Chapter 8
Motivation and Rewards
Management in Sport
Organizations
Learning objectives
– Explain the role of rewards in employee and volunteer
motivation
– Describe different types of intrinsic and extrinsic
rewards
– Describe the components of a financial compensation
plan
– Recognize job design as part of a rewards
management system
– Understand the importance of volunteer recognition
Rewards management
• to attract, motivate and retain employees
and volunteers
• reward strategies should support an
organisation’s goals and its human
resource plan
• selection and design of an effective
rewards management system should
consider human motivation theories
Theories of motivation
• motivation is a psychological state that
describes one’s drive to engage in a
particular behaviour
• Content theories and Process theories are
used to understand motivation
Content theories
•
attempt to explain what motivates
individuals
• The 3 classic theories are:
1. Maslow’s hierarchy of needs theory
2. Herzberg’s motivator-hygiene theory
3. McLelland’s three needs theory
Maslow’s hierarchy of needs
Based on 5 progressive levels of needs that every
human experiences:
• Physiological needs (e.g., food, shelter, clothing)
• Safety needs (e.g., security, stability, health)
• Belongingness needs (e.g., affection,
acceptance, friendship)
• Esteem needs (e.g., self-esteem, confidence,
respect by others)
• Self-actualization (e.g., personal growth,
morality)
Herzberg’s motivator-hygiene
theory
• aspects of the job itself (work content) related to
satisfaction; eg, achievement, recognition –
‘motivators’
• aspects of the workplace (work context) related
to dissatisfaction; eg, policies, relationship with
supervisor – ‘hygienes’
• Improvement of hygiene factors is needed to
avoid employee dissatisfaction
• to increase motivation opportunities for
employee achievement, recognition, and growth
(motivators) must be addressed
McLelland’s 3 need theory
• Need for achievement –to accomplish moderately
challenging performance goals, be successful in
competitive situations, assume personal responsibility for
work (rather than delegating it to others)
• Need for power –to control one’s environment, including
people and material resources.
• Need for affiliation –to seek approval from others,
conform to their wishes and expectations, and avoid
conflict/confrontation
• individuals have some need for achievement, power and
affiliation, however, one of these needs will be
predominant
Process theories
• explain how individuals are motivated; that
is, the cognitive process that individuals go
through that explain how a felt need can
result in certain behaviour
• Two classic process theories are equity
theory and expectancy theory
Equity theory
• extends the content theories of motivation by
proposing that individuals will be motivated, not
just by a given reward, but by whether they
perceive the reward situation to be equitable and
fair
• individuals will evaluate a given reward
according to whether they feel it is proportionate
with their own efforts & whether it is equitable to
the efforts and rewards of others
Classic model of equity
• ‘people will evaluate the fairness of their
situation in an organisation based on a
comparison of the ratio of their own inputs and
outcomes with some referent’s ratio of inputs
and outcomes’ (Mitchell & Daniels, 2003, p. 242)
• When the ratios are unequal individuals are
motivated to rectify the perceived inequity by (a)
modifying their own input (effort) to outcome
(rewards) ratio, (b) changing their referent other
and focusing instead on another person’s ratio of
inputs and outcomes, (c) distorting their
perceptions, or (d) quitting
Expectancy theory
• describes the cognitive process individuals go
through when determining whether to exert effort
• assumes that individuals are rational beings who
think about possible outcomes before they
engage in behaviour
• motivation to exert effort is a function of an
individual’s perception that, engagement in a
particular behaviour (e.g., performs tasks well)
will be acceptable and rewarded – and the
reward is valued
Types of rewards
• Intrinsic rewards - received directly as a
result of performing his or her job
• presume that there can be value in the
task itself
• Extrinsic rewards - financial (salary or
wages, incentives or bonuses) or
nonfinancial (pension contributions, life
insurance)
Financial compensation plan
• objectives should be clearly stated &
consistent with its corporate strategy and
human resource plan.
• What does the sport organization want to
pay for? What does it want to reward?
