Essential of Management

Documentation of Motivating Employees

Submitted To: Respected Ma’am Saher Imtaiz

Submitted By:

Sohail Yousaf (11022720-074)

Motivation

The term motivation is derived from the Latin word movere, meaning "to move." Motivation can be broadly defined as the forces acting on or within a person that cause the arousal, direction, and persistence of goal-directed, voluntary effort. Motivation theory is thus concerned with the processes that explain why and how human behavior is activated.The broad rubric of motivation and motivation theory is one of the most frequently studied and written-about topics in the organizational sciences, and is considered one of the most important areas of study in the field of organizational behavior. Despite the magnitude of the effort that has been devoted to the study of motivation, there is no single theory of motivation that is universally accepted. The lack of a unified theory of motivation reflects both the complexity of the construct and the diverse backgrounds and aims of those who study it. To delineate these crucial points, it is illuminating to consider the development of motivation and motivation theory as the objects of scientific inquiry.

HISTORICAL DEVELOPMENT Early explanations of motivation focused on instincts. Psychologists writing in the late 19th and early twentieth century have suggested that human beings were basically programmed to behave in certain ways, depending upon the behavioral cues to which they were exposed. Sigmund Freud, for example, argued that the most powerful determinants of individual behavior were those of which the individual was not consciously aware.According to Motivation and Leadership at Work (Steers, Porter, and Bigley, 1996), in the early twentieth century researchers began to examine other possible explanations for differences in individual motivation. Some researchers focused on internal drives as an explanation for motivated behavior. Others studied the effect of learning and how individuals base current behavior on the consequences of past behavior. Still others examined the influence of individuals' cognitive processes, such as the beliefs they have about future events. Over time, these major theoretical streams of research in motivation were classified into two major schools: the content theories of motivation and the process theories of motivation.

Early Theories of Motivation

We begin by looking at four early theories of motivating employees.1. Maslow's hierarchy of needs. 2. McGregor’s Theory X and Theory Y.3. Herzberg’s Two-factor theory. 4. McClelland’s three needs theory.

Although more valid explanations of motivation have been developed, these early theories are important because they represent the foundation from which contemporary motivation theories were developed and because many practicing managers still use them.

Maslow's hierarchy of needs An interpretation of Maslow's hierarchy of needs, represented as a pyramid with the more basic needs at the bottom. Maslow's hierarchy of needs is a theory in psychology, proposed by Abraham Maslow in his 1943 paper A Theory of Human Motivation. Maslow subsequently extended the idea to include his observations of Humans' innate curiosity. His theories parallel many other theories of human developmental psychology, all of which focus on describing the stages of growth in humans. Maslow use the terms Physiological, Safety, Belongingness and Love, Esteem, and Self-Actualization needs to describe the pattern that human motivations generally move through.

Maslow studied what he called exemplary people such as Albert Einstein, Jane Addams, Eleanor Roosevelt, and Frederick Douglass rather than mentally ill or neurotic people, writing that "the study of crippled, stunted, immature, and unhealthy specimens can yield only a cripple psychology and a cripple philosophy." Maslow studied the healthiest 1% of the college student population. Maslow's theory was fully expressed in his 1954 book Motivation and Personality. Abraham Maslow Note that Maslow never personally used a pyramid to describe these levels in any of his writings on the subject.

Hierarchy

Maslow's hierarchy of needs is often portrayed in the shape of a pyramid, with the largest and most fundamental levels of needs at the bottom, and the need for self-actualization at the top.

The most fundamental and basic four layers of the pyramid contain what Maslow called "deficiency needs" or "d-needs": esteem, friendship and love, security, and physical needs. With the exception of the most fundamental (physiological) needs, if these "deficiency needs" are not met, the body gives no physical indication but the individual feels anxious and tense. Maslow's theory suggests that the most basic level of needs must be met before the individual will strongly desire (or focus motivation upon) the secondary or higher level needs. Maslow also coined the term Met motivation to describe the motivation of people who go beyond the scope of the basic needs and strive for constant betterment. Met motivated people are driven by B-needs (Being Needs), instead of deficiency needs (D-Needs).

The human mind and brain is complex and have parallel processes running at the same time, so many different motivations from different levels of Maslow's pyramid usually occur at the same time. Maslow was clear about speaking of these levels and their satisfaction in terms such as "relative" and "general" and "primarily", and says that the human organism is "dominated" by a certain need, rather than saying that the individual is "only" focused on a certain need at any given time. So Maslow acknowledges that many different levels of motivation are likely to be going on in a human all at once. His focus in discussing the hierarchy was to identify the basic types of motivations, and the order that they generally progress as lower needs are reasonably well met.

1. Physiological needs

For the most part, physiological needs are obvious – they are the literal requirements for human survival. If these requirements are not met, the human body simply cannot continue to function. Air, water, and food are metabolic requirements for survival in all animals, including humans. Clothing and shelter provide necessary protection from the elements. The intensity of the human sexual instinct is shaped more by sexual competition than maintaining a birth rate adequate to survival of the species.

2. Safety needs

With their physical needs relatively satisfied, the individual's safety needs take precedence and dominate behavior. In the absence of physical safety – due to war, natural disaster, or, in cases of family violence, childhood abuse, etc. – people (re-)experience post-traumatic stress disorder and trans-generational trauma transfer. In the absence of economic safety – due to economic crisis and lack of work opportunities – these safety needs manifest themselves in such things as a preference for job security, grievance procedures for protecting the individual from unilateral authority, savings accounts, insurance policies, reasonable disability accommodations, and the like.

Safety and Security needs include:

Personal security Financial security

Health and well-being

Safety net against accidents/illness and their adverse impacts

3. Love and belonging

After physiological and safety needs are fulfilled, the third layer of human needs is interpersonal and involves feelings of belongingness. The need is especially strong in childhood and can over-ride the need for safety as witnessed in children who cling to abusive parents. Deficiencies with respect to this aspect of Maslow's hierarchy – due to hospitalist, neglect, shunning, ostracism etc. – can impact individual's ability to form and maintain emotionally significant relationships in general, such as:

Friendship Intimacy

Family

Humans need to feel a sense of belonging and acceptance, whether it comes from a large social group, such as clubs, office culture, religious groups, professional organizations, sports teams, gangs, or small social connections (family members, intimate partners, mentors, close colleagues, confidants). They need to love and be loved (sexually and non-sexually) by others. In the absence of these elements, many people become susceptible to loneliness, social anxiety, and clinical depression. This need for belonging can often overcome the physiological and security needs, depending on the strength of the peer pressure; an anorexic, for example, may ignore the need to eat and the security of health for a feeling of control and belonging.[citation needed]

4. Self- Esteem

All humans have a need to be respected and to have self-esteem and self-respect. Esteem presents the normal human desire to be accepted and valued by others. People need to engage themselves to gain recognition and have an activity or activities that give the person a sense of contribution, to feel self-valued, be it in a profession or hobby. Imbalances at this level can result in low self-esteem or an inferiority complex. People with low self-esteem need respect from others. They may seek fame or glory, which again depends on others. Note, however, that many people with low self-esteem will not be able to improve their view of themselves simply by receiving fame, respect, and glory externally, but must first accept themselves internally. Psychological imbalances such as depression can also prevent one from obtaining self-esteem on both levels.

Most people have a need for a stable self-respect and self-esteem. Maslow noted two versions of esteem needs, a lower one and a higher one. The lower one is the need for the respect of others, the need for status, recognition, fame, prestige, and attention. The higher one is the need for self-respect, the need for strength, competence, mastery, self-confidence, independence and freedom. The latter one ranks higher because it rests more on inner competence won through experience. Deprivation of these needs can lead to an inferiority complex, weakness and helplessness.

Maslow also states that even though these are examples of how the quest for knowledge is separate from basic needs he warns that these “two hierarchies are interrelated rather than sharply separated” (Maslow 97). This means that this level of need, as well as the next and highest level, is not strict, separate levels but closely related to others, and this is possibly the reason that these two levels of need are left out of most textbooks.

