Chapter 9; Employee Motivation

Chapter Summary

- Employees who have high self-esteem, a high need for achievement, and intrinsic motivation and who are expected to perform well by others are more motivated than their counterparts with low self-esteem and low achievement need who are extrinsically motivated. - Goals are most effective if they are concrete and specific, are of high but reasonable difficulty, and are set with the input of the employee. - Providing feedback on goal attainment and performance levels will increase performance. - Operant conditioning principles can be used to motivate employees. - It is important to treat employees fairly. - Common individual incentive plans include pay for performance and merit pay. - Common organizational incentive plans include profit sharing, gainsharing, and stock options.

1. Maslow's Needs Hierarchy

- The most famous theory of motivation - Maslow believed that employees would be motivated by and satisfied with their jobs at any given point in time if certain needs were met. - Maslow believed that there are five major types of needs and that these needs are hierarchical—> lower-level needs must be satisfied before an individual will be concerned with the next level of needs. It is helpful to look at a hierarchy as if it were a staircase that is climbed one step at a time until the top is reached. Each level is taken one step at a time, and a higher-level need cannot be reached until a lower-level need is satisfied. 1. Basic Biological Needs - The first step in Maslow's needs hierarchy, concerning survival needs for food, air, water, and the like. 2. Safety Needs - The second step in Maslow's hierarchy, concerning the need for security, stability, and physical safety. 3. Social Needs - The third step in Maslow's hierarchy, concerns the need to interact with other people. 4. Ego Needs - The fourth step in Maslow's hierarchy, concerning the individual's need for recognition and success. 5. Self-Actualization Needs - The fifth step in Maslow's hierarchy, concerning the need to realize one's potential.

Group Incentive Plans: Gainsharing

- Used by about 11% of organizations - Gainsharing ties group-wide financial incentives to improvements (gains) in organizational performance. T - Gainsharing programs consist of three important elements: (1) a cooperative/participative management philosophy, (2) incentives based on improvement, and (3) a group-based bonus formula The typical gainsharing program works as follows: 1) First, the company monitors performance measures over some period of time to derive a baseline. 2) Then productivity goals above the baseline are set, and the employees are told that they will receive bonuses for each period that the goal is reached. To make goal setting more effective, constant feedback is provided to employees on how current performance is in relation to the goal. 3) At the end of each reporting period, bonuses are paid on the basis of how well the group did. In general, gainsharing plans seem to be effective. A review of gainsharing studies indicates improvements in productivity, increased employee and union satisfaction, and declines in absenteeism. As with any incentive plan, gainsharing is most effective when employees are formally involved in the design and operation and when there is not a long delay between performance and the financial payoff

Group Incentive Plans: Profit sharing

- developed in the United States by Albert Gallatin way back in 1794. - As its name implies, profit-sharing programs provide employees with a percentage of profits above a certain amount. - For example, in addition to their base salary, employees might receive 50% of the profits a company makes above 6%. - Organizations will usually not share the initial 5% or so of profits, as that money is needed for research and development and as a safety net for unprofitable years. The profits to be shared can be paid directly to employees as a bonus (cash plans) or placed into the employees' retirement fund (deferred plans). Profit sharing will motivate employees only if they understand the link between performance and profits and believe that the company has a reasonable chance of making a profit. Research indicates that profit sharing results in greater employee commitment.

(1) Personality (four individual differences that are most related to work motivation)

-> Most psychologists believe that there are five main personality dimensions: Openness to experience, conscientiousness, extraversion, agreeableness, and stability. As shown in Table 9.2, meta-analyses have found that several of these dimensions are related to behaviors suggesting high levels of motivation. Conscientiousness is the best personality predictor of work performance, organizational citizenship behavior (OCB), and academic performance; stability is most associated with salary and setting high goals; and extraversion is most highly correlated with the number of promotions received. * Organizational citizenship behaviors (OCBs) Behaviors that are not part of an employee's job but which make the organization a better place to work (e.g., helping others, staying late).

Job Expectations

A discrepancy between what an employee expects a job to be like and the reality of the job can affect motivation and satisfaction. Employees compare what the organization promised to do for them (e.g., provide a computer, and support continued education) with what the organization actually does. If the organization does less than it promised, employees will be less motivated to perform well and will retaliate by doing less than they promised. As you can guess from these examples, it is important that applicants be given a realistic job preview (RJP). Though being honest about the negative aspects of a job may reduce the applicant pool, it decreases the chances of hiring a person who will later lose motivation or become dissatisfied. Realistic job preview (RJP) A method of recruitment in which job applicants are told both the positive and the neg- ative aspects of a job.

A good example of such a pay-for-performance plan

A good example of such a plan comes from the Superior Court Records Management Center in Phoenix, Arizona. After conducting a study that showed a negative correlation between employee salary and productivity (r .49), the clerk of the court decided to try a pay-for-performance system. Tharaldson Enterprises in Fargo, North Dakota, changed its compensation system for the housekeepers employed in its 300 hotels. Rather than being paid by the hour, the housekeepers were paid by the number of rooms they cleaned. This change saved the company $2 million per year and resulted in the housekeepers making more money and working fewer hours than under the old hourly rate system Union National Bank in Little Rock, Arkansas, has had tremendous success by pay- ing its workers for the number of customers they serve, the number of new customers gained, the amount of time taken to balance accounts at the end of the day, and so on. The bank's pay-for-performance program has resulted in the average employee making 25% more in take-home pay, and the bank itself has almost doubled its profits. Though pay-for-performance plans appear to be successful for both the employee and the employer, some research suggests that employees are not satisfied with such plans.

Example of how Maslow's general principles can be used

A situation at a major university provides an example of how Maslow's general principles can be used. After years of increasing enrollment and prestige, a scandal at the university caused a rapid decline in enrollment, financial backing, and staff morale. To fix these problems, a new president was hired. His first acts were to announce a "spirit day" each Friday on which employees could dress casually, an increased emphasis on diversity issues, and his intention to start a new sports team. Employee satisfaction and motivation continued to drop, faculty left in great numbers, and millions of dollars were cut from the budget. What went wrong? Among many things, the president's proposals were aimed at Maslow's level three and above, whereas the employees' needs were at level two—that is, "Will this university survive?" and "Will I still have a job next year?"

