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johns_ob_6e_ebook_ch05 - Chapter 5 T heories of Work...

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Unformatted text preview: Chapter 5 T heories of Work Motivation Learning Objectives After reading Chapter 5, you should be able to: 1 Define motivation, discuss its basic proper- ties, and distinguish it from performance. 2 Compare and contrast intrinsic and extrinsic motivation. 3 Explain and discuss the different factors that predict performance and define general cognitive ability and emotional intelligence. 4 Explain and discuss need theories of motiva- tion. 5 Explain and discuss expectancy theory. 6 Explain and discuss equity theory. 7 Explain and discuss goal setting theory. 8 Discuss the cross-cultural limitations of theo- ries of motivation. 9 Summarize the relationship among the var- ious theories of motivation, performance, and job satisfaction. Employees at Starbucks Coffee Co., the world’s largest chain of coffee shops, do not just serve up coffee to customers. Rather, these “partners,” as they are Starbucks called, are actively involved in the company and are credited with finding new and innovative ways to cut costs and save the company money and increase sales. Their efforts appear to be making a difference. Starbucks stock is up more than 800 percent since the company went public in 1992, and sales and profits have been growing more than 50 percent a year. There are more than 7,000 Starbucks stores worldwide, including stores in Tokyo, Singapore, and Great Britain, and three to four new stores open almost every day. Starbucks stores can be found in almost every major metropolitan area in the United States, and its blend of coffee is available in restaurants, hotels, offices, and airlines (not to mention a Starbucks brand of coffee ice cream and compact discs). Some might argue that Starbucks’ chairperson and CEO, Howard Schultz, who purchased the company for $4 million in 1987, was in the right place at the right time. After all, 10 years ago a coffee shop was, well, just a place to get a coffee, not somewhere you would go to relax and hang out with a “cuppa-joe.” However, take a closer look inside Starbucks, and what you see will amaze you. Rated among the top 10 on F ortune magazine’s most recent list of “America’s Most Admired Companies,” and the magazine’s most admired food-services company in 2001 and 2002, Starbucks’ mission statement includes providing a great work environment, treating people with respect and dignity, a commitment to diversity, and making all employees partners. 133 A stock option plan, recognition programs, and a comprehensive work–life benefits program have helped Starbucks create an inspired, enthusiastic, and motivated workforce. The hourly pay at Starbucks is better than other entry-level food service jobs. But the real difference is the company’s “bean stock” program, a stock-option plan that makes every employee of Starbucks a partner and links employee contributions to company profits. Starbucks became one of the first service companies to offer stock options. All employees, from top management down, are awarded stock options. Beginning in 1991, each employee was awarded stock options worth 12 percent of their base pay, which has since risen to 14 percent, thanks to healthy profits. A stock investment plan allows employees to buy shares at a discount through payroll deductions. In addition, recognition programs reward outstanding achievement for upholding Starbucks’ mission and goals. Starbucks also has a comprehensive work–life benefits program that includes on-site fitness services and educational support for child care and elder care. All employees who work a minimum of 20 hours a week are entitled to universal benefits packages, including full medical and dental coverage, vision care, and disability and life insurance—perks that are usually reserved only for those in the managerial ranks. To stay attuned to the needs and desires of employees, Starbucks conducts regular opinion surveys and open forums in order to be able to provide programs that address employees’ life stages and personal needs. For example, in response to the growing number of employees starting families, Starbucks offers flexible work schedules. As well, a number of “nontraditional” benefits have been designed, including a program that links employees with similar interests and hobbies. The objective is to provide a range of work/life solutions that meet the multiple life demands of employees. Not surprisingly, the job satisfaction of Starbucks employees is much higher than most companies, and turnover is lower than at most fast-food restaurants. The Starbucks’ formula appears to be straightforward: Take care of your people, they will take care of your customers, and the bottom line will grow. What is not so straightforward is the creation of an inspired, enthusiastic, and motivated workforce that shares a common Starbucks Coffee Co. www.starbucks.com 134 purpose, is treated like business partners, and shares the rewards of the company’s success. Is it any wonder that Starbucks met its goal of becoming a $1 billion company and received W orkforce m agazine’s Quality of Life Optimas award in 2003! 1 Would you be motivated if you worked at Starbucks? What kind of person would respond well to Starbucks’ motivational techniques? What underlying philosophy of motivation is Starbucks using? These are some of the questions that this chapter will explore. First, we will define motivation and distinguish it from performance. After this, we will describe several popular theories of work motivation and contrast them. Then we will explore whether these theories translate across cultures. Finally, we will present a model that links motivation, performance, and job satisfaction. Why Study Motivation? Why should you study motivation? Motivation is one of the most traditional topics in organizational behaviour, and it has interested managers, researchers, teachers, and sports coaches for years. However, a good case can be made that motivation has become even more important in contemporary organizations. Much of this is a result of the need for increased productivity to be globally competitive (as at Starbucks). It is also a result of the rapid changes that contemporary organizations are undergoing. Stable systems of rules, regulations, and procedures that once guided behaviour are being replaced by requirements for flexibility and attention to customers that necessitate higher levels of initiative. This initiative depends on motivation. What would a good motivation theory look like? In fact, as we shall see, there is no single all-purpose motivation theory. Rather, we will consider several theories that serve somewhat different purposes. In combination, though, a good set of theories should recognize human diversity and consider that the same conditions will not motivate everyone. Also, a good set of theories should be able to explain how it is that some people seem to be self-motivated, while others seem to require external motivation. Finally, a good set of theories should recognize the social aspect of human beings—people’s motivation is often affected by how they see others being treated. Before getting to our theories, let us define motivation more precisely. What Is Motivation? The term motivation is not easy to define. However, from an organization’s perspective, when we speak of a person as being motivated, we usually mean that the person works “hard,” “keeps at” his or her work, and directs his or her behaviour toward appropriate outcomes. Basic Characteristics of Motivation Motivation. The extent to which persistent effort is directed toward a goal. We can formally define motivation as the extent to which persistent effort is directed toward a goal.2 Chapter 5 Theories of Work Motivation 135 Effort. The first aspect of motivation is the strength of the person’s work-related behaviour or the amount of effort the person exhibits on the job. Clearly, this involves different kinds of activities on different kinds of jobs. A loading dock worker might exhibit greater effort by carrying heavier crates, while a researcher might reveal greater effort by searching out an article in some obscure foreign technical journal. Both are exerting effort in a manner appropriate to their jobs. Persistence. The second characteristic of motivation is the persistence that individuals exhibit in applying effort to their work tasks. The organization would not be likely to think of the loading dock worker who stacks the heaviest crates for two hours and then goofs off for six hours as especially highly motivated. Similarly, the researcher who makes an important discovery early in her career and then rests on her laurels for five years would not be considered especially highly motivated. In each case, workers have not been persistent in the application of their effort. Direction. Effort and persistence refer mainly to the quantity of work an individual produces. Of equal importance is the quality of a person’s work. Thus, the third characteristic of motivation is the direction of the person’s work-related behaviour. In other words, do workers channel persistent effort in a direction that benefits the organization? Employers expect motivated stockbrokers to advise their clients of good investment opportunities and motivated software designers to design software, not play computer games. These correct decisions increase the probability that persistent effort is actually translated into accepted organizational outcomes. Thus, motivation means working smart as well as working hard. Goals. Ultimately, all motivated behaviour has some goal or objective toward which it is directed. We have presented the preceding discussion from an organizational perspective—that is, we assume that motivated people act to enhance organizational objectives. In this case, employee goals might include high productivity, good attendance, or creative decisions. Of course, employees can also be motivated by goals that are contrary to the objectives of the organization, including absenteeism, sabotage, and embezzlement. In these cases, they are channelling their persistent efforts in directions that are dysfunctional for the organization. Extrinsic and Intrinsic Motivation Some hold the view that people are motivated by factors in the external environment (such as supervision or pay), while others believe that people can, in some sense, be self-motivated without the application of these external factors. You might have experienced this distinction. As a worker, you might recall tasks that you enthusiastically performed simply for the sake of doing them and others that you performed only to keep your job or placate your boss. Experts in organizational behaviour distinguish between intrinsic and extrinsic motivation. At the outset, we should emphasize that there is only weak consensus concerning the exact definitions of these concepts and even weaker agreement about whether we should label specific motivators as intrinsic or extrinsic.3 However, the following definitions and examples seem to capture the distinction fairly well. Intrinsic motivation stems from the direct relationship between the worker and the task and is usually self-applied. Feelings of achievement, accomplishment, challenge, and competence derived from performing one’s job are examples of intrinsic motivators, as is sheer interest in the job itself. Off the job, avid participation in sports and hobbies is often intrinsically motivated. Extrinsic motivation stems from the work environment external to the task and is usually applied by someone other than the person being motivated. Pay, fringe benefits, company policies, and various forms of supervision are examples of extrinsic motivators. Intrinsic motivation. Motivation that stems from the direct relationship between the worker and the task; it is usually self-applied. Extrinsic motivation. Motivation that stems from the work environment external to the task; it is usually applied by others. 136 Individual Behaviour Part Two Obviously, employers cannot package all conceivable motivators as neatly as these definitions suggest. For example, a promotion or a compliment might be applied by the boss but might also be a clear signal of achievement and competence. Thus, some potential motivators have both extrinsic and intrinsic qualities. Despite the fact that the distinction between intrinsic and extrinsic motivation is fuzzy, many theories of motivation implicitly make the distinction. However, the relationship between intrinsic and extrinsic motivators has been the subject of a great deal of debate.4 Some research studies have reached the conclusion that the availability of extrinsic motivators can reduce the intrinsic motivation stemming from the task itself.5 The notion is that when extrinsic rewards depend on performance then the motivating potential of intrinsic rewards decreases. Proponents of this view have suggested that making extrinsic rewards contingent on performance makes individuals feel less competent and less in control of their own behaviour. That is, they come to believe that their performance is controlled by the environment and that they perform well only because of the money.6 As a result, their intrinsic motivation suffers. However, a recent review of research in this area reached the conclusion that the negative effect of extrinsic rewards on intrinsic motivation occurs only under very limited conditions and they are easily avoidable.7 As well, in organizational settings in which individuals see extrinsic rewards as symbols of success and as signals of what to do to achieve future rewards, they increase their task performance.8 Thus, it is safe to assume that both kinds of rewards are important and compatible in enhancing work motivation. Motivation and Performance Performance. The extent to which an organizational member contributes to achieving the objectives of the organization. Amount of Effort Persistence of Effort Direction of Effort Motivation Personality Task Understanding General Cognitive Ability Emotional Intelligence Chance Performance Exhibit 5.1 Factors contributing to individual job performance. General cognitive ability. A person’s basic information processing capacities and cognitive resources. At this point, you might well be saying, “Wait a minute, I know many people who are ‘highly motivated’ but just don’t seem to perform well. They work long and hard, but they just don’t measure up.” This is certainly a sensible observation, and it points to the important distinction between motivation and performance. Performance can be defined as the extent to which an organizational member contributes to achieving the objectives of the organization. Some of the factors that contribute to individual performance in organizations are shown in Exhibit 5.1.9 While motivation clearly contributes to performance, the relationship is not one-to-one because a number of other factors also influence performance. For example, recall from Chapter 2 that personality traits such as the “Big Five” and core self-evaluations also predict job performance. You might also be wondering about the role of intelligence—doesn’t it