Chapter 18: Motivation CHAPTER 18 MOTIVATION Learning Objectives After reading this chapter, the student should be able to: Differentiate between intrinsic and extrinsic rewards and describe how they influence motivation. Outline the five primary content theories of motivation and describe how they are similar or different. Describe the primary process theories of motivation and what each one attempts to measure. Explain the different ways in which desired behavior is reinforced within an organization and the role that job design plays in channeling motivation. Chapter Outline Introduction Content Theories of Motivation o Hierarchy of Needs Theory o ERG Theory o Two-Factor Theory o Acquired Needs Theory o Four-Drive Theory © 2014 Cengage Learning. All Rights Reserved. 1 Chapter 18: Motivation Process Theories of Motivation o Goal-Setting Theory o Expectancy Theory o Equity Theory Reinforcing Motivation o Work Design o Reinforcing Strengths Summary Self-Reflection: What Motivates You? This self-reflection is designed to assess students’ understanding of what motivates them. Students who understand what motivates them can use this knowledge for goal setting, career planning, and performance management. This assessment has ten true and false statements. Self-Reflection Motivating Factor Question Q1 Financial Rewards Q2 Fear of Punishment Q3 Recognition Q4 Challenge Q5 Goals 2 © 2014 Cengage Learning. All Rights Reserved. Chapter 18: Motivation Q6 Achievements Q7 Developmental Opportunities Q8 Helping Others Q9 Affiliation or a Sense of Belonging Q10 The need to learn or Master a task After completing the assessment, students can reflect upon how they think their motivating factors will influence their career choices. Comprehensive Lecture Outline Discussion Starter: Ask students to describe jobs or projects where they were motivated and examples of when they were demotivated. A wide range of responses will reinforce the point of how people need many different motivators. I. Introduction. The real test of leadership is the ability to stimulate individuals’ action to pursue an organization’s vision or direction. Motivation is the desire, stimulus, or incentive to pursue a particular course of action. Extrinsic rewards are rewards used to facilitate or motivate task performance that include pay, promotions, fringe benefits, and job security. Intrinsic rewards are rewards associated with “doing the job,” that include interesting and challenging work, self-direction and responsibility, variety, opportunities to use one’s skills and abilities, and sufficient feedback regarding one’s efforts. The degree to which each factor (intrinsic or extrinsic) is important is generally unique to a specific individual. Successful companies and their leaders understand and utilize the various motivational levers at their disposal to generate employee engagement and excitement throughout the organization. © 2014 Cengage Learning. All Rights Reserved. 3 Chapter 18: Motivation Class Activity: Use the case below as an opportunity to allow students to apply concepts from the chapter. Suggestion: You could ask them to do this case as individuals or in teams as a class activity. Have the students read the case presented in the text and answer the included questions. Case In Point: Vineet Nayar and HCL Technologies 1. Why did Vineet Nayar want to change the culture at HCL Technologies? Nayer wanted to change the culture of HCL Technologies because of its performance problems. In the 1980s, HCL prospered selling hardware. But by the 1990s, HCL lagged behind as the industry shifted its focus to software and services. HCL was forced to reorganize because of financial performance and a 30% turnover rate. Nayer believed many of HCL problems were a result of a culture that lacked unity and encouraged employees to work in silos. 2. How do you think the objectives of the Employee First Campaign changed the culture at HCL Technologies The objectives were to 1) provide a unique employment environment; 2) to drive an inverted organizational structure; 3) to create transparency and accountability in the organization; and 4) to encourage a value-driven culture. The “Employee First” campaign changed the culture by signaling how HCL was investing in its people to produce bottomline results. 3. How did Vineet Nayar motivate employees to collaborate? Nayer motivated employees to collaborate by improving the intranet system so employees were more connected. He mandated 360-degree feedback to transform managerial behavior. Finally, he implemented trust pay, providing full pay up front before employees 4 © 2014 Cengage Learning. All Rights Reserved. Chapter 18: Motivation hit their performance targets. 4. Why was investment in employee development an important motivator? For this question, students may discuss how investments in employee development signaled to employees that HCL’s management was committed to their well being, and this commitment motivated the performance of employees. 5. Why do you think motivating the employees improved HCL Technologies’ performance? For this question, students may discuss how Nayer created a motivation system that is aligned with Maslow’s Need Hierarchy (refer to Figue 19.1). Students can discuss how the work not only provided a salary and job security, but also a culture of inclusion, recognitions, rewards, and job autonomy. II. Content Theories of Motivation. What incentives and needs energize, direct, sustain, or stop an individual’s behavior? A. Hierarchy of Needs Theory. Maslow states that individuals have multiple needs that must be fulfilled in a specific hierarchical order to ensure the greatest level of satisfaction. According to Maslow, lower-order needs are the most pressing and must be satisfied before higher-order needs can be addressed. According to Maslow, most people continually work to fulfill their needs for belongingness and esteem while never truly arriving at the level of self-actualization. B. ERG Theory. Alderfer collapsed Maslow’s five levels into three, which he called existence, relatedness, and growth. 