Chapter 16 Motivation. 2 What Would You Do? Motivation at Medtronic Medtronic has increased sales of...

Chapter 16

Motivation

2

What Would You Do? Motivation at Medtronic

Medtronic has increased sales of medical equipment (defibrillators) by 19 percent per year

Industry is becoming very competitive How can Medtronic continue to motivate

employees following its long-term success?

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After discussing this section, you should be able to:

Learning ObjectivesWhat Is Motivation?

1. explain the basics of motivation.

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Components of Motivation

Initiation Persistence

Direction

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Motivating With the BasicsMotivating With the Basics

Basics of Motivation

EffortEffortandand

PerformancePerformance

EffortEffortandand


NeedNeedSatisfactionSatisfaction

NeedNeedSatisfactionSatisfaction

ExtrinsicExtrinsicandand

IntrinsicIntrinsicRewardsRewards

ExtrinsicExtrinsicandand


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A Basic Model of Work Motivation and Performance

EffortEffort


Adapted From Exhibit 16.2

• InitiationInitiation• DirectionDirection• PersistencePersistence

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Effort and Performance

Job performance how well someone performs the job

Motivation effort put forth on the job

Ability capability to do the job

Situational Constraints external factors affecting performance

Job Performance = Motivation X Ability X Situational Constraints

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Need Satisfaction

Needs: physical or psychological requirements must be met to ensure survival and well being

Unmet needs motivate people Three approaches

Maslow Alderfer McClelland

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Adding Need Satisfaction to the Model


EffortEffort• InitiationInitiation• DirectionDirection• PersistencePersistence

UnsatisfiedUnsatisfiedneedneed

TensionTension Energized toEnergized totake actiontake action

SatisfactionSatisfaction

Adapted from Exhibit 16.3

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McClelland’sMcClelland’sLearned NeedsLearned Needs

Alderfer’sAlderfer’sERGERG

Maslow’sMaslow’sHierarchyHierarchy

Higher-Order Needs

Lower-Order Needs

Needs Classification of Different Theories

Adapted From Exhibit 16.4

Self-ActualizationEsteemBelongingness

SafetyPhysiological

GrowthRelatedness

Existence

PowerAchievementAffiliation

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Extrinsic and Intrinsic Rewards Extrinsic Rewards

tangible and visible to others given contingent on performance

Intrinsic Rewards natural rewards associated with the task for its own sake

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Adding Rewards to the Model

EffortEffort• InitiationInitiation• DirectionDirection• PersistencePersistence



PerformancePerformanceSatisfactionSatisfaction


ExtrinsicExtrinsicRewardsRewards


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Motivating with the Basics

Ask people what their needs are Satisfy lower order needs first Expect people’s needs to change Satisfy higher order needs by looking for

ways to allow employees to experience intrinsic rewards


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Learning ObjectivesHow Perceptions and Expectations Affect Motivation

2. use equity theory to explain how employees’ perceptions of fairness affect motivation.

3. use expectancy theory to describe how workers’ expectations about rewards, effort, and the link between rewards and performance influence motivation.

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Been There, Done That

Current CEO compensation is entirely in the form of stock options current stock price has fallen below strike price CEO believes his compensation should be

based on the “difference” he makes Is performance-based executive pay a

good motivator?

Executive Motivation and Compensation at Oglebay Norton

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Equity Theory

ComponentsComponentsofof

EquityEquityTheoryTheory

How PeopleHow PeopleReact toReact to

PerceivedPerceivedInequityInequity

MotivatingMotivatingwithwith

EquityEquityTheoryTheory

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Components of Equity Theory Inputs

employee contributions to the organization Outcomes

rewards employees receive from the organization

Referents comparison others

Outcome/input (O/I) ratio

Outcomesself

Inputsself

Outcomesother

Inputsother

=

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Inequity

When a person’s O/I ratio differs from their referent’s O/I ratio

Underreward referent’s O/I ratio is greater than yours experience anger or frustration

Overreward referent’s O/I ratio is less than yours experience guilt

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How People React to Perceived Inequity (Underreward) Reduce inputs Increase outcomes Rationalize inputs or outcomes Change the referent Leave

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Adding Equity to the Model EffortEffort• Initiation• Direction• Persistence