5. Self-actualization

“What a man can be, he must be.” This forms the basis of the perceived need for self-actualization. This level of need pertains to what a person's full potential is and realizing that potential. Maslow describes this desire as the desire to become more and more what one is, to become everything that one is capable of becoming. This is a broad definition of the need for self-actualization, but when applied to individuals the need is specific. For example one individual may have the strong desire to become an ideal parent, in another it may be expressed athletically, and in another it may be expressed in painting, pictures, or inventions. As mentioned before, in order to reach a clear understanding of this level of need one must first not only achieve the previous needs, physiological, safety, love, and esteem, but master these needs.

McGregor’s Theory X and Theory Y

Theory X and Theory Y are theories of human motivation created and developed by Douglas McGregor at the MIT Sloan School of Management in the 1960s that have been used in human resource management, organizational behavior, organizational communication and organizational development. They describe two contrasting models of workforce motivation.

Douglas McGregor

Theory X In this theory, which has been proven counter-effective in most modern practice, management assumes employees are inherently lazy and will avoid work if they can and that they inherently dislike work. As a result of this, management believes that workers need to be closely supervised and comprehensive systems of controls developed. A hierarchical structure is needed with narrow span of control at each and every level. According to this theory, employees will show little ambition without an enticing incentive program and will avoid responsibility whenever they can. According to Michael J. Papa, if the organizational goals are to be met, theory X managers rely heavily on threat and coercion to gain their employees' compliance. Beliefs of this theory lead to mistrust, highly restrictive supervision, and a punitive atmosphere. The Theory X manager tends to believe that everything must end in blaming someone. He or she thinks all prospective employees are only out for themselves. Usually these managers feel the sole purpose of the employee's interest in the job is money. They will blame the person first in most situations, without questioning whether it may be the system, policy, or lack of training that deserves the blame. A Theory X manager believes that his or her employees do not really want to work, that they would rather avoid responsibility and that it is the manager's job to structure the work and energize the employee. One major flaw of this management style is it is much more likely to cause diseconomies of scale in large businesses.

Theory Y In this theory, management assumes employees may be ambitious and self-motivated and exercise self-control. It is believed that employees enjoy their mental and physical work duties. According to Papa, to them work is as natural as play. They possess the ability for creative problem solving, but their talents are underused in most organizations. Given the proper conditions, theory Y managers believe that employees will learn to seek out and accept responsibility and to exercise self-control and self-direction in accomplishing objectives to which they are committed. A Theory Y manager believes that, given the right conditions, most people will want to do well at work. They believe that the satisfaction of doing a good job is a strong motivation. Many people interpret Theory Y as a positive set of beliefs about workers. A close reading of The Human Side of Enterprise reveals that McGregor simply argues for managers to be open to a more positive view of workers and the possibilities that this creates. He thinks that Theory Y managers are more likely than Theory X managers to develop the climate of trust with employees that are required for human resource development. It's human resource development that is a crucial aspect of any organization. This would include managers communicating openly with subordinates, minimizing the difference between superior-subordinate relationships, creating a comfortable environment in which subordinates can develop and use their abilities. This climate would include the sharing of decision making so that subordinates have say in decisions that influence them.

Herzberg’s Two -factor theory

The Two-factor theory (also known as Herzberg's motivation-hygiene theory and Dual-Factor Theory) states that there are certain factors in the workplace that cause job satisfaction, while a separate set of factors cause dissatisfaction. It was developed by Frederick Herzberg, a psychologist, who theorized that job satisfaction and job dissatisfaction act independently of each other. Two-factor theory fundamentals: Attitudes and their connection with industrial mental health are related to Maslow's theory of motivation.His findings have had a considerable theoretical, as well as a practical, influence on attitudes toward administration. According to Herzberg, Frederick Herzbergindividuals are not content with the satisfaction of lower-order needs at work, for example, those associated with minimum salary levels or safe and pleasant working conditions. Rather, individuals look for the gratio with achievement, recognition, responsibility, advancement, and the nature of the work itself. So far, this appears to parallel Maslow's theory of a need hierarchy. However, Herzberg added a new dimension to this theory by proposing a two-factor model of motivation, based on the notion that the presence of one set of job characteristics or incentives lead to worker satisfaction at work, while another and separate set of job characteristics lead to dissatisfaction at work. Thus, satisfaction and dissatisfaction are not on a continuum with one increasing as the other diminishes, but are independent phenomena. This theory suggests that to improve job attitudes and productivity, administrators must recognize and attend to both sets of characteristics and not assume that an increase in satisfaction leads to decrease in un pleasurable dissatisfaction.

The two-factor, or motivation-hygiene theory, developed from data collected by Herzberg from interviews with a large number of engineers and accountants in the Pittsburgh area. From analyzing these interviews, he found that job characteristics related to what an individual does — that is, to the nature of the work he performs — apparently have the capacity to gratify such needs as achievement, competency, status, personal worth, and self-realization, thus making him happy and satisfied. However, the absence of such gratifying job characteristics does not appear to lead to unhappiness and dissatisfaction. Instead, dissatisfaction results from unfavorable assessments of such job-related factors as company policies, supervision, technical problems, salary, interpersonal relations on the job, and working conditions. Thus, if management wishes to increase satisfaction on the job, it should be concerned with the nature of the work itself — the opportunities it presents for gaining status, assuming responsibility, and for achieving self-realization. If, on the other hand, management wishes to reduce dissatisfaction, then it must focus on the job environment — policies, procedures, supervision, and working conditions. If management is equally concerned with (as is usually the case), then managers must give attention to both sets of job factors.

The theory was based around interviews with 203 American accountants and engineers in Pittsburgh, chosen because of their professions' growing importance in the business world. The subjects were asked to relate times when they felt exceptionally good or bad about their present job or any previous job, and to provide reasons, and a description of the sequence of events giving rise to that positive or negative feeling.Here is the description of this interview analysis:

Briefly, we asked our respondents to describe periods in their lives when they were exceedingly happy and unhappy with their jobs. Each respondent gave as many "sequences of events" as he could that met certain criteria—including a marked change in feeling, a beginning and an end, and contained some substantive description other than feelings and interpretations…The proposed hypothesis appears verified. The factors on the right that led to satisfaction (achievement, intrinsic interest in the work, responsibility, and advancement) are mostly unipolar; that is, they contribute very little to job dissatisfaction. Conversely, the dis-satisfiers (company policy and administrative practices, supervision, interpersonal relationships, working conditions, and salary) contribute very little to job satisfaction. Two-factor theory distinguishes between:

Motivators (e.g., challenging work, recognition, responsibility) that give positive satisfaction, arising from intrinsic conditions of the job itself, such as recognition, achievement, or personal growth, and

Hygiene factors (e.g. status, job security, salary, fringe benefits, work conditions) that do not give positive satisfaction, though dissatisfaction results from their absence. These are extrinsic to the work itself, and include aspects such as company policies, supervisory practices, or wages/salary.

Essentially, hygiene factors are needed to ensure an employee is not dissatisfied. Motivation factors are needed to motivate an employee to higher performance. Herzberg also further classified our actions and how and why we do them, for example, if you perform a work related action because you have to then that is classed as movement, but if you perform a work related action because you want to then that is classed as motivation.Unlike Maslow, who offered little data to support his ideas, Herzberg and others have presented considerable empirical evidence to confirm the motivation-hygiene theory, although their work has been criticized on methodological grounds.

Validity and criticisms In 1968 Herzberg stated that his two-factor theory study had already been replicated 16 times in a wide variety of populations including some in Communist countries, and corroborated with studies using different procedures that agreed with his original findings regarding intrinsic employee motivation making it one of the most widely replicated studies on job attitudes.While the Motivator-Hygiene concept is still well regarded, satisfaction and dissatisfaction are generally no longer considered to exist on separate scales. The separation of satisfaction and dissatisfaction has been shown to be an artifact of the Critical Incident Technique (CIT) used by Herzberg to record events. Furthermore, it has been noted the theory does not allow for individual differences, such as particular personality traits, which would affect individuals' unique responses to motivating or hygiene factors. A number of behavioral scientists have pointed to inadequacies in the need hierarchy and motivation-hygiene theories. The most basic is the criticism that both of these theories contain the relatively explicit assumption that happy and satisfied workers produce more..Another problem is that these and other statistical theories are concerned with explaining "average" behavior and, on the other hand, if playing a better game of golf is the means chosen to satisfy one's need for recognition, then one will find ways to play and think about golf more often, perhaps resulting in an accompanying lower output on the job. Finally, in his pursuit of status a person might take a balanced view and strive to pursue several behavioral paths in an effort to achieve a combination of personal status objectives.In other words, an individual's expectation or estimated probability that a given behavior will bring a valued outcome determines his choice of means and the effort he will devote to these means. In effect, this diagram of expectancy depicts an employee asking himself the question posed by one investigator,

"How much payoff is there for me toward attaining a personal goal while expending so much effort toward the achievement of an assigned organizational objective?" The Expectancy theory by Victor Vroom also provides a framework for motivation based on expectations.