influence performance? The answer, of course, is yes—intelligence, or what is also known as mental ability, does predict performance. Two forms of intelligence that are particularly important are general cognitive ability and emotional intelligence. Let us consider each before we discuss motivation. General Cognitive Ability. The term cognitive ability is often used to refer to what most people call intelligence or mental ability. Although there are many different types of specific cognitive abilities, in organizational behaviour we are most concerned with what is known as general cognitive ability. General cognitive ability is a term used to refer to a person’s basic information-processing capacities and cognitive resources. It reflects an individual’s overall capacity and efficiency for processing information and it includes a number of cognitive abilities such as verbal, numerical, spatial, and reasoning abilities that are required to perform mental tasks. Cognitive ability is usually measured by a number of specific aptitude tests that measure these abilities.10 Research has found that general cognitive ability predicts learning and training success as well as job performance in all kinds of jobs and occupations including those that involve both manual and mental tasks. This should not come as a sur- Chapter 5 137 Theories of Work Motivation prise because many cognitive skills are required to perform most kinds of jobs. General cognitive ability is an even better predictor of performance for more complex and higher-level jobs that require the use of more cognitive skills and involve more information processing.11 Thus, both general cognitive ability and motivation are necessary for performance. Research has also found that general cognitive ability and motivation are required for career success. In a study on the early career success of MBA graduates, those students with higher general cognitive ability in combination with higher motivation were more successful in their job search at graduation, obtained higher salaries and more rapid pay increases, and received more promotions. The results of this study attest to the importance of both general cognitive ability and motivation for career success and performance.12 Emotional Intelligence. Although the importance of general cognitive ability for job performance has been known for many years, researchers have only recently begun to study emotional intelligence. Emotional intelligence (EI) has to do with an individual’s ability to understand and manage his or her own and others’ feelings and emotions. It involves the ability to perceive and express emotion, assimilate emotion in thought, understand and reason about emotions, and manage emotions in oneself and others. People with emotional intelligence are able to identify and recognize the meanings of emotions and to manage and regulate their emotions as a basis for problem solving, reasoning, thinking, and action.13 Peter Salovey and John Mayer, who are credited with first coining the term emotional intelligence, have developed an EI model that consists of four interrelated sets of skills or branches. The four skills represent sequential steps that form a hierarchy. The perception of emotion is at the bottom of the hierarchy, followed by (in ascending order) the integration and assimilation of emotions, the knowledge and understanding of emotions, and the management and regulation of emotions. Salovey and Mayer’s EI model is shown in Exhibit 5.2 and described below:14 1. The perception of emotions: This involves the ability to perceive emotions and to accurately identify emotions in oneself and others. An example of this is the ability to accurately identify emotions in people’s faces and nonverbal behaviour. This step is the most basic level of EI and is necessary in order to be able to perform the other steps in the model. 2. The integration and assimilation of emotions: This refers to the ability to use and assimilate emotions and emotional experiences in order to guide and facilitate one’s thinking and reasoning. As well, new emotions can be generated during this stage. 3. Knowledge and understanding of emotions: This stage involves being able to understand emotional information, transitions from one emotion to another, and linguistic information about emotions. 4. Management of emotions: This involves the ability to manage one’s own and others’ feelings and emotions as well as emotional relationships. This is the highest level of EI because it requires one to have mastered the previous stages. At this stage, an individual is able to regulate, adjust, and change his or her own as well as others’ emotions to suit the situation. Examples of this include being able to calm oneself when feeling angry or being able to lower the anxiety of another person. In order to understand the importance of emotional intelligence for organizational behaviour and each of the four sets of skills, consider an employee who is confronted by an angry customer. In order to respond effectively, the employee must first be able to perceive and accurately identify the customer’s emotions. Next, the employee must be able to use this information in thinking about the most appro- Emotional intelligence. The ability to understand and manage one’s own and other’s feelings and emotions. Management of Emotions Knowledge and Understanding of Emotions Integration and Assimilation of Emotions Perception of Emotions Exhibit 5.2 Salovey and Mayer’s model of emotional intelligence. Source: Based on Mayer, J. D., Caruso, D.R., & Salovey, P. (2000). Emotional intelligence meets traditional standards for an intelligence. Intelligence, 27, 267–298; Salovey, P., & Mayer, J. D. (1990). Emotional intelligence. Imagination, Cognition and Personality, 9, 185–211. 138 Individual Behaviour Part Two priate course of action. The employee must also understand his or her own emotions (while being yelled at, no less!), know what emotions he or she should be displaying, and how to change the customer’s emotion. Finally, the employee must manage his or her emotions and stay calm rather than becoming angry with the customer, and also change the customer’s angry emotion. Employees who have high EI are more capable of managing situations like this. They can manage their emotions and stay calm throughout the confrontation and also calm the customer’s anger. Employees who lack EI are likely to get angry during this kind of confrontation and, in the process, to increase the anger of the customer. As the above example illustrates, EI is important for organizational behaviour. In fact, research has shown that EI predicts performance in a number of areas, including work performance and academic performance. One study found that college students’ EI measured at the start of the academic year predicted grade point average at the end of the year. And while EI has been found to predict job performance in many jobs, it is particularly important in jobs that involve a lot of social interaction and emotional labour.15 In summary, it is certainly possible for performance to be low even when a person is highly motivated. In addition to personality and levels of general cognitive ability and emotional intelligence, poor performance could also be due to a poor understanding of the task or luck and chance factors that can damage the performance of the most highly motivated individual. Of course, an opposite effect is also conceivable. An individual with rather marginal motivation might have high general cognitive ability and/or emotional intelligence, or might understand the task so well that some compensation occurs—what little effort the individual makes is expended very efficiently in terms of goal accomplishment. Also, a person with weak motivation might perform well because of some luck or chance factor that boosts performance. Thus, it is no wonder that workers sometimes complain that they receive lower performance ratings than colleagues who “don’t work as hard.” In this chapter, we will concentrate on the motivational components of performance, rather than on the other determinants in Exhibit 5.1. However, the moral here should be clear: We cannot consider motivation in isolation; high motivation will not result in high performance if employees have low general cognitive ability and emotional intelligence, do not understand their jobs, or encounter unavoidable obstacles over which they have no control. Motivational interventions, such as linking pay-to-performance, simply will not work if employees are deficient in important skills and abilities.16 Need Theories of Work Motivation Need theories. Motivation theories that specify the kinds of needs people have and the conditions under which they will be motivated to satisfy these needs in a way that contributes to performance. The first three theories of motivation that we will consider are need theories. These theories attempt to specify the kinds of needs people have and the conditions under which they will be motivated to satisfy these needs in a way that contributes to performance. Needs are physiological and psychological wants or desires that individuals can satisfy by acquiring certain incentives or achieving particular goals. It is the behaviour stimulated by this acquisition process that reveals the motivational character of needs: NEEDS —➤ BEHAVIOUR —➤ INCENTIVES AND GOALS Notice that need theories are concerned with what motivates workers (needs and their associated incentives or goals). They can be contrasted with process theories, which are concerned with exactly how various factors motivate people. Need and process theories are complementary rather than contradictory. Thus, a need theory might contend that money can be an important motivator (what), and a process theory might explain the actual mechanics by which money motivates (how).17 In this section, we will examine three prominent need theories of motivation. Chapter 5 Theories of Work Motivation 139 Maslow’s Hierarchy of Needs Abraham Maslow was a psychologist who, over a number of years, developed and refined a general theory of human motivation.18 According to Maslow, humans have five sets of needs that are arranged in a hierarchy, beginning with the most basic and compelling needs (see the left side of Exhibit 5.3). These needs include: 1. Physiological needs. These include the needs that must be satisfied for the person to survive, such as food, water, oxygen, and shelter. Organizational factors that might satisfy these needs include the minimum pay necessary for survival and working conditions that promote existence. 2. Safety needs. These include needs for security, stability, freedom from anxiety, and a structured and ordered environment. Organizational conditions that might meet these needs include safe working conditions, fair and sensible rules and regulations, job security, a comfortable work environment, pension and insurance plans, pay above the minimum needed for survival, and freedom to unionize. 3. Belongingness needs. These include needs for social interaction, affection, love, companionship, and friendship. Organizational factors that might meet these needs include the opportunity to interact with others on the job, friendly and supportive supervision, opportunity for teamwork, and opportunity to develop new social relationships. 4. Esteem needs. These include needs for feelings of adequacy, competence, independence, strength, and confidence, and the appreciation and recognition of these characteristics by others. Organizational factors that might satisfy these needs include the opportunity to master tasks leading to feelings of achievement and responsibility. Also, awards, promotions, prestigious job titles, professional recognition, and the like might satisfy these needs when they are felt to be truly deserved. 5. Self-actualization needs. These needs are the most difficult to define. They involve the desire to develop one’s true potential as an individual to the fullest extent and to express one’s skills, talents, and emotions in a manner that is most personally fulfilling. Maslow suggests that self-actualizing people have clear perceptions of reality, accept themselves and others, and are independent, creative, and appreciative of the world around them. Organizational conditions that might provide self-actualization include absorbing jobs with the potential for creativity and growth as well as a relaxation of structure to permit self-development and personal progression. Given the fact that individuals may harbour these needs, in what sense do they form the basis of a theory of motivation? That is, what exactly is the motivational Higher Order Needs Maslow’s Need Hierarchy Self-actualization Alderfer’s ERG Theory Intrinsic Motivation Growth Self-esteem Belongingness Relatedness Safety Physiological Basic Needs Existence Extrinsic Motivation Exhibit 5.3 Relationship between Maslow and Alderfer need theories. 140 Maslow’s hierarchy of needs. A five-level hierarchical need theory of motivation that specifies that the lowest-level unsatisfied need has the greatest motivating potential. Individual Behaviour Part Two premise of Maslow’s hierarchy of needs? Put simply, the lowest-level unsatisfied need category has the greatest motivating potential. Thus, none of the needs is a “best” motivator; motivation depends on the person’s position in the need hierarchy. According to Maslow, individuals are motivated to satisfy their physiological needs before they reveal an interest in safety needs, and safety must be satisfied before social needs become motivational, and so on. When a need is unsatisfied, it exerts a powerful effect on the individual’s thinking and behaviour, and this is the sense in which needs are motivational. However, when needs at a particular level of the hierarchy are satisfied, the individual turns his or her attention to the next higher level. Notice the clear implication here that a satisfied need is no longer an effective motivator. Once one has adequate physiological resources and feels safe and secure, one does not seek more of the factors that met these needs but looks elsewhere for gratification. According to Maslow, the single exception to this rule involves selfactualization needs. He felt that these were “growth” needs that become stronger as they are gratified. Alderfer’s ERG Theory ERG theory. A three-level hierarchical need theory of motivation (existence, relatedness, growth) that allows for movement up and down the hierarchy. Clayton Alderfer developed another need-based theory, called ERG theory.19 It streamlines Maslow’s need classifications and makes some different assumptions about the relationship between needs and motivation. The name ERG stems from Alderfer’s compression of Maslow’s five-category need system into three categories—existence, relatedness, and growth needs: 1. Existence needs. These are needs that are satisfied by some material substance or condition. As such, they correspond closely to Maslow’s physiological needs and to those safety needs that are satisfied by material conditions rather than interpersonal relations. These include the need for food, shelter, pay, and safe working conditions. 