1. Existence. These are basic primary needs that enable a person to live and function productively. Maslow’s physiological and safety needs are encompassed within Alderfer’s existence needs. © 2014 Cengage Learning. All Rights Reserved. 5 Chapter 18: Motivation 2. Relatedness. Similar to Maslow’s need for belongingness, these are desires to interact with others and to be part of a whole. Individuals seek opportunities to relate to others, share feelings, and openly express and debate thoughts and ideas. 3. Growth. These needs refer to an individual’s desire to reach his or her full potential, which results in higher esteem and a heightened sense of self-actualization. Although Alderfer shared Maslow’s belief in a hierarchical order of needs, he disagreed with Maslow on the process of achieving satisfaction. Alderfer believed that individuals could pursue multiple needs at once and often pursue them in a recurring loop pattern. C. Two-Factor Theory. Herzberg surveyed employees about their job attitudes and levels of job satisfaction. His results supported the theory about higher-order and lower-order needs, but Herzberg disagreed that every need is a motivator. Herzberg believed that lower-order needs were potential dissatisfiers while higher-order needs were the true motivators. Herzberg called these two dimensions hygiene factors and motivators. According to Herzberg, improving these aspects of the job environment does not create satisfaction, nor does it motivate people to perform better in their work. In essence, these are baseline conditions that employees expect. D. Acquired Needs Theory. Unlike Maslow and Herzberg who asserted that individuals are born with underlying needs, David McClelland believed that certain types of needs are acquired over time and are shaped through life experiences. Individuals are driven or motivated by the following three needs. 6 © 2014 Cengage Learning. All Rights Reserved. Chapter 18: Motivation 1. Need for achievement. The need to set, meet, and exceed goals. 2. Need for affiliation. The need to interact, socialize, and develop friendships. 3. Need for power. The need to seek opportunities for personal aggrandizement (personalized power) or the need to make an impact on and influence others (socialized power). Although individuals often prioritize one of the acquired needs more than the others, in general, individuals are not driven by only one of these needs because the drive to fulfill each need generally ranges from “high” to “low.” To be satisfied, a person needs to fulfill all three needs at some level. E. Four-Drive Theory. Lawrence and Nohria agreed with other motivation theorists on three specific levels. They believed that underlying needs are innate, that fulfilling them creates satisfaction, and that leaving them unfulfilled creates dissatisfaction. But they also believed that there was no requisite hierarchical order in which the needs must be satisfied and that the satisfaction of one need is not dependent on the satisfaction of another need. The four drives include the following. 1. The drive to acquire. To acquire scarce goods and social status. 2. The drive to bond. To connect with individuals and groups inside and outside the workplace. 3. The drive to comprehend. To satisfy curiosity through understanding, to learn, and to master challenges. 4. The drive to defend. To protect oneself and others against external threats and to promote justice. © 2014 Cengage Learning. All Rights Reserved. 7 Chapter 18: Motivation To motivate employees, therefore, all four drives must be addressed at some level. A Different View: Drive For this chapter’s A Different View, we recommend that the professor facilitate a discussion on how motivating factors for employees have changed. As a conversation starter, the professor can present Daniel Pink’s perspective from his book, Drive. Daniel Pink contends that today’s independent thinkers are no longer motivated by external rewards such as financial incentives. Rather, they are motivated by the internal gratification of a job well done. After discussing this concept, students should discuss the following. 1. Rewards that motivate your students. Discuss whether those rewards are external or internal. 2. Rewards offered to your students when they worked on a job; students should evaluate the effectiveness of these rewards. Discussion Starter: Consider A Different View: Drive. Ask the students the following questions about themselves. 1. What rewards motivate you? Are they external or internal rewards? 2. In your business experience, what types of rewards were offered to you or your colleagues? How effective were those rewards? III. Process Theories of Motivation. Process theories of motivation see the individual as an active decision maker. Discussion Starter: Ask the class, "How many of you set goals?" For the students who raise their hands, ask why they are goal setters. Also ask students who don't set goals why they don't (if 8 © 2014 Cengage Learning. All Rights Reserved. Chapter 18: Motivation anyone will disclose). A. Goal-Setting Theory. The theory that setting goals that are difficult, but achievable, is a significant motivator of performance. Locke and Latham found that setting high goals and directing employees toward meeting them is a key driver of motivation. 