Techniques for Changing Employee Attitudes
By Devon Kirchner, Christian Brugger, Monica Rivera, and Natalie
Bartman
Organizational Behaviour
Lloyd Michaels
Oct 17, 2011
Table of Contents
Purpose Statement/Introduction ……………………………………………………….pg.1
Part I: Extrinsic Motivators
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Monetary…………………………………………………………………………………....pg.2
Benefits……………………………………………………………………………………pg.3-4
Promotions………………………………………………………………………………pg.5-6
Stock Options……………………………………………………………………………pg.6-7
Part II: Intrinsic Motivators
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Progress……………………………………………………………………………………pg.8-9
Challenges………………………………………………………………………………pg.9-10
Recognition/Achievement………………………………………………………pg.10-11
Perceived Justice……………………………………………………………………pg.11-12
Conclusion…………………………………………………………………………………………pg13
Bibliography/References/Footnotes……………………………………………pg.14-15
Introduction
Purpose Statement: The purpose of this research is to investigate how employee attitudes
can be affected or changed with the prospect of rewards.
Through our research we have discovered 8 primary rewards that have the potential to
change employee behaviour for both the positive and negative; for example, the prospect of a
monetary reward can be immediately effective but should be used carefully due to the power it
has in altering behaviours. Benefits can offer lucrative prospects for workers who may be
focused on outside factors such as healthcare or transportation, therefore leaving more room
for them to make work their main focus point. Promotions, on the other hand, create a
competition between employees, instilling a drive towards excellence and innovation that some
find crucial to their own personal motivation. Progress, an important intrinsic factor, gives
people a reason to continue a certain task when they are aware of its development and their
own addition to that development. Challenges --not unlike promotions and progress—are used
to motivate employees by giving them the option to excel at something that plays to their
strengths, and therefore have a greater chance of staying relevant and productive. Finally,
Perceived Justice is the idea of equality in the work place and how to reward in relation to
effort. All of the above are analyzed in an effort to discover the potential impacts of rewards on
employee behaviours. These rewards, both intrinsic and extrinsic, focus in on what really
motivates people to perform tasks efficiently and with little resistance.
Part I: Extrinsic Rewards
Monetary:
“Money is probably the most emotionally meaningful object in contemporary life; only
food and sex are its close competitors as common carriers of such strong and diverse feelings,
significance, and strivings”1
According to Maslow's “Hierarchy of needs” the most basic and important of human
needs --“Physiological” and “Safety”-- must be fulfilled before a person can focus on the
secondary needs; because money is the means to satisfy a person’s primary needs, its
importance as a reward cannot be understated as a motivating factor in altering employee
behavior. Managers often underestimate the significance of money which can potentially lead
to employee’s poor job satisfaction. In a recent study, “54% of employees rated direct financial
compensation as 'very important' or 'extremely important' to motivation”2 another study
showed “45% of employers thought money was not a large factor in losing their talented
employees but 71% of those top employees felt it was the primary factor in their disaffection” 3.
The above statistics indicate the importance of money to employees and how it cannot be
overlooked when trying to alter employee behavior. When proper payment scales and methods
are implemented a positive employee attitude can emerge which can lead to higher
performance. In fact, when companies used specific techniques such as gain sharing, bonuses,
and profit sharing those companies saw a 66-89% increase in positive feedback4. If an employee
enjoys working hard, and being paid on his own merit of organizational achievement then a pay
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system such as “Merit-Based Pay” would help increase the employee’s perception of
relationship between the rewards and their performance which can lead to a desirable change
in behavior. Managers must also stay mindful of the potentially unintended and undesired
effects that pay system can cause in employee behavior. For example, the “unexpected
behaviors that may arise when employees try to ensure they will receive bonuses.”5 The idea of
a bonus can be twisted into an expectation for some employees; when a fiscal year is poor and
bonuses cannot be given undesirable behavior may emerge. Money, as a reward, can be a very
helpful instrument in altering employee’s behaviors to better suit organizations needs but
managers should be aware of the unintended behavioral effects of money.