2. Relatedness needs. These are needs that are satisfied by open communication and the exchange of thoughts and feelings with other organizational members. They correspond fairly closely to Maslow’s belongingness needs and to those esteem needs that involve feedback from others. However, Alderfer stresses that relatedness needs are satisfied by open, accurate, honest interaction rather than by uncritical pleasantness. 3. Growth needs. These are needs that are fulfilled by strong personal involvement in the work setting. They involve the full utilization of one’s skills and abilities and the creative development of new skills and abilities. Growth needs correspond to Maslow’s need for self-actualization and the aspects of his esteem needs that concern achievement and responsibility. As you can see in Exhibit 5.3, Alderfer’s need classification system does not represent a radical departure from that of Maslow. In addition, Alderfer agrees with Maslow that as lower-level needs are satisfied, the desire to have higher-level needs satisfied will increase. Thus, as existence needs are fulfilled, relatedness needs gain motivational power. Alderfer explains this by arguing that as more “concrete” needs are satisfied, energy can be directed toward satisfying less concrete needs. Finally, Alderfer agrees with Maslow that the least concrete needs—growth needs—become more compelling and more desired as they are fulfilled. It is, of course, the differences between ERG theory and the need hierarchy that represent Alderfer’s contribution to the understanding of motivation. First, unlike the need hierarchy, ERG theory does not assume that a lower-level need must be gratified before a less concrete need becomes operative. Thus, ERG theory does not propose a rigid hierarchy of needs, and some individuals, owing to background and experience, might seek relatedness or growth even though their existence needs are ungratified. Hence, ERG theory seems to account for a wide variety of individual Chapter 5 Theories of Work Motivation 141 differences in motive structure. Second, ERG theory assumes that if the higher-level needs are ungratified, individuals will increase their desire for the gratification of lower-level needs. Notice that this represents a radical departure from Maslow. According to Maslow, if esteem needs are strong but ungratified, a person will not revert to an interest in belongingness needs because these have necessarily already been gratified. (Remember, he argues that satisfied needs are not motivational.) According to Alderfer, however, the frustration of higher-order needs will lead workers to regress to a more concrete need category. For example, the software designer who is unable to establish rewarding social relationships with superiors or co-workers might increase his interest in fulfilling existence needs, perhaps by seeking a pay increase. Thus, according to Alderfer, an apparently satisfied need can act as a motivator by substituting for an unsatisfied need. Given the preceding description of ERG theory, we can identify its two major motivational premises as follows: The more lower-level needs are gratified, the more higher-level need satisfaction is desired; the less higher-level needs are gratified, the more lower-level need satisfaction is desired. McClelland’s Theory of Needs Psychologist David McClelland has spent several decades studying the human need structure and its implications for motivation. According to McClelland’s theory of needs, needs reflect relatively stable personality characteristics that one acquires through early life experiences and exposure to selected aspects of one’s society. Unlike Maslow and Alderfer, McClelland has not been interested in specifying a hierarchical relationship among needs. Rather, he has been more concerned with the specific behavioural consequences of needs. In other words, under what conditions are certain needs likely to result in particular patterns of motivation? The three needs that McClelland studied most have special relevance for organizational behaviour—needs for achievement, affiliation, and power.20 Individuals who are high in need for achievement (n Ach) have a strong desire to perform challenging tasks well. More specifically, they exhibit the following characteristics: ■ ■ ■ McClelland’s theory of needs. A nonhierarchical need theory of motivation that outlines the conditions under which certain needs result in particular patterns of motivation. Need for achievement. A strong desire to perform challenging tasks well. A preference for situations in which personal responsibility can be taken for outcomes. Those high in n Ach do not prefer situations in which outcomes are determined by chance because success in such situations does not provide an experience of achievement. A tendency to set moderately difficult goals that provide for calculated risks. Success with easy goals will provide little sense of achievement, while extremely difficult goals might never be reached. The calculation of successful risks is stimulating to the high–n Ach person. A desire for performance feedback. Such feedback permits individuals with high n Ach to modify their goal attainment strategies to ensure success and signals them when success has been reached.21 People who are high in n Ach are concerned with bettering their own performance or that of others. They are often concerned with innovation and long-term goal involvement. However, these things are not done to please others or to damage the interests of others. Rather, they are done because they are intrinsically satisfying. Thus, n Ach would appear to be an example of a growth or self-actualization need. People who are high in need for affiliation (n Aff) have a strong desire to establish and maintain friendly, compatible interpersonal relationships. In other words, they like to like others, and they want others to like them! More specifically, they have an ability to learn social networking quickly and a tendency to communicate frequently with others, either face-to-face, by telephone, or by letter. Also, they prefer to avoid conflict and competition with others, and they sometimes exhibit Need for affiliation. A strong desire to establish and maintain friendly, compatible interpersonal relationships. 142 Need for power. A strong desire to influence others, making a significant impact or impression. Individual Behaviour Part Two strong conformity to the wishes of their friends. The n Aff motive is obviously an example of a belongingness or relatedness need. People who are high in need for power (n Pow) strongly desire to have influence over others. In other words, they wish to make a significant impact or impression on them. People who are high in n Pow seek out social settings in which they can be influential. When in small groups, they act in a “high-profile,” attention-getting manner. There is some tendency for those who are high in n Pow to advocate risky positions. Also, some people who are high in n Pow show a strong concern for personal prestige. The need for power is a complex need because power can be used in a variety of ways, some of which serve the power seeker and some of which serve other people or the organization. However, n Pow seems to correspond most closely to Maslow’s self-esteem need. McClelland predicts that people will be motivated to seek out and perform well in jobs that match their needs. Thus, people with high n Ach should be strongly motivated by sales jobs or entrepreneurial positions, such as running a small business. Such jobs offer the feedback, personal responsibility, and opportunity to set goals, as noted above. People who are high in n Aff will be motivated by jobs such as social work or customer relations because these jobs have as a primary task establishing good relations with others. Finally, high n Pow will result in high motivation in jobs that enable one to have a strong impact on others—jobs such as journalism and management. In fact, McClelland has found that the most effective managers have a low need for affiliation, a high need for power, and the ability to direct power toward organizational goals.22 (We will study this further in Chapter 12.) Research Support for Need Theories Measuring peoples’ needs and the extent to which they have these needs fulfilled has proven to be a difficult task. Thus, the need theories are not especially easy to test. Nevertheless, we can draw some conclusions about their usefulness. Maslow’s need hierarchy suggests two main hypotheses. First, specific needs should cluster into the five main need categories that Maslow proposes. Second, as the needs in a given category are satisfied, they should become less important, while the needs in the adjacent higher-need category should become more important. This second hypothesis captures the progressive, hierarchical aspect of the theory. In general, research support for both these hypotheses is weak or negative. This is probably a function of the rigidity of the theory, which suggests that most people experience the same needs in the same hierarchical order. However, in this research, there is fair support for a simpler two-level need hierarchy comprising the needs toward the top and the bottom of Maslow’s hierarchy.23 This latter finding provides some indirect encouragement for the compressed need hierarchy found in Alderfer’s ERG theory. Several tests indicate fairly good support for many of the predictions generated by the theory, including expected changes in need strength. Particularly interesting is the confirmation that the frustration of relatedness needs increases the strength of existence needs.24 The simplicity and flexibility of ERG theory seem to capture the human need structure better than the greater complexity and rigidity of Maslow’s theory. McClelland’s need theory has generated a wealth of predictions about many aspects of human motivation. Recently, researchers have tested more and more of these predictions in organizational settings, and the results are generally supportive of the idea that particular needs are motivational when the work setting permits the satisfaction of these needs.25 Managerial Implications of Need Theories The need theories have some important things to say about managerial attempts to motivate employees. Chapter 5 Theories of Work Motivation 143 Appreciate Diversity. The lack of support for the fairly rigid need hierarchy suggests that managers must be adept at evaluating the needs of individual employees and offering incentives or goals that correspond to their own needs. Unfounded stereotypes about the needs of the “typical” employee and naive assumptions about the universality of need satisfaction are bound to reduce the effectiveness of chosen motivational strategies. The best salesperson might not make the best sales manager! The needs of a young recent college graduate probably differ from those of an older employee preparing for retirement. One of the most important aspects of Starbucks work–life benefits program is that it surveys employees to find out what their needs are and then offers programs that meet those needs. Appreciate Intrinsic Motivation. The need theories also serve the valuable function of alerting managers to the existence of higher-order needs (whatever specific label we apply to them). The recognition of these needs in many employees is important for two key reasons. One of the basic conditions for organizational survival is the expression of some creative and innovative behaviour on the part of members. Such behaviour seems most likely to occur during the pursuit of higherorder need fulfillment, and ignorance of this factor can cause the demotivation of the people who have the most to offer the organization. Second, observation and research evidence support Alderfer’s idea that the frustration of higher-order needs prompts demands for greater satisfaction of lower-order needs. This can lead to a vicious motivational circle—that is, because the factors that gratify lower-level needs are fairly easy to administer (e.g., pay and fringe benefits), management has grown to rely on them to motivate employees. In turn, some employees, deprived of higher-order need gratification, come to expect more and more of these extrinsic factors in exchange for their services. Thus, a circle of deprivation, regression, and temporary gratification continues at great cost to the organization.26 How can organizations benefit from the intrinsic motivation that is inherent in strong higher-order needs? First, such needs will fail to develop for most employees unless lower-level needs are reasonably well gratified.27 Thus, very poor pay, job insecurity, and unsafe working conditions will preoccupy most workers at the expense of higher-order outcomes. Second, if basic needs are met, jobs can be “enriched” to be more stimulating and challenging and to provide feelings of responsibility and achievement. Finally, organizations could pay more attention to designing career paths that enable interested workers to progress through a series of jobs that continue to challenge their higher-order needs. Individual managers could also assign tasks to employees with this goal in mind. Process Theories of Work Motivation In contrast to need theories of motivation, which concentrate on what motivates people, process theories concentrate on how motivation occurs. In this section, we will examine three important process theories—expectancy theory, equity theory, and goal setting theory. Process theories. Motivation theories that specify the details of how motivation occurs. Expectancy Theory The basic idea underlying expectancy theory is the belief that motivation is determined by the outcomes that people expect to occur as a result of their actions on the job. Psychologist Victor Vroom is usually credited with developing the first complete version of expectancy theory and applying it to the work setting.28 The basic components of Vroom’s theory are shown in Exhibit 5.4: ■ Outcomes are the consequences that may follow certain work behaviours. First-level outcomes are of particular interest to the organization; for example, Expectancy theory. A process theory that states that motivation is determined by the outcomes that people expect to occur as a result of their actions on the job. Outcomes. Consequences that follow work behaviour. 