1. Goals direct attention and effort toward goal-relevant activities and away from goal-irrelevant activities. 2. Difficult goals make employees want to work harder, regardless of whether the goals are set by management or the employee. 3. Tight deadlines for goal completion lead to a more rapid work pace. 4. People use the knowledge and skills they have attained from other activities and apply them to meet new goals. Organizations that set specific, challenging goals that are acceptable to employees and then help employees track their progress toward goal achievement by providing timely feedback can realize more benefits from enhanced motivation. B. Expectancy Theory. Vroom suggests that employees expect that high effort should lead to good performance and that good performance, in turn, should lead to reward. In essence, a relationship between effort, performance, and reward (or outcomes) is assumed. The following three variables enter into the thought processes of employees when trying to decide how much effort to expend. 1. Effort to performance expectancy. The evaluation of whether putting in effort will lead to high performance. © 2014 Cengage Learning. All Rights Reserved. 9 Chapter 18: Motivation 2. Performance to outcome expectancy. The evaluation of whether successful performance will lead to a desired reward. 3. Valance. The evaluation of whether the available outcomes are attractive. Discussion Starter: Students are often confused by the introduction of expectancy theory and don't always see how it relates to their own lives. Giving them examples from every day decision making is a good way to help them make sense of it. One example would be how they determine how much to study for each class in which they are enrolled. Another would be how we make decisions in the workplace that affect our lives, such as whether to work overtime when the boss gives you the option. The relationship between these three variables is considered multiplicative, which means that if any of these variables is absent, motivation also is absent. 4. To increase the desired impact of expectancy theory, managers should attempt to do the following: a. Determine what rewards each employee values. b. Be clear about what behavior the organization expects, c. Ensure that desired levels of performance are challenging yet achievable. C. d. Link desired outcomes to desired performances. e. Analyze situations for potential conflicts. Equity Theory. Individuals do not expect just to be rewarded for their efforts; they also expect that those rewards will be fair and equitable. Adams proposes that people will compare their circumstances with those of similar others and 10 © 2014 Cengage Learning. All Rights Reserved. Chapter 18: Motivation that this behavior motivates them to seek fairness in the way they are rewarded for performance. 1. Equity process. Employees evaluate equity (fairness of effort-reward tradeoffs) as their perception of the ratio of their outcomes to their referent other’s outcomes. 2. If employee’s outcomes are less, the employee will be motivated to seek to adjust the ratio. IV. Reinforcing Motivation. The process of using rewards or punishments to induce behaviors or actions is central to reinforcement theory. B. F. Skinner, one of the most prominent reinforcement theorists, proposed that positive and negative reinforcements can increase certain behaviors while extinction and punishment can decrease them. • Positive reinforcement is rewarding a desired behavior. • Negative reinforcement is removing an aversive condition in response to a desired behavior. • Punishment is presenting an aversive stimulus in response to an undesired behavior. • Extinction is the idea that a behavior stops because it has ceased to be rewarded or punished. • Skinner believed that behavior is learned and that rewards are important for encouraging employees to repeat desired behaviors and discontinue undesirable ones. This notion is called the theory of operant conditioning. A. Work Design. The design of the work also can be an important driver of performance. © 2014 Cengage Learning. All Rights Reserved. 11 Chapter 18: Motivation 1. Organizations that are successful in creating a highly motivated workforce provide opportunities for employees to engage in tasks that are meaningful and tied to overall organizational goals. 2. When employees believe that what they are doing is valued and appreciated by the organization, they will be more satisfied with their work and therefore less likely to seek alternative employment. 3. Employees should also feel a sense of responsibility for the outcome of their work and be able to continually monitor their progress. See Figure 18.6 • Work Design as Motivation 4. Employment engagement. In his study of the relationship between managers and subordinates, Douglas McGregor identified two fundamentality different approaches to managing what he called Theory X and Theory Y. a. Managers who conform to Theory X believe that employees inherently dislike work and need to be constantly monitored and evaluated to ensure that they do what is expected. b. Theory Y managers believe that employees are not slackers, but are motivated to do their best and to work to their potential. c. Follow-up research indicated that the attitudes and beliefs of Theory X and Y managers created self-fulfilling prophecies. d. The characteristics of organizations with high employee engagement include a climate with the following. o Participative decision making. o Information sharing (open communication up and down the organization). 