1st individual incentive plan: Pay for performance

A system in which employees are paid on the basis of how much they individually produce. Also called earnings-at-risk (EAR) plans, pay-for-performance plans pay employees according to how much they individually produce. Simple pay- for-performance systems with which you are probably familiar include commission (being paid for each unit of something sold) and piecework (being paid for each unit of something produced). 1) The first step in creating more complicated pay-for-performance plans is to determine the average or standard amount of production. For example, the average number of envelopes sorted by mail clerks might be 300 per hour. 2) Next step is to determine the desired average amount of pay. We can decide that on average, he should earn $12/ hour. 3) We then compute the piece rate by dividing hourly wage by the number of envelopes sorted (12/300), which is .04 -> Thus, each correctly sorted envelope is worth 4 cents. If a mail clerk is good and sorts 400 envelopes per hour, he will make $16 per hour. To protect workers from the effects of external factors, minimum-wage laws ensure that even the worst employee will make enough money to survive. Most organizations provide a base salary to ensure that employees will have at least minimal financial security. In fact, research indicates that employees paid a flat hourly rate plus a performance bonus perform at levels equal to employees who are paid on a piece-rate plan

(4) Needs for Achievement and Power (four individual differences that are most related to work motivation)

A theory developed by McClelland (1961) suggests that employees differ in the extent to which they are motivated by the need for achievement, affiliation, and power. Employees who have a strong need for achievement are motivated by jobs that are challenging and over which they have some control, whereas employees who have minimal achievement needs are more satisfied when jobs involve little challenge and have a high probability of success. In contrast, employees who have a strong need for affiliation are motivated by jobs in which they can work with and help other people. Finally, employees who have a strong need for power are motivated by a desire to influence others rather than simply to be successful.

Equity theory

A theory of job satisfaction stating that employees will be satisfied if their ratio of effort to reward is similar to that of other employees. Inputs In equity theory, the elements that employees put into their jobs. Outputs In equity theory, what employees get from their jobs. Input/output ratio The ratio of how much employees believe they put into their jobs to how much they believe they get from their jobs.

Self-regulation

A theory that employees can be motivated by monitoring their own progress toward the goals they set and adjusting their behavior to reach those goals (or adjusting the goals).

Job Characteristics

According to job characteristics theory, employees desire jobs that are meaningful, provide them with the opportunity to be personally responsible for the outcome of their work (autonomy), and provide them with feedback on the results of their efforts. If there is a discrepancy between the extent to which a job provides these three outcomes and an employee's need for these outcomes, the employee will be less motivated. According to job characteristics theory, jobs will have motivation potential if they allow employees to use a variety of skills (skill variety) and to connect their efforts to an outcome (task identification) that has meaning, is useful, or is appreciated by coworkers as well as by others in society (task significance). Take, for example, a job in which a factory worker stitches the company logo on shirts that were created by other workers and in which the quality of the shirts and the logo stitching is evaluated by employees in the quality control department. Because the job does not involve a variety of skills (lacks skill variety), someone else checks the quality of their work (no feedback, low task identification), putting logos on a shirt is probably not appreciated by society (low task significance), and the employee is closely supervised (low autonomy), the job would be considered to have low motivation potential.

2. Safety Needs

After basic biological needs have been met, a job that merely provides food and shelter will no longer be satisfying. Employees then become concerned about meeting their safety needs. That is, they may work in an unsafe coal mine to earn enough money to ensure their family's survival, but once their family has food and shelter, they will remain satisfied with their jobs only if the workplace is safe. Safety needs have been expanded to include psychological as well as physical safety. Psychological safety—often referred to as job security—can certainly affect job motivation. For example, public-sector employees often list job security as a main benefit to their jobs—a benefit so strong that they will stay in lower-paying public-sector jobs rather than take higher-paying, yet less secure, jobs in the private sector. The importance of safety needs was demonstrated in a 2012 survey asking employees about the work factors that were most important to them. Although the most important factor was opportunity to use skills/abilities, three safety/security need factors were in the top 10: job security (2), organization's financial stability (7), and feeling safe in the work environment

2. ERG theory

Aldefer's needs theory, which describes three levels of satisfaction: existence, relatedness, and growth. Because of the technical problems with Maslow's hierarchy, Aldefer (1972) developed a needs theory that has only three levels: existence, relatedness, and growth—hence ERG theory. Other than the number of levels, the major difference between Maslow's theory and ERG theory is that Aldefer suggested that a person can skip levels. By allowing for such movement, Aldefer has removed one of the biggest problems with Maslow's theory. Furthermore, Aldefer's theory explains why a higher-level need sometimes does not become more important once a lower-level need has been satisfied. Aldefer believes that for jobs in many organizations, advancement to the next level is not possible because of such factors as company policy or the nature of the job. Thus the path to the next level is blocked, and the employee becomes frustrated and places more importance on the previous level. Perhaps that is why some unions demand more money and benefits for their members rather than job enrichment. They realize that the jobs will always be tedious and that little can be done to improve them. Thus, the previous needs level becomes more important. This idea has received at least some empirical support

Evaluation of Maslow's Theory

Although Maslow's needs theory makes good intuitive sense and has always been popular with managers and marketing analysts, it lost popularity with academicians in the 1970s before making a resurgence in the new millennium. The lack of popularity was due to three potential problems with the theory. 1) Maslow's five levels may be too many, and that there are actually only two or three levels - However, some more recent research suggests that five might actually be the correct number. 2) Some people do not progress up the hierarchy as Maslow suggests they do. Most people move up from the basic biological needs level to safety needs to social needs and so on. Some people, however, have been known to skip levels. For example, bungee jumpers obviously skip the safety-needs level and go straight to satisfying their ego needs. When exceptions to the hierarchical structure occur, the theory loses support. 3) The theory predicts that once the needs at one level are satisfied, the next needs level should become most important. Research, however, has shown that this does not necessarily happen. Even though Maslow's theory has not been supported by research, it may still be useful. Some of the theory's specific assertions may not be true, but it still provides guidelines that organizations can follow to increase motivation and satisfaction. Providing recognition, enrichment, and a safe workplace does increase employee motivation. The validity of this recommendation is probably why Maslow's theory still is widely used by human resources professionals, even though it is not popular with academicians and researchers who prefer more complicated models. Needs theory A theory based on the idea that employees will be satisfied with jobs that satisfy their needs.

Are Employees Rewarded for Achieving Goals?

