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Chapter 10

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Management (MGT)
Chris Bovaird

Chapter 10: Motivating and Leading Employees Psychological Contracts in Organizations Psychological Contract: the set of expectations held by an employee concerning what he or she will contribute to an organization (contributions) and what the organization will provide the employee (inducements) in return  If either party perceives an inequity in the contract, that party may seek a change o The employee, for example, might ask for a pay raise, promotion, or a bigger office o He or she might put forth less effort or look for a better job elsewhere o Or the organization can initiate change by training workers to improve their skills, transferring them to new jobs, or terminating them Human Relations: interactions between employers and employees and their attitudes toward one another The Importance of Job Satisfaction and Morale Job Satisfaction: the pleasure and feeling of accomplishment employees derive from performing their jobs well  IF people enjoy their work, they are relatively satisfied; if they do not enjoy their work, they are relatively dissatisfied Morale: the generally positive or negative mental attitude of employees toward their work and workplace  Morale reflects the degree to which they perceive that their needs are being met by their jobs  It is determined by a variety of factors, including job satisfaction and satisfaction with things such as pay, benefits, co-workers, and promotion opportunities Why Businesses Need Satisfied Employees When workers are enthusiastic and happy with their jobs, the organization benefits in many ways  Satisfied employees are more likely to work hard and try to make useful contributions to the organization  They will also have fewer grievances and are less likely to engage in negative behaviors (complaining, or deliberately working slow)  Satisfied workers are more likely to come to work every day and more likely to remain with the organization  So by ensuring that employees are satisfied, management gains a more efficient and smooth running company The costs of job dissatisfaction and poor morale are high  Dissatisfied workers, for example, are far more likely to be absent due to minor illnesses, personal reasons, or a general disinclination to go to work  Low morale may also result in high turnover Turnover: the percentage of an organization’s workforce that leaves and must be replaced  Some turnover is natural and healthy way to week out low-performing workers in an organization  High levels of turnover have many negative consequences, including numerous vacancies, disruption in production, decreased productivity, and high retraining costs Motivation in the Workplace Motivation is one part of the managerial function of directing Motivation: the set of forces that causes people to behave in certain ways 1  For example, while one worker may be motivated to work hard to produce as much as possible, another may be motivated to just enough to get by There are three main theories that address the issues of motivation: classical theory and scientific management, behaviour theory, and contemporary motivation theories Classical Theory and Scientific Management Classical Theory of Motivation: a theory of motivation that presumes that workers are motivated almost solely by money  Taylor reasoned, then paying them more would prompt them to produce more Meanwhile, the firm that analyzed jobs and found better ways to perform them would be able to produce goods more cheaply, make higher profits, and thus pay – and motivate – workers better than its competitors Taylor’s approach is known as scientific management Scientific Management: breaking down jobs into easily repeated components and devising more efficient tools and machines for performing them  Soon many experts were hired to perform time-and0mortion studies  These were the first “scientific” attempts to break down jobs into easily repeated components and to devise more efficient tools and machines for performing them Behaviour Theory: The Hawthorne Studies In 1925, a group of Harvard researchers began a study at the Hawthorne Works of Western Electric  Their intent was to examine the relationship between changes in the physical environment and worker output, focussing on increasing productivity  Increased lighting levels improved productivity, but so did lowering lighting levels  The explanation lay in workers response to attention Hawthorne Effect: tendency for workers’ productivity to increase when they feel they are receiving special attention from management  This had a major influence on human relations management, convincing many businesses that paying attention to employees is indeed good business Contemporary Motivation Theories Following the Hawthorne studies, managers and researching focussed more on the importance of human relations in motivating employees’ performance The major motivation theories include human-resource model, the hierarchy of needs model, two-factor theory, expectancy theory, equity theory, and goal-setting theory The Human-Resources Model: Theories X and Y Douglas McGregor concluded that managers had radically different beliefs about how best to use the human resources at a firm’s disposal. These were classified into “Theory X” and “Theory Y” 2 Theory X: a management approach based on the belief that people must be forces to be productive because they are naturally lazy, irresponsible, and uncooperative  People are lazy, lack ambition, dislike responsibility, self-centered, resist change, gullible, and not very bright Theory Y: a management approach based on the belief that people want to be productive because they are naturally energetic, responsible, and co-operative  People are energetic, ambitious, seek