• the objectives form the basis upon which
pay and incentives will be awarded
Pay structure
Three principles guide the establishment of
a pay structure:
1. internal equity
2. the external market
3. employee contribution
Internal equity
• (a) comparable pay for comparable
content of work
• (b) comparable skills that are required
• (c) comparable contribution of the work or
skills to the objectives of an organisation
External market principle
• refers to positioning an organisation’s pay
structure, relative to what competitors are
paying
• needs to be considered in setting a
competitive (and equitable) compensation
package in order to attract and retain
competent staff
Employee contribution
Refers to the relative emphasis in a pay
structure on compensation by
1. job level
2. skills
3. seniority
4. performance
• or some combination.
Factors
Major
league
teams
Major
league
offices
College/
University
athletics
Sport
marketing
agencies
Minor league
teams
Arenas/spor
t venues
Broadcast/
media
Average compensation
($US)
$79,560
$77,500
$44,930
$103,077
$50,698
$63,684
$118,269
Range of
compensation
$25,000350,000
$25,000312,500
$25,00085,000
$25,000350,000
$25,000337,500
$27,500162,500
$27,500350,000
% compensation based
on bonus/commission
12.3%
13.9%
2.5%
19.7%
18.0%
4.7%
23.5%
Bonuses based on
dept. performance
45.7%
37.2%
58.3%
18.5%
8.6%
37.8%
35.6%
Bonuses based on
company performance
24.0%
20.6%
16.7%
47.2%
61.4%
23.3%
30.6%
Bonuses based on
individual performance
28.6%
42.2%
25.0%
34.3%
30.0%
38.9%
33.8%
Entertainment expense
account
54%
41%
28%
58%
32%
53%
77%
Pension
56%
59%
75%
33%
11%
68%
54%
Company car/auto
reimbursement
42%
32%
61%
35%
32%
37%
25%
Tuition reimbursement
13%
5%
64%
6%
3%
3%
25%
Country club
membership
10%
0%
11%
4%
12%
11%
6%
Data is based on a survey of 421 sport marketing professionals employed in seven segments of the sport industry in the United States.
Respondents were predominantly male (81.6%), average age 35.5 years, holding an undergraduate degree (94%),
with an average of 8.8 years of experience in the sport industry, and a 57-hour average work week.
Job design
• the opportunity to fulfill individual needs
can be built into the design of a job
• typical motivating elements of a job are:
autonomy, intrinsic job feedback, extrinsic
job feedback, social interaction, task
variety, task identity, skill/knowledge
requirements, task significance,
growth/learning, and recognition
Hackman & Oldham’s job
characteristics model
Five core job characteristics:
1. skill variety
2. task identity
3. task significance
4. task autonomy
5. job feedback
– contribute to employees’ sense of the
meaningfulness of their work, responsibility for
the outcomes of their work, and knowledge of
the results of their work
Volunteer recognition & rewards
(a) normative incentives - motivated by the
opportunity to help a cause such as a sport
program which he or she may feel is important
(b) affective incentives - motivated by the
opportunity to work with others, develop
friendships, and identify with a group
(c) utilitarian incentives - motivated by the
opportunity to use skills or sport background to
develop new skills and work experience or to
network in the community
• the importance of these incentives varies by
sport volunteers’ age
Nonfinancial extrinsic rewards
• can be an important symbolic expression
of appreciation for contributions and
performance
• provide some kind of alternative
recognition that is tangible and extrinsic to
the act of volunteering itself eg letter or
thanks, award for service, complimentary
tickets to special events and functions etc.
Summary
• Content theories (e.g., Maslow’s Hierarchy of Needs Theory,
Herzberg’s Motivator-Hygiene Theory, McClelland’s Three-Need
Theory) explain what motivates employees and volunteers, while
process theories (e.g., equity theory, expectancy theory) explain
how they are motivated.
• Job design can be used to increase the motivating potential of a job
by increasing task variety, task identity, task significance, autonomy,
and direct feedback, all of which provide an employee or volunteer
with an increased sense of the meaningfulness of their job,
responsibility for the outcomes of their work, and knowledge of
results of their contributions.
• Volunteers by definition do not receive extrinsic (direct) financial
compensation, therefore the sport organisation must rely on the
intrinsic rewards of the volunteer role itself to ensure their needs are
met.