An essential strategy for motivating employees is to provide an incentive for employees to accomplish the goals set by an organization. Organizations offer incentives for a wide variety of employee behaviors, including working overtime or on weekends, making suggestions, referring applicants, staying with the company (length-of-service awards), coming to work (attendance bonuses), not getting into accidents, and performing at a high level. The basis for these incentive systems are operant conditioning principles, which state that employees will engage in behaviors for which they are rewarded and avoid behaviors for which they are punished. Thus, if employees are rewarded for not making errors, they are more likely to produce high-quality work. If employees are rewarded for the amount of work done, they will place less emphasis on quality and try to increase their quantity. Finally, if employees are not rewarded for any behavior, they will search for behaviors that will be rewarded. -> Unfortunately, these might include absenteeism (which is rewarded by going fishing) or carelessness (which is rewarded by spending more time with friends). Research and applied literature abound with studies demonstrating the effectiveness of reinforcement. Though the research is clear that rewarding employees will often lead to increased motivation and performance, six factors must be considered in determining the effectiveness of incentive programs: 1. Timing of the incentive 2. Contingency of the consequences 3. Type of incentive used 4. Use of individual-based versus group-based incentives 5. Use of positive incentives (rewards) versus negative incentives (punishment) 6. Fairness of the reward system (equity)

2nd individual incentive plan: Merit pay

An incentive plan in which employees receive pay bonuses based on performance appraisal scores. The major distinction between merit pay and pay for performance is that merit pay systems base their incentives on performance appraisal scores rather than on such objective performance measures as sales and productivity. Thus, merit pay is a potentially good technique for jobs in which productivity is difficult to measure. The actual link between performance appraisal scores and the amount of merit pay received by an employee varies greatly around the United States. Research on merit pay has brought mixed reviews. Some research has shown that employees like the idea of merit pay, but other research has found that it is not popular with all employees and that many do not consider the merit ratings to be fair. Not surprisingly, employees are most satisfied with merit pay if they help develop the system. One of merit pay's biggest problems is that increases are based on subjective performance appraisals. Aware of this, some supervisors will inflate performance appraisal scores to increase their employees' pay and thus increase the positive feelings of employees toward their supervisors. Managers have also been known to inflate performance appraisal ratings when they believe the base salaries for certain positions are too low. Another problem with merit pay is that its availability or amount often changes with each fiscal year. Thus excellent performance one year might result in a large bonus, but the same performance another year might bring no bonus at all. This is especially true in the public sector. For merit pay to be successful, funding must be consistently available and the amount must be great enough (about 7%) to motivate employees.

Premack Principle

An interesting method of providing incentives that meet the individual needs of each employee stems from the Premack Principle (Premack, 1963), which states that reinforcement is relative and that a supervisor can reinforce an employee with something that on the surface does not appear to be a reinforcer. The best way to explain this principle is to construct a reinforcement hierarchy on which an employee lists his preferences for a variety of reinforcers. The Premack Principle may sound silly, but think of the reinforcers you have used to reward yourself for studying. After reading a certain number of pages, you might allow yourself a trip to the water fountain. Certainly, getting a drink of water is hardly anyone's idea of a good time, but it may be more interesting than studying and so can become a reinforcer to increase studying. Example from author's boss: Because salary raises are small in size and never a certainty, it is difficult to motivate faculty to do the "little things" by offering financial rewards. Instead, my boss rewarded good departmental citizenship by giving the best faculty their most desired schedule, their favorite classes, and their favorite committee assignments. From what I have seen, these reinforcers work better than money! Of course, my boss was successful in using the Premack Principle because he had a good sense of every faculty member's reinforcement hierarchy.

3. Supervisor Behavior

Another approach to increasing employee self-esteem is to train supervisors to communicate a feeling of confidence in an employee. The idea here is that if an employee feels that a manager has confidence in him, his self-esteem will increase, as will his performance. Such a process is known as the Pygmalion effect and has been demonstrated in situations as varied as elementary school classrooms, the workplace, courtrooms, and the military. In contrast, the Golem effect occurs when negative expectations of an individual cause a decrease in that individual's actual performance. Two meta-analyses have shown that the Pygmalion effect greatly influences performance. The meta-analysis by McNatt (2000) found an overall effect size of 1.13, and the meta-analysis by Kierein and Gold (2001) found an overall effect size of 0.81. Effect sizes of this magnitude are considered to be very large. The Pygmalion and Golem effects can be explained by the idea that our expectations of others' performance lead us to treat them differently Pygmalion effect The idea that if people believe that something is true, they will act in a manner consistent with that belief. Golem effect When negative expectations of an individual cause a decrease in that individual's performance.

Are Rewards and Resources Given Equitably?

Another factor related to motivation and job satisfaction is the extent to which employees perceive that they are being treated fairly. The first theory on this topic was equity theory (Adams, 1965). Equity theory is based on the premise that our levels of motivation and job satisfaction are related to how fairly we believe we are treated in comparison with others. If we believe we are treated unfairly, we attempt to change our beliefs or behaviors until the situation appears to be fair. Three components are involved in this perception of fairness: inputs, outputs, and input/output ratio. Inputs are those personal elements that we put into our jobs. Obvious elements are time, effort, education, and experience. Less obvious elements include money spent on child care and distance driven to work. Outputs are those elements that we receive from our jobs. A list of obvious out- puts includes pay, benefits, challenge, and responsibility. Less obvious outputs are benefits such as friends and office furnishings. According to the theory, employees subconsciously list all their outputs and inputs and then compute an input/output ratio by dividing output value by input value. By itself, this ratio is not especially useful. But employees then compute the input/output ratios for other employees and for previous work experiences and compare them with their own. According to equity theory, when an employee's ratio is lower than those of others, he will become dissatisfied and be motivated to make the ratios equal in one or more ways. First, employees can seek greater outputs by such means as asking for a raise or for more responsibility. Second, employees can make the ratio more equal by reducing their inputs. Thus they might not work as hard or might reduce their attendance. A less practical way of equalizing the ratios wo

Compensation Plan

As shown in Figure 9.2, a compensation plan should include base pay and a benefits package to provide employees with security; salary adjustments to cover such conditions as undesirable shifts and geographic areas with high costs of living; and variable pay to provide an incentive to perform better.

Integration of Motivation Theories

As shown in Figure 9.3, people come to a job with a predisposition toward motivation. That is, some people, such as those with high self-esteem, are generally more motivated than others. We discussed many theories of work motivation. Let's review what we have learned: - From the discrepancy and needs theories, we will be motivated in our jobs if the job itself and the organization meet our expectations and values and satisfy our needs. - From goal-setting theory, we find that employees who have, understand, and agree to goals will be more motivated than those without goals or with unclear goals. - From expectancy theory and goal-setting theory, we know that the goals must be challenging but reasonable. - From operant learning and expectancy theories, it is clear that extrinsically motivated people will be more motivated if behavior results in a reward. -> From these same two theories plus discrepancy theory, the needs theories, and the Premack Principle, we know that the rewards must have value to the employee to be motivating. Because different people value different rewards, care must be taken to ensure that a variety of rewards are available. - From equity theory, we know that rewards that are valued will be motivating only if they are given in an equitable way. As discussed previously in the chapter, perceptions of equity are as important as the reality of equity. - Social influence theory tells us that if other employees are motivated, there is an increased probability that we will model their behavior and be motivated. The results of these factors are summed to indicate an employee's current level of motivation. As conditions change, so will the motivation level.

Expectancy theory can also be used to suggest ways to change employee motivation.