144 Individual Behaviour Instrumentality. The probability that a particular first-level outcome will be followed by a particular second-level outcome. ■ Valence. The expected value of work outcomes; the extent to which they are attractive or unattractive. ■ Part Two high productivity versus average productivity, illustrated in Exhibit 5.4, or good attendance versus poor attendance. Expectancy theory is concerned with specifying how an employee might attempt to choose one first-level outcome instead of another. Second-level outcomes are consequences that follow the attainment of a particular first-level outcome. Contrasted with first-level outcomes, second-level outcomes are most personally relevant to the individual worker and might involve amount of pay, sense of accomplishment, acceptance by peers, fatigue, and so on. Instrumentality is the probability that a particular first-level outcome (such as high productivity) will be followed by a particular second-level outcome (such as pay). For example, a bank teller might figure that the odds are 50 – 50 (instrumentality =.5) that a good performance rating will result in a pay raise. Valence is the expected value of outcomes, the extent to which they are attractive or unattractive to the individual. Thus, good pay, peer acceptance, the chance of being fired, or any other second-level outcome might be more or less attractive to particular workers. According to Vroom, the valence of first-level outcomes is the sum of products of the associated second-level outcomes and their instrumentalities—that is, the valence of a particular = Σ instrumentalities × second-level valences. first-level outcome Expectancy. The probability that a particular first-level outcome can be achieved. ■ Force. The effort directed toward a first-level outcome. ■ In other words, the valence of a first-level outcome depends on the extent to which it leads to favourable second-level outcomes. Expectancy is the probability that the worker can actually achieve a particular first-level outcome. For example, a machinist might be absolutely certain (expectancy = 1.0) that she can perform at an average level (producing 15 units a day) but less certain (expectancy =.6) that she can perform at a high level (producing 20 units a day). Force is the end product of the other components of the theory. It represents the relative degree of effort that will be directed toward various first-level outcomes. According to Vroom, the force directed toward a first-level outcome is a product of the valence of that outcome and the expectancy that it can be achieved. Thus, force = first-level valence × expectancy. We can expect an individual’s effort to be directed toward the first-level outcome that has the largest force product. Notice that no matter how valent a particular first-level outcome might be, a person will not be motivated to achieve it if the expectancy of accomplishment approaches zero. Believe it or not, the mechanics of expectancy theory can be distilled into a couple of simple sentences! In fact, these sentences nicely capture the premises of the theory: People will be motivated to perform in those work activities that they find attractive and that they feel they can accomplish. The attractiveness of various work activities depends on the extent to which they lead to favourable personal consequences. It is extremely important to understand that expectancy theory is based on the perceptions of the individual worker. Thus, expectancies, valences, instrumentalities, and relevant second-level outcomes depend on the perceptual system of the person whose motivation we are analyzing. For example, two employees performing the same job might attach different valences to money, differ in their perceptions of the instrumentality of performance for obtaining high pay, and differ in their expectations of being able to perform at a high level. Therefore, they would likely exhibit different patterns of motivation. Chapter 5 Theories of Work Motivation First-Level Outcomes Second-Level Outcomes Money V I I High Productivity V Sense of Accomplishment V I Peer Acceptance V I E Fatigue V Force? Money V E I I Average Productivity V Sense of Accomplishment V I I Peer Acceptance V Fatigue V Although expectancy theory does not concern itself directly with the distinction between extrinsic and intrinsic motivators, it can handle any form of second-level outcome that has relevance for the person in question. Thus, some people might find second-level outcomes of an intrinsic nature, such as feeling good about performing a task well, positively valent. Others might find extrinsic outcomes, such as high pay, positively valent. To firm up your understanding of expectancy theory, consider Tony Angelas, a middle manager in a firm that operates a chain of retail stores (Exhibit 5.5). Secondlevel outcomes that are relevant to him include the opportunity to obtain a raise and the chance to receive a promotion. The promotion is more highly valent to Tony than the raise (7 versus 5 on a scale of 10) because the promotion means more money and increased prestige. Tony figures that if he can perform at a very high level in the next few months, the odds are six in ten that he will receive a raise. Thus, the instrumentality of high performance for obtaining a raise is .6. Promotions are harder to come by, and Tony figures the odds at .3 if he performs well. The 145 Exhibit 5.4 A hypothetical expectancy model (E = Expectancy, I = Instrumentality, V = Valence). 146 Individual Behaviour Part Two instrumentality of average performance for achieving these favourable second-level outcomes is a good bit lower (.2 for the raise and only .1 for the promotion). Recall that the valence of a first-level outcome is the sum of the products of second-level outcomes and their instrumentalities. Thus, the valence of high performance for Tony is (5 × .6) + (7 × .3) = 5.1. Similarly, the valence of average performance is (5 × .2) + (7 × .1) = 1.7. We can conclude that high performance is more valent for Tony than average performance. Does this mean that Tony will necessarily try to perform at a high level in the next few months? To determine this, we must take into account his expectancy that he can actually achieve the competing first-level outcomes. As shown in Exhibit 5.5, Tony is absolutely certain that he can perform at an average level (expectancy = 1.0) but much less certain (.3) that he can sustain high performance. Force is a product of these expectancies and the valence of their respective first-level outcomes. Thus, the force associated with high performance is .3 × 5.1 = 1.53, while that associated with average performance is 1.0 × 1.7 = 1.70. As a result, although high performance is attractive to Tony, he will probably perform at an average level. With all this complicated figuring, you might be thinking “Look, would Tony really do all this calculation to decide his motivational strategy? Do people actually think this way?” The answer to these questions is probably no. Rather, the argument is that people implicitly take expectancy, valence, and instrumentality into account as they go about their daily business of being motivated. If you reflect for a moment on your behaviour at work or school, you will realize that you have certain expectancies about what you can accomplish, the chances that these accomplishments will lead to certain other outcomes, and the value of these outcomes for you. Exhibit 5.5 Expectancy model for Tony Angelas (E = Expectancy, I = Instrumentality, V = Valence). I= .6 Pay Raise V=5 High Performance I= E = .3 .3 Promotion V=7 Force? E = 1. 0 I= .2 Pay Raise V=5 Average Performance I= .1 Promotion V=7 Chapter 5 Theories of Work Motivation Research Support for Expectancy Theory Tests have provided moderately favourable support for expectancy theory.29 In particular, there is especially good evidence that the valence of first-level outcomes depends on the extent to which they lead to favourable second-level consequences. We must recognize, however, that the sheer complexity of expectancy theory makes it difficult to test. We have already suggested that people are not used to thinking in expectancy terminology. Thus, some research studies show that individuals have a difficult time discriminating between instrumentalities and second-level valences. Despite this and other technical problems, experts in motivation generally accept expectancy theory. Managerial Implications of Expectancy Theory The motivational practices suggested by expectancy theory involve “juggling the numbers” that individuals attach to expectancies, instrumentalities, and valences. Boost Expectancies. One of the most basic things managers can do is ensure that their employees expect to be able to achieve first-level outcomes that are of interest to the organization. No matter how positively valent high productivity or good attendance might be, the force equation suggests that workers will not pursue these goals if expectancy is low. Low expectancies can take many forms, but a few examples will suffice to make the point. ■ ■ ■ Employees might feel that poor equipment, poor tools, or lazy co-workers impede their work progress. Employees might not understand what the organization considers to be good performance or see how they can achieve it. If performance is evaluated by a subjective supervisory rating, employees might see the process as capricious and arbitrary, not understanding how to obtain a good rating. Although the specific solutions to these problems vary, expectancies can usually be enhanced by providing proper equipment and training, demonstrating correct work procedures, carefully explaining how performance is evaluated, and listening to employee performance problems. The point of all this is to clarify the path to beneficial first-level outcomes. At Starbucks, employees receive extensive training about coffee and how to meet, greet, and serve customers that should result in high expectancies in areas such as product quality and customer service.30 Clarify Reward Contingencies. Managers should also attempt to ensure that the paths between first- and second-level outcomes are clear. Employees should be convinced that first-level outcomes desired by the organization are clearly instrumental in obtaining positive second-level outcomes and avoiding negative outcomes. If a manager has a policy of recommending good performers for promotion, she should spell out this policy. Similarly, if managers desire regular attendance, they should clarify the consequences of good and poor attendance. To ensure that instrumentalities are strongly established, they should be clearly stated and then acted on by the manager. Managers should also attempt to provide stimulating, challenging tasks for workers who appear to be interested in such work. On such tasks, the instrumentality of good performance for feelings of achievement, accomplishment, and competence is almost necessarily high. The ready availability of intrinsic motivation reduces the need for the manager to constantly monitor and clarify instrumentalities.31 147 148 Individual Behaviour Part Two Appreciate Diverse Needs. Obviously, it might be difficult for managers to change the valences that employees attach to second-level outcomes. Individual preferences for high pay, promotion, interesting work, and so on are the product of a long history of development and are unlikely to change rapidly. However, managers would do well to analyze the diverse preferences of particular employees and attempt to design individualized “motivational packages” to meet their needs. Of course, all concerned must perceive such packages to be fair. Let us examine another process theory that is concerned specifically with the motivational consequences of fairness. Equity Theory Equity theory. A process theory that states that motivation stems from a comparison of the inputs one invests in a job and the outcomes one receives in comparison with the inputs and outcomes of another person or group. In Chapter 4, we discussed the role of equity theory in explaining job satisfaction. To review, the theory asserts that workers compare the inputs that they invest in their jobs and the outcomes that they receive against the inputs and outcomes of some other relevant person or group. When these ratios are equal, the worker should feel that a fair and equitable exchange exists with the employing organization. Such fair exchange contributes to job satisfaction. When the ratios are unequal, workers perceive inequity, and they should experience job dissatisfaction, at least if the exchange puts the worker at a disadvantage vis-à-vis others. But in what sense is equity theory a theory of motivation? Put simply, individuals are motivated to maintain an equitable exchange relationship. Inequity is unpleasant and tension producing, and people will devote considerable energy to reducing inequity and achieving equity. What tactics can do this? Psychologist J. Stacey Adams has suggested the following possibilities: ■ ■ ■ ■ ■ Perceptually distort one’s own inputs or outcomes. Perceptually distort the inputs or outcomes of the comparison person or of the group. Choose another comparison person or group. Alter one’s inputs or alter one’s outcomes. Leave the exchange relationship.32 Notice that the first three tactics for reducing inequity are essentially psychological, while the last two involve overt behaviour. To clarify the motivational implications of equity theory, consider Terry, a middle manager in a consumer products company. He has five years’ work experience and an M.B.A. degree and considers himself a good performer. His salary is $75,000 a year. Terry finds out that Maxine, a co-worker with whom he identifies closely, makes the same salary he does. However, she has only a Bachelor’s degree and one year of experience, and he sees her performance as average rather than good. Thus, from Terry’s perspective, the following outcome/input ratios exist: TERRY $75,000 MAXINE $75,000 ≠ Good performance, MBA, 5 years Average performance, Bachelor’s, 1 year In Terry’s view, he is underpaid and should be experiencing inequity. What might he do to resolve this inequity? Psychologically, he might distort the outcomes that he is receiving, rationalizing that he is due for a certain promotion that will bring his pay into line with his inputs. Behaviourally, he might try to increase his outcomes (by seeking an immediate raise) or reduce his inputs. Input reduction could include a decrease in work effort or perhaps excessive absenteeism. Finally, Terry might resign from the organization to take what he perceives to be a more equitable job somewhere else. Let us reverse the coin and assume that Maxine views the exchange relationship identically to Terry—same inputs, same outcomes. Notice that she too should be Chapter 5 Theories of Work Motivation experiencing inequity, this time from relative overpayment. It does not take a genius to understand that Maxine would be unlikely to seek equity by marching into the boss’s office and demanding a pay cut. However, she might well attempt to increase her inputs by working harder or enrolling in an M.B.A. program. Alternatively, she might distort her view of Terry’s performance to make it seem closer to her own. As this example implies, equity theory is somewhat vague about just when individuals will employ various inequity reduction strategies. Gender and Equity. As an addendum to the previous example, it is extremely interesting to learn that both women and men have some tendency to choose samesex comparison persons—that is, when judging the fairness of the outcomes that they receive, men tend to compare themselves with other men, and women tend to compare themselves with other women. This might provide a partial explanation for why women are paid less than men, even for the same job. If women restrict their equity comparisons to (lesser paid) women, they are less likely to be motivated to correct what we observers see as wage inequities.33 Research Support for Equity Theory. Most research on equity theory has been restricted to economic outcomes and has concentrated on the alteration of inputs and outcomes as a means of reducing