Perceived Equity/Inequity





Restoring Equity• Decrease inputs• Increase outcomes• Rationalize inputs or

outcomes• Change the referent• Leave

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Motivating with Equity Theory Look for and correct major inequities Reduce employees’ inputs Make sure decision-making processes are

fair distributive justice procedural justice

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Expectancy Theory

Components of Expectancy TheoryComponents of Expectancy Theory

Motivating with Expectancy TheoryMotivating with Expectancy Theory

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Components of Expectancy Theory Valence

attractiveness or desirability of reward or outcome Expectancy

perceived relationship between effort and performance

Instrumentality perceived relationship between performance and

rewards

Motivation = Valence X Instrumentality X Expectancy

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Restoring Equity• Decrease inputs• Increase outcomes• Rationalize inputs or

outcomes• Change the referent• Leave

Adding Expectancy Theory to the Model EffortEffort

• Initiation• Direction• Persistence










Instrumentality

Valence

Expectancy

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Motivating with Expectancy Theory Systematically gather information to find out

what employees want from their jobs Clearly link rewards to individual performance Empower employees to make decisions

which enhances expectancy perceptions

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Learning ObjectivesHow Rewards and Goals Affect Motivation

4. explain how reinforcement theory works and how it can be used to motivate

5. describe the components of goal-setting theory and how managers can use them to motivate workers

6. discuss how the entire motivation model can be used to motivate workers

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Reinforcement Theory

Components of Reinforcement TheoryComponents of Reinforcement Theory

Motivating with Reinforcement TheoryMotivating with Reinforcement Theory

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Components of Reinforcement Theory Positive reinforcement

desirable consequence strengthens behavior Negative reinforcement

withholding unpleasant consequence strengthens behavior

Punishment unpleasant consequence weakens behavior

Extinction no consequence weakens behavior

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Restoring Equity• Decrease inputs• Increase outcomes• Rationalize inputs

or outcomes• Change the referent• Leave

Adding Reinforcement Theory to the Model EffortEffort











Instrumentality Valence

Expectancy

Reinforcement ContingenciesSchedules of

Reinforcement

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Blast From The PastSend in the Reinforcements! 1972, Michigan Bell

standards and timely feedback 1971, Emery Air Freight

baselines and goals 1911, Frederick W. Taylor

work redesign and incentives

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Schedules for Delivering Reinforcement

ContinuousContinuous IntermittentIntermittent

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Intermittent Reinforcement Schedules Interval Schedules

consequence delivered after time passes two types

fixed variable

Ratio Schedules consequence delivered after behavior occurs two types

fixed variable

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Motivating with Reinforcement Theory Identify, measure, analyze, intervene, and

evaluate Don’t reinforce the wrong behavior Correctly administer punishment at the

appropriate time Choose the simplest and most effective

schedule of reinforcement

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What Really Works?

Financial, Nonfinancial, and Social Rewards

Overall Performance and Rewards

10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Probability of success 63%

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What Really Works? (cont’d)

Nonfinancial Rewards

10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

10% 20% 30% 40% 50% 60% 70% 80% 90% 100%



Financial, Nonfinancial, and Social Rewards

10% 20% 30% 40% 50% 60% 70% 80% 90% 100%


Performance in Manufacturing Organizations

Financial Rewards

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Nonfinancial Rewards

10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

10% 20% 30% 40% 50% 60% 70% 80% 90% 100%



Social Rewards

10% 20% 30% 40% 50% 60% 70% 80% 90% 100%


Performance in Service Organizations

Financial Rewards

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Nonfinancial and Social Rewards

10% 20% 30% 40% 50% 60% 70% 80% 90% 100%


10% 20% 30% 40% 50% 60% 70% 80% 90% 100%


Performance in Service Organizations

Financial and Nonfinancial Rewards

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Goal-Setting Theory

Components of Goal-SettingComponents of Goal-Setting

Motivating with Goal-SettingMotivating with Goal-Setting

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Components of Goal-Setting Theory Goal Specificity

the clarity of goals Goal Difficulty

how challenging goals are Goal Acceptance

how well goals are agreed to or understood Performance Feedback

information on goal progress

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Restoring Equity• Decrease inputs• Increase outcomes• Rationalize inputs

or outcomes• Change the referent• Leave

Adding Goal-Setting Theory to the Model EffortEffort











Instrumentality Valence

Expectancy

Reinforcement Contingencies

Schedules of Reinforcement

Goals

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Motivating with Goal-Setting Theory Assign specific, challenging goals Make sure workers truly accept

organizational goals Provide frequent, specific performance-

related feedback

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Motivating with the Integrated ModelMotivating with Motivating with

the Basicsthe Basics

Motivating with Motivating with Equity TheoryEquity Theory

Motivating with Motivating with Expectancy TheoryExpectancy Theory

Motivating with Motivating with Reinforcement Reinforcement

TheoryTheory

Motivating with Motivating with Goal-Setting TheoryGoal-Setting Theory

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What Really Happened? Motivation at Medtronic

Meet employee’s lower-order needs insurance needs, family issues, fitness, etc.

Offer competitive set of extrinsic rewards matching 401k plan, retirement plan, Employee Stock Ownership

Plan, Employee Stock Purchase Plan, cash performance awards Importance of medical products leads to intrinsic rewards

Chapter 16 Motivation. 2 What Would You Do? Motivation at Medtronic Medtronic has increased sales of...

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