Benefits
A main element in extrinsic motivation is work benefits. One of the most effective
rewards within organizations is benefit plans. Benefit plans are used by managers to attract the
right people, and retain the valuable employees it already has. They must be strategic, up to
date, and must meet the demands of the employee receiving them. “According to Herzberg’s
two-factor theory (motivation and hygiene), an employee benefit program is a necessary and
sufficient working condition.”6 Something that can concern managers about benefit plans is the
fact that these have a bigger effect on work motivation that in employee productivity. The
amount and value of employee benefit plans depends on the size of the corporation; bigger,
private corporations have a stronger demand for benefit plans than smaller businesses.
Another difference between benefit plans is the person receiving them and their daily lives. It
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has been shown that “Single employees perceive more employee benefit impact on job
performance than married ones.”7 Also, employees with higher educational levels will expect
different, and perhaps higher, benefits than those with less education. Throughout this same
research, it has been found that younger employees are more affected by benefit plans than
older ones.
Benefits such as having flexible work times are something that draws people’s attention
a job. For example, if someone was trouble balancing work and family time in a previous job
and our business offers to give them flexible hours the employee would be most likely to want
to work for this certain company. Other kinds of job benefits are group insurance, disability
income protection, paid vacations, sick leave and many more. Another name given to these
benefits is Bonus Plans. Bonus Plans are a great way to motivate one’s employees and “boost
[employee] performance.”8 One way managers put this into action is by giving employees a set
percent rate for their sales. For example, a big store like Wal-Mart could decide that for every
$25,000 over a period of time, employees get a bonus of 5%. This would make Wal-Mart’s
employees more motivated to sell more because they can, in return for their hard work, take
home more money than what their paycheck would usually be.
Even though we see benefit plans as being really good motivators, it has its
consequences too. For example, a number of companies that offer health care and or insurance
do not pay the full price with the company’s money; what some employees do is take a certain
percentage of the cost from the worker’s paycheck, leaving him or her short of money.
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Although these benefits provide the employee with discounts, most of these benefits, such as
health care and insurance, have some additional cost to the employee.
Promotions
Promotions can be an excellent and effective way to increase employee enthusiasm in
the workplace. Susan David, co-director of the Harvard/Maclean Institute of Coaching, feels
that "who an organization promotes is a very strong index of their core culture"9. With this in
mind, they must be properly approached, because when somebody gets promoted, it inevitably
sends a strong signal of entitlement to the rest of the organization. Primarily, it is exceedingly
important to remember that the way in which an employee is promoted holds explicit
implications for that individual’s achievement. For example, it is common for businesses to lose
some of their best workers because there is only one pathway to success. One way isn't good
enough. "Organizations who create multiple, flexible pathways to success will keep their best
people, keep them engaged, and keep them for longer"10 says Susan David. Make sure that all
the necessary research about the employee’s performance, attitude and level of commitment is
done. In the rare case that an employee is expressing a want or need for a new challenge, that
is a sure indication that a promotion is a possibility. On the flip side, the better half of
employees do not want to be promoted, because with a promotion comes added responsibility.
Promotions are extremely subjective, and whether or not it is a good idea depends solely on
the person at hand. They are the foundation that can potentially make or break the stability of
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a company's staff.
Stock Options
Although money has always been a motivator when it comes to employee performance,
it is not only the idea of benefits such as bonuses and raises that can entice employees, but also
that of stock options. This applies mostly to larger corporations, although some smaller
companies offer it as well. If a business is thriving, stocks can be a vital way of accumulating
more money, especially if the employee in question has knowledge of the stock market. Many
companies like to reward good performance with higher amounts of stock in the company.
“The idea is that employees will be more likely to think about the consequences of their
behaviour on the bottom line if they own part of the company.”11 This could end up making the
employee feel like a key contributor and stakeholder in the business, expanding his or her
feeling of control over what is going on. Knowing that you own a part of the company is a good
incentive for performance, because the better the company does, the better you do as well.