12 © 2014 Cengage Learning. All Rights Reserved. Chapter 18: Motivation o Training and development. o Performance-based outcomes or rewards. e. This feeling of engagement creates a sense of self-efficacy, the belief that one has the capability to accomplish organizational goals. B. Reinforcing Strengths. Understanding what motivates one individual versus another is key to being an effective leader. To be successful in tailoring opportunities and rewards to employees, managers should ask the following three questions. 1. What are the individual’s strengths? 2. What are the triggers that activate those strengths? 3. What is the individual’s learning style? The Leadership Development Journey For this assignment, students are asked to consider how leaders motivate their employees by creating a culture that engages employees. Employee engagement is a positive emotional connection that employees have with their organization. In this section, students were provided with the following list of practices that demonstrate how a leader can engage employees. Create a climate of trust. Behave with integrity. Design jobs that are intellectually stimulating. Provide career growth opportunities. © 2014 Cengage Learning. All Rights Reserved. 13 Chapter 18: Motivation Invest in employee development. Emphasize the importance of high-quality relationships. Instill organizational pride. Create a line of sight between an individual’s performance and the organization’s goals. Using this list, students should consider a time when they were engaged by a leader and elaborate on what engagement strategy the leader used. Ask students to discuss how the leader’s ability to engage motivated his or her performance. Discussion Topics 1. In what ways can a company align organizational and employee goals? How can a company ensure that employees are focused on the right goals? 2. Compare and contrast the five content theories of motivation. In what ways are they similar and different? As you think about your own motivational drives, which content theory resonates with you? 3. What are the implications of the two-factor theory of motivation? How can a company effectively respond to both sides of the equation? 4. How do goals act as motivational drivers? In Chapter13, we discussed the locus of control. How does the locus of control impact an individual's approach to the setting and achievement of goals? 5. In what ways are the goal-setting theory and the expectancy theory similar? 6. In what ways does an individual's conception of equity influence his or her level of motivation? 7. How does the design of a job impact an employee's motivational levels? What levers could an employer use to increase the level of motivation of its employees? 14 © 2014 Cengage Learning. All Rights Reserved. Chapter 18: Motivation 8. In what ways do cultural factors influence motivation? How should managers of global operations think about motivation? 9. Consider the Theory X and Theory Y approaches to leadership. Which one resonates with you? Think of an example of a highly successful Theory X and Theory Y leader. What did they do to achieve success? 10. Think about a time when you were at your best at work or in school. What motivated you to perform at your best? Were you motivated by extrinsic or intrinsic rewards? How does focusing on one's strengths improve his or her performance? What are the potential downsides of this approach to motivation? Assignments Management Research 1. For this question, students are required to research a company that was recently listed on Fortune Magazine’s “Great Places to Work” list. Students should create a press release for this company that describes how it motivates its employees. Topics for the press release may include the following. How the company creates an affiliate-work climate. How the company rewards its employees. How the company uses training to develop its employees. How the company creates a line of sight between the contributions of employees and organizational goals. Students can share their press release with their classmates and discuss what they learned about the importance of motivation. © 2014 Cengage Learning. All Rights Reserved. 15 Chapter 18: Motivation 2. For this question, students should consider a goal they would like to accomplish this year. Students should describe the goal and evaluate the feasibility of this goal using the following SMART criteria. Is the goal specific? Can the goal be measured? Is the goal attainable? How relevant is the goal? Have you established a time line for achieving the goal? In the Field For this assignment, students should interview both a Baby Boomer and a Gen Y. Students should ask each interviewee to map out how their life experience and goals influence their motivations. Students should compare and contrast the life maps of the Baby Boomer and Gen Y and answer the following questions. 16 What are the similarities in their motivations? What are the differences in their motivations? Why do you think there are differences? What are the managerial implications of these differences? © 2014 Cengage Learning. All Rights Reserved. Chapter 18: Motivation This page intentionally left blank. © 2014 Cengage Learning. All Rights Reserved. 17