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Chapter 10

Chapter 10 Notes

Management (MGT)
Course Code
Chris Bovaird

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Chapter 10 Notes: Motivating and Leading Employees
Psychological Contracts in Organizations
Psychological contract: The set of expectation held by an employee concerning
what he or she will contribute to an organization and what the organization will
provide the employee (inducements) in return.
Inequity in contract, both parties may seek changes
Human relations: Interactions between employers and employees and their
attitudes toward one another
Effective psychological contracts = satisfied and motivated workers
The Importance of Job Satisfaction and Morale
Job Satisfaction: The pleasure of feeling of accomplishment employees derive from
performing their jobs well
Morale: The generally positive or negative mental attitude of employees toward
their work and workplace.
Reflects the degree to which they perceive that their needs are being met by
the jobs
Determined by job satisfaction such as pay, benefits, co-workers, promotion
chance etc
Why Businesses Need Satisfied Employees?
Committed to work and organization
Willing to work hard and make useful contributions
Few grievances, less likely to engage in negative behaviours
More likely to come to work and remain in the organization
Low morale may result in high turnover (% of an organizations workforce that
leaves and must be replaced)
Negative consequences: vacancies, disruption in production, decreased productivity
Motivation in the Workplace
Motivation : The set of forces that causes people to behave in certain ways
3 major theories about motivation
Classical theory and scientific management
Behaviour theory
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
The Principles of Scientific Management by Frederick Taylor
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Proposed a way for both companies and workers to benefit from this widely
accepted view of life in the workplace
Workers are motivated by money
Pay more = more productive
Produce goods more cheaply = higher profits= better pay for employees
Tayloys approach = scientific management: breaking down jobs into easily
repeated components and devising more efficient tools and machines for
performing them
Industrial- engineering techniques were applied to perform it most
Time and motion studies > job analysis > specialization > repetition
Remove inefficiencies, reduce waste, productivity should increase
Introduce repetition and specialization
Piece rate system: pay workers for their output
Problems with Scientific Theory
Productivity does increase in short term. But - people are NOT
Boring, repetitive jobs lead to alienation , disaffection,
Behaviour Theory: The Hawthorne Studies
A group of Harvard researchers challenged the classical theory
Intention was to examine the relationship between changes in the physical
environment and worker output = increasing productivity
Increasing + decreasing lighting level improved productivity
Raising wages failed to increase productivity
Hawthorne Effect: The tendency for workers productivity to increase when they
feel they are receiving special attention from management
Convinced many businesses to pay attention to workers
Contemporary Motivation Theories
Human- resources mode
Hierarchy of needs model
Two- factory theory
Expectancy theory
Equity theory
Goal setting theory
The human- Resources Model: Theories X and Y
Behavioural scientist Douglas McGregor
Managers had radically different beliefs about how best to use human
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