Chapter 10 Motivating and Leading Employees Notes
Psychological Contracts in Organizations
x 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
x all organizations face the basic challenge of managing psychological contracts—they want value from their employees, and they
must give the employees the right inducements
x valuable but underpaid employees may perform below their capabilities or leave for better jobs
x human relations : interactions between employers and employees and their attitudes toward one another
x if psychological contracts are created, maintained, and managed effectively, the result is likely to be workers who are satisfied
and motivated; on the other hand, poorly managed psychological contracts may result in dissatisfied, unmotivated workers
The Importance of Job Satisfaction and Morale
x job satisfaction : the pleasure and feeling of accomplishment employees derive from performing their jobs well
x morale : the general positive or negative mental attitude of employees toward their work and workplace
x morale is determined by a variety of factors, including job satisfaction and satisfaction with such things as pay, benefits, co-
workers, and promotion opportunities
Why Businesses Need Satisfied Employees
x when workers are enthusiastic and happy with their jobs, the organization benefits in many ways
x satisfied workers are more likely to work hard, try to make useful contributions to the organization, they will have fewer
grievances, are less likely to engage in negative behaviours, will come to work everyday, likely to remain with organization
x dissatisfied workers are more likely to be absent due to minor illnesses, personal reasons, or general disinclination to go to work
x turnover : the percentage of an organization’s workforce that leaves and must be replaced
x high levels of turnover have many negative consequences, including numerous vacancies, disruptions in production, decreased
productivity, and high retraining costs
Motivation in the Workplace
x motivation : the set of forces that causes people to behave in certain ways
Classical Theory and Scientific Management
x classical theory of motivation : a theory of motivation that presumes that workers are motivated almost solely by money
x Frederick Taylor proposed a way for both companies and workers to benefit from this widely accepted view of life in the
workplace in his book The Principles of Scientific Management
¾ if workers are motivated by money, then paying them more would prompt them to produce more
¾ 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—motivate—workers better than its competitors
x scientific management : breaking down jobs into easily repeated components, and devising more efficient tools and machines
for performing them
Behaviour Theory: The Hawthorne Studies
x in essence, it was determined that almost any action on the part of management that made workers believe they were receiving
special attention caused worker productivity to rise
x Hawthorne effect : the tendency for workers’ productivity to increase when they feel they are receiving special attention from
management, which had a major influence on HR management, convincing many businesses that paying attention to employees
is indeed good for business
Contemporary Motivation Theories
The Human – Resources Model: Theories X and Y
Theory X Theory Y
1. People are lazy.
2. People lack ambition and dislike responsibility.
3. People are self-centred.
4. People resist change.
5. People are gullible and not very bright.
1. People are energetic.
2. People are ambitious and seek responsibility.
3. People can be selfless.
4. People want to contribute to business growth and change.
5. People are intelligent.
x Theory X : a management approach based on the belief that people must be forced to be productive because they are naturally
lazy, irresponsible, and uncooperative
x Theory Y : a management approach based on the belief that people want to be productive because they are naturally energetic,
responsible, and co-operative
x Theory Y managers are more likely to have satisfied, motivated employees
x value lies primarily in ability to highlight and analyze the behaviours of managers in light of their attitudes toward employees
Maslow’s Hierarchy of Needs Model
x 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
¾ Psychological needs are necessary for survival; they include food, water, shelter, and sleep. Businesses address these needs
by providing both comfortable working environments and salaries sufficient to buy food and shelter.
¾ Security needs include needs for stability and protection from unknown. Employers offer pension plans and job security.
N morale the general positive or negative mental attitude of employees toward their work and workplace. N when workers are enthusiastic and happy with their jobs, the organization benefits in many ways. N motivation the set of forces that causes people to behave in certain ways. N classical theory of motivation a theory of motivation that presumes that workers are motivated almost solely by money. Frederick taylor proposed a way for both companies and workers to benefit from this widely accepted view of life in the workplace in his book the principles of scientific management. N scientific management breaking down jobs into easily repeated components, and devising more efficient tools and machines for performing them. N in essence, it was determined that almost any action on the part of management that made workers believe they were receiving special attention caused worker productivity to rise. The human resources model: theories x and y.