As we saw with the bank, motivation was increased by making the performance standard more reasonable and by increasing the value of the consequence. Similarly, if we wanted to apply the theory to decrease cheating, we would increase the probability of catching cheaters, make convicting a person who has cheated easier, and make the consequences for cheating more severe.

3 types of self-esteem

Chronic self-esteem is a person's overall feeling about himself. Situational self-esteem (also called self-efficacy) is a person's feeling about himself in a particular situation such as operating a machine or talking to other people. Socially influenced self-esteem is how a person feels about himself on the basis of the expectations of others. All three types of self-esteem are important to job performance. For example, an employee might be low in chronic self-esteem but very high in situational self-esteem. That is, a computer programmer might believe he is a terrible person whom nobody likes (low chronic self-esteem) but feel that he can program a computer better than anyone else (high situational self-esteem). If consistency theory is true, we should find that employees with high self-esteem are more motivated, perform better, and rate their own performance as being higher than employees with low self-esteem. Research supports these predictions: significant correlations between self-esteem and motivation, and a meta-analysis found a significant relationship between self-esteem and job performance (p .26). On the basis of consistency theory, we should be able to improve performance by increasing an employee's self-esteem, and the results of a meta-analysis indicate that interventions designed to increase self-esteem or self-efficacy can greatly increase performance. Organizations can theoretically do this in three ways: self-esteem workshops, experience with success, and supervisor behavior.

The expectancy theory - example

Concerned that the bank's tellers were averaging only 3 new Visa card customers each month, the management sought to increase the number of Visa card applications taken by each teller. Tellers were expected to ask each customer if he or she had a Visa card. If not, the teller was to give the customer an application. A teller would receive $5 extra per month if he or she increased the number of new Visa customers per month to 25. The program was a flop, much to management's surprise. Applying expectancy theory, however, would have led an industrial/organizational psychologist to predict the program's lack of success. 1) First, let us look at the expectancy component. If the tellers currently averaged only three new Visa card customers each month, they probably did not believe that even working hard, they would be able to generate 25 new customers. Thus, the expectancy probability for the program was low. 2) Second, most tellers probably did not place much value on an extra $5 per month, so the valence component also was low. Thus, with two of three components having low values, the program was destined to fail from the start. The bank later reduced the monthly number of new Visa cards to 10 and increased the teller reward to $20. These simple changes brought about the desired increase in new Visa card customers.

3. Type of Incentive Used

Different employees have different values, which is why supervisors should have access to and be trained to administer different types of reinforcers. For example, some employees can be rewarded with praise, others with awards, others with interesting work, and still others with money. A meta-analysis by Stajkovic and Luthans (1997) found that financial, nonfi-nancial, and social rewards all resulted in increased levels of performance. It is important to conduct periodic employee surveys about what employees want because supervisors and employees often have different ideas about what is rewarding and important. The need for variety in rewards is also true of punishment. Threatening an employee with a three-day suspension will be effective only if he needs the money or doesn't like being off work; yelling at an employee will be effective only if the employee does not like being yelled at; and threatening to not promote an employee will be effective only if the employee values promotions and perceives he has a reasonable chance of getting one.

Are Other Employees Motivated?

Employees observe the levels of motivation and satisfaction of other employees and then model those levels. Thus, if an organization's older employees work hard and talk positively about their jobs and their employer; new employees will model this behavior and be both productive and satisfied. The reverse is also true: If veteran employees work slowly and complain about their jobs, so too will new employees. The importance of this type of modeling was demonstrated in a study: employees who observed other employees engage in antisocial behavior began to act in a similar fashion

A note of caution

Even though operant conditioning and the Premack Principle have been successful in improving motivation and performance, a note of caution comes from Deci (1972), who believes that for some people and some jobs, work is intrinsically motivating. That is, people are motivated because they enjoy working, not because they are being rewarded. A reasonable body of research, much of it conducted by Deci himself, demonstrates that paying a person for the amount of work done will reduce the degree to which he enjoys performing the task. Thus, when financial incentives are no longer available, the employee will be less motivated to work than before rewards were used. As interesting as this concept sounds, some researchers argue that Deci's conclusion that extrinsic rewards decrease intrinsic motivation are flawed.

5. Self-Actualization Needs

Even when employees have friends, have earned awards, and are making a relatively high salary, they may not be completely motivated by their jobs because their self-actualization needs may not have been satisfied yet. These needs are the fifth and final level of Maslow's needs hierarchy. Self-actualization might be best defined by the U.S. Army's recruiting slogan "Be all that you can be." An employee striving for self-actualization wants to reach her potential in every task. Thus, employees who have worked with the same machine for 20 years may become dissatisfied with and less motivated by their jobs. They have accomplished all that can be accomplished with that particular machine and are now searching for a new challenge. If none is available, they may become dissatisfied and unmotivated. With some jobs, satisfying self-actualization needs is easy. For example, a college professor always has new research to conduct, new classes to teach, and new clients to consult. Thus, the variety of tasks and the new problems encountered provide a constant challenge that can lead to higher motivation. Other jobs, however, may not satisfy self-actualization needs. A good example is an employee who welds parts on an assembly line. Boredom and the realization that the job will never change begin to set in. It is no wonder that the employee becomes dissatisfied and loses motivation.

Expectancy Theory

Expectancy theory Vroom's theory that motivation is a function of expectancy, instrumentality, and valence. -> and then modified by others, including Porter and Lawler (1968). An influential theory of worker motivation that integrates many of the factors discussed previously in this chapter This theory has three components: 1. Expectancy (E): The perceived relationship between the amount of effort an employee puts in and the resulting outcome. 2. Instrumentality (I): The extent to which the outcome of a worker's perfor- mance, if noticed, results in a particular consequence. 2. Valence (V): The extent to which an employee values a particular consequence. To understand or predict an employee's level of motivation, these components are used in the following formula: Motivation = E (I x V) Thus, all possible outcomes of a behavior are determined, the valence of each is multiplied by the probability that it occurs at a particular performance level, and then the sum (product??) of these products is multiplied by the expectancy of an employee putting in the effort to attain the necessary level of performance. As can be seen from this formula, the higher the score on each component, the greater the employee's motivation.

Financial Rewards

Financial incentives can be used to motivate better worker performance either by making variable pay an integral part of an employee's compensation package or by using financial rewards as a "bonus" for accomplishing certain goals. Though incentive systems often result in higher levels of performance, when designed poorly they can result in such negative outcomes as increased stress and decreased performance. Financial incentives in the form of bonuses or prizes are also used to motivate employees. For example McDonald's have scholarship programs for their employees; and Abuelo's, the Mexican food restaurant chain, gives "reward pesos" to employees who demonstrate "Xtraordinary" performance. These "pesos" can be exchanged for merchandise from the company store.

