needs =
external
5 Levels of Needs
1.
2.
3.
4.
5.
Physiological Needs: the most basic human physical needs, in
which one is concerned with having food, clothing, shelter, and
comfort and with self-preservation
Safety Needs: concern with physical safety and emotional security,
so that a person is concerned with avoiding violence and threats
Belongingness Needs: once basic needs and security are taken
care of, people look for love, friendship, and affection
Esteem Needs: after they meet their social needs, people focus on
such matters as self-respect, status, reputation, recognition, and
self-confidence
Self-Actualization Needs: it is self-fulfillment—the need to
develop one’s fullest potential, to become the best one is capable
of being
Organization fulfills employee’s need
by…
Offer training, creativity,
promotions, employee control
over jobs
Offer recognition, status,
challenges, merit pay, employee
participation in making decisions
Offer interaction with others,
participation in workgroup,
good relations with supervisors
Offer safe working
conditions, job security,
health and retirement
benefits
Offer adequate
ventilation, heat, water,
base pay
II. McGregor’s Theory X and Theory Y
It should guide
management practice
which would maximize
employee motivation
Theory X:
negative view
of people such
as workers have
little ambition,
dislike work,
want to avoid
responsibility,
need to be
closely
controlled to
work effectively
Theory Y:
positive view of
people such as
workers enjoy
work, seek out
and accept
responsibility,
exercise selfdirection
III. Herzberg’s Two-Factor Theory: From
Dissatisfying Factors to Satisfying Factors
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Also called “motivation-hygiene theory”
This theory proposed that work satisfaction and
dissatisfaction arise from 2 different factors:
motivating factors (motivators)— “What will make my people
satisfied?”
The higher-level needs or simply motivators are factors associated
with job satisfaction—such as achievement, recognition,
responsibility, and advancement—all of which affect the job
content or the rewards of work performance
 hygiene factors—“Why are my people dissatisfied?”
The lower-level needs are factors associated with job
dissatisfaction—such as salary, working conditions,
interpersonal relationships, and company policy—all of which
affect the job context in which people work

Satisfaction vs. Dissatisfaction
IV. McClelland’s Three-Needs Theory:
Achievement, Affiliation, and Power
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3 needs—achievement, affiliation, and power—are
major motives determining people’s behavior in the
workplace
3 needs are as follows:
Need for achievement– “I need to excel at task”: the desire
to do something better or more efficiently, to solve
problems, to achieve excellence in challenging tasks
 Need for affiliation– “I need close relationships”: the desire
for friendly and warm relations with other people
 Need for power– “I need to control others”: the desire to be
responsible for other people to influence their behavior or
to control them
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Fitting Jobs to People Techniques
(Job Design)
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Job Enlargement: putting variety into a job
•
•
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It consists of increasing the number of tasks in a job to
increase variety and motivation
This increases job scope which expand scope of knowledge
Job Enrichment: putting more responsibility & other
motivating factors into a job
•
•
It consists of building into a job such motivating factors as
responsibility, achievement, recognition, stimulating
work, and advancement
This increases job depth which enable more employee’s
empowerment
Motivation & Compensation
Characteristics of the best incentive compensation
plans:
 Rewards
must be linked to performance and be
measurable
 Rewards must be agreed on by manager and
employees
 Rewards must be perceived as being equitable,
believable, and achievable by employees
Motivation & Compensation
Popular incentive compensation plans:
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Pay for performance (merit pay): it bases pay on one’s results,
according to measurable criteria
Bonuses: they are cash awards given to employees who achieve
specific performance objectives
Profit sharing: the distribution to employees of a percentage of
the company’s profits (profitability measure)
Gainsharing: the distribution of savings or “gains” to groups of
employees who reduced costs and increased measurable
productivity (productivity measure)
Stock options: with stock options, certain employees are given the
right to buy stock at the future date for a discounted price
Pay for knowledge (skill-based pay): it ties employee pay to
number of job-relevant skills or academic degrees they earn
Nonmonetary Ways of Motivating
Employees
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Thoughtfulness: the value of being nice
Work-life benefits
Surroundings
Skill-building & educational opportunities
Sabbaticals (leave)