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Management (MGT)

Psychological contracts in organizations • Psychological contract—is the set of expectations held by an employee concerning what he or she will contribute to an organization and what the organization will provide the employee in return • All organizations face basic challenge of managing psychological contracts—they want value from employees and give employees the right incentives • Valuable but underpaid employees may perform below their capabilities or leave for better jobs • But overpaying employees who contribute little incurs unnecessary costs • The foundation of a good human relations—is a satisfied and motivated workforce The importance of job satisfaction and morale • Job satisfaction—the pleasure and feeling of accomplishment employees derive from performing their jobs well—if they enjoy their work, they are relatively satisfied, but if not, they are relatively dissatisfied • Satisfied employees are likely to have high morale—the generally positive or negative mental attitudes of employees toward their work and workplace Why businesses need satisfied employees • When workers are enthusiastic and satisfied—they are more committed to their work and organization, and are more likely to work harder and make useful contributions to the organization • Probably have fewer frievances and are less likely to engage in negative behaviours and are more likely to come to work everyday and stay remain with the organization • Dissatisfied workers are more likely to be absent due to minor illnesses, personal reasons or a general disinclination to go to work • Low morale may result in high turnover—the percentage of an organizations workforce that leaves and must be replaced • Some turnover is necessary and healthy way to weed out low performing workers, but high levels have many negative consequences—decreased productivity, disruption in productionMotivation in the workplace • Employee motivation is even more critical to a firms success • Motivation—is the set of forces that causes people to behave in certain ways Classical theory and scientific management • Classical theory of motivation—according to this workers are motivated almost solely by money • Scientific management—breaking down jobs into easily repeated components and devising more efficient tools and machines for performing them • Reasoned that if workers are motivated by money, then paying them more would prompt them to produce more Behaviour theory: the hawthorn studies • Results from the experiment—was that increasing lighting levels improved productivity, but so did lowering lighting levels • Raising the pay of workers failed to increase their productivity • The explanation for the lighting phenomenon lay in workers response to attention—they determined that any action on the part of the management that made workers believe they were receiving special attention caused worker productivity to rise • Hawthorne effect—the tendency for worker’s productivity to increase when they feel they are receiving special attention from management Contemporary motivation theories • The human resources model: theories X and Y—researcher concluded that managers had radically different beliefs about how best to use the HR at a firms disposal—he classified them into theories X and Y • Theory X—management approach based on the belief that people must be forced to be productive because they are naturally lazy, irresponsible and uncooperative—so they think to either punish or reward to be productive • Theory y—a management approach based on the belief that people want to be productive because they are naturally energetic, responsible and cooperative • Argued that theory Y managers are more likely to be satisfied, motivated employees • Theory x and y distinctions are simplistic and don’t offer concrete basis for action, their value lies primarily in their ability to highlight and analyze the behaviour of managers in light of their attitudes toward employees • Maslow’s hierarchy of needs models—theory of motivation describing five levels of human needs and arguing that basic needs must be fulfilled before people work to satisfy higher level needs—he classified these into 5 basic types • Physiological needs—those necessary for survival—food, water, shelter and sleep • Security needs—need for stability and protection from the unknown— so pension plans and job security • Social needs—need for friendship and companionship • Esteem needs—need for status and recognition as well as the need for self respect—eg. Respected job titles and large offices • Self actualization needs—needs for self fulfillment—include need to grow and develop one’s capabilities and to achieve new and meaningful goals • According to maslow—once one set of needs has been satisfied, it ceases to motivate behaviour • Two factor theory—theory of human relations developed by Frederick Herzberg that identifies factors that must be present for employees to be satisfied with their jobs and facts that if increased lead employees to work harder • The two factors were—hygiene factors—such as working conditions and motivating factors—such as recognition for a job well done • According to two factor theory—hygiene factors affect motivation and satisfaction only if they are absent or fail to meet expectations • Motivating factors lie on a continuum from satisfaction to no satisfaction • Hygiene factors on the other hand are likely to produce feelings that lie on a continuum from dissatisfaction to no satisfaction • While motivating factors are directly related to teh work that employees actually perform hygiene factors refer to the environment in which they perform it • This theory suggests that managers should follow a two step approach to enhancing motivation—they must ensure that hygiene factors are acceptable and they must offer motivation factors Strategies for enhancing job satisfaction and morale Reinforcement/behaviour modification • Many companies try to control or modify worker’s behaviours through systematic rewards and punishments for specific behaviours • So they define specific behaviours they want their employee to exhibit and specific behaviours they want to eliminate—then they try to shape employee behaviour by linking reinforcement with desired behaviours and punishment with undesired behaviours • Reinforcement—controlling and modifying employee behaviour through the use of systematic rewards and punishments for specific behaviours • When rewards are tied directly to performance they serve as positive reinforcement • Punishment is designed to change behaviour by presenting people with unpleasant consequences if they fail to change in desirable ways • Extensive rewards work best when people are learning new behaviours, new skills or new jobs—as workers become more adept, rewards can be used less frequently—most managers prefer giving rewards Management by objectives • Is a system of collaborative goal setting that extends from the top of an organization to its bottom • Mainly concerned with helping managers implement and carry out their plans • MBO involves managers and subordinates in setting goals and evaluating process • Once program is set up, the first step is establishing overall organizational goals—which will be evaluated to determine the success of the program • Collaborative activity is the key to MBO, ot can also serve as a program for improving satisfaction and motivation • Motivational impact is the biggest advantage of MBO—when employees sit down with managers to set goals they learn more about company wide objectives, feel that they are important and see how they can improve company wide performance • If an MBO system is properly used, employees should h
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