In addition to predicting employee effort, expectancy theory has been applied successfully to predict speeding by drivers and cheating by students.

First, look at the expectancy component. We might ask what the probability is for catching a cheater. Students who cheat most likely believe that it is very low. To determine the instrumentality component, we might ask what the probability is for some negative consequence if a cheater is caught. In many universities, this probability is low. Not only is it difficult to prove that a student cheated, but if it is the first time a student is caught, punishment usually results in no more than a few days' suspension. Finally, we examine the valence component. Even if a student was caught and suspended, how terrible would that be? For many students, a few days of vacation may not seem so terrible. Thus, when combining the three components, we should not be surprised that cheating often occurs.

The extent to which we might select a work goal and apply energy toward that goal is influenced by the discrepancy between what we want, value, and expect and what the job actually provides.

For example, if you enjoy working with people but your job involves working with data, you are not likely to be motivated by or satisfied with your job. Likewise, if you value helping others, yet your job involves selling things people don't really need, you will probably not be motivated to perform well. Potential discrepancies between what employees want and what the job gives them affect how motivated and satisfied employees will be with their jobs Because one's values often change over time, it is not surprising that an employee, who is motivated by his job one year, may not be so motivated in the next year. For example, an unmarried employee might value money and not mind working late hours at a high-paying job, but if he gets married and starts a family, his values might shift to his family and thus want a job in which he has stability and allows him time to be with his family.

In general, research has supported the idea that our motivation decreases when our input/output ratios are lower than others'

For example, research on major league baseball players found that players who thought that their output (salary) was too low, responded by reducing their inputs (performance). In a study of professional basketball players, it was found that overpaid players responded by being more team oriented (e.g., passing the ball, rebounding), whereas underpaid players responded by being more selfish (e.g., taking shots).

Goal setting

Goal setting A method of increasing performance in which employees are given specific performance goals to aim for. To increase motivation, goal setting should be used. With goal setting, each employee is given a goal such as increasing attendance, selling more products, or reducing the number of grammar errors in reports. The first goal-setting study that caught the interest of industrial psychologists: To increase each delivery's load, the drivers were given specific weight goals and were told that they would be neither punished nor rewarded for reaching the goal. A significant increase in the average load per delivery resulted. Although this is the most celebrated study, goal setting has been shown to be effective in a wide variety of situations. For goal setting to be most successful, the goals themselves should possess certain qualities represented by the acronym SMART: specific, measurable, attainable, relevant, and time-bound

SMART - (5) Time-Bound

Goals work best when there is a time frame for their completion. A goal to clean one's office would be more motivating if the goal included a date by which the office would be cleaned.

3. Two-factor theory

Herzberg (1966) believed that job-related factors could be divided into two categories—hygiene factors and motivators—thus the name two- factor theory. Hygiene factors are those job-related elements that result from but do not involve the job itself. For example, pay and benefits are consequences of work but do not involve the work itself. Similarly, making new friends may result from going to work, but it is also not directly involved with the tasks and duties of the job. Motivators are job elements that do concern actual tasks and duties. Examples of motivators would be the level of responsibility, the amount of job control, and the interest that the work holds for the employee. Herzberg believes that hygiene factors are necessary but not sufficient for job satisfaction and motivation. That is, if a hygiene factor is not present at an adequate level (e.g., the pay is too low), the employee will be dissatisfied and less motivated. However, if all hygiene factors are represented adequately, the employee's level of satisfaction and motivation will only be neutral. Only the presence of both motivators and hygiene factors can bring job satis- faction and motivation. Thus, an employee who is paid a lot of money but has no control or responsibility over her job will probably be neither motivated nor unmotivated. But an employee who is not paid enough will be unmotivated, even though he may have tremendous control and responsibility over his job. Finally, an employee who is paid well and has control and responsibility will probably be motivated. Again, Herzberg's is one of those theories that makes sense but has not received strong research support. In general, researchers have criticized the theory because of the methods used to develop the two factors—the idea that factors such as pay can be both hygie

2. Contingency of Consequences

If it is not possible to immediately reward or punish a behavior, it should at least be made clear that the employee understands the behaviors that brought reward or punishment. To return to our example of the waiter, if he is told the reason for the size of his tip, he will be better able to change his behavior. Have you ever given a waiter or waitress a large tip even though the service was terrible? When this happens, however, the waiter or waitress is reinforced for poor performance and has no incentive to improve unless poor performance has its own consequence. And if the waiter has done an outstanding job but has received a small tip, the probability of his repeating his outstanding performance is reduced. Furthermore, when tips are pooled at restaurants so that each employee gets a share of all tips received, an individual employee's rewards are not as contingent on his own behavior as when tips are not pooled. The point of these examples is that reward and punishment must be made contingent upon performance, and this contingency of consequence must be clear to employees if we want them to be motivated. If the reward or punishment cannot be administered immediately, the employee must be told the purpose of the consequence so that the link between behavior and outcome is clear.

Expectancy, Instrumentality, Valence

In terms of expectancy, if an employee believes that no matter how hard he works he will never reach the necessary level of performance, then his motivation will probably be low. For instrumentality, the employee will be motivated only if his behavior results in some specific consequence. That is, if the employee works extra hours, he expects to be rewarded, or if he is inexcusably absent from work, he expects to be punished. For a behavior to have a desired consequence, two events must occur. First, the employee's behavior must be noticed. If the employee believes he is able to attain the necessary level of performance but that his performance will not be noticed, then his level of motivation will be low. Second, noticed behavior must be rewarded. If no rewards are available, then, again, motivation will be low. If appropriate behavior does not have positive consequences or if inappropriate behavior does not have negative consequences, the probability that a worker will continue undesired behaviors increases, and the probability that an employee will continue desired behaviors decreases. For valence, if an employee is rewarded, the reward must be something he values. If good performance is rewarded by an award, then the employee will be motivated only if he values awards. Likewise, if we punish an employee by suspending him, the punishment will be effective only if the employee needs the money. If he does not particularly like his job and would rather spend a few days at the lake, the suspension will obviously not be effective. In an applied study, Fox, Scott, and Donohue (1993) found that in a pay-for-performance environment, pay served as an incentive only for employees with a high monetary valence.

4. Individual Versus Group Incentives

Individual Incentive Plans Individual incentive plans are designed to make high levels of individual performance financially worthwhile, and the research is clear that monetary incentives increase performance over the use of a guaranteed hourly salary. Individual incentives help reduce such group problems as social loafing. There are three main problems associated with individual incentive plans. 1. The first is the difficulty in measuring individual performance. Not only are objective measures difficult to find, but supervisors are reluctant to evaluate employees, especially when the outcome will determine the amount of money an employee will receive 2. Individual incentive plans can foster competition among employees. Though competition is not always bad, it is seldom consistent with the recent trend toward a team approach to work. When done right, however, team environments and individual incentive programs can coexist and result in high levels of employee performance 3. The third problem is that for an incentive plan to effectively motivate employees, it is essential that employees understand the incentive system. Surprisingly, only 40% of employees report that they understand how their pay is determined. The two most common individual incentive plans are pay for performance and merit pay.