inequity. In general, this research is very supportive of the theory when inequity occurs because of underpayment.34 For example, when workers are underpaid on an hourly basis, they tend to lower their inputs by producing less work. This brings inputs in line with (low) outcomes. Also, when workers are underpaid on a piece-rate basis (e.g., paid $1 for each market research interview conducted), they tend to produce a high volume of low-quality work. This enables them to raise their outcomes to achieve equity. Finally, there is also evidence that underpayment inequity leads to resignation. Presumably, some underpaid workers thus seek equity in another organizational setting. The theory’s predictions regarding overpayment inequity have received less support.35 The theory suggests that such inequity can be reduced behaviourally by increasing inputs or by reducing one’s outcomes. The weak support for these strategies suggests either that people tolerate overpayment more than underpayment, or that they use perceptual distortion to reduce overpayment inequity. Managerial Implications of Equity Theory. The most straightforward implication of equity theory is that perceived underpayment will have a variety of negative motivational consequences for the organization, including low productivity, low quality, theft, and/or turnover. (See “Ethical Focus: Inequity and Employee Theft.”) On the other hand, attempting to solve organizational problems through overpayment (disguised bribery) might not have the intended motivational effect. The trick here is to strike an equitable balance. But how can such a balance be struck? Managers must understand that feelings about equity stem from a perceptual social comparison process in which the worker “controls the equation”—that is, employees decide what are considered relevant inputs, outcomes, and comparison persons, and management must be sensitive to these decisions. For example, offering the outcome of more interesting work might not redress inequity if better pay is considered a more relevant outcome. Similarly, basing pay only on performance might not be perceived as equitable if employees consider seniority an important job input. Understanding the role of comparison people is especially crucial.36 Even if the best engineer in the design department earns $2,000 more than anyone else in the department, she might still have feelings of inequity if she compares her salary with that of more prosperous colleagues in other companies. Awareness of the comparison people chosen by workers might suggest strategies for reducing felt inequity. Perhaps the company will have to pay even more to retain its star engineer. Equity 149 150 Individual Behaviour Part Two Inequity and Employee Theft In a survey conducted by the London House publishing firm and the Food Marketing Institute, supermarket employees admitted that they stole an average of $168 worth of merchandise a year. This figure was substantially higher than in previous years’ surveys. The most popular products were meat, cheese, cigarettes, and beauty and health-care items. Some of this theft is probably due to feelings of exploitation in employees. Equity theory predicts that underpayment inequity can be resolved by increasing one’s outcomes. Theft could be an informal mechanism for doing this. As one survey respondent noted, “During the last couple of years, the company has kept raising the standards and cutting back on the hours allotted to keeping those standards up. If you don’t work off the clock, the job won’t get done. Some people steal as a way to get even.” Food Marketing Institute www.fmi.org Psychologist Jerald Greenberg studied employee theft in manufacturing plants before, during, and after the imposition of a temporary 10-week pay cut that was necessitated by a loss of orders. In line with equity theory predictions, he found that theft increased greatly during the rollback and then returned to previous levels once normal pay levels were reinstituted. Greenberg also found that the increase in theft was less pronounced in a plant where management provided an honest and caring explanation for the pay cuts. Perceptions that management was trying to act ethically despite the need for the cuts reduced feelings of inequity. Sources: Greenberg, J. (1990). Employee theft as a reaction to underpayment inequity: The hidden cost of pay cuts. Journal of Applied Psychology, 75, 561–568; London House/Food Marketing Institute. (1992). Third annual report on employee theft in the supermarket industry. Rosemont, IL: London House. is achieved at Starbucks by treating all employees as partners who are equal participants in the company’s “bean stock” and work–life programs. Goal Setting Theory Goal setting. A motivational technique that uses specific, challenging, and acceptable goals and provides feedback to enhance performance. One of the basic characteristics of all organizations is that they have goals. A goal is the object or aim of an action.37 At the beginning of this chapter, individual performance was defined as the extent to which a member contributes to the attainment of these goals or objectives. Thus, if employees are to achieve acceptable performance, some method of translating organizational goals into individual goals must be implemented. Unfortunately, there is ample reason to believe that personal performance goals are vague or nonexistent for many organizational members. Employees frequently report that their role in the organization is unclear, or that they do not really know what their boss expects of them. Even in cases in which performance goals would seem to be obvious because of the nature of the task (e.g., filling packing crates to the maximum to avoid excessive freight charges), employees might be ignorant of their current performance. This suggests that the implicit performance goals simply are not making an impression. The notion of goal setting as a motivator has been around for a long time. However, theoretical developments and some very practical research has demonstrated when and how goal setting can be effective.38 What Kinds of Goals Are Motivational? A large body of evidence suggests that goals are most motivational when they are specific, challenging, and when organizational members are committed to them. In addition, feedback about progress toward goal attainment should be provided.39 Goal Specificity. Specific goals are goals that specify an exact level of achievement for people to accomplish in a particular time frame. For example, “I will enroll Chapter 5 Theories of Work Motivation in five courses next semester and achieve a B or better in each course” is a specific goal. Similarly, “I will increase my net sales by 20 percent in the coming business quarter” is a specific goal. On the other hand, “I will do my best” is not a specific goal, since level of achievement and time frame are both vague. Goal Challenge. Obviously, specific goals that are especially easy to achieve will not motivate effective performance. However, goal challenge is a much more personal matter than goal specificity, since it depends on the experience and basic skills of the organizational member. One thing is certain, however—when goals become so difficult that they are perceived as impossible to achieve, they will lose their potential to motivate. Thus, goal challenge is best when it is pegged to the competence of individual workers and increased as the particular task is mastered. One practical way to do this is to base initial goals on past performance. For example, an academic counsellor might encourage a D student to set a goal of achieving Cs in the coming semester and encourage a C student to set a goal of achieving Bs. Similarly, a sales manager might ask a new salesperson to try to increase his sales by 5 percent in the next quarter and ask an experienced salesperson to try to increase her sales by 10 percent. Goal Commitment. Individuals must be committed to specific, challenging goals if the goals are to have effective motivational properties. The effect of goals on performance is strongest when individuals have high goal commitment. In a sense, goals really are not goals and cannot improve performance unless an individual accepts them and is committed to working towards them. This is especially important when goals are challenging and difficult to achieve. In a following section, we will discuss some factors that affect goal commitment. Goal Feedback. Specific and challenging goals have the most beneficial effect when they are accompanied by ongoing feedback that enables the person to compare current performance with the goal. This is why a schedule of tasks to be completed often motivates goal accomplishment. Progress against the schedule provides feedback. To be most effective, feedback should be accurate, specific, credible, and timely. Enhancing Goal Commitment It has probably not escaped you that the requirements for goal challenge and goal commitment seem potentially incompatible. After all, you might be quite amenable to accepting an easy goal but balk at accepting a tough one. Therefore, it is important to consider some of the factors that might affect commitment to challenging, specific goals, including participation, rewards, and management support. Participation. It seems reasonable that organizational members should be more committed to goals that are set with their participation than to those simply handed down by their superior. Sensible as this sounds, the research evidence on the effects of participation is very mixed—sometimes participation in goal setting increases performance, and sometimes it does not.40 If goal commitment is a potential problem, participation might prove beneficial.41 When a climate of distrust between superiors and employees exists, or when participation provides information that assists in the establishment of fair, realistic goals, then it should facilitate performance. On the other hand, when employees trust their boss, and when the boss has a good understanding of the capability of the employees, participation might be quite unnecessary for goal commitment.42 Interestingly, research shows that participation can improve performance by increasing the difficulty of the goals that employees adopt.43 This might occur because participation induces competition or 151 152 Individual Behaviour Part Two a feeling of team spirit among members of the work unit, which leads them to exceed the goal expectations of the supervisor. Rewards. Will the promise of extrinsic rewards (such as money) for goal accomplishment increase goal commitment? Probably, but there is plenty of evidence that goal setting has led to performance increases without the introduction of monetary incentives for goal accomplishment. One reason for this might be that many ambitious goals involve no more than doing the job as it was designed to be done in the first place. For example, encouraging employees to pack crates or load trucks to within 5 percent of their maximum capacity does not really involve a greater expenditure of effort or more work. It simply requires more attention to detail. Goal setting should, however, be compatible with any system to tie pay to performance that already exists for the job in question. Supportiveness. There is considerable agreement about one factor that will reduce commitment to specific, challenging performance goals. When supervisors behave in a coercive manner to encourage goal accomplishment, they can badly damage employee goal commitment. For goal setting to work properly, supervisors must demonstrate a desire to assist employees in goal accomplishment and behave supportively if failure occurs, even adjusting the goal downward if it proves to be unrealistically high. Threat and punishment in response to failure will be extremely counterproductive.44 Goal Orientation Learning goals. Processoriented goals that focus on learning and enhance understanding of a task and the use of task strategies. Performance goals. Outcomeoriented goals that focus attention on the achievement of specific performance outcomes. A recent development in goal setting theory has been research on different types of goals or what is known as goal orientation. Two goal orientations that are particularly important are a learning goal orientation and a performance goal orientation. Learning goals are process-oriented goals that focus on learning. They enhance understanding of a task and the use of task strategies. Performance goals are outcome-oriented goals that focus attention on the achievement of specific performance outcomes.45 Individuals appear to differ in their goal preference and goal orientation. In fact, goal orientation has been found to be a stable individual difference. Some individuals have a preference for learning goals while others have a preference for performance goals. Individuals with a learning goal orientation are most concerned about learning something new and developing their competence in an activity by acquiring new skills and mastering new situations. Individuals with a performance goal orientation are most concerned about demonstrating their competence in performing a task by seeking favourable judgments and avoiding negative judgments.46 Goal orientation is important because it can influence performance as well as cognitive, affective, and motivational processes. In the last several years, research has found that a learning goal orientation is especially important for performance and leads to higher performance compared to a performance goal orientation. One study on the salespeople of a medical supplies distributor found that a learning goal orientation was positively related to sales performance but a performance goal orientation was not. A learning goal orientation has also been found to be positively related to effort, self-efficacy, and goal-setting level. Thus, learning goals appear to be important for motivation, learning, and performance.47 Research Support for and Managerial Implications of Goal Setting Theory Several decades of research has demonstrated that specific difficult goals lead to improved performance and productivity on a wide variety of tasks and occupations, Chapter 5 Theories of Work Motivation 153 Drivers at Weyerhaeuser Company were assigned a specific, challenging performance goal of loading their trucks to 94 percent of legal weight capacity. including servicing drink machines, entering data, selling, teaching, and typing text. Studies reveal that the positive results of goal setting are not short lived—they persist over a long enough time to have practical value.48 Furthermore, although we have focused on individual goal setting, the effect of group goal setting on group performance is similar to the effect of individual goal setting. Group goals result in superior group performance, especially when groups set specific goals and when the group members participate in setting the goals.49 It is also worth noting that the positive effects of goals on performance are due to four mechanisms: they direct attention toward goal-relevant activities; they lead to greater effort; they increase and prolong persistence; and they lead to the discovery and use of task-relevant strategies for goal attainment.50 Exhibit 5.6 shows the mechanisms that explain the effects of goals on performance. The managerial implications of goal setting theory are straightforward: Set specific and challenging goals and provide ongoing feedback so that individuals can compare their performance with the goal. While goals can be motivational in certain circumstances, they obviously have some limitations. For example, the performance impact of goal setting is stronger for simpler jobs than for more complex jobs such as scientific and engineering work. In the next chapter, we will discuss a more elaborate application of goal setting theory, called management by objectives. For now, consider the application of goal setting theory in “Applied Focus: Goal Setting at Weyerhaeuser Company.” Goals Mechanisms Specific Direction Challenge Effort Goal commitment Persistence Feedback Task strategies Performance Exhibit 5.6 The mechanisms of goal setting. Source: Locke, E. A., & Latham, G. P. (2002). Building a practically useful theory of goal setting and task motivation. American Psychologist, 57, 705–717. 