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Chapter 10

RSM100Y1 Chapter Notes - Chapter 10: Job Satisfaction, Flextime, Rein

Rotman Commerce
Course Code
Michael Szlachta

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Chapter 10: Motivating and Leading Employees
Psychological Contracts in Organizations
- psychological contract is similar to a legal contract. It is the set of expectations held by an employee
concerning what he/she will contribue to an organization (the contributions) and what the organization will
provide the employee in return (the inducements)
- organizations want value from their employees and must give their employees the right inducements
- good human relations = interactions between employers and employees and their attitudes towards one
another - is a VDWLV¿HG and motivated work force.
- if psychological contracts are created, maintained and managed effectively, the result is likely to be workers
who are VDWLV¿HG and motivated
The importance of job satisfaction and morale
- job satisfaction is the pleasure and feeling of accomplishment that employees derive from doing their work.
If people do their work, they are VDWLV¿HG SaWLV¿HG employees have high morael - the mental attitude of
employees toward their work and workplace
- morale is the degree to which they feel that their needs are being met by their jobs
- morale is determined by job satisfaction, satisfaction with pay, EHQH¿WV co workers and promotion
why businesses need VDWLV¿HG employees?
- VDWLV¿HG workers are more likely to work hard to make useful contributions to the organization and they will
be less likely to engage in negative behaviours
- saWLV¿HG workers are more likely to stay with the organization
- GLVVDWLV¿HG workers (have low morale) are more likely to be absent for inadequate reasons
- low morale may result in high turnover (the percentage of an RUJDQL]DWLRQV workforce that leaves and must
be replaced)
- turnover is good when you weed out the bad employees, get new talent etc. but LV bad when there is a
disruption in production, decreased productivity and high retraining costs.
Motivation and the Work Place
- employee motivation is critical to a ¿UPV success
- motivation is the set of forces that causes people to behave in certain ways.
Classical 7KHRU\6FLHQWL¿F management
- classical theory of motivation - workers are motivated by money. Frederick Taylor said to pay workers more
in order to get them to produce more. Meanwhile, ¿rms needed to analyze jobs and ¿nd better ways to
produce goods and more cheaply, make higher SUR¿WV and pay and motivate workers.

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- This approach is known as VFLHQWL¿F management because the goal was to break down jobs into easily
repeated components and to devise more HI¿FLHQW tools and machines for performing them
Behaviour theory- Hawthorne Studies
- goal of the studies was to examine the relationship between changes in the physical environment and
worker output with an eye to increasing productivity
- the results were that you could increase the pay, but this did not raise productivity. To make workers work
better, management had to make workers believe that they were receiving special attention, and that would
cause worker productivity to rise. This result is known as the Hawthorne effect
Contemporary motivation theories
- looking at the factors that cause, focus and sustain ZRUNHUV behaviour. Motivation theorists are concerned
with the ways in which management thinks about and treats employees
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