Is an Employee Predisposed to Being Motivated?

Is an Employee Predisposed to Being Motivated? Psychologists have postulated that some employees are more predisposed to being motivated than others. That is, some employees come to most jobs with a tendency to be motivated, whereas others come with a tendency to be unmotivated. Researchers have found four individual differences that are most related to work motivation: (1) personality, (2) self-esteem, (3) intrinsic motivation tendency, and (4) a need for achievement.

Job characteristics theory

Job characteristics theory The theory proposed by Hackman and Oldham that suggests that certain character- istics of a job will make the job more or less satisfying, depending on the particular needs of the worker.

Travel

Many organizations are offering travel awards rather than financial rewards. For exam- ple, every executive at McDonald's is allowed to nominate high-performing employees for a chance to spend a week in one of the company's condos in Hawaii, Florida, or Lake Tahoe, Nevada.

1. Basic Biological Needs

Maslow thought that an individual first seeks to satisfy basic biological needs for food, air, water, and shelter. In our case, an individual who does not have a job, is homeless, and is on the verge of starvation will be satisfied with any job as long as it provides for these basic needs. When asked how well they enjoy their job, people at this level might reply, "I can't complain, it pays the bills."

Work Behaviors That Imply Motivation

Measuring actual levels of motivation can be difficult. As a result, other than asking employees about their motivation levels, researchers use behaviors such as those shown in Table 9.1 that imply high levels of motivation. There are, of course, problems with using such behaviors as proxies for motivation. For example, an employee might be highly motivated but have a low level of performance because he lacks the ability to do the job. Likewise, an employee might be highly motivated to attend work but suffers an illness that keeps her from attending.

Results of the Fried and Ferris (1987) Meta-analysis

Meta-analysis results demonstrate that jobs with a high motivating potential score result in higher levels of employee satisfaction and performance, and lower levels of absenteeism.

Given whatever general level of motivation they have, what is the process by which individuals decide how they will direct their energy and effort?

Most psychologists believe that the answer comes from the process of self-regulation: a person's ability to select, set, and modify goals to adapt to changing conditions. Self-regulation is a four-step process in which people: 1. Choose their goals and set levels for each goal 2. Plan how they will accomplish those goals 3. Take action toward accomplishing the goals (goal striving) 4. Evaluate progress toward goal attainment and either maintain, revise, or abandon a goal E.g. an employee has a goal of completing a 100-page report in two weeks. If there are 10 working days in the two-week period, the employee might determine that she should complete 10 pages a day. After two days, the employee counts the number of pages written and compares it with where she thought she should be after two days (20 pages). If she has written only 10 pages, she has some choices to make. Should she change her goal to give herself more time, or perhaps change the goal so that the report will be shorter? Should she change her behavior so that she quits working on other projects and concentrates only on the report? Should she work longer hours or get more help so she can complete the report in two weeks? Though this example describes self-regulation of a specific task (writing a report), employees obviously have many goals, some of which are complex and some that might compete with other goals. For example, an employee might have goals of increasing her job knowledge (learning goal orientation), performing at a high level (performance goal orientation), making a lot of money, advancing within the organization, having a full social life, and spending quality time with the family. If the employee wanted to attend a weeklong seminar to increase her skills, would it come at the expense of her goals to perform at a high level and to spend t

3. Social Needs

Once the first two need levels have been met, employees will remain moti- vated by their jobs only when their social needs have been met. Social needs involve working with others, developing friendships, and feeling needed. Organizations attempt to satisfy their employees' social needs in a variety of ways. Company cafeterias provide workers with a place and an opportunity to socialize and meet other employees, company picnics allow families to meet one another, and company sports programs such as bowling teams and softball games provide opportunities for employees to play together in a neutral environment. It is important that an organization make a conscious effort to satisfy these social needs when a job itself does not encourage social activity. For example, janitors or night watchmen encounter few other people while working. Thus the chance of mak- ing new friends is small.

Organizational justice

Organizational justice A theory that postulates that if employees perceive they are being treated fairly, they will be more likely to be satisfied with their jobs and motivated to do well. Though equity theory has some theoretical problems, it was the springboard for modern research in organizational justice. The idea behind organizational justice is that if employees are treated fairly, they will be more satisfied and motivated. Whereas equity theory was limited to work outcomes such as pay and promotions, organizational justice theory has focused on the fairness of many aspects of work such as the process of how decisions are made (procedural justice), the outcomes of the decisions (distributive justice), and the ways in which decisions and other information are communicated to employees (interactional justice).

Premack Principle & Reinforcement hierarchy

Premack Principle The idea that reinforcement is relative both within an individual and between individuals. Reinforcement hierarchy A rank-ordered list of reinforcers for an individual.

SMART - (4 )Relevant

Properly set goals are also relevant. Setting a goal about increasing public speaking skills will not be as motivating to a person working in a landfill as it would be to a police officer who often testifies in court.

SMART - (1)Specific

Properly set goals are concrete and specific. A goal such as "I will produce as many as I can" will not be as effective as "I will print five thousand pages in the next hour." The more specific the goal, the greater the productivity. Though setting specific goals makes sense, it is not always easy to do. Microsoft found that nearly 25% of the goals set by employees as part of their performance plans were not specific. The results of focus groups investigating this lack of specificity found that employees believed that with a constantly changing environment, it was difficult to set specific goals because the goals would need constant adjustment.