One example of how the use of stock options has been an effective motivator is Nucor Corp., a
steel manufacturing facility. “Nucor gave out more than $220 million in profit sharing and
bonuses to the rank and file in 2005”12. These benefits that Nucor rewards its employees with
are the reason it is successful today. “Nucor's performance, propelled by a red-hot steel
market, has been nothing less than sensational. It has grown into a company with 2005 sales of
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$12.7 billion, up from $4.6 billion when DiMicco took over in 2000”13. They rely on high wages,
innovative ideas, and healthy competition between employees to keep them working at their
best. It is these stock options that make the workers feel like they have a real stake in how the
company prospers, and gives them the tools to take control of their earning power. At the base
of all workers is not only a need to gain a larger wealth, but also to have a greater feeling of
domination in their job, giving them an overall sense of security. It is this security that enables
them to perform at a higher level than those who operate with a level of uncertainty, and in the
end alters their behaviour.
Part II: Intrinsic Rewards
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Progress
For many people in the workforce today, one of the most intrinsically important factors
in the success of their performance relies not only on the ability to “climb the ladder” in their
career and the achievement that comes with that, but also a sense of progress. “Children tend
to have an obvious and touching hunger for immediate gratification…As people grow into
adults, they generally learn to take on longer tasks and develop patience. But the need for
reinforcement doesn’t go away, it simply changes form.”14 Even those who are not so driven by
“moving up” and who are comfortable in their position need to feel a sense of things moving
along. When you start a task with excitement and hope, it can make it easier to complete.
However, without evidence that progress is being made, it could end up making it more
difficult. To see that something is on its way to completion is a main intrinsic motivator for
people in all fields. Although the thrill of finishing is the ultimate goal for many people, it can be
noted that it is often the “Little Wins”15 as Tom Jones describes that are most important to
people. As important as the finish line is, something has to motivate you to get there, especially
if it is a long-drawn out task over many months or years. The speed at which a task is being
done is also important to a worker’s outlook. If it is being done quickly and efficiently, the more
likely the worker will be motivated to keep moving. However, if it comes to a standstill, the
worker might begin to lose faith in the project and begin to lag. “Jack Welch, CEO of General
Electric, speaks vividly of the energy that he and his employees get from moving forward
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quickly on work tasks.”Speed," he says simply, "is exhilarating!”16 This is a good real world
example of an employer who sees an obvious difference in his workers when a task is moving
forward. In the end, people will always feel more persuaded to finish a job when they are visibly
aware of how that job is positively progressing.
Challenges
One of the many ways employees are motivated intrinsically is by giving them
challenging tasks. Many studies have found that the most successful motivators are those
which are nonmonetary. It has been shown in many cases, that employee’s work harder when
the outcome is tied to a personal goal, or when the task at hand is challenging. When giving
employees a challenge we need to make sure it is not too hard or too easy. If employees are
faced with a task they believe is too hard for them to carry out, they are likely to lose focus and
motivation quickly. The main reason some employees do not find motivation at the workplace
is because they are rarely presented with challenging tasks. If employers take the time to come
up with more challenging tasks, employee motivation has the potential to improve. As human
beings, when we are presented with a challenge, we are motivated to overcome it. According
to writer, researcher and Editor Neena Dayal, “All [we] need to do is to feel the challenge of the
situation and [we] feel motivated to do something about it.”17
One thing we should take into consideration when looking at employee motivation
through challenge is, what the business itself looks like. Recent research has found that
executives are more motivated by challenge than managers are by almost 30%. This research
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also showed that employee motivation between large and small businesses. Around 77% of
employees are motivated by challenge in businesses with less than 1,000 employees; however,
this was only true for 43% of employees in larger businesses.
If we look at Herzberg’s theory of motivation, he talks about job enrichment which can
be defined as, “a deliberate, planned process to improve the responsibility and challenge of a
job.”18 By giving employees job enrichment they may be motivated to come to work every
morning prepared to work hard and take on any challenge he/she is given. A few ways this can
be done is by; giving more freedom to the employee to decide what the right decision is,
variety, and providing continuous feedback. Another technique he talks about is job rotation.
