COPYRIGHT 2001 PEARSON EDUCATION CANADA INC. CHAPTER 6 1 CHAPTER 6 MOTIVATION IN PRACTICE.

COPYRIGHT 2001 PEARSON EDUCATION CANADA INC. CHAPTER 6

1

CHAPTER 6MOTIVATION IN

PRACTICE


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LEARNING OBJECTIVES Discuss how to tie pay to performance on

production jobs and the difficulties of wage incentive plans.

Explain how to tie pay to performance on white-collar jobs and the difficulties of merit pay plans.

Understand how to use pay to motivate team work.

Describe the details of the Job Characteristics Model.


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Discuss the motivational properties of job enrichment.

Understand the connection between goal setting and Management by Objectives.

Explain how alternative work schedules respect employee diversity.

Review the motivational aspects of total quality management.


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MONEY AS A MOTIVATOR According to Maslow and

Alderfer, pay should prove especially motivational to people who have strong lower-level needs.

If pay has this capacity to fulfill a variety of needs, then it should have good potential as a motivator.


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LINKING PAY TO PERFORMANCEON PRODUCTION JOBS

Piece-rate – A pay system in which individual workers are paid a certain sum of money for each unit of production.


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Wage incentive plans – Various systems that link pay to performance on production jobs.


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POTENTIAL PROBLEMS WITH WAGE INCENTIVES

Lowered quality

Differential opportunity

Reduced cooperation


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Incompatible job design

Restriction of productivity


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HYPOTHETICAL PRODUCTIVITY DISTRIBUTIONS


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LINKING PAY TO PERFORMANCE OF WHITE-COLLAR JOBS

Merit pay plans – Systems that attempt to link pay to performance on white-collar jobs.


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POTENTIAL PROBLEMS WITH MERIT PAY PLANS

Low discrimination – Managers unable to discriminate between good performers and poor performers.

Small increases – Merit increases are too small to be effective motivators. Lump sum bonuses get people’s attention.


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Pay secrecy – Salaries are confidential information. Many organizations fail to inform employees about the average raise received by those doing similar work.


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MANAGER’S ESTIMATES OF PAY EARNED BY OTHERS


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USING PAY TO MOTIVATE TEAMWORK

Profit sharing The return of some company

profit to employees in the form of a cash bonus or retirement supplement.


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Employee stock ownership plans are incentive plans that allow employees to own a set amount of a company’s shares and provide employees with a stake in the company’s future earnings and success.


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Gainsharing A group pay incentive plan

based on productivity or performance improvements over which the work force has some control.


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Skilled-Based Pay or pay for knowledge A system in which people

are paid according to the number of job skills they have acquired.


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CHARACTERISTICS OF TEAM-ORIENTED INCENTIVE PLANS

PROFIT SHARING AND EMPLOYEE STOCK OWNERSHIP

How it works: Employees receive a varying annual bonus based on corporate profits and/or can purchase a certain amount of the company’s shares. Payments can be made in cash or deferred into a retirement fund.


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What it requires to be effective: Participating employees collectively must

be able to influence profits. Owners must value employees’

contributions enough to be willing to share profits and ownership.


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Advantages:The incentive formula is simple and easy to

communicate.The plan is guaranteed to be affordable: It pays

only when the firm is sufficiently profitable.It unites the financial interests of owners and

employees.


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Disadvantages:Annual payments may lead employers to ignore long-

term performance.Factors beyond the employee’s control can influence

profits.The plan forces private companies to open their books.


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GAIN SHARING

How it works: When a unit beats predetermined performance targets, all members get bonuses. Objectives often include better productivity, quality, and customer service.


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What it requires to be effective: Objectives must be measurable.Management must encourage employee

involvement.Employees must have a high degree of

trust in management.


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Advantages:The plan enhances coordination and

teamwork.Employees learn more about the

business and focus on objectives.Employees work harder and smarter.


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Disadvantages:Plans that focus only on productivity may

lead employees to ignore other important objectives, such as quality.

The company may have to pay bonuses even when unprofitable.


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SKILL-BASED PAY

How it works: An employee’s salary or wage rises with the number of tasks he or she can do, regardless of the job performed.


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What it requires to be effective: Skills must be identified and assigned a

pay grade.The company must have well-developed

employee assessment and training procedures.


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Advantages:By increasing flexibility, the plan lets the

company operate with a leaner staff.The plan gives workers a broader

perspective, making them more adept at problem solving.


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Disadvantages:Most employees will learn all applicable

skills, raising labour costs.Training costs are high.

Source: Perry, N.J. (1988, December 19). Here come richer, riskier pay plans. Fortune, 50-58, p. 52.