SMART - (3)Specific

Properly set goals are high but attainable. If an employee regularly prints 5,000 pages an hour and sets a goal of 4,000 pages, performance is certainly not going to increase. Conversely, if the goal becomes 20,000 pages, it will also not be effective because the employee will quickly realize that he cannot meet the goal and will quit trying. E.g. Because their goals could not be attained, the students felt they had failed and quit trying. Though setting higher goals generally leads to better performance than does set- ting lower goals, the level of goal difficulty will most affect performance when employees are committed to reaching the goal That is, if they believe they can accomplish the goal, agree that the goal is worthwhile, and will be rewarded for achieving the goal, their commitment to achieve the goal is likely to be high. Interestingly, setting goals that are too difficult to accomplish can result not only in decreased performance but in an increase in unethical behavior as well. When employees feel pressure to reach a goal that they realize can't be met, they at times will engage in unethical behaviors in attempts to reach the goal or to "cook the books" to make it look as if the goals have been met - Optimists tend to set higher goals than do pessimists - In the Big 5 schema, people scoring high in conscientiousness, extraversion, and openness and low in agreeableness and neuroticism also tend to set high goals

SMART - (2) Measurable

Properly set goals are measurable. That is, if one's goal is to improve performance or increase customer service, can performance or customer service be measured? In the Microsoft study mentioned in the previous paragraph, only 40% of the goals set by employees were measurable

Recognition

Rather than providing financial incentives, many organizations reward employee behavior through recognition programs. For example: Organizations such as Best Buy, Kohl's, and Helen Keller Hospital give employees of the month a personal parking space. In some organizations, recognition awards are given by peers. For example, employees at Oakland Mercy Hospital in Nebraska vote for the Staff Member of the Year. Informal recognition programs, called social recognition, can prove to be tremendous sources of employee motivation. Social recognition consists of personal attention, signs of approval (e.g., smiles, head nods), and expressions of appreciation. Social recognition A motivation technique using such methods as personal attention, signs of approval, and expressions of appreciation. Providing a reserved parking space for an employee of the month is one of many ways to recognize valued employees.

Reward Versus Punishment

Rather than rewarding desired behaviors, we can change employee performance by punishing undesired behaviors. Though many psychologists advise against punishment, it is common, and managers generally believe it to be effective. Proponents of using punishment to change employee behavior argue that if applied properly, punishment not only reduces undesired behaviors in a particular employee but also sets an example for other employees. Opponents of punishment argue that punishment changes behavior only in the short run, does not teach an employee proper behaviors, and causes resentment. Furthermore, punishment causes employees to learn new methods to break rules, rather than teaching them not to break rules. A meta-analysis comparing the reward and punishment behaviors of leaders found that although both reward and punishment behaviors affect employee behavior and attitudes, the magnitude of the effect is stronger for rewards. For punishment to be effective, an employee must understand why he is being punished and be shown alternative ways of behaving that will result in some type of desired reinforcement. The punishment must also "fit the crime" in that too severe a punishment will cause resentment and too lenient a punishment will not motivate a change in behavior. Punishment should usually be done in private rather than in front of other employees.

1. Timing of the incentive

Research indicates that a reinforcer or a punisher is most effective if it occurs soon after the performance of the behavior. Unfortunately, if the timing of the incentive is too long, the effectiveness of the incentive to improve performance will be hindered. For example, a restaurant employee learning how to wait on tables performs many behaviors in the course of serving a customer. A tip is usually left by the customer after the meal, which provides immediate feedback about the employee's performance. However, if the tip is small, the employee is not sure which particular behavior caused the customer's displeasure. Likewise, if the tip is large, the employee is unsure which particular behavior or behaviors initiated the large tip. Thus the timing of the consequence by itself may not be enough.

(2) Self-Esteem (four individual differences that are most related to work motivation)

Self-esteem is the extent to which a person views himself as valuable and worthy. In the 1970s, Korman (1970, 1976) theorized that employees high in self-esteem are more motivated and will perform better than employees low in self-esteem. According to Korman's consistency theory, there is a positive correlation between self-esteem and performance. That is, employees who feel good about themselves are motivated to perform better at work than employees who do not feel that they are valuable and worthy people. Consistency theory takes the relationship between self-esteem and motivation one step further by stating that employees with high self-esteem actually desire to perform at high levels and employees with low self-esteem desire to perform at low levels. In other words, employees try to perform at levels consistent with their self-esteem level. This desire to perform at levels consistent with self-esteem is compounded by the fact that employees with low self-esteem tend to underestimate their actual ability and performance. Thus, low self-esteem employees will desire to perform at lower levels than their actual abilities would allow. Consistency theory Korman's theory that employees will be motivated to perform at levels consistent with their levels of self-esteem.

Group Incentive Plans: Stock options

Stock options A group incentive method in which employees are given the option of buying stock in the future at the price of the stock when the options were granted Although stock options represent the most complicated organizational incentive plan, the 2010 National Association for Stock Plan Professionals/Deloitte consulting survey indicates they are offered to all private sector employees by more than 25% of companies. - With stock options, employees are given the opportunity to purchase stock in the future, typically at the market price on the day the options were granted. Usually stock options vest over a certain period of time and must be exercised within a maximum time frame. The idea is that as a company does well, the value of its stock increases, as does the employee's profit. Stock options allow employees to share in the long-term success of an organization. In fact, such organizations as GTE, United Airlines, Home Depot, and Foldcraft Company report not only that their employees are making good money through their stock ownership but that organizational productivity has improved as well. At times, stock options may not be good motivators because employees have trouble understanding the concept of stock and because the incentive (profit made on the selling of stock) is psychologically well removed from day-to-day performance. However, having partial ownership in a company can increase performance. For example, in a study of hotel managers, Qian (1996) found a significant correlation between the amount of manager ownership and the hotel's profit margin.

Motivation

The force that drives an employee to perform well.

Group Incentive Plans

The idea behind group-based, or organization-based, incentive plans is to get employees to participate in the success or failure of the organization. Rather than encourag- ing individual competition, these plans reward employees for reaching group goals. The problems with group incentive plans are that they can encourage social loafing and can get so complicated that they become difficult to explain to employees. In spite of these potential problems, meta-analysis results indicate that team-based incentive programs result in better performance (d 1.40) than do individual-based programs (d .55)

Motivation

The internal force that drives a worker to action as well as the external factors that encourage that action. Ability and skill determine whether a worker can do the job, but motivation determines whether the worker will do it properly. Because basic abilities don't change greatly over time, changes in work behavior are thought to be affected by the amount of effort an employee applies to her work rather than applying that effort to other aspects of life such as family or hobbies. -> When we discuss work motivation, we are really talking about the factors that cause a person to apply their effort to work rather than on something else. Likewise, a person's overall level of work motivation might not change, but the effort spent on various tasks at work might change.

The major criticism of the expectancy theory

The major criticism involves the components equation. As it is now written, all of the components are multiplied. Some researchers have suggested that perhaps the addition of some components would be more appropriate than their multiplication. This is because when the components are multiplied, a zero in any component results in a prediction of zero motivation, even when ratings in the other components are high. A second criticism involves the values assigned to each component. Research has indicated that even though valence and instrumentality can be reliably measured, the theory is most predictive when people behave rationally, which they often do not, and have an internal locus of control, which may not always be the case. Despite problems with the equation, however, the theory is still one of the most useful for predicting employee behavior. Internal locus of control The extent to which people believe that they are responsible for and in control of their success or failure in life.

Needs, Values, and Wants

Three theories focus on employees' needs and values: 1. Maslow's needs hierarchy, 2. ERG (existence, relatedness, and growth) theory, 3. Two-factor theory.