154 Individual Behaviour Part Two Goal Setting at Weyerhaeuser Company Weyerhaeuser Company is a large forest products firm headquartered in Tacoma, Washington. Weyerhaeuser faced a problem that commonly crops up in production operations—the underutilization of expensive resources. The problem centred on the truck drivers who hauled logs from the forest to a company sawmill. The drivers, who also loaded the trucks, were unionized and were paid on an hourly basis. Management determined that the trucks were averaging only about 60 percent of their legal weight capacity. This extreme underloading was very undesirable because extra trucks, extra drivers, and extra diesel fuel were necessary to transport a given amount of timber. Management was convinced that it could improve the situation if the drivers could be motivated to pay more attention to their loading procedures. Because logs differ in diameter and length, a full load could vary between 60 and 120 logs. Thus, the drivers had to exercise judgment in the loading process. Although a scale was available at the loading point, the drivers did not seem to be making good use of it. Weyerhaeuser Co. www.weyerhaeuser.com With the union’s cooperation, the drivers were assigned a specific, challenging performance goal of loading their trucks to 94 percent of legal weight capacity. Before setting this goal, management had simply asked the drivers to do their best to maximize their weight. The results? Over the first several weeks, load capacity gradually increased to over 90 percent and remained at this high level for seven years! In the first nine months alone, the company accountants conservatively estimated the savings at $250,000. These results were achieved without driver participation in setting the goal and without monetary incentives for goal accomplishment. Drivers evidently found the 94 percent goal motivating in and of itself; they frequently recorded their weights in informal competition with other drivers. Sources: Latham, G. P., & Baldes, J. J. (1975). The “practical significance” of Locke’s theory of goal setting. Journal of Applied Psychology, 60, 122–124; Adapted from Latham, G. P., & Locke, E. (1979, Autumn). Goal setting—a motivational technique that works. Organizational Dynamics, 8(2), 68–80. Do Motivation Theories Translate Across Cultures? Are the motivation theories that we have been considering in this chapter culture bound? That is, do they apply only to North America, where they were developed? The answer to this question is important for North American organizations that must understand motivational patterns in their international operations. It is also important to foreign managers, who are often exposed to North American theory and practice as part of their training and development. It is safe to assume that most theories that revolve around human needs will come up against cultural limitations to their generality. For example, both Maslow and Alderfer suggest that people pass through a social stage (belongingness, relatedness) on their way to a higher-level personal growth or self-actualization stage. However, as we discussed in Chapter 4, it is well established that there are differences in the extent to which societies value a more collective or a more individualistic approach to life.51 In individualistic societies (e.g., the United States, Canada, Great Britain, Australia), people tend to value individual initiative, privacy, and taking care of oneself. In more collective societies (e.g., Mexico, Singapore, Pakistan), more closely knit social bonds are observed, in which members of one’s in-group (family, clan, organization) are expected to take care of each other in exchange for strong loyalty to the in-group.52 This suggests that there might be no superiority to self-actualization as a motive in more collective cultures. In some cases, for example, appealing to employee loyalty might prove more motivational than the opportunity for self-expression because it relates to strong belongingness needs that stem from cultural values. Also, cultures differ in the extent to which they value achievement as it is defined in North America, and conceptions of achieve- Chapter 5 155 Theories of Work Motivation ment might be more group oriented in collective cultures than in individualistic North America. Similarly, the whole concept of intrinsic motivation might be more relevant to wealthy societies than to the developing societies. Turning to equity theory, we noted earlier that people should be appropriately motivated when outcomes received “match” job inputs. Thus, higher producers are likely to expect superior outcomes compared with lower producers. This is only one way to allocate rewards, however, and it is one that is most likely to be endorsed in individualistic cultures. In collective cultures, there is a tendency to favour reward allocation based on equality rather than equity.53 In other words, everyone should receive the same outcomes despite individual differences in productivity, and group solidarity is a dominant motive. Trying to motivate employees with a “fair” reward system might backfire if your definition of fairness is equity and theirs is equality. Because of its flexibility, expectancy theory is very effective when applied crossculturally. The theory allows for the possibility that there may be cross-cultural differences in the expectancy that effort will result in high performance. It also allows for the fact that work outcomes (such as social acceptance versus individual recognition) may have different valences across cultures.54 Finally, setting specific and challenging goals should also be motivational when applied cross-culturally and, in fact, goal setting has been found to predict, influence, and explain behaviour in numerous countries around the world.55 However, for goal setting to be effective, careful attention will be required to adjust the goalsetting process in different cultures. For example, individual goals are not likely to be accepted or motivational in collectivist cultures. Therefore, group rather than individual goals should be used in collectivist cultures. Power distance is also likely to be important in the goal-setting process. In cultures where power distance is large, it would be expected that goals be assigned by superiors. However, in some small power distance cultures in which power differences are downplayed, participative goal setting would be more appropriate. One limitation to the positive effect of goal setting might occur in those (mainly Far-Eastern) cultures in which saving face is important. That is, a specific and challenging goal may not be very motivating if it suggests that failure could occur and if it results in a negative reaction. This would seem to be especially bad if it were in the context of the less-thanpreferred individual goal setting. Failure in the face of a very specific goal could lead to loss of face. As well, in the so-called “being-oriented” cultures where people work only as much as needed in order to live and avoid continuous work, there tends to be some resistance to goal setting.56 International management expert Nancy Adler has exemplified how cultural blinders often lead to motivational errors.57 A primary theme running through this discussion is that appreciating cultural diversity is critical in maximizing motivation. Now that we have covered the major motivation theories, let us use them to evaluate an actual motivation program. Please consult “You Be the Manager: The New Incentive Program at Wesco International, Inc.” Putting It All Together: Integrating Theories of Work Motivation In this chapter, we have presented several theories of work motivation and attempted to distinguish between motivation and performance. In Chapter 4, we discussed the relationship between job performance and job satisfaction. At this point, it seems appropriate to review just how all these concepts fit together. Exhibit 5.7 presents a model that integrates these relationships. Each of the theories helps us to understand the motivational process. First, in order for individuals to obtain rewards, they must achieve designated levels of performance. We know from earlier in this chapter that performance is a function of Cultures differ in how they define achievement. In collective societies where group solidarity is dominant, achievement may be more group oriented than in individualistic societies. Wesco International, Inc. www.wescodist.com 156 Individual Behaviour Manager You Be the Wesco offers its employees a unique mix of bonuses and commissions tied to the company’s top and bottom lines. Not long ago, Wesco International, Inc., an electricalsupplies distributor based in Pittsburgh, was a money-losing unit of Westinghouse Electric Corp. Its staff was demoralized, turnover was high, and the company was adrift. To repair the damage quickly and create some forward momentum, a new management team decided to give employees a cut of the profits and reward them for increasing net income year over year. As a starting point, Wesco offered salespeople whose expenses are paid by the company a 12.5 percent commission on the annual gross profit of their sales. Salespeople who pay their own expenses are entitled to 18 percent of the gross profit their annual sales bring. For salespeople in the 18 percent category, Wesco also pays bonuses, capped at $10,000, for exceeding the total profit their sales generated the previous year. One Wesco salesman earned a bundle when he landed a multimilliondollar contract with the federal government to provide an electric power generation system for the U.S. peacekeeping force in Bosnia. However, the new system also carries its share of dangers for employees who do not have the drive needed to keep leaping over profitability hurdles. Wesco keeps a close eye on sales performance by grading it on a quarterly basis. Salespeople are paid a monthly advance of about $2,500 to $3,000 against their commission; those who do not cover Part Two The New Incentive Program at Wesco International, Inc. their advance at the end of a quarter are fired or transferred to a less demanding position. But effective salespeople willing to put in the 60 to 70 hours a week their jobs demand say they are happy at Wesco. So far, the numbers have proved the program a success. In 1993, when the New York investment bank Clayton, Dubilier & Rice bought Wesco from Westinghouse for $340 million, the company was losing money. Wesco showed a slight profit in 1994 and then went firmly into the black in 1995 with a profit of $25 million. In 1996, boosted by a string of acquisitions in 1995, Wesco earned a profit of $32.5 million on sales of $2.3 billion. Since 1994, the company has maintained a six-year string of record annual sales and operating earnings. Today, Wesco is a publicly traded Fortune 500 holding company with annual sales over $3 billion. At the same time, average annual compensation for the top performers in Wesco’s sales force has climbed to more than $140,000, from about $70,000 in 1993. Among the company’s 320 branch managers, average annual compensation at the most profitable branches has climbed to $160,000, from about $100,000 in 1993. And the turnover rate is 11 percent, the company’s lowest in 15 years and less than half of what it was before Wesco was sold. Use the questions below to frame your opinion about the motivational effectiveness of the new incentive program. Questions 1. Use expectancy and goal setting theories to evaluate the strengths and weaknesses of the program. 2. How could equity considerations influence employee receptiveness to the program? For some commentary on Wesco’s incentive program, see The Manager’s Notebook at the end of the chapter. Source: Excerpted from O’Brien, T. L. (1997, April 10). Reaping the rewards. The Wall Street Journal, p. R9. motivation as well as other factors such as personality, general cognitive ability, emotional intelligence, understanding of the task, and chance. In terms of motivation, we are concerned with the amount, persistence, and direction of effort. Therefore, Boxes 1 through 5 in Exhibit 5.7 explain these relationships. Perceptions of expectancy and instrumentality (expectancy theory) relate to all three components of motivation (Box 1). In other words, individuals direct their Chapter 5 Expectancy Theory • Expectancy • Instrumentality Goal Setting Theory • Specific goal • Challenging goal 157 Theories of Work Motivation 4 Intervening Factors • General cognitive ability • Emotional intelligence • Personality • Task understanding • Chance 1 2 Motivation • Effort • Persistence • Direction 3 5 Performance 6 7 Equity Perception • Equity of intrinsic and extrinsic rewards Needs and valence • Intrinsic rewards • Extrinsic rewards 8 Job Satisfaction Exhibit 5.7 Integrative model of motivation theories. effort toward a particular first-level outcome (expectancy) and increase the amount and persistence of effort to the extent that they believe it will result in second-level outcomes (instrumentality). Goal setting theory (Box 2) indicates that specific and challenging goals will have a positive effect on amount, persistence, and direction of effort. Goal specificity should also strengthen both expectancy and instrumentality connections. The individual will have a clear picture of a first-level outcome to which her effort should be directed and greater certainty about the consequences of achieving this outcome. Boxes 3 through 5 illustrate that motivation (Box 3) will be translated into good performance (Box 5) if the worker has the levels of general cognitive ability and emotional intelligence relevant to the job, and if the worker understands the task (Box 4). Chance can also help to translate motivation into good performance. If these conditions are not met, high motivation will not result in good performance. For example, consider a hospital nurse who exhibits tremendous motivation but does not know how to use a syringe properly and is confused about her tasks and responsibilities. Clearly, such an individual will perform poorly in spite of high motivation. It is at this link between motivation and performance that