This approach to the study and understanding of motivation would appear to have certain conceptual advantages over other theories: First, unlike Maslow's and Herzberg's theories, it is capable of handling individual differences. Second, its focus is toward the present and the future, in contrast to drive theory, which emphasizes past learning, Third, it specifically correlates behavior to a goal and thus eliminates the problem of assumed relationships, such as between motivation and performance.Fourth, it relates motivation to ability:

Performance = Motivation*Ability.

That said, a study by the Gallup Organization, as detailed in the book First, Break All the Rules: What the World's Greatest Managers Do by Marcus Buckingham and Curt Coffman, appears to provide strong support for Herzberg's division of satisfaction and dissatisfaction onto two separate scales. In this book, the authors discuss how the study identified twelve questions that provide a framework for determining high-performing individuals and organizations. These twelve questions align squarely with Herzberg's motivation factors, while hygiene factors were determined to have little effect on motivating high performance.

To better understand employee attitudes and motivation, Frederick Herzberg performed studies to determine which factors in an employee's work environment caused satisfaction or dissatisfaction. He published his findings in the 1959 book The Motivation to Work.The studies included interviews in which employees where asked what pleased and displeased them about their work. Herzberg found that the factors causing job satisfaction (and presumably motivation) were different from that causing job dissatisfaction. He developed the motivation-hygiene theory to explain these results. He called the satisfiers motivators and the dissatisfies hygiene factors, using the term "hygiene" in the sense that they are considered maintenance factors that are necessary to avoid dissatisfaction but that by themselves do not provide satisfaction.The following table presents the top seven factors causing dissatisfaction and the top six factors causing satisfaction, listed in the order of higher to lower importance.

Leading to satisfaction Achievement Recognition Work itself Responsibility Advancement Growth

Leading to dissatisfaction Company policy Supervision Relationship with boss Work conditions Salary Relationship with peers Security

Herzberg reasoned that because the factors causing satisfaction are different from those causing dissatisfaction, the two feelings cannot simply be treated as opposites of one another. The opposite of satisfaction is not dissatisfaction, but rather, no satisfaction. Similarly, the opposite of dissatisfaction is no dissatisfaction.While at first glance this distinction between the two opposites may sound like a play on words, Herzberg argued that there are two distinct human needs portrayed. First, there are physiological needs that can be fulfilled by money, for example, to purchase food and shelter. Second, there is the psychological need to achieve and grow, and this need is fulfilled by activities that cause one to grow.From the above table of results, one observes that the factors that determine whether there is dissatisfaction or no dissatisfaction are not part of the work itself, but rather, are external factors. Herzberg often referred to these hygiene factors as "KITA" factors, where KITA is an acronym for Kick in the Ass, the process of providing incentives or a threat of punishment to cause someone to do something. Herzberg argues that these provide only short-run success because the motivator factors that determine whether there is satisfaction or no satisfaction are intrinsic to the job itself, and do not result from carrot and stick incentives.

In a survey of 80 teaching staff at Egyptian private universities, Mohamed Hossam El-Din Khalifa and Quang Truong (2009) found that perception of equity was directly related to job satisfaction when the outcome in the equity comparison was one of Herzberg's motivators. On the contrary, perceptions of equity and job satisfaction were not related when the outcome in the equity comparison was one of Herzberg's hygiene factors. The findings of this study provide a kind of an indirect support to Herzberg's findings that improving hygiene factors would not lead to improvement in an employee's job satisfaction.Implications for managementIf the motivation-hygiene theory holds, management not only must provide hygiene factors to avoid employee dissatisfaction, but also must provide factors intrinsic to the work itself for employees to be satisfied with their jobs.Herzberg argued that job enrichment is required for intrinsic motivation, and that it is a continuous management process. According to Herzberg:"The job should have sufficient challenge to utilize the full ability of the employee.""Employees who demonstrate increasing levels of ability should be given increasing levels of responsibility."

"If a job cannot be designed to use an employee's full abilities, then the firm should consider automating the task or replacing the employee with one who has a lower level of skill. If a person cannot be fully utilized, then there will be a motivation problem."Critics of Herzberg's theory argue that the two-factor result is observed because it is natural for people to take credit for satisfaction and to blame dissatisfaction on external factors. Furthermore, job satisfaction does not necessarily imply a high level of motivation or productivity.Herzberg's theory has been broadly read and despite its weaknesses its enduring value is that it recognizes that true motivation comes from within a person and not from KITA factors. (French, 2008)

McClelland’s Theory of NeedsDavid McClelland and his associates proposed McClelland’s theory of Needs / Achievement Motivation Theory. This theory states that human behavior is affected by three needs - Need for Power, Achievement and Affiliation. Need for achievement is the urge to excel, to accomplish in relation to a set of standards, to struggle to achieve success. Need for power is the desire to Influence other individual’s behavior as per your wish. In other words, it is the desire to have control over others and to be influential. Need for affiliation is a need for open and sociable interpersonal relationships. In other words, it is a desire for relationship based on co-operation and mutual understanding.The individuals with high achievement needs are highly motivated by competing and challenging work. They look for promotional opportunities in job. They have a strong urge for feedback on their achievement. Such individuals try to get satisfaction in performing things better. High achievement is directly related to high performance. Individuals who are better and above average performers are highly motivated. David McClellandThey assume responsibility for solving the problems at work. McClelland called such individuals as gamblers as they set challenging targets for themselves and they take deliberate risk to achieve those set targets. Such individuals look for innovative ways of performing job. They perceive achievement of goals as a reward, and value it more than a financial reward.The individuals who are motivated by power have a strong urge to be influential and controlling. They want that their views and ideas should dominate and thus, they want to lead. Such individuals are motivated by the need for reputation and self-esteem. Individuals with greater power and authority will perform better than those possessing less power. Generally, managers with high need for power turn out to be more efficient and successful managers. They are more determined and loyal to the organization they work for. Need for power should not always be taken negatively. It can be viewed as the need to have a positive effect on the organization and to support the organization in achieving its goals.The individuals who are motivated by affiliation have an urge for a friendly and supportive environment. Such individuals are effective performers in a team. These people want to be liked by others. The manager’s ability to make decisions is hampered if they have a high affiliation need as they prefer to be accepted and liked by others, and this weakens their objectivity. Individuals having high affiliation needs prefer working in an environment providing greater personal interaction. such people have a need to be on the good books of all. They generally cannot be good leaders

Contemporary Theories of Motivation

The theories we look at in this section represent current explanation of employee motivation. Although these theories may not be as well knows as justice discusses, they are supported by research. These contemporary motivation approaches are

1. Goal-setting theory. 2. Reinforcement theory.3. Job Design theory. 4. Equity theory.5. Expectancy theory.

1. Goal Setting Theory

Goal setting is a powerful way of motivating people, and of motivating yourself. The value of goal setting is so well recognized that entire management systems, like Management, have goal setting basics incorporated within them.In fact, goal setting theory is generally accepted as among the most valid and useful motivation theories in industrial and organizational psychology, human resource management, and organizational behavior.Many of us have learned – from bosses, seminars, and business articles – to set SMART goals. It seems natural to assume that by setting a goal that's Specific, Measurable, Attainable, Relevant, and Time-bound, we will be well on our way to accomplishing it.But is this really the best way of setting goals?To answer this, we look to Dr Edwin Locke's pioneering research on goal setting and motivation in the late 1960s. In his 1968 article "Toward a Theory of Task Motivation and Incentives," he stated that employees were motivated by clear goals and appropriate feedback. Locke went on to say that working toward a goal provided a major source of motivation to actually reach the goal – which, in turn, improved performance.This information does not seem revolutionary to us some 40 years later. This shows the impact his theory has had on professional and personal performance.In this article, we look at what Locke had to say about goal setting, and how we can apply his theory to our own performance goals.