1. Self-Esteem Workshops

To increase self-esteem, employees can attend workshops in which they are given insights into their strengths. It is thought that these insights raise self-esteem by showing employees that they have several strengths and are good people. For example, in one self-esteem training program, participants spend 10 days learning to sail on the Spirit of New Zealand. During the cruise, they not only learn how to sail, but engage in activities designed to provide opportunities for learning, teamwork, success, and positive reinforcement as well. Research indicates that compared to controls who did not to on the cruise, participants had significant increases in self-esteem; increases that were still present 12 months later. Outdoor experiential training (challenge courses) is another approach to increasing self-esteem. In training programs such as Outward Bound or the "ropes course," participants learn that they are emotionally and physically strong enough to be successful and to meet challenges. Meta-analysis results indicate that such programs increase both self-esteem and self-efficacy.

Are Employees Receiving Feedback on Their Goal Progress?

To increase the effectiveness of goal setting, feedback should be provided to employees on their progress in reaching their goals Feedback is so important that in a survey of IT employees, 80% said that effective feedback would make them less likely to leave their organization Unfortunately, only 42% of employees report they receive regular feedback on their performance Feedback can include verbally telling employees how they are doing, placing a chart on a wall, or using non- verbal communication such as smiles, glares, and pats on the back. Feedback best increases performance when it is positive and informational rather than negative and controlling To encourage employees to ask for feedback, supervisors should indicate their willingness to provide feedback and then reinforce employees who seek it. Feedback is constructive when it is given positively with the goal of encouraging and reinforcing positive behavior. For feedback to be effective, it must be given when employees do things properly, not just when they make mistakes.

Examples from Herzberg's Two-Factor Theory

Two-factor theory Herzberg's needs theory, postulates that there are two factors involved in job satisfaction: hygiene factors and motivators. Hygiene factors In Herzberg's two-factor theory, job-related elements that result from but do not involve the job itself. Motivators In Herzberg's two-factor theory, elements of a job that concern the actual duties performed by the employee.

Employee Participation

Until fairly recently, it was generally thought that a goal would lead to the greatest increase in productivity if it was set at least in part by the employee. That is, although performance would increase if the supervisor set the employee's goal, it would increase even more if the employee participated. However, several meta-analyses have indicated that participating in goal setting does not increase performance. However, a meta-analysis indicates that employee participation in goal setting increases the commitment to reaching a goal

Although actually testing the relationship between motivation and performance is also difficult, psychologists generally agree that increased worker motivation results in increased job performance.

We will explore several theories that seek to explain why workers are motivated by their jobs. None of the theories completely explains motivation, but each is valuable in that it suggests ways to increase employee performance. Thus, even though a theory itself may not be completely supported by research, the resulting suggestions have generally led to increased performance. The various theories suggest that employees will be highly motivated if - they have a personality that predisposes them to be motivated; - their expectations have been met; - the job and the organization are consistent with their values; - the employees have been given achievable goals; - the employees receive feedback on their goal attainment; - the organization rewards them for achieving their goals; - the employees perceive they are being treated fairly; - their coworkers demonstrate a high level of motivation.

Employees' motivation increased when coworkers received appropriate sanctions for their behavior.

When a high-performing group member was rewarded or a poor-performing group member was punished, the satisfaction and motivation of the group increased. The degree of inequity that an employee feels when underpaid appears to be a function of whether the employee chose the actions that resulted in underpayment. That is, if an employee chooses to work harder than others who are paid the same, he will not feel cheated, but if he is pressured into working harder for the same pay, he will be unhappy. An interesting prediction from this theory is a situation in which an employee's input/output ratio is higher than the ratio of others. Because the theory is based on equity, the prediction would be that the employee would still strive for equal ratios by either increasing his inputs or decreasing his outputs. He would either work harder or ask to be paid less. In fact, research has indicated that employ- ees often do respond to being "overpaid" by feeling guilty or working harder. But feelings of inequity caused by being "overpaid" do not last long and probably do not produce long-term changes in behavior.

Equity Theory Research

When an employee's inputs are greater than his outputs (underpayment), he: - works less hard - becomes more selfish - has lower job satisfaction When an employee's outputs are greater than his inputs (overpayment), he: - is less likely to be persuaded by his underpaid peers - does not feel guilty - works harder - becomes more team oriented

(3) Intrinsic Motivation (four individual differences that are most related to work motivation)

When people are intrinsically motivated, they will seek to perform well because they either enjoy performing the actual tasks or enjoy the challenge of successfully completing the task. When they are extrinsically motivated, they may not necessarily enjoy the tasks but are motivated to perform well to receive some type of reward or to avoid negative consequences. People who are intrinsically motivated don't need external rewards such as pay or praise. In fact, being paid for something they enjoy may reduce their satisfaction and intrinsic motivation. An interesting debate has formed between researchers who believe that rewards reduce intrinsic motivation and those who don't. It appears that this debate will continue. Individual orientations toward intrinsic and extrinsic motivation can be measured by the Work Preference Inventory (WPI) (Amabile, Hill, Hennessey, & Tighe, 1994). The WPI yields scores on two dimensions of intrinsic motivation (enjoyment, challenge) and two dimensions of extrinsic motivation (compensation, outward orientation). Intrinsic motivation Work motivation in the absence of such external factors as pay, promotion, and coworkers. Extrinsic motivation Work motivation that arises from such nonpersonal factors as pay, coworkers, and opportunities for advancement. Work Preference Inventory (WPI) A measure of an individual's orientation toward intrinsic versus extrinsic motivation.

4. Ego Needs

When social needs have been satisfied, employees concentrate next on meeting their ego needs. These are needs for recognition and success, and an organization can help to satisfy them through praise, awards, promotions, salary increases, publicity, and many other ways. E.g. Whether the person had his or her own parking space. Many organizations use furniture to help satisfy ego needs. The higher the employee's position, the better the office furniture. Similarly, at one engineering firm in Louisville, Kentucky, engineers are not allowed to mount their diplomas or awards on the wall until they receive their professional certification.

2. Experience with Success

With the experience-with-success approach, an employee is given a task so easy that he will almost certainly succeed. It is thought that this success increases self-esteem, which should increase performance, which further increases self-esteem, which further increases performance, and so on. This method is based loosely on the principle of the self-fulfilling prophecy, which states that an individual will perform as well or as poorly as he expects to perform. In other words, if an individual believes he is intelligent, he should do well on tests. If he thinks he is dumb, he should do poorly. So if an employee believes he will always fail, the only way to break the vicious cycle is to ensure that he performs well on a task. This relationship between self-expectations and performance is called the Galatea effect. Self-fulfilling prophecy The idea that people behave in ways consistent with their self- image. Galatea effect When high self-expectations result in higher levels of performance.