Job rotation “is the planned rotating of staff between jobs to alleviate monotony and provide a
fresh job challenge.”19 When employees are faced with different challenging tasks, rotating
from time to time, they are more likely to be motivated and work harder and harder every
time.
Recognition
Recognition is a key intrinsic motivator for the simple reason that all people have a
need to be addressed for a job well done. This can be achieved by a pat on the back, a simple
“Good Job!” or even a thank you note. Canadian firms were surveyed in 2004 by Hewitt
Associates, and found that 34 percent of companies recognized individual or group
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achievements with cash or merchandise. 20. The amount of recognition an employee receives
can have a direct correlation to his or her job performance and whether or not they want to
stay at that job. “..When asked why employees left for jobs at other companies, 34 percent said
it was due to lack of recognition and praise…”21 By making sure employees get the right amount
of recognition, companies can greatly reduce the amount of hiring and firing that has to be
done and can keep a more consistent employee base. However, too much recognition could
make some employees accustomed to gratification, and they may expect rewards for every
little good thing they do. Therefore, it is important for managers and business owners to be
specific with their recognition and rewards, to make it have a lasting effect on employee
behaviours.
Perceived Justice
Justice can alter employee behaviour by linking the values of a culture to the rewards
they feel entitled to. If an employees behaviour is perceived to be poor, then other workers
have a need for –their perception of-- justice to be upheld. If action is not taken to rectify the
discrepancy then a negative shift in employee behaviour may emerge.
“Recent scandals and CEO indiscretions, however, illustrate that employees have their limits. Thus, a
precipitating event, such as a large pay increase or bonus for a CEO when employees are facing
layoffs, may call attention to the gap and create injustice perceptions with regard to the distribution of
organizational rewards...such a reaction by employees may lead to counterproductive workplace
behaviors that may be detrimental to organizational effectiveness”22
When employees feel that their job rewards --the perception of-- “correct behaviour” and has
punitive measures for “incorrect” or perhaps unethical behaviour, a desirable shift in employee
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citizenship behaviour can result. This was mentioned by Mehmet Ince reflecting on the research of Abu
Elanain, “One of the findings is the positive effect of procedural justice on individual
contributions to organizational development and taking care of the organizational jobs. The
positive emotions of individuals toward procedural justice bring about higher performance and
increase in organizational citizenship behavior”23. Furthermore, when looking at distributive
justice, which is defined as, “people’s perceptions of fairness of the distribution of resources
amongst organizational members”24, Rahim et al “found that when perceptions of distributive
justice were high, employees used more cooperative conflict management
styles when interacting with their supervisor”25. This shows a feeling of perceived justice
altering an employee’s attitude with the way they interact with their supervisors. The
perception of equality in procedural justice can lead to increased job satisfaction which can
intern lead to, “employees will make significant efforts towards achieving high performance”26.
The perception of justice plays an important role in altering employee behaviour; feelings of equality and
perceived “fairness” are linked with how an employee will react and ultimately how they behave; As
such, their attitudes can be altered by the prospect of or lack of justice.
Conclusion
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All in all, we have concluded that there are 8 specific areas of rewards to focus on in
order to motivate employees to perform tasks quickly and efficiently. We focussed on both
intrinsic and extrinsic rewards as means of motivation. The ideas ranged from monetary
rewards, which are surprisingly not as important in the eyes of an employee as we came to
expect; to the extreme importance of merely being recognized and acknowledged for your
efforts in the workplace. These motivation techniques vary between employees, due to the fact
that some may be more driven by extrinsic, monetary rewards and others by intrinsic, nonmonetary rewards. By observing the behaviour and needs of their employees, employers can
gain a better understanding of how to properly motivate them and enable them to not only do
their jobs, but do them well and with genuine enjoyment. Overall, these specific motivation
techniques and rewards give the employer a clearer view of what can, and most likely will, alter
employee behaviour and result in the desired performance.
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