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JOB SCOPE AS A FUNCTION OF JOB DEPTH AND JOB BREADTH


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THE JOB CHARACTERISTIC MODEL

Several core job characteristics that have a certain psychological impact on workers.

This leads to certain outcomes that are relevant to the worker and the organization.

Moderators influence the extent to which these relationships hold true.


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THE JOB CHARACTERISTICS MODEL


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CORE JOB CHARACTERISTICS Skill variety - The opportunity to do a variety of

job activities using various skills and talents.

Autonomy – The freedom to schedule one’s own work activities and decide work procedures.

Task significance – The impact that a job has on other people.


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Task identity – The extent to which a job involves doing a complete piece of work, from beginning to end.

Feedback – Information about the effectiveness of one’s work performance.


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EXAMPLES OF CORE JOB CHARACTERISTICS

SKILL VARIETY

High variety: The owner-operator of a garage who does electrical repair, rebuilds engines, does body work, and interacts with customers.

Low variety: A body shop worker who sprays paint eight hours a day.


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TASK IDENTITY

High variety: A cabinet maker who designs a piece of furniture, selects the wood, builds the object, and finishes it to perfection.

Low variety: A worker in a furniture factory who operates a lathe solely to make table legs.


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TASK SIGNIFICANCE

High variety: Nursing the sick in a hospital intensive care unit.

Low variety: Sweeping hospital floors.


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AUTONOMY

High variety: A telephone installer who schedules his or her own work for the day, makes visits without supervision, and decides on the most effective techniques for a particular installation.

Low variety: A telephone operator who must handle calls as they come according to a routine, highly specified procedure.


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JOB FEEDBACK

High variety: An electronics factory worker who assembles a radio and then tests it to determine if it is working properly.

Low variety: An electronics factory worker who assembles a radio and then routes it to a quality control inspector who tests it for proper operation and makes needed adjustments.


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LEVELS OF CORE JOB CHARACTERISTICS


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JDS FORMULA TO CALCULATE THE MOTIVATING POTENTIAL

Motivatingpotentialscore

=

Skillvariety

+Taskvariety

+Tasksignificance

x Autonomy

3x Job feedback


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MODERATORS

Knowledge and Skill

Growth Need Strength

“Context” Satisfactions


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JOB ENRICHMENT

The design of jobs to enhance intrinsic motivation and the quality of the working life.


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JOB ENRICHMENT

Combining tasks

Establishing external client relationships

Establishing internal client relationships


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Reducing supervision or reliance on others

Forming work teams

Making feedback more direct


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POTENTIAL PROBLEMS WITH JOB ENRICHMENT

Poor Diagnosis

Lack of Desire or Skill

Demand for Rewards


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Union Resistance

Supervisory Resistance


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MANAGEMENT BY OBJECTIVES(MBO)

An elaborate, systematic, ongoing program designed to facilitate goal establishment, goal accomplishment and employee development.


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THE PROCEDURES OF MBO

1. The superior meets with the subordinate to develop and agree on subordinate objectives.

2. Periodic meetings monitor the subordinate’s progress in achieving the objectives.

3. An appraisal meeting evaluates objectives and diagnoses reasons for success and failure.

4. The MBO cycle is repeated.


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FLEX-TIME

An alternative work schedule in which arrival and quitting times are flexible.


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COMPRESSED WORK WEEK

An alternative work schedule in which employees work fewer than the normal five days a week, but still put in a normal number of hours per week.


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JOB SHARING

An alternative work schedule in which two part-time employees divide the work of a full-time job.


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TELECOMMUTING

A system by which employees are able to work at home but stay in touch with their offices through the use of communications and technology.


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TOTAL QUALITY MANAGEMENT(TQM)

A systematic attempt to achieve continuous improvement in the quality of an organization’s products and/or services.


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TQM AND MOTIVATION

An obsession with customer satisfaction.

A concern for good relations with suppliers.

A search for continuous improvement of processes.


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The prevention (not just detection) of quality errors.

Frequent measurement and assessment.

Extensive training.

High employee involvement and teamwork.


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TQM AND GOAL SETTING / MBO

Continuous improvement places a high premium on specific goal setting.

Benchmarking - A systematic process for examining the products, services and work processes of firms that are recognized as illustrating the best practices for organizational improvement.


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TQM AND JOB DESIGN

Empowerment Giving people the authority,

opportunity and motivation to take initiative and solve organizational problems.

COPYRIGHT 2001 PEARSON EDUCATION CANADA INC. CHAPTER 6 1 CHAPTER 6 MOTIVATION IN PRACTICE.

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Transcript of COPYRIGHT 2001 PEARSON EDUCATION CANADA INC. CHAPTER 6 1 CHAPTER 6 MOTIVATION IN PRACTICE.