Ch 10 notes
When that happens, the company usually loses more than an experienced employee. It can also
lose the equivalent of 6 to 18 months’ salary to cover the costs of recruiting and training a
replacement. 1The “soft” costs of losing employees are even greater: loss of intellectual capital,
decreased morale of remaining workers, increased employee stress, decreased customer service,
interrupted product development, and a poor reputation.
An intrinsic reward is the personal satisfaction you feel when you perform well and complete
goals. The belief that your work makes a significant contribution to the organization or to society
is a form of intrinsic reward. An extrinsic reward is given to you by someone else as recognition
for good work
The Principles of Scientific Management was written by U.S. efficiency engineer Frederick Taylor
and published in 1911, earning Taylor the title “father of scientific management.” Taylor’s goal
was to increase worker productivity to benefit both the firm and the worker. The solution, he
thought, was to scientifically study the most efficient ways to do things, determine the one “best
way” to perform each task, and then teach people those methods. This approach became known
as scientific management. Three elements were basic to Taylor’s approach: time, methods, and
rules of work. His most important tools were observation and the stopwatch.
Believing different materials called for different shovels, he proceeded to invent a wide variety
of sizes and shapes of shovels and, stopwatch in hand, measured output over time in what were
called time-motion studies. These were studies of the tasks performed in a job and the time
needed for each.
Taylor’s scientific management became the dominant strategy for improving productivity in the
Scientific management viewed people largely as machines that needed to be properly
programmed. There was little concern for the psychological or human aspects of work. Taylor
believed that workers would perform at a high level of effectiveness—that is, be motivated—if
they received high enough pay.
In the end, Mayo guessed that some human or psychological factor was at play. He and his
colleagues interviewed the workers, asking about their feelings and attitudes toward the
experiment. The answers began a profound change in management thinking that still has
repercussions today. Here is what the researchers concluded:
• The workers in the test room thought of themselves as a social group. The atmosphere
was informal, they could talk freely, and they interacted regularly with their supervisors
and the experimenters. They felt special and worked hard to stay in the group. This
• The workers were included in planning the experiments. For example, they rejected one
kind of pay schedule and recommended another, which was adopted. They believed
their ideas were respected and felt engaged in managerial decision making. This, too,
• No matter the physical conditions, the workers enjoyed the atmosphere of their special
room and the additional pay for being more productive. Job satisfaction increased
dramatically. Page 273 Researchers now use the term Hawthorne effect to refer to people’s tendency to
behave differently when they know they’re being studied. The Hawthorne study’s results
encouraged researchers to study human motivation and the managerial styles that lead to higher
productivity. Research emphasis shifted from Taylor’s scientific management toward Mayo’s
new human-based management.
• Mayo’s findings led to completely new assumptions about employees. One was that pay
is not the only motivator. In fact, money was found to be a relatively ineffective
motivator. New assumptions led to many theories about the human side of motivation.
One of the best-known motivation theorists was Abraham Maslow, whose work we
Psychologist Abraham Maslow believed that to understand motivation at work, we must
understand human motivation in general. It seemed to him that motivation arises from need. That
is, people are motivated to satisfy unmet needs. Needs that have already been satisfied no longer
Figure 10.1 shows Maslow’s hierarchy of needs, whose levels are:
2. Physiological needs: Basic survival needs, such as the need for food, water, and shelter.
3. Safety needs: The need to feel secure at work and at home.
4. Social needs: The need to feel loved, accepted, and part of the group.
5. Esteem needs: The need for recognition and acknowledgment from others, as well as self-
respect and a sense of status or importance.
6. Self-actualization needs: The need to develop to one’s fullest potential.
In the mid-1960s, psychologist Frederick Herzberg conducted the most discussed study in this
area. Herzberg asked workers to rank various job-related factors in order of importance relative
to motivation. The question was: What creates enthusiasm for workers and makes them work to
full potential? The most important factors were:
1. Sense of achievement.
2. Earned recognition.
3. Interest in the work itself.
4. Opportunity for growth.
5. Opportunity for advancement.
6. Page 275Importance of responsibility.
7. Peer and group relationships.
9. Supervisor’s fairness.
10.Company policies and rules.
12. Job security.
13. Supervisor’s friendliness.
14. Working conditions.
Factors receiving the most votes all clustered around job content. Workers like to feel they
contribute to the company (sense of achievement was number 1). They want to earn recognition
(number 2) and feel their jobs are important (number 6). They want responsibility (which is why
learning is so important) and to earn recognition for that responsibility by having a chance for
growth and advancement. Of course, workers also want the job to be interesting. Do you
feel the same way about your work? Workers did not consider factors related to job environment to be motivators. It was interesting
to find that one of those factors was pay. Workers felt theabsence of good pay, job security, and
friendly supervisors could cause dissatisfaction, but their presence did not motivate employees to
work harder; it just provided satisfaction and contentment. Would you work harder if you
were paid more?
Herzberg concluded that certain factors, which he called motivators, made employees
productive and gave them satisfaction. These factors, as you have seen, mostly related to job
content. Herzberg called other elements of the job hygiene factors (or maintenance factors).
These related to the job environment and could cause dissatisfaction if missing but would not
necessarily motivate employees if increased. See Figure 10.2 for a list of motivators and hygiene
Management theorist Douglas McGregor observed that managers’ attitudes generally fall into
one of two entirely different sets of managerial assumptions, which he called Theory X and
The assumptions of Theory X management are:
• The average person dislikes work and will avoid it if possible.
• Because of this dislike, workers must be forced, controlled, directed, or threatened with
punishment to make them put forth the effort to achieve the organization’s goals.
• The average worker prefers to be directed, wishes to avoid responsibility, has relatively
little ambition, and wants security.
• Primary motivators are fear and punishment.
Theory Y makes entirely different assumptions about people:
• Most people like work; it is as natural as play or rest.
• Most people naturally work toward goals to which they are committed.
• The depth of a person’s commitment to goals depends on the perceived rewards for
• Under certain conditions, most people not only accept but also seek responsibility.
• People are capable of using a relatively high degree of imagination, creativity, and
cleverness to solve problems.
• In industry, the average person’s intellectual potential is only partially realized.
• People are motivated by a variety of rewards. Each worker is stimulated by a reward
unique to him or her (time off, money, recognition, and so on).
Rather than authority, direction, and close supervision, Theory Y managers emphasize a relaxed
managerial atmosphere in which workers are free to set objectives, be creative, be flexible, and
go beyond the goals set by management. A key technique here is empowerment, giving
employees authority to make decisions and tools to implement the decisions they make. For
empowerment to be a real motivator, management should follow these three steps:
1. Find out what people think the problems in the organization are.
2. Let them design the solutions.
3. Get out of the way and let them put those solutions into action.
In contrast, the U.S. management approach, which Ouchi called Type A, relied on short-term
employment, individual decision making, individual responsibility for the outcomes of decisions, rapid evaluation and promotion, explicit control mechanisms, specialized career pat