responsibility, selfless, want to contribute to business growth and change, and are intelligent Maslow’s Hierarchy of Needs Model Hierarchy of Human Needs Model: 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  Physiological needs are necessary for survival; they include food, water, shelter, and sleep o Businesses address these needs by providing both comfortable working environments and salaries sufficient to buy food and shelter  Security needs include the need for stability and protection from the unknown o Many employers thus offer pension plans and job security  Social needs include the needs for friendship and companionship o Making friend at work can help to satisfy social needs, as can the feeling that you “belong” in a company  Esteem needs include the need for status and recognition as well as the need for self-respect o Respected job titles and large offices are among the things that businesses can provide to address these needs  Self-actualization needs are needs for self-fulfillment o They include the needs to grow and develop one’s capabilities and to achieve new and meaningful goals o Challenging job assignments can help satisfy these needs According to Maslow, once one set of needs has been satisfied, it ceases to motivate behaviour  For example, if you feel secure in your new job, a new pension plan will probably be less important to you than a chance to make new friends and join an informal network among your co-workers  If however, a lower-level need suddenly becomes unfulfilled, most people automatically refocus on that lower level Maslow’s theory recognizes that because different people have different needs, different things motivate them  The hierarchy varies widely, not only for different people but also across different cultures Two-Factor Theory Frederick Herzberg concluded that job satisfaction and dissatisfaction depends on two factors: hygiene factors, and motivating factors Two-Factor Theory: a theory of human relations that identifies factors that must be present for employees to be satisfied with their jobs and factors that, if increased, lead employees to work harder  Hygiene factors: such as working conditions, supervisors, interpersonal relations, pay and security, and company policies and administration o Hygiene factor only affect motivation only if they are absent or fail to meet expectations 3  For example, workers will be dissatisfied if they believe they have poor working conditions. If working conditions improve, however; they will not necessarily become satisfied; they will simply be not dissatisfied  If workers receive no recognition for successful work, they may be neither dissatisfied nor satisfied, but if recognition is provided they will be satisfied o Hygiene factors are likely to produce feelings that lie on a continuum from dissatisfaction to no dissatisfaction o Hygiene factors refer to the environment in which they perform it  Motivating factors: such as recognition of a job well done, achievement, the work itself, responsibility, and advancement and growth o Motivating factors lie on a continuum from satisfaction to no satisfaction o Motivating factors are directly related to work that employees actually perform There is a two-step approach to enhancing motivation 1. Ensure that hygiene factors are acceptable. This practise will result in the absence of dissatisfaction 2. Then they must offer motivating factors. This will improve satisfaction and motivation Research suggests that two-factor theory works in some professional settings, but it is not as effective in clerical and manufacturing settings Strategies for Enhancing Job Satisfaction and Morale Reinforcement/ Behaviour Modification Theory Many companies try to control, and even alter or modify, workers’ behaviour through systematic rewards and punishments for specific behaviours  They try to define the specific behaviours they want employees to exhibit and the specific behaviours they want to eliminate o Good behaviour includes working hard, being nice to customers, and stressing quality o Bad behaviour incudes wasting time, being rude to customers, and ignoring quality Reinforcement: controlling and modifying employee behaviour through the use of systematic rewards and punishments for specific behaviours  In reinforcement strategies, rewards refer to all the positive things people receive for working (pay, praise, promotions, job security etc) o When rewards are tied directly to performance, they serve as positive reinforcement  For example, paying cash bonuses to salespeople who exceed quotas prompts them to work even harder during the next selling period  Punishment is designed to change behaviour by presenting people with unpleasant consequences if they fail to change in desirable ways o Employees who are repeatedly late for work, for example, may be suspended or have their pay docked Management by Objective (MBO) Management by Objective: is a system of collaborative goal setting that extends from the top of an organization to its bottom  MBO is concerned mainly with helping managers implement and carry out their plans 4 Once the program is set up, the first step is establishing overall organizational goals  It is also these goals that will ultimately be evaluated to determine the success of the program o At the same time, however, collaborative activity – communicating, meeting, counselling – is the key to MBO o Therefore, in addition to acting as a planning tool, MBO can serve as a program for improving satisfaction and motivation According to experts, motivation impact is the biggest advantage of MBO  When employees sit down with managers to set goals, they learn more able company-wide objectives, feel that they are an important part of the tam, and see how they can improve company0wide
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