John Locke's research showed that there was a relationship between how difficult and specific a goal was and people's performance of a task. He found that specific and difficult goals led to better task performance than vague or easy goals.Telling someone to "Try hard" or "Do your best" is less effective than "Try to get more than 80% correct" or "Concentrate on beating your best time." Likewise, having a goal that's too easy is not a motivating force. Hard goals are more motivating than easy goals, because it's much more of an accomplishment to achieve something that you

have to work for. John Locke'A few years after Locke published his article, another researcher, Dr Gary Latham, studied the effect of goal setting in the workplace. His results supported exactly what Locke had found, and the inseparable link between goal setting and workplace performance was formed.In 1990, Locke and Latham published their seminal work, "A Theory of Goal Setting and Task Performance." In this book, they reinforced the need to set specific and difficult goals, and they outlined three other characteristics of successful goal setting.

Five Principles of Goal Setting

To motivate, goals must have:1. Clarity.2. Challenge.3. Commitment.4. Feedback.5. Task complexity.

Let's look at each of these in detail.

1. Clarity Clear goals are measurable and unambiguous. When a goal is clear and specific, with a definite time set for completion, there is less misunderstanding about what behaviors will be rewarded. You know what's expected, and you can use the specific result as a source of motivation. When a goal is vague – or when it's expressed as a general instruction, like "Take initiative" – it has limited motivational value.To improve your or your team's performance, set clear goals that use specific and measurable standards. "Reduce job turnover by 15%" or "Respond to employee suggestions within 48 hours" are examples of clear goals.When you use the SMART acronym to help you set goals, you ensure the clarity of the goal by making it Specific, Measurable and Time-bound.

2. Challenge One of the most important characteristics of goals is the level of challenge. People are often motivated by achievement, and they'll judge a goal based on the significance of the anticipated accomplishment. When you know that what you do will be well received, there's a natural motivation to do a good job.Rewards typically increase for more difficult goals. If you believe you'll be well compensated or otherwise rewarded for achieving a challenging goal, that will boost your enthusiasm and your drive to get it done.Setting SMART goals that are Relevant links them closely to the rewards given for achieving challenging goals. Relevant goals will further the aims of your organization, and these are the kinds of goals that most employers will be happy to reward.When setting goals, make each goal a challenge. If an assignment is easy and not viewed as very important – and if you or your employee doesn't expect the accomplishment to be significant – then the effort may not be impressive.

Note: It's important to strike an appropriate balance between a challenging goal and a realistic goal. Setting a goal that you'll fail to achieve is possibly more de-motivating than setting a goal that's too easy. The need for success and achievement is strong, therefore people are best motivated by

challenging, but realistic, goals. Ensuring that goals are Achievable or Attainable is one of the elements of SMART.

3. Commitment Goals must be understood and agreed upon if they are to be effective. Employees are more likely to "buy into" a goal if they feel they were part of creating that goal. The notion of participative management rests on this idea of involving employees in setting goals and making decisions.One version of SMART – for use when you are working with someone else to set their goals – has A and R stand for Agreed and Realistic instead of Attainable and Relevant. Agreed goals lead to commitment.This doesn't mean that every goal has to be negotiated with and approved by employees. It does mean that goals should be consistent and in line with previous expectations and organizational concerns. As long as the employee believes that the goal is consistent with the goals of the company, and believes the person assigning the goal is credible, then the commitment should be there. Interestingly, goal commitment and difficulty often work together. The harder the goal, the more commitment is required. If you have an easy goal, you don't need a lot of motivation to get it done. When you're working on a difficult assignment, you will likely encounter challenges that require a deeper source of inspiration and incentive.As you use goal setting in your workplace, make an appropriate effort to include people in their own goal setting. Encourage employees to develop their own goals, and keep them informed about what's happening elsewhere in the organization. This way, they can be sure that their goals are consistent with the overall vision and purpose that the company seeks. 

4. Feedback In addition to selecting the right type of goal, an effective goal program must also include feedback. Feedback provides opportunities to clarify expectations, adjust goal difficulty, and gain recognition. It's important to provide benchmark opportunities or targets, so individuals can determine for themselves how they're doing.These regular progress reports, which measure specific success along the way, are particularly important where it's going to take a long time to reach a goal. In these cases, break down the goals into smaller chunks, and link feedback to these intermediate milestones.SMART goals are Measurable, and this ensures that clear feedback can be provided.With all your goal setting efforts, make sure that you build in time for providing formal feedback. Certainly, informal check-ins are important, and they provide a means of giving regular encouragement and recognition. However, taking the time to sit down and discuss goal performance is a necessary factor in long-term performance improvement. See our article on Delegation for more on this.

5. Task Complexity The last factor in goal setting theory introduces two more requirements for success. For goals or assignments that are highly complex, take special care to ensure that the work doesn't become too overwhelming.People who work in complicated and demanding roles probably have a high level of motivation already. However, they can often push themselves too hard if measures aren't built into the goal expectations to account for the complexity of the task. It's therefore important to do the following:Give the person sufficient time to meet the goal or improve performance.Provide enough time for the person to practice or learn what is expected and required for success.

The whole point of goal setting is to facilitate success. Therefore, you want to make sure that the conditions surrounding the goals don't frustrate or inhibit people from accomplishing their objectives. This reinforces the "Attainable" part of SMART.

Key Points Goal setting is something most of us recognize as necessary for our success.By understanding goal setting theory, you can effectively apply the principles to goals that you or your team members set. Locke and Latham's research confirms the usefulness of SMART goal setting, and their theory continues to influence the way we measure performance today.Use clear, challenging goals, and commit yourself to achieving them. Provide feedback on goal performance. Take into consideration the complexity of the task. If you follow these simple rules, your goal setting process will be much more successful, and your overall performance will improve.

2. Reinforcement Theory Reinforcement theory is the process of shaping behavior by controlling the consequences of the behavior. In reinforcement theory a combination of rewards and/or punishments is used to reinforce desired behavior or extinguish unwanted behavior. Any behavior that elicits a consequence is called operant behavior, because the individual operates on his or her environment. Reinforcement theory concentrates on the relationship between the operant behavior and the associated consequences, and is sometimes referred to as operant conditioning.

BACKGROUND AND DEVELOPMENT OF REINFORCEMENT THEORY

Behavioral theories of learning and motivation focus on the effect that the consequences of past behavior have on future behavior. This is in contrast to classical conditioning, which focuses on responses that are triggered by stimuli in an almost automatic fashion. Reinforcement theory suggests that individuals can choose from several responses to a given stimulus, and that individuals will generally select the response that has been associated with positive outcomes in the past. E.L. Thorndike articulated this idea in 1911, in what has come to be known as the law of effect. The law of effect basically states that, all other things being equal, responses to stimuli that are followed by satisfaction will be strengthened, but responses that are followed by discomfort will be weakened.B.F. Skinner was a key contributor to the development of modern ideas about reinforcement theory. Skinner argued that the internal needs and drives of individuals can be ignored because people learn to exhibit certain behaviors based on what happens to them as a result of their behavior. This school of thought has been termed the behaviorist, or radical behaviorist, school.