observers frequently make judgments about the motivation of workers. Thus, the head nurse might judge the nurse as having “high” but “misdirected” motivation because the nurse is directing persistent effort in a way that does not help the hospital achieve its goals. This portion of the model is essentially the same as the relationships in Exhibit 5.1. Second, a particular level of performance (Box 5) will be followed by certain outcomes. To the extent that performance is followed by outcomes that fulfill individual needs (need theory) and are positively valent second-level outcomes (expectancy theory), they can be considered rewards for good performance (Box 6). In general, the connection between performance and the occurrence of intrinsic rewards should be strong and reliable because such rewards are self-administered. For example, the nurse who assists several very sick patients back to health is almost certain to feel a sense of competence and achievement because such feelings stem directly from the job. On the other hand, the connection between performance and extrinsic rewards might be much less reliable because the occurrence of such rewards depends on the actions of management. Thus, the head nurse might or might not recommend attendance at a nursing conference (an extrinsic fringe benefit) for the good performance. Third, to the extent that the rewards fulfill individual needs (need theory), then they will be motivational as depicted by the path from rewards (Box 6) to motivation (Box 3). In addition, the rewards that individuals receive are also the outcomes 158 Individual Behaviour Part Two of the equity theory equation and will be used by individuals to form perceptions of equity (Box 7). Perceptions of equity also influence motivation (Box 3) and job satisfaction (Box 8). You will recall that this relationship between job outcomes, equity, and job satisfaction was discussed in Chapter 4. According to equity theory, individuals in a state of equity have high job satisfaction. Individuals who are in a state of inequity experience job dissatisfaction. Also recall from Chapter 4 that good performance leads to job satisfaction if that performance is rewarded, and job satisfaction in turn leads to good performance. In summary, each theory of motivation helps us to understand a different part of the motivational process. Understanding how the different theories of motivation can be integrated brings us to the topic of the next chapter—practical methods of motivation that apply the theories we have been studying in this chapter. the manager’s The New Incentive Program at Wesco International, Inc. Notebook Wesco’s new strategy is in tune with new practices for compensating salespeople. While most companies once tied commissions solely to the amount of business captured by a salesperson or a branch office, a growing number are now paying attention to the bottom line and are compensating their sales force on the basis of the profitability of new contracts. Wesco’s incentive program is unusual, in that it builds a real element of risk into pay—employees could make more or less commissions on the basis of the plan they choose, and failure to cover their advances can mean being fired or transferred. Let us put the incentive program through a motivation theory audit: 1. In expectancy theory terms, sales and exceeding one’s total profit from the previous year are firstlevel outcomes. Sales commissions and the bonus are second-level outcomes. The commission and bonus are clearly large enough to get employees’ attention (12.5 percent or 18 percent commission and up to $10,000 bonus), and it should be highly valent. Also, the instrumentality connection between sales and one’s commission and bonus is clear and obvious, being spelled out by a formula. Potential problems centre on the expectancy that employees would be able to exceed their previous year’s sales, cover their advances, and work the required 60 to 70 hours a week to do so. Outstanding management support would be necessary, as would some sales training geared toward improving sales. Also, factors beyond the employees’ control, such as the economy, could adversely affect profit growth and thus damage expectancy. In goal setting theory terms, the goals of exceeding one’s sales each year and covering advances are very specific and probably challenging to most of the sales force which should prove to be highly motivational. 2. From an equity theory perspective, the outcomes that employees receive are a direct result of their inputs. In other words, one’s commission and bonus are the result of one’s sales. However, when considering the social comparison component of equity theory, a couple of potential problems could result in perceptions of inequity and reduced motivation. First, because of the requirement to leap profitability hurdles and cover advances, employees may feel that they are being treated unfairly, compared with how they were treated under the previous system which did not penalize them for not covering their advance or increasing their sales. Second, because employees who pay their own expenses receive a higher percent of commission and are also eligible for a bonus in comparison with salespersons whose expenses are paid by the company, there is the potential for some salespersons to earn more money for doing the same amount of sales. Large differences in compensation between the two plans might lead to some perceptions of inequity. Chapter 5 Theories of Work Motivation Learning Objectives Checklist 1. Motivation is the extent to which persistent effort is directed toward a goal. Performance is the extent to which an organizational member contributes to achieving the objectives of the organization. 2. Intrinsic motivation stems from the direct relationship between the worker and the task and is usually self-applied. Extrinsic motivation stems from the environment surrounding the task and is applied by others. 3. Performance is influenced by motivation as well as personality, general cognitive ability, emotional intelligence, task understanding, and chance factors. General cognitive ability refers to a person’s basic information processing capacities and cognitive resources. Emotional intelligence refers to the ability to manage emotions in oneself and others. Motivation will be translated into good performance if an individual has the general cognitive ability and emotional intelligence relevant to the job, and if he or she understands the task. 4. Need theories propose that motivation will occur when employee behaviour can be directed toward goals or incentives that satisfy personal wants or desires. The three need theories discussed were Maslow’s need hierarchy, Alderfer’s ERG theory, and McClelland’s theory of needs for achievement, affiliation, and power. Maslow and Alderfer have concentrated on the hierarchical arrangement of needs and the distinction between intrinsic and extrinsic motivation. McClelland has focused on the conditions under which particular need patterns stimulate high motivation. 5. Process theories attempt to explain how motivation occurs rather than what specific factors are motivational. Expectancy theory argues that people will be motivated to engage in work activities that they find attractive and that they feel they can accomplish. The attractiveness of these activities depends on the extent to which they lead to favourable personal consequences. 6. Equity theory states that workers compare the inputs that they apply to their jobs and the outcomes that they achieve from their jobs with the inputs and outcomes of others. When these outcome/input ratios are unequal, inequity exists, and workers will be motivated to restore equity. 159 7. Goal setting theory states that goals are motivational when they are specific and challenging, and when workers are committed to them. In some cases, companies can facilitate goal commitment through employee participation in goal setting and by financial incentives for goal attainment, but freedom from coercion and punishment seems to be the key factor in achieving goal commitment. Goals also can vary in terms of whether they are learning or performance goals. 8. There are some cross-cultural limitations of the theories of motivation. For example, most theories that revolve around human needs will come up against cultural limitations to their generality as a result of differences in values across cultures. As for equity theory, trying to motivate employees with a “fair” reward system might backfire if the definition of fairness is other than equity (e.g., equality). Because of its flexibility, expectancy theory is very effective when applied cross-culturally and allows for the possibility that there may be cross-cultural differences in the expectancy that effort will result in high performance. It also allows for the fact that work outcomes (such as social acceptance versus individual recognition) may have different valences across cultures. Setting specific and challenging goals should also be motivational when applied cross-culturally. However, for goal setting to be effective, careful attention will be required to adjust the goal-setting process in different cultures. 9. Performance is a function of motivation as well as other factors such as personality, general cognitive ability, emotional intelligence, understanding of the task, and chance. Perceptions of expectancy and instrumentality influence motivation as do specific and challenging goals. Motivation will be translated into good performance if the worker has the levels of general cognitive ability and emotional intelligence relevant to the job, and if the worker understands the task. Chance can also help to translate motivation into good performance. To the extent that performance leads to rewards that fulfill individual needs and are positively valent, they will be motivational. When the rewards are perceived as equitable, they will have a positive effect on motivation and job satisfaction. Furthermore, good performance leads to job satisfaction if that performance is rewarded, and job satisfaction in turn leads to good performance. 160 Individual Behaviour Part Two Discussion Questions Integrative Discussion Questions 1. Many millionaires continue to work long, hard hours, sometimes even beyond the usual age of retirement. Use the ideas developed in the chapter to speculate about the reasons for this motivational pattern. Is the acquisition of wealth still a motivator for these individuals? 1. Refer to the cross-cultural dimensions of values described in Chapter 4 (i.e., work centrality, power distance, uncertainty avoidance, masculinity/ feminity, individualism/collectivism, and longterm/short-term orientation) and discuss the implications of each value for exporting the work motivation theories across cultures. Based on your analysis, how useful are the theories described in this chapter for understanding and managing motivation across cultures? What are the implications? 2. Discuss a time when you were highly motivated to perform well (at work, at school, in a sports contest) but performed poorly in spite of your high motivation. How do you know that your motivation was really high? What factors interfered with good performance? What did you learn from this experience? 3. Use Maslow’s hierarchy of needs and Alderfer’s ERG theory to explain why assembly line workers and executive vice-presidents might be susceptible to different forms of motivation. 4. Colleen is high in need for achievement, Eugene is high in need for power, and Max is high in need for affiliation. They are thinking about starting a business partnership. To maximize the motivation of each, what business should they go into, and who should assume which roles or jobs? 5. Reconsider the case of Tony Angelas, which was used to illustrate expectancy theory. Imagine that you are Tony’s boss and you think that he can be motivated to perform at a high level. Suppose you cannot modify second-level outcomes or their valences, but you can affect expectancies and instrumentalities. What would you do to motivate Tony? Prove that you have succeeded by recalculating the force equations to demonstrate that Tony will now perform at a high level. 6. Debate the following statements: Of all the motivational theories we discussed in this chapter, goal setting is the simplest to implement. Goal setting is no more than doing what a good manager should be doing anyway. 2. Consider the basic characteristics of motivation in relation to operant learning and social learning theory. What are the implications of operant learning and social learning theory for motivation, and how do they compare to the theories of work motivation described in this chapter? Experiential Exercise Emotional Intelligence The following scale is a self-report measure of emotional intelligence. Answer each of the statements as accurately and honestly as possible using the following response scale: 1–Strongly disagree 4–Agree 2–Disagree 5–Strongly agree 3–Neither agree or disagree ____ 1. I know when to speak about personal problems to others. ____ 2. When I am faced with obstacles, I remember times I faced similar obstacles and overcame them. ____ 3. I expect that I will do well on most things I try. ____ 4. Other people find it easy to confide in me. ____ 5. I find it hard to understand the nonverbal messages of other people. 7. What are the implications of goal orientation for motivating a group of employees? When would it be best to set a learning goal versus a performance goal? ____ 6. Some of the major events of my life have led to me to re-evaluate what is important and not important. 8. Critique the following assertion: People are basically the same. Thus, the motivation theories discussed in the chapter apply equally around the globe. ____ 8. Emotions are one of the things that make my life worth living. ____ 7. When my mood changes, I see new possibilities. ____ 9. I am aware of my emotions as I experience them. ____ 10. I expect good things to happen. ____ 11. I like to share my emotions with others. Chapter 5 Theories of Work Motivation ____ 12. When I experience a positive emotion, I know how to make it last. ____ 13. I arrange events others enjoy. ____ 14. I seek out activities that make me happy. ____ 15. I am aware of the non-verbal messages I send to others. ____ 16. I present myself in a way that makes a good impression on others. ____ 17. When I am in a positive mood, solving problems is easy for me. ____ 18. By looking at their facial expressions, I recognize the emotions people are experiencing. ____ 19. I know why my emotions change. ____ 20. When I am in a positive mood, I am able to come up with new ideas. ____ 21. I have control over my emotions. ____ 22. I easily recognize my emotions as I experience them. ____ 23. I motivate myself by imagining a good outcome on tasks I take on. ____ 24. I compliment others when they have done something well. ____ 25. I am aware of the non-verbal messages other people send. ____ 26. When another person tells me about an important event in his or her life, I almost feel as though I have experienced this event myself. 