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Chapter 13

Motivating Performance

Applying InnovationBy David O’Sullivan and Lawrence Dooley

© Sage Publications 2008

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Reflections What is a team, and how does it differ from an

organization or community? What can organizations do to create a successful

team environment? Name the four different types of teams that can be

used for managing projects. Explain the terms fully empowered and enabled in

regard to team members. List a number of ways in which creativity can be

improved in teams. What technologies can be used to support virtual

teams? What is a community of practice?

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Activities

[Discussion of selected student ‘Activities’ from previous chapter]

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Learning Targets Examine the role of motivation in influencing

individual behaviour Understand the difference between intrinsic and

extrinsic motivation Outline the process of linking individual performance

to organizational performance Describe a number of techniques for sharing rewards

with all team members Understand the performance appraisal technique Explain the training and development approach in

relation to motivation Design a simple performance appraisal system

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Motivation Creativity: Expertise, Creative

Thinking and Motivation (Amabile, 1998)

Maslow: self-fulfillment, ego or esteem, social, safety, and physiological needs.

Theory x – authoritarian Theory Y – participative Intrinsic and Extrinsic motivation

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Intrinsic Motivation

From within the individual The most powerful type of motivation Inherent desire to perform better Difficult to manage Organizations need to hire self

motivated people, provide training and opportunity and provide a challenging work environment

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Forces against Intrinsic Motivation

People are often risk averse and tend to remain within a certain comfort zone rather than stretch beyond it.

The intrinsic needs of the person and those of the organization may not align.

People need to fulfill all of Maslow’s needs, and lower needs are not adequately met by intrinsic motivation and instead require extrinsic motivation.

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Extrinsic Motivation From outside the individual Financial incentives, additional holidays,

etc. Useful up to a ‘saturation’ point beyond

which free time and self-development become important

Popular systems: Gain sharing Profit Sharing Performance Appraisal

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Gain Sharing Group bonus scheme where entire

organisation benefits from improved innovation

Individual remuneration linked with organisational performance

Some individuals rewarded for little effort Based on an agreed formula:

If labor costs are below 12% of sales then bonus awarded amounting to 60% of difference between actual costs and 12% target

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Profit Sharing

Bonuses based exclusively on profits. If profits increase then bonus

awarded on agreed formula Difficulty when profits are affected by

factors outside control of organization Changing share prices Currency fluxuations Materials costs

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Benefits of Gainsharing Coordination, teamwork, and sharing of knowledge

increase. Social needs are recognized via participation and

mutual reinforcing of group behavior. Attention is focused on goals such as performance

indicators. Change due to technology, market, and new methods

gains acceptance. People demand better performance from each other. Innovation increases. Where unions are present, union–management

relations become more flexible.

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Performance Appraisal Reward or recognition based on individual

performance Linking goals and actions to individuals

i.e. individual responsible for particular goals or contributing to particular ideas or projects

Typical linkages around: Objectives Indicators Skills – technical, personal and interpersonal Ideas and Projects

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Performance Appraisal - sample

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Training and Development Individuals developed through job design,

task delegation, skills training and career development

Identification of skills available and required Identification of mechanisms for improving

skills E.g. courses, manuals, etc.

Planning development of skills within organisations through training plan

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Summary Examine the role of motivation in influencing

individual behaviour Understand the difference between intrinsic and

extrinsic motivation Outline the process of linking individual performance

to organizational performance Describe a number of techniques for sharing rewards

with all team members Understand the performance appraisal technique Explain the training and development approach in

relation to motivation Design a simple performance appraisal system

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Activities

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Search Online

http://mitworld.mit.edu/ Why Bad Things Happen to Good

Technologies (John Sterman) Stuck: Why It’s So Hard to Do New

Things in Old Organizations (Rebecca Henderson)

Building Growth: Why Don’t We Use What We Know (Rebecca Henderson)

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