REINFORCEMENT, PUNISHMENT, AND EXTINCTION

The most important principle of reinforcement theory is, of course, reinforcement. Generally speaking, there are two types of reinforcement: positive and negative. Positive reinforcement results when the occurrence of a valued behavioral consequence has the effect of strengthening the probability of the behavior being repeated. The specific behavioral consequence is called a reinforcer. An example of positive reinforcement might be a salesperson that exerts extra effort to meet a sales quota (behavior) and is then rewarded with a bonus (positive reinforcer). The administration of the positive reinforcer should make it more likely that the salesperson will continue to exert the necessary effort in the future.Negative reinforcement results when an undesirable behavioral consequence is withheld, with the effect of strengthening the probability of the behavior being repeated. Negative reinforcement is often confused with punishment, but they are not the same. Punishment attempts to decrease the probability of specific behaviors; negative reinforcement attempts to increase desired behavior. Thus, both positive and negative reinforcement have the effect of increasing the probability that a particular behavior will be learned and repeated. An example of negative reinforcement might be a salesperson that exerts effort to increase sales in his or her sales territory (behavior), which is followed by a decision not to reassign the salesperson to an undesirable sales route (negative reinforcer). The administration of the negative reinforcer should make it more likely that the salesperson will continue to exert the necessary effort in the future.As mentioned above, punishment attempts to decrease the probability of specific behaviors being exhibited. Punishment is the administration of an undesirable behavioral consequence in order to reduce the occurrence of the unwanted behavior. Punishment is one of the more commonly used reinforcement-theory strategies, but many learning experts suggest that it should be used only if positive and negative reinforcement cannot be used or have previously failed, because of the potentially negative side effects of punishment. An example of punishment might be demoting an employee who does not meet performance goals or suspending an employee without pay for violating work rules.Extinction is similar to punishment in that its purpose is to reduce unwanted behavior. The process of extinction begins when a valued behavioral consequence is withheld in order to decrease the probability that a learned behavior will continue. Over time, this is likely to result in the ceasing of that behavior. Extinction may alternately serve to reduce a wanted behavior, such as when a positive reinforcer is no longer offered when a desirable behavior occurs. For example, if an employee is continually praised for the promptness in which he completes his work for several months, but receives no praise in subsequent

months for such behavior, his desirable behaviors may diminish. Thus, to avoid unwanted extinction, managers may have to continue to offer positive behavioral consequences.

SCHEDULES OF REINFORCEMENT The timing of the behavioral consequences that follow a given behavior is called the reinforcement schedule. Basically, there are two broad types of reinforcement schedules: continuous and intermittent. If a behavior is reinforced each time it occurs, it is called continuous reinforcement. Research suggests that continuous reinforcement is the fastest way to establish new behaviors or to eliminate undesired behaviors. However, this type of reinforcement is generally not practical in an organizational setting. Therefore, intermittent schedules are usually employed. Intermittent reinforcement means that each instance of a desired behavior is not reinforced. There are at least four types of intermittent reinforcement schedules: fixed interval, fixed ratio, variable interval, and variable ratio.Fixed interval schedules of reinforcement occur when desired behaviors are reinforced after set periods of time. The simplest example of a fixed interval schedule is a weekly paycheck. A fixed interval schedule of reinforcement does not appear to be a particularly strong way to elicit desired behavior, and behavior learned in this way may be subject to rapid extinction. The fixed ratio schedule of reinforcement applies the reinforcer after a set number of occurrences of the desired behaviors. One organizational example of this schedule is a sales commission based on number of units sold. Like the fixed interval schedule, the fixed ratio schedule may not produce consistent, long-lasting, behavioral change.Variable interval reinforcement schedules are employed when desired behaviors are reinforced after varying periods of time. Examples of variable interval schedules would be special recognition for successful performance and promotions to higher-level positions. This reinforcement schedule appears to elicit desired behavioral change that is resistant to extinction.Finally, the variable ratio reinforcement schedule applies the reinforcer after a number of desired behaviors have occurred, with the number changing from situation to situation. The most common example of this reinforcement schedule is the slot machine in a casino, in which a different and unknown number of desired behaviors (i.e., feeding a quarter into the machine) is required before the reward (i.e., a jackpot) is realized. Organizational examples of variable ratio schedules are bonuses or special awards that are applied after varying numbers of desired behaviors occur. Variable ratio schedules appear to produce desired behavioral change that is consistent and very resistant to extinction.

REINFORCEMENT THEORY APPLIED TO ORGANIZATIONAL SETTINGS Probably the best-known application of the principles of reinforcement theory to organizational settings is called behavioral modification, or behavioral contingency management. Typically, a behavioral modification program consists of four steps:

1. Specifying the desired behavior as objectively as possible.2. Measuring the current incidence of desired behavior.3. Providing behavioral consequences that reinforce desired behavior.4. Determining the effectiveness of the program by systematically assessing behavioral change.

Reinforcement theory is an important explanation of how people learn behavior. It is often applied to organizational settings in the context of a behavioral modification program. Although the assumptions of reinforcement theory are often criticized, its principles continue to offer important insights into individual learning and motivation.

2. Job Theory Work arrangement (or rearrangement) aimed at reducing or overcoming job dissatisfaction and employee alienation arising from repetitive and mechanistic tasks. Through job design, organizations try to raise productivity levels by offering non-monetary rewards such as greater satisfaction from a sense of personal achievement in meeting the increased challenge and responsibility of one's work. Job enlargement, job enrichment, job rotation, and job simplification are the various techniques used in a job design exercise.

Job enlargement   Job enlargement means increasing the scope of a job through extending the range of its job duties and responsibilities generally within the same level and periphery. This contradicts the principles of specialization and the division of labor whereby work is divided into small units, each of which is performed repetitively by an individual worker. Some motivational theories suggest that the boredom and alienation caused by the division of labour can actually cause efficiency to fall. Thus, job enlargement seeks to motivate workers through reversing the process of specialization. A typical approach might be to replace assembly lines with modular work; instead of an employee repeating the same step on each product, they perform several tasks on a single item. In order for employees to be provided with Job Enlargement they will need to be retrained in new fields which can prove to be a lengthy process. However results have shown that this process can see its effects diminish after a period of time, as even the enlarged job role become the mundane, this in turn can lead to similar levels of demotivation and job dissatisfaction at the expense of increased training levels and costs. The continual enlargement of a job over time is also known as 'job creep,' which can lead to an unmanageable workload.

Job enrichment   Job enrichment is an attempt to motivate employees by giving them the opportunity to use the range of their abilities. It is an idea that was developed by the American psychologist Frederick Herzberg in the 1950s. It can be contrasted to job enlargement which simply increases the number of tasks without changing the challenge. As such job enrichment has been described as 'vertical loading' of a job, while job enlargement is 'horizontal loading'. An enriched job should ideally contain:

A range of tasks and challenges of varying difficulties (Physical or Mental) A complete unit of work - a meaningful task

Feedback, encouragement and communication

Techniques Job enrichment, as a managerial activity includes a three steps technique:

1. Turn employees' effort into performance: Ensuring that objectives are well-defined and understood by everyone. The overall corporate mission statement should be communicated to all. Individual's goals should also be clear. Each employee should know exactly how he/she fits into the overall process and be aware of how important their contributions are to the organization and its customers.Providing adequate resources for each employee to perform well. This includes support functions like information technology, communication technology, and personnel training and

development.Creating a supportive corporate culture. This includes peer support networks, supportive management, and removing elements that foster mistrust and politicking.Free flow of information. Eliminate secrecy. Provide enough freedom to facilitate job excellence. Encourage and reward employee initiative. Flextime or compressed hours could be offered.Provide adequate recognition, appreciation, and other motivators.Provide skill improvement opportunities. This could include paid education at universities or on the job training.Provide job variety. This can be done by job sharing or job rotation programmes.It may be necessary to re-engineer the job process. This could involve redesigning the physical facility, redesign processes, change technologies, simplification of procedures, elimination of repetitiveness, redesigning authority structures.

2. Link employee’s performance directly to reward;

Clear definition of the reward is a mustExplanation of the link between performance and reward is importantMake sure the employee gets the right reward if performs wellIf reward is not given, explanation is needed

3. Make sure the employee wants the reward. How to find out?

Ask themUse surveys (checklist, listing, questions)

Job Characteristics Model

Hack man and Oldham (1975) broke "The job itself" into five dimensions. They say that any given job can be analyzed, utilizing these five dimensions for its motivating potential. The job can then be redesigned to eliminate From Hackman, J.R. and Oldham, G.R. 1976. Motivation through the Design of Work: Test of Theory. Organizational Behavior and Human Performance:

Hackman and Oldham (1975) proposed five "core" dimensions for evaluating the immediate work environment constituting the Job Diagnostic Survey JDS. These core dimensions turned out to be associated significantly with job satisfaction and a high sense of workers' motivation. That is, the work environment source consisted of five dimensions, namely those of skill variety, task identity, task significance, autonomy and feedback.