161 Scoring and Interpretation To obtain your score, first subtract your response to questions 5, 28, and 33 from 6. For example, if you gave a response of 1 to question 5, give yourself a 5 (6 minus 1). Then add up your scores to all 33 items. Your total should be somewhere between 33 and 165. The higher your score, the higher your emotional intelligence. Because this is a self-report measure of EI, it is susceptible to bias. As a result, your score might differ somewhat on a more objective measure of EI. In a study that compared the EI scores of psychotherapists, prisoners, and substance abuse clients, the EI was highest for the psychotherapists (134.92), followed by the substance abuse clients (122.23), and then the prisoners (120.08). As well, the women in the sample had higher EI scores (130.94) than the men (124.78). In addition, the EI of college students who completed this scale was significantly related to grade point averages at the end of their first year. In other words, higher EI was associated with a higher grade point average. Higher scores on this EI scale have also been found to be related to openness to experience but not to any of the other dimensions of the Five-Factor Model of Personality. Source: Schutte, N. S., Malouff, J. M., Hall, L. E., Haggerty, D. J., Cooper, J. T., Golden, C. J., & Dornheim, L. (1998). Development and validation of a measure of emotional intelligence. Personality and Individual Differences, 25, 167–177. What Are Your Needs? What are your needs and what will motivate you? Think about your future career. Think about the ideal job you would like to have. What matters the most to you? What matters the least to you? Listed below are three groups of work-related characteristics. Rank each group separately from 5 for the most important to 1 for the least important. Career Rank this Group from 5 (Most) to 1 (Least) _____ 1. My co-workers will be very friendly. ____ 27. When I feel a change in emotions, I tend to come up with new ideas. ____ 28. When I am faced with a challenge, I give up because I believe I will fail. ____ 29. I know what other people are feeling just by looking at them. _____ 2. The company will protect me from harassment by customers, fellow employees, and supervisors. _____ 3. The working conditions will protect me from bad weather. _____ 4. The work will be creative and challenging. ____ 30. I help other people feel better when they are down. ____ 31. I use good moods to help myself keep trying in the face of obstacles. ____ 32. I can tell how people are feeling by listening to the tone of their voice. ____ 33. It is difficult for me to understand why people feel the way they do. _____ 5. My supervisor will recognize the value of my work and praise me for it. Rank this Group from 5 (Most) to 1 (Least) _____ 6. I will be able to participate in decision making. _____ 7. The company will sponsor social activities both on and off the job. _____ 8. The pay and fringe benefits will be good. 162 Individual Behaviour _____ 9. There will be good opportunities for promotion to a higher status job. Part Two Rank this Group from 5 (Best) to 1 (Worst) _____ 11. I get along well with my supervisor. _____ 10. The company will work hard to maintain safe working conditions. _____ 12. There is a merit pay system based on performance. Rank this Group from 5 (Most) to 1 (Least) _____ 13. The company provides a cafeteria for its employees. _____ 11. I will get along well with my supervisor. _____ 14. The work itself has a flexible schedule and I have a lot of autonomy. _____ 12. There will be a merit pay system based on performance. _____ 15. There is excellent job security. _____ 13. The company will provide a cafeteria for its employees. _____ 14. The work itself will have a flexible schedule, and I will have a lot of autonomy. _____ 15. There will be excellent job security. Think about your current job (or if you do not have one right now, think about the last job you had). What are the best things about this job? What are the worst things about the job? Listed below are three groups of characteristics about jobs. Rank each group separately from 5 for the best thing to 1 for the worst thing. Current Job Scoring and Interpretation The items in this list represent the five levels of needs found in Maslow’s hierarchy of needs. Each of the groups of five has an item which refers to one of Maslow’s needs as applied to the workplace. Use the number in the left-hand column to sort out the items. Add the scores together for each level of the hierarchy. The instrument also differentiates between your needs as they exist as an ideal and the way in which your current employer is meeting your needs. These are also scored separately. Your Career: What Is Your Hierarchy of Needs? Self-actualization: Add together the ranks for items 4, 6, and 14 (4) + (6) + (14) = Rank this Group from 5 (Best) to 1 (Worst) _____ 1. My co-workers are very friendly. Self-esteem: Add together the ranks for items 5, 9, and 12 _____ 2. The company protects me from harassment by customers, fellow employees, and supervisors. (5) _____ 3. The working conditions protect me from bad weather. + (9) + (12) = Belongingness: Add together the ranks for items 1, 7, and 11 (1) + (7) + (11) = Safety: Add together the ranks for items 2, 10, and 15 (2) + _____ 4. The work is creative and challenging. _____ 5. My supervisor recognizes the value of my work and praises me for it. Rank this Group from 5 (Best) to 1 (Worst) _____ 6. I am able to participate in decision making. _____ 7. The company sponsors social activities both on and off the job. _____ 8. The pay and fringe benefits are good. _____ 9. There are good opportunities for promotion to a higher status job. (10) + (15) = Physiological: Add together the ranks for items 3, 8, and 13 (3) + (8) + (13) = Current Job: How Are Your Needs Being Met? Self-actualization: Add together the ranks for items 4, 6, and 14 (4) + (6) + (14) = Self-esteem: Add together the ranks for items 5, 9, and 12 _____ 10. The company works hard to maintain safe working conditions. (5) + (9) + (12) = Chapter 5 Theories of Work Motivation Belongingness: Add together the ranks for items 1, 7, and 11 (7) + Safety: Add together the ranks for items 2, 10, and 15 2. Discuss the motivational potential of this program according to expectancy theory. Will the program motivate the sales staff and improve sales? (2) + 3. How would you change the program in order to make it more effective for motivating employees? + (11) (15) = 1. According to need theories of motivation and goal setting theory, will this program be motivational? (1) (10) + 163 = Physiological: Add together the ranks for items 3, 8, and 13 (3) + (8) + (13) = Lincoln Electric Company TABLE OF RESULTS Hierarchy of Needs Your Career Case Study Current Job Self-actualization Self-esteem Social Security Physiological Analyze your results by comparing your career needs with those in your current job. 1. What is your strongest need? Is it being met in your current job? 2. What differences exist between your career needs and your current job? 3. According to Maslow’s need hierarchy theory, what should your current or future employer do to motivate you? Source: Hoffman, R. & Ruemper, F. (1997). What matters in a job? Organizational behavior: Canadian cases and exercises, 3rd ed. Reprinted with permission of Captus Press Inc., Units 14 & 15, 1600 Steeles Ave. West, Concord, ON L4K 4M5. E-mail: info@captus.com. Internet: http://www.captus.com. Case Incident Mayfield Department Stores As competition in the retail market began to heat up, it became necessary to find ways to motivate the sales staff of Mayfield Department Stores in order to increase sales. Therefore, a motivational program was developed with the help of a consulting firm. Employees were informed that each month employees in the department with the highest sales would have a chance to win a trip to Florida. At the end of the year, the names of all employees in those departments that had the highest sales for at least one month would have their name entered into a draw, and then three names would be chosen to win a one-week trip to Florida paid for by Mayfield. On the surface, the Lincoln Electric Company might look like a motivational disaster. The firm, located near Cleveland, Ohio, offers employees no paid sick days and no paid holidays. Lincoln employees have to pay their own health insurance, and overtime work and unexpected job reassignments are mandatory. If older workers lower their productivity, they receive less pay. Management does not take seniority into account in promotions. Lincoln managers receive no executive “perks”—no cars, no executive dining room, no club memberships, no management seminars, and no reserved parking. Despite these apparently draconian policies, Lincoln has become something of a mecca for visiting managers (from Ford, GM, TRW, 3M, Motorola, and McDonnell Douglas), who flock to Cleveland to learn something about motivation. Lincoln is the world’s largest producer of arc welding equipment, and it also makes electric motors. The firm has turned a handsome profit every quarter for over 50 years and has not laid anyone off for over 40 years. In 1995, the company celebrated its centennial year by posting record sales of $1.03 billion. Employee turnover is extremely low, and Lincoln workers are estimated to be roughly twice as productive as other manufacturing workers. This productivity is an important key to Lincoln’s success because it is not dealing in hightech products, and it does not compete strongly on price. What is the secret to Lincoln’s motivational success? In a word, money. Lots of it. In addition to its leadership position in the manufacture of arc welding equipment, Lincoln Electric is also known for its innovative incentive system. Lincoln Electric offers what some say are the best paid factory jobs in the world. At the core of the system is an intricate piece-rate pay plan that rewards workers for what they produce and a merit-based profit-sharing plan that provides a yearly bonus. This bonus, which can approach 100 percent of regular earnings, is also allocated on merit to managers and staff. Each employee is regularly evaluated by his or her immediate supervisor on a number of dimensions (e.g., quality and cooperation). The size of the bonus pool is based on the company’s economic performance. In other words, the more profitable the company the larger will be the dollar pool from which the bonuses are paid. The total bonus received by each employee is based on his or her evaluation. As a result, there is a direct connection between an employee’s performance and the bonus paid out to that employee at the end of the year. Employees who do better than average receive a higher bonus and those 164 Individual Behaviour who do worse than average receive a lower bonus. Year end bonuses normally range from 60 to 150 percent of regular salary. The average production worker has earned $45,000 in recent years, with some earning well over $85,000! If workers think up a way to increase productivity, the company does not adjust the piece-rate to cap potential wages. Also, they cannot work themselves out of a job, since Lincoln has a no-layoff policy. Effectively, this amounts to lifetime employment. Employees are guaranteed 30 hours a week, and work is shared instead of laying people off. Employees are so keen to get working that the company enforces a policy prohibiting them from coming in too early. The company is also known for having fewer supervisors per worker than most organizations, with a ratio of 1:100. Training programs are frequently available on all aspects of business and factory life including communication skills, teamwork programs, and math courses. When the company had its first big hiring in years, it received 27,000 applications. Life at Lincoln, however, is not for everyone. Some managers would resent the lack of perks. Some new production workers cannot take the fast pace and quit shortly after hiring. In fact, out of the 27,000 applications, 2,000 were eventually hired, but over 1,000 left in the first 90 days. Many never even apply because of Lincoln’s non-union status. In recent years, Lincoln Electric has expanded internationally. And although the company’s arc welding equipment is used in the same way everywhere, this has not been the case for the company’s motivational system. According to Donald Hastings, Chairman Emeritus and former CEO, “In many cases we didn’t truly understand the cultures of those countries we expanded. For example, we had an incentive program that was based on the belief that everybody in the world would be willing to work a little harder to enhance their lives and their families and their incomes. It was an erroneous assumption. It simply didn’t work in Germany, for example. Ten years from now, it might, because Germans are changing their thought patterns, getting away from a completely socialized economy where the quality of life is much more important than the monetary returns. But for now, they don’t really want to put in the extra time and effort that Americans, Canadians, and Australians do.” Although Lincoln Electric still sells their products in Germany, the manufacturing operation has been closed down. Part Two Sources: Hodgetts, R.M. (1997, Winter). A conversation with Donald F. Hastings of the Lincoln Electric Company. Organizational Dynamics, pp. 68–74; 60 Minutes, Lincoln Electric Company, 1993; Epstein, G. (1989, October). Inspire your team. Success, p. 12; Perry, N.J. (1988, December 19). Here come richer, riskier pay plans. Fortune, 50–58; Sharplin, A. D. (1990). Lincoln Electric Company, 1989. In A. A. Thompson, Jr., & A. J. Strickland, III. Strategic management: Concepts and cases. Homewood, IL: BPI/Irwin. 1. Describe the practices that Lincoln Electric uses to motivate employees. What are some of the consequences of these practices for employees and the company? 2. Discuss the motivational system at Lincoln Electric, using each of the need theories of motivation. What does each theory say about the motivational practices at Lincoln Electric and which theory works best for explaining employees’ motivation? 3. Consider the motivational system at Lincoln Electric in terms of the process theories of motivation. What does each theory say about the company’s motivational practices? In other words, can we understand the system and its effectiveness in terms of expectancy theory, equity theory, and goal setting theory? 4. Some have said that the methods of motivation used at Lincoln Electric should be used by all organizations to motivate their employees. Do you believe this to be true? Explain your reasoning. 5. Comment on the cross-cultural limitations of Lincoln Electric’s motivational system. How do the theories of work motivation help us to understand why the company’s incentive program did not work in Germany but does work in North America and Australia? What does this tell us about the cross-cultural limitations of the theories of motivation? 6. What can other organizations learn about motivation from Lincoln Electric? What do you recommend that organizations do to motivate employees based on your knowledge of the Lincoln Electric motivational system and on your understanding of motivation? ...
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