Organizational Behavior:
An Introduction to
Your Life in Organizations
Chapter 4
Fundamentals of Motivation
©2007 Prentice Hall
Preview
• What makes people work harder, smarter, and more
positively?
• How can managers tap an employee’s intrinsic
motivation?
• How do managers motivate using rewards and
punishments?
• How do managers use behavior modification to design
performance appraisals and reward systems?
• What organizational systems do companies use to
motivate their employees?
• When motivating yourself and others, also …
©2007 Prentice Hall
Motivation
• An individual’s direction, intensity and
persistence of effort in attaining a goal
• Intrinsic motivators are inner influences
that cause a person to act
• Extrinsic motivators are external
influences that cause a person to act,
including both rewards and punishments
©2007 Prentice Hall
Money--the universal reinforcer
• Called the universal reinforcer because
you can exchange it for so many things
• Can help satisfy lower order and higher
order needs
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How can manages tap an
employee’s intrinsic motivation?
• Main intrinsic factors that motivate us are:
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our personality
emotions
needs and motives
goals
beliefs
©2007 Prentice Hall
Personality
• Internal-external locus of control affects
motivation depending on the job
requirements
• Self-efficacy is a person’s generalized
belief in their ability to execute a course of
action in any given situation
• Independent and interdependent selfconcepts affect focus on helping
themselves or the group
©2007 Prentice Hall
Needs and motives
• Needs are unconscious patterns, some
developed early in life and some perhaps
instinctive, that lead to emotional and
behavioral preferences
• McClelland’s needs theory:
 need for achievement
 need for power
 need for affiliation
©2007 Prentice Hall
Needs and motives
• Humanistic needs: managers should pay
attention to meeting individual needs like
personal growth and purpose in life
• Sociobiology suggests that the most
fundamental, instinctual, human needs are
to reproduce and preserve life (untested)
• Explicit motives: the reasons people give
for their actions
©2007 Prentice Hall
Goals
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Set specific goals
Set tough but achievable goals
Establish feedback for goal achievement
Keep in mind that learning goals motivate
differently than performance goals
• Account for the limitations of goal setting
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Beliefs and expectations
• Expectancy theory: an individual’s effort is
determined primarily by his or her beliefs
in three key areas:
 Expectancy: that one’s effort will lead to an
acceptable level of performance
 Instrumentality: the belief that the
performance level one achieves will result in
specific positive and/or negative outcomes
 Valence: the belief that the outcome attained
will be personally valued
©2007 Prentice Hall
Beliefs and expectations
• Equity theory predicts that you will weigh
the ratio of your effort (and other job inputs
such as your experience and ability) to
your rewards against that of others
• Distributive justice: the perceived fairness
of outcomes in terms of how rewards and
resources are allocated in an organization
©2007 Prentice Hall
The 5-Step OB mod Approach
Step 1. Identify the target
behavior
Step 2. Establish a baseline for the
target behavior
Step 3. Analyze the antecedents and the
consequences of the behavior
Step 4. Intervene with a program that
emphasizes reinforcement
Step 5: Evaluate the intervention to see if it
changed the desired behavior
©2007 Prentice Hall
The design of performance
appraisals
• Judgment-based evaluation: a manager rates
employees on traits that management has
deemed to be important
• Results-based evaluation: rating employees on
their performance over time
• Behaviorally-based evaluation: observable
behaviors are rated on a quantifiable measure
such as their frequency, and the frequency of the
behaviors is summarized in a behaviorally
anchored rating scheme (BARS)
©2007 Prentice Hall
Limitations of behavior modification
• Most successful when applied to simple
tasks
• For the more complex tasks in
professional and managerial work,
feedback typically has the strongest effect
on work performance, followed by social
recognition and then money
©2007 Prentice Hall
Systems that emphasize pay
• Mixed results for pay based on general
performance
• Pay as a reinforcement for targeted
behaviors is effective
• Variable-pay programs blend a set salary,
sometimes a relatively modest one, with
pay contingent on some output measure
©2007 Prentice Hall
Systems that emphasize goals
• Management by Objectives (MBO):
supervisors and their subordinates jointly
decide the individual employee’s goals for
the year
• The employees’ rewards for the year
depend on how well they meet their goals
©2007 Prentice Hall
Systems that emphasize
participation
• Quality circles are teams of employees
who meet to discuss quality improvements
• Self-managed teams are autonomous
groups that take on some of the tasks
typically done by supervisors
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Systems that maximize intrinsic and
extrinsic motivation
• Employee stock ownership plans (ESOPs)
are particular plans that allow employees
to buy stock
• Must show cause-and-effect relationship
between work and success
• Employees are vulnerable if the stock
value plunges
©2007 Prentice Hall
Recent trends
• As jobs become more information-based and
complex, it is harder to use standards for
productivity
• Since long term relationships between
employees and their companies are declining,
the motivating value of such relationships is
being lost
• Some theorists believe that monetary reward
alone will never be a sufficient motivator
because it does not reduce conflicts of interest
and make people pursue common goals
©2007 Prentice Hall
Take national culture into account
• Learned behaviors are culture bound
• Cultures differ on how they value work
itself
• Cultures also differ in terms of the
motivation systems they will accept
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Apply what you have learned
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World Class Company: Hiscox plc
Advice from the Pro’s
Gain Experience
Can you solve this manager’s problem?
©2007 Prentice Hall
Summary – What makes people
work harder, smarter, and more
positively?
• Managers attempt to use both intrinsic and
extrinsic motivators
• Managers must be realistic about their
ability to control others’ behavior
• The universal reinforcer is money
©2007 Prentice Hall
Summary – How can managers tap
an employee’s person’s intrinsic
motivation?
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Managers should select appropriate
individuals if a job requires a certain type
of personality or emotion
Managers might reasonably attempt to
influence an individual’s goals, beliefs or
expectations
©2007 Prentice Hall
Summary – How do managers
motivate using rewards and
punishments?
• OB Mod is the theory that behavior can be
controlled by extrinsic factors, namely
reinforcements and punishments
• The goal of an OB Mod program is to
change observable and quantifiable
behaviors
• OB Mod has sparked many business
applications
©2007 Prentice Hall
Summary – How do managers use behavior
modification to design performance appraisals
and reward systems?
• Managers can choose either judgmentbased, results-based, or behaviorallybased performance appraisals
• Managers should be careful to reward the
right behaviors, and to chose appropriate
schedules of reinforcement
©2007 Prentice Hall
Summary – What organizational
systems do companies use to
motivate their employees?
• Some emphasize pay
• Others emphasize feedback and
recognition
• Some create an Employee Stock
Ownership Plan, or ESOP
©2007 Prentice Hall
Summary – When motivating
yourself and others, also…
• Weigh recent trends
• Take national culture into account
• Motivate yourself to motivate others.
©2007 Prentice Hall