1. Skill variety    - Doing different things; using different valued skills, abilities, and talents.   - The degree to which a job requires a variety of challenging skills and abilities.

2. Task identity    - Doing a complete job from beginning to end, the whole job rather than bits and pieces.   - The degree to which a job requires completion of a whole and identifiable piece of work.

3. Task significance    - The degree of meaningful impact the job has on others; the importance of the job.   - The degree to which the job has a perceivable impact on the lives of others, either within the organization or the world at large.

4. Autonomy   - Freedom to do the work as one sees fit; discretion in scheduling, decision-making, and means for accomplishing a job.   - The degree to which the job gives the worker freedom and independence in scheduling work and determining how the work will be carried out.

5. Feedback   - Clear and direct information about job outcomes or performance.   - The degree to which the worker gets information about the effectiveness of his or her efforts, either directly from the work itself or from others.

Equity Theory Equity theory is a theory that attempts to explain relational satisfaction in terms of perceptions of fair/unfair distributions of resources within interpersonal relationships. Considered one of the justice theories, equity theory was first developed in 1963 by John Stacey Adams, a workplace and behavioral psychologist, who asserted that employees seek to maintain equity between the inputs that they bring to a job and the outcomes that they receive from it against the perceived inputs and outcomes of others (Adams, 1965). The belief is that people value fair treatment which causes them to be motivated to keep the fairness maintained within the relationships of their co-workers and the organization. The structure of equity in the workplace is based on the ratio of inputs to outcomes. Inputs are the contributions made by the employee for the organization.

Definition of equityAn individual will consider that he is treated fairly if he perceives the ratio of his inputs to his outcomes to be equivalent to those around him. Thus, all else being equal, it would be acceptable for a more senior colleague to receive higher compensation, since the value of his experience (and input) is higher. The way people base their experience with satisfaction for their job is to make comparisons with themselves to people they work with. If an employee notices that another person is getting more recognition and rewards for their contributions, even when both have done the same amount and quality of work, it would persuade the employee to be dissatisfied. This dissatisfaction would result in the employee feeling underappreciated and perhaps worthless. This is in direct contrast with the idea of equity theory, the idea is to have the rewards (outcomes) be directly related with the quality and quantity of the employees contributions (inputs). If both employees were perhaps rewarded the same, it would help the workforce realize that the organization is fair, observant, and appreciative.

This can be illustrated by the following equation:

Inputs and outcomes

InputsInputs are defined as each participant’s contributions to the relational exchange and are viewed as entitling him/her to rewards or costs. The inputs that a participant contributes to a relationship can be either assets – entitling him/her to rewards – or liabilities - entitling him/her to costs. The entitlement to rewards or costs ascribed to each input varies depending on the relational setting. In industrial settings, assets such as capital and manual labor are seen as "relevant inputs" – inputs that legitimately entitle the contributor to rewards. In social settings, assets such as physical beauty and kindness are generally seen as assets entitling the possessor to social rewards. Individual traits such as boorishness and cruelty are seen as liabilities entitling the possessor to costs (Walster, Traupmann & Walster, 1978). Inputs typically include any of the following:

Time, Effort, Loyalty, Hard Work, Commitment, Ability, Adaptability, Flexibility, Tolerance, Determination, Enthusiasm, Personal sacrifice, Trust in superiorsSupport from co-workers and colleagues Skill.

OutcomesOutputs are defined as the positive and negative consequences that an individual perceives a participant has incurred as a consequence of his/her relationship with another. When the ratio of inputs to outcomes is close, than the employee should have much satisfaction with their job. Outputs can be both tangible and intangible (Walster, Traupmann & Walster, 1978). Typical outcomes include any of the following:

Job security, Salary, Employee benefit, Expenses, Recognition, Reputation, ResponsibilitySense of achievement, Praise, Thanks, Stimuli.

PropositionsEquity theory consists of four propositions:

1. Individuals seek to maximize their outcomes (where outcomes are defined as rewards minus costs).

2. Groups can maximize collective rewards by developing accepted systems for equitably

apportioning rewards and costs among members. Systems of equity will evolve within groups, and members will attempt to induce other members to accept and adhere to these systems. The only way groups can induce members to equitably behave is by making it more profitable to behave equitably than inequitably. Thus, groups will generally reward members who treat others equitably and generally punish (increase the cost for) members who treat others inequitably.

3. When individuals find themselves participating in inequitable relationships, they become distressed. The more inequitable the relationship, the more distress individuals feel. According to equity theory, both the person who gets “too much” and the person who gets “too little” feel distressed. The person who gets too much may feel guilt or shame. The person who gets too little may feel angry or humiliated.

4. Individuals who perceive that they are in an inequitable relationship attempt to eliminate their distress by restoring equity. The greater the inequity, the more distress people feel and the more they try to restore equity. (Walster, Traupmann and Walster, 1978)

Expectancy Theory Expectancy Theory proposes that a person will decide to behave or act in a certain way because they are motivated to select a specific behavior over other behaviors due to what they expect the result of that selected behavior will be. In essence, the motivation of the behavior selection is determined by the desirability of the outcome. However, at the core of the theory is the cognitive process of how an individual processes the different motivational elements. This is done before making the ultimate choice. The outcome is not the sole determining factor in making the decision of how to behave. Victor Vroom

Expectancy theory is about the mental processes regarding choice, or choosing. It explains the processes that an individual undergoes to make choices. In the study of organizational behavior, expectancy theory is a motivation theory first proposed by Victor Vroom of the Yale School of Management."This theory emphasizes the needs for organizations to relate rewards directly to performance and to ensure that the rewards provided are those rewards deserved and wanted by the recipients." Victor H. Vroom (1964) defines motivation as a process governing choices among alternative forms of voluntary activities, a process controlled by the individual. The individual makes choices based on estimates of how well the expected results of a given behavior are going to match up with or eventually lead to the desired results. Motivation is a product of the individual’s expectancy that a certain effort will lead to the intended performance, the instrumentality of this performance to achieving a certain result, and the desirability of this result for the individual, known as valence.

Key ElementsThe Expectancy Theory of Motivation explains the behavioral process of why individuals choose one behavioral option over another. It also explains how they make decisions to achieve the end they value. Vroom introduces three variables within the expectancy theory which are valence (V), expectancy (E) and instrumentality (I). The three elements are important behind choosing one element over another because they are clearly defined: effort-performance expectancy (E>P expectancy), performance-outcome expectancy (P>O expectancy).

1. Expectancy: Effort → Performance (E→P).2. Instrumentality: Performance → Outcome (P→O). 3. Valence- V(R).Expectancy: Effort → Performance (E→P)Expectancy is the belief that one's effort (E) will result in attainment of desired performance (P) goals. Usually based on an individual's past experience, self confidence (self efficacy), and the perceived difficulty of the performance standard or goal. Factors associated with the individual's Expectancy perception are self efficacy, goal difficulty, and control. Self efficacy is the person’s belief about their ability to successfully perform a particular behavior. Goal difficulty happens when goals are set too high or performance expectations that are made too difficult are most likely to lead to low expectancy perceptions. Control is one's perceived control over

performance. In order for expectancy to be high, individuals must believe that they have some degree of control over the expected outcome.

Instrumentality: Performance → Outcome (P→O) Instrumentality is the belief that a person will receive a reward if the performance expectation is met. This reward may come in the form of a pay increase, promotion, recognition or sense of accomplishment. Instrumentality is low when the reward is given for all performances given.Factors associated with the individual's instrumentality for outcomes are trust, control and policies. If individuals trust their superiors, they are more likely to believe their leaders promises. When there is a lack of trust on leadership, people often attempt to control the reward system. When individuals believe they have some kind of control over how, when, and why rewards are distributed, Instrumentality tends to increase. Formalized written policies impact the individuals' instrumentality perceptions. Instrumentality is increased when formalized policies associates rewards to performance.

Valence- V(R) Valence: the value the individual places on the rewards based on their needs, goals, values and Sources of Motivation. Factors associated with the individual's valence for outcomes are values, needs, goals, preferences and Sources of Motivation Strength of an individual’s preference for a particular outcome.The valence refers the value the individual personally places on the rewards. -1 →0→ +1-1= avoiding the outcome 0= indifferent to the outcome +1=welcomes the outcomeIn order for the valence to be positive, the person must prefer attaining the outcome to not attaining it.Expectancy Theory of motivation can help managers understand how individuals make decisions regarding various behavioral alternatives. The model below shows the direction of motivation, when behavior is energized:

Integrating contemporary Theories of Motivation

Many of the ideas underline the contemporary motivation theories are complementary and you’ll understand better how to motivate. People if you see how the theories fit to gather. Its basic foundation is the expectancy model. Let‘s works through the model starting on the left.

The individual effort box has an arrow reading into it. This arrow flow from the individual goals. Consistent with goal setting theory .this goal effort link is meant to illustrate that goal direct behavior. Expectancy theory predict that an employee will exert a high level of effort If he or she perceived that there is a strong relationship between effort and performance, performance and reward, and reward and satisfaction of personal goal’s.

Current issue in Motivation So far, we've covered a lot of the theoretical bases of employee motivation. Understanding and predicting employee motivation continues to be one of the most popular areas in management research. However, even current studies of employee motivation are influenced by several significant workplace issues—issues such as motivating a diverse workforce, pay-for-performance programs, open-book management, and motivating the "new workforce." Let's take a closer look at each of these issues.

Motivating a Diverse Workforce:

To maximize motivation among today's diverse workforce, managers need to think in terms of flexibility. For instance, studies tell us that men place more importance on having autonomy in their jobs than do women. In contrast, the opportunity to learn, convenient and flexible work 43 hours, and good interpersonal relations are more important to women. Managers need to recognize that what motivates a single mother with two dependent children who is working full time to support her family may be very different from the needs of a single part-time employee or an older employee who is working only to supplement his or her retirement income. Employees have different personal needs and goals that they are hoping to satisfy through their job. A diverse array of rewards is needed to motivate employees with such varied needs.

Flexible Working Schedules Many of the so-called family-friendly benefits that organizations have implemented are a response to the varied needs of a diverse workforce. In addition, many organizations have developed flexible working schedules that recognize different needs. What are some of these types of flexible working schedules?A compressed workweek is a workweek in which employees work longer hours per day butFewer days per week. The most common form is four 10-hour days (a 4-40 program). However, organizations could design whatever schedules they wanted to fit employees' needs. For example, employees at ChevronTexaco's headquarters work nine hours every Monday through Thursday, eight hours on a Friday, and zero hours the next Friday. This compressed workweek provides employees with time off for running errands, pursuing hobbies, or taking care of family problems. Another alternative is flexible work hours (also popularly known as flextime), which is a scheduling system in which employees are required to work a specific number of hours a week but are free to vary those hours within certain limits. In a flextime schedule, there are certain common core hours when all employees are required to be on the job, but starting, ending, and lunch-hour times are flexible. Flextime is one of the most desired benefits employees want from 45their employers. And employers have responded, according to a survey indicating that 57 percent of employers were offering flextime in 1999.

Another job scheduling option that can be effective in motivating a diverse workforce is job sharing—the practice of having two or more people split a full-time job. This type of job schedule might be attractive, for example, to individuals with school-age children or retirees, who want to work but do not want the demands and hassles of a full-time position.Another alternative made possible by information technology is telecommuting. Here, employeework at home and are linked to the workplace by computer and modem. Many jobs can be done at home, and this approach might be close to the ideal job for some people because there is no commuting, the hours are flexible, there is freedom to dress as you please, and there are little or no interruptions from colleagues. However, keep in mind that not all employees embrace the ideaof telecommuting. Some workers relish the informal interactions at work that satisfy their social needs as well as being a source of new ideas.

Cultural Differences in Motivation Managing a diverse workforce also means that managers need to be flexible by being aware of cultural differences and show flexibility in responding to those differences. The motivation theories we've just studied were developed largely by U.S. researchers and were validated with U.S. workers. These theories may need to be modified for different cultures.Take, for instance, Maslow's needs hierarchy. The hierarchy aligns well with American culture. But in countries where uncertainty avoidance characteristics are strong—such as in Japan, Greece, and Mexico—security needs would be on top of the needs hierarchy. In countries with high scores on quality of life, such as Denmark, Sweden, Norway, the Netherlands, and Finland, social needs would be on top. Although equity theory has a strong following in the United States, evidence suggests that in collectivist cultures—especially in the former socialist countries of Central and Eastern Europe—employees expect rewards to reflect their individual needs as well as their performance. Moreover, consistent with a legacy of communism and centrally planned economies, employees exhibited an entitlement attitude—that is, they expected outcomes to be greater than their inputs.Don't assume, however, that there aren't any cross-cultural consistencies. For instance, the desire for interesting work seems important to almost all workers, regardless of their national culture. As a case in point, in a study of employees in Belgium, Britain, Israel, and the United States, "interesting work" ranked number one among 11 work goals. And this factor was ranked either second or third in Japan, the Netherlands, and Germany. And in a study comparing job-preference outcomes among graduate students in the United States, Canada, Australia, and Singapore, growth, achievement, and responsibility were rated as the top three and had identical rankings. Both of these studies suggest that there is some universality to the importance of intrinsic factors.

Pay-for-Performance Programs

Why do most people work? Although there may be many reasons why people work, most of us do so because it pays us an amount of money that allows us to satisfy our needs and wants. Because monetary compensation is an important type of reward, how can managers use pay to motivate high levels of employee performance? The relation between pay and motivation explains the intent and logic behind pay-for-performance programs.

Pay-for-performance programs are compensation plans that pay employees on the basis of some performance measure. Piece-rate pay plans, wage incentive plans, profit sharing, and lump-sum bonuses are examples. What differentiates these forms of pay from more traditional compensation plans is that instead of paying a person for time on the job, pay is adjusted to reflect some performance measure. These performance measures might include such things as individual productivity, team or work group productivity, departmental productivity, or the overall organization's profit performance. For instance, employee teams at ExxonMobil Corporation are eligible for team-performance-based incentives of as much as 30 percent of base pay. And employees at Comfort Shoe Specialists, a retail store located in a shopping center outside St.

Louis, each get a weekly $50 bonus if sales for the week exceed those of the previous week.Pay-for-performance compensation is probably most compatible with expectancy theory. Specifically, individuals should perceive a strong relationship between their performance and therewards they receive for motivation to be maximized. If rewards are allocated only on non-performance factors—such as seniority, job title, or across-the-board pay raises then employees

are likely to reduce their efforts. From a motivation perspective, making some or all of employee's pay conditional on some performance measure focuses his or her attention and effort toward that measure and then reinforces the continuation of the effort with a reward. If the employee, team, or organization's performance declines, so does the reward. Thus, there's an Incentive to keep efforts and motivation strong.

Open-Book Management Many organizations of various sizes are involving their employees in workplace decisions by opening up the financial statements (the "books"). They share that information so that employees will be motivated to make better decisions about their work and better able to understand the implications of what they do, how they do it, and the ultimate impact on the bottom line. This approach is called open-book management. According to a study by Ernst & Young LLP, workers who are treated as business partners are more likely to be productive and motivated to contribute to their company's profitability.The goal of open-book management is to get employees to think like an owner by seeing the impact their decisions and actions have on financial results. But most employees don't have the knowledge or background to understand the financials, so they have to be taught how to read and understand the organization's financial statements. And once employees have this knowledge, managers need to share the numbers regularly with them.Some organizations take open-book management a step further. For instance, at Springfield Remanufacturing Company in Springfield, Missouri, employees not only get financial information but also receive bonuses and incentive pay based on profit improvements. Throughthis type of sharing arrangement, employees begin to see the link between their efforts, level of performance, and operational results. Most firms that have introduced open-book management say that it has significantly helped the business. For instance, Allstate's Business Insurance Group used open-book management to boost return on equity from 2.9 percent to 16.5 percent in just three years. The unit's president said, "It got employees involved and committed, and it gave them some ownership. They understood they had an impact on the bottom line."

Motivating the "New Workforce" Special groups present unique motivational challenges. In this section we look at some of the unique problems faced in trying to motivate professional employees, contingent workers, and low- skilled, minimum-wage employees

Motivating Professionals In contrast to a generation ago, the typical employee today is more likely to be a highly trained professional with a college degree than a blue-collar factory worker. These professionals receive a great deal of intrinsic satisfaction from their work. They tend to be well paid. What special concerns should managers be aware of when trying to motivate a team of engineers at Intel, software designers at SAS Institute, or a group of consultants at Accenture? Professionals are typically different from nonprofessionals. They have a strong and long-term commitment to their field of expertise. Their loyalty is more often to their profession than to their employer. To keep current in their field, they need to regularly update their knowledge, and because of their commitment to their profession they rarely define their workweek as 8 a.m. to 5 p.m. five days a week.What motivates professionals? Money and promotions typically are low on their priority list. Why? They tend to be well paid and they enjoy what they do. In contrast, job challenge tends to be ranked high. They like to tackle problems and find solutions. Their chief reward in their job isthe work itself. Professionals also value support. They want others to think that what they are working on is important. That may be true for all employees, but professionals tend to be focusedon their work as their central life interest, whereas nonprofessionals typically have other interests

outside of work that can compensate for needs not met on the job.The preceding description implies a few guidelines to keep in mind when motivating professionals. Provide them with ongoing, challenging projects. Give them autonomy to follow their interests, and allow them to structure their work in ways they find productive. Reward themwith educational opportunities—additional training, workshops, attending conferences—that allow them to keep current in their field. Also reward them with recognition, and ask questions and use other actions that demonstrate to them that you're sincerely interested in what they're doing and value it.

Motivating Contingent Workers The elimination of jobs through downsizing and other organizational restructurings has increased the number of openings for part-time, contract, and other types of temporary workers. Contingent workers don't have the security or stability that permanent employees have, and they don't identify with the organization or display the commitment that other employees do. Temporary workers also typically get little or no benefits such as health care or pensions. There's no simple solution for motivating contingent employees. For that small set of temps who prefer the freedom of their temporary status—for instance, some students, working mothers, retirees—the lack of stability may not be an issue. In addition, temporariness might be preferred by highly compensated physicians, engineers, accountants, or financial planners who don't want the demands of a full-time job. But these are the exceptions. For the most part, temporary employees are not temporary by choice.What will motivate involuntarily temporary employees? An obvious answer is the opportunity tobecome a permanent employee. In cases in which permanent employees are selected from a pool of temps, the temps will often work hard in hopes of becoming permanent. A less obvious answer is the opportunity for training. The ability of a temporary employee to find a new job is largely dependent on his or her skills. If the employee sees that the job he or she is doing can help develop marketable skills, then motivation is increased. From an equity standpoint, you should also consider the repercussions of mixing permanent and temporary workers when pay differentials are significant. When temps work alongside permanent employees who earn more, and get benefits, too, for doing the same job, the performance of temps is likely to suffer. Separating such employees or perhaps converting all employees to a variable-pay or skill-based pay plan might help minimize the problems.

Motivating Low-Skilled, Minimum-Wage Employees Suppose that in your first managerial position after graduating, you're responsible for managing a work group composed of low-skilled, minimum-wage employees. Offering more pay to these employees for high levels of performance is out of the question: Your company just can't afford it. In addition, these employees have limited education and skills. What are your motivational options at this point? One of the toughest motivational challenges a manager faces is how to achieve and keep high-performance levels among these types of workers. One trap we often fall into is thinking that people are motivated only by money. Although money s important as a motivator, it's not the only reward that people seek and that managers can use. In motivating minimum-wage employees, managers should look at other types of rewards that help motivate employee performance. What are some other rewards managers might use? One that many companies use is employee recognition programs such as employee of the month, quarterly employee performance awards ceremonies, or other celebrations of employees' accomplishments. For instance, at many fast-food restaurants or retail stores, you'll often see plaques hanging in prominent places featuring the names of "Employee of the Month." These types of programs serve the purpose of highlighting employees whose work performance has been of the type and level the organization wants to encourage in all its employees. Many

managers also recognize the power of praise. However, you need to be sure that these "pats on the back" are sincere and given for the right reasons.What else can managers do to motivate high levels of performance from minimum-wage employees? Again, we can look to job design and expectancy theories for some answers. In service industries such as travel and hospitality, retail sales, child care, and maintenance in which pay for frontline employees generally does not exceed the minimum-wage level, successful companies are empowering these frontline employees with more authority to address customers' problems. If we use the JCM to examine this change, we can see that this type of job redesign provides enhanced motivation because employees now experience increased skill variety, task identity, task significance, autonomy, and feedback. For instance, almost every job at Marriott International has been redesigned to place more workers in contact with more guests more of the time. These employees are now able to take care of customer complaints and requests that formerly were referred to a manager or another department. In addition, employees have at least part of their pay tied to customer satisfaction, so there's a clear link between level of performance and reward (instrumentality linkage from expectancy theory). So, even though motivating minimum-wage workers may be a challenge, we can still use what we know about employee motivation to help us find some answers.

From Theory to Practice: Suggestions for Motivating Employees

we've covered a lot of information about motivation. If you're a manager concerned with motivating your employees, what specific recommendations can you draw from the theories and issues presented in this chapter? Although there's no simple, all-encompassing set of guidelines, the following suggestions draw on the essence of what we know about motivating employees.

Recognize individual differences. Almost every contemporary motivation theory recognizes that employees aren't identical. They have different needs, attitudes, personality, and other important individual variables.

Match people to jobs. There's a great deal of evidence showing the motivational benefits of carefully matching people to jobs. For example, high achievers should have jobs that allow them to participate in setting moderately challenging goals and that involve autonomy and feedback. Also keep in mind that not everybody is motivated by jobs that are high in autonomy, variety, and responsibility.

Use goals. The literature on goal-setting theory suggests that managers should ensure that employees have hard, specific goals and feedback on how well they're doing in achieving those goals. Should the goals be assigned by the manager or should employees participate in setting them? The answer depends on your perception of goal acceptance and the organization's culture. If you expect resistance to goals, participation should increase acceptance. If participation is inconsistent with the culture, use assigned goals.

Ensure that goals are perceived as attainable. Regardless of whether goals are actually attainable, employees who see goals as unattainable will reduce their effort because they'll be thinking "why bother." Managers must be sure, therefore, that employees feel confident that increased efforts can lead to achieving performance goals.

Individualize rewards. Because employees have different needs, what acts as a reinforcer for one may not for another. Managers should use their knowledge of employee differences to individualize the rewards they control, such as pay, promotions, recognition, desirable work assignments, autonomy, and participation.

Link rewards to performance. Managers need to make rewards contingent on performance. Rewarding factors other than performance will only reinforce those other factors. Important rewards such as pay increases and promotions should be given for the attainment of specific goals. Managers should also look for ways to increase the visibility of rewards, making them potentially more motivating.

Check the system for equity. Employees should perceive that rewards or outcomes are equal to the inputs. On a simple level, experience, ability, effort, and other obvious inputs should explaindifferences in pay, responsibility, and other obvious outcomes. And remember that one person's equity is another's inequity, so an ideal reward system should probably weigh inputs differently in arriving at the proper rewards for each job.

Don't ignore money. It's easy to get so caught up in setting goals, creating interesting jobs, and providing opportunities for participation that you forget that money is a major reason why most people work. Thus, the allocation of performance-based wage increases, piecework bonuses, and other pay incentives is important in determining employee motivation. A review of 80 studies evaluating motivational methods and their impact on employee productivity supports this point. Goal setting alone produced, on average, a 16 percent increase in productivity; job redesign efforts to enrich jobs yielded 8 to 16 percent increases; employee participation in decision making produced a median increase of less than 1 percent; and monetary incentives led to an average increase of 30 percent. We're not saying that managers should focus solely on money as a motivational tool. Rather, we're simply stating the obvious—that is, if money is removed as an incentive, people aren't going to show up for work. The same can't be said for removing goals, enriched work, or participation.

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