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Motivation: From
  Concepts to
  Applications
Lecturer: Do Tien Long
09 04 51 54 46
dotienlong_mc@yahoo.com.vn


      Org...
What Is Motivation?

             Direction


  Intensity                     Persistence



       Organisational Behavio...
What is Motivation?
What is Motivation?
Motivation
The processes that account for an individual’s intensity,
direction, an...
Hierarchy of Needs Theory (Maslow)
Hierarchy of Needs Theory (Maslow)
Hierarchy of Needs Theory
There is a hierarchy of fi...
Maslow’s Hierarchy of Needs
             Maslow’s Hierarchy of Needs
Lower-Order Needs                                    ...
Assumptions of Maslow’s Hierarchy
Assumptions of Maslow’s Hierarchy
Movement up the Pyramid
•Individuals cannot move to th...
Having Little Ambition

     Theory X                                         Disliking Work
Managers See Workers As…

   ...
Herzberg’s Two-Factor Theory
      Herzberg’s Two-Factor Theory
Bottom Line: Satisfaction and Dissatisfaction are
     not...
Contrasting Views of Satisfaction and
Contrasting Views of Satisfaction and
           Dissatisfaction
           Dissatis...
David McClelland’s Theory of Needs
David McClelland’s Theory of Needs
Need for Achievement                            Need...
Matching High Achievers and Jobs
Matching High Achievers and Jobs




                                                   E...
Cognitive Evaluation Theory
Cognitive Evaluation Theory
Cognitive Evaluation Theory
Providing an extrinsic reward for beha...
What Would Herzberg Say? What
What Would Herzberg Say? What
     Would Maslow Say?
      Would Maslow Say?




           ...
Goal-Setting Theory (Edwin Locke)
Goal-Setting Theory (Edwin Locke)
Basic Premise: That specific and difficult goals,
 wit...
Goal Setting in Action: MBO
Goal Setting in Action: MBO
Programs
Programs


  Management By Objectives Programs
   Managem...
What is MBO?
What is MBO?
Management by Objectives (MBO)
A program that encompasses specific goals,
participatively set, f...
Cascading of Objectives
Cascading of Objectives




                                                   E X H I B I T 6–1
 ...
Linking MBO and Goal-Setting
Linking MBO and Goal-Setting
Theory
Theory
                   MBO                   Goal-Sett...
Why MBOs Fail
Why MBOs Fail
Unrealistic expectations about MBO results
Lack of commitment by top management
Failure to all...
Self-Efficacy
                        Self-Efficacy
           •An individual’s feeling that s/he can
           complete ...
Self-Efficacy and Goal Setting
Self-Efficacy and Goal Setting




        Organisational Behavior, Do Tien Long
Four Ways of Increasing Self Efficacy
Four Ways of Increasing Self Efficacy
             (Bandura)
              (Bandura)...
Reinforcement Theory
Reinforcement Theory
Argues that behavior is a function of its
consequences.


 Assumptions:
  Assump...
Equity Theory
Equity Theory
Equity Theory
Individuals compare their job inputs and outcomes with
those of others and then ...
Equity Theory (cont’d)
Equity Theory (cont’d)




                                                    E X H I B I T 6–8
  ...
Equity Theory (cont’d)
Equity Theory (cont’d)

  Choices for dealing with inequity:
   Choices for dealing with inequity:
...
Equity Theory (cont’d)
Equity Theory (cont’d)

Propositions relating to inequitable pay:
 Propositions relating to inequit...
Justice and Equity Theory
Justice and Equity Theory




           Organisational Behavior, Do Tien Long
Three types of Justice
                Three types of Justice
     Distributive Justice                                   ...
Expectancy Theory
                     Expectancy Theory



                            Ethical Values and
               ...
Chapter Check-Up: Motivation


   If you study really hard and only
    get a B on an exam, but your
    classmate barely ...
Chapter Check-Up: Motivation

 What theory would say that this man, who knows he
  works hard and is performing well, will...
Chapter Check-Up: Motivation


  Expectancy Theory.
  Would a gym membership
  be considered a motivator
  or hygiene fact...
Putting It All Together
Putting It All Together




 Organisational Behavior, Do Tien Long
Job Design Theory
Job Design Theory

Job Characteristics
Model                                           Characteristics:
...
Job Design Theory (cont’d)
Job Design Theory (cont’d)
 Job Characteristics Model
 – Jobs with skill variety, task identity...
The Job Characteristics Model
 The Job Characteristics Model




Source: J.R. Hackman and G.R. Oldham, Work Design (excerp...
Job Design Theory (cont’d)
Job Design Theory (cont’d)
Skill Variety
The degree to which a job requires a variety of
differ...
Job Design Theory (cont’d)
Job Design Theory (cont’d)
 Autonomy
 The degree to which the job provides substantial
 freedom...
Computing a Motivating Potential
Computing a Motivating Potential
Score
Score




People who work on jobs with high core d...
Job Design and Scheduling
Job Design and Scheduling
Job Rotation
The periodic shifting of a worker from
one task to anothe...
Guidelines for Enriching a Job
 Guidelines for Enriching a Job




                                                       ...
Alternative Work Arrangements
   Alternative Work Arrangements
Flextime
Employees work during a common core time period ea...
Example of a Flextime Schedule
Example of a Flextime Schedule




                                                   E X H...
Alternative Work Arrangements,
         Alternative Work Arrangements,
                      cont.
                      c...
Telecommuting
              Telecommuting
Advantages                                   Disadvantages
                     ...
Performance = f(A x M x O)
                       Performance = f(A x M x O)




Source: Adapted from M. Blumberg and C.D....
What is Employee Involvement?
  What is Employee Involvement?
Employee Involvement Program
A participative process that us...
Examples of Employee Involvement
Examples of Employee Involvement
Programs
Programs
Participative Management
A process in ...
Examples of Employee Involvement
Examples of Employee Involvement
Programs (cont’d)
Programs (cont’d)
Representative
Parti...
Examples of Employee Involvement
Examples of Employee Involvement
Programs (cont’d)
Programs (cont’d)
Quality Circle
A wor...
Linking EI Programs and Motivation
Linking EI Programs and Motivation
Theories
Theories
    Theory Y
     Theory Y        ...
Rewarding Employees: Four Aspects
Rewarding Employees: Four Aspects

•What to Pay (Internal vs. external equity)
•How to P...
Rewarding Employees: Variable Pay
Rewarding Employees: Variable Pay
Programs
Programs
Variable Pay Programs
A portion of a...
Variable Pay Programs (cont’d)
Variable Pay Programs (cont’d)
Piece-rate Pay Plans
Workers are paid a fixed sum for each
u...
Rewarding Employees
          Rewarding Employees
Employee Stock Ownership Plans (ESOPs)
Company-established benefit plans...
Skill-Based Pay Plans
Skill-Based Pay Plans
Pay levels are based on how many skills employees have
or how many jobs they c...
Skill-Based Pay Plans (cont’d)
Skill-Based Pay Plans (cont’d)

  Drawbacks of Skill-based Pay Plans:
  Drawbacks of Skill-...
Linking Skill-based Plans and
  Linking Skill-based Plans and
       Motivation Theories
       Motivation Theories

     ...
Flexible Benefits
Flexible Benefits
Employees tailor their
benefit program to meet
                                       ...
Employee Recognition Programs
Employee Recognition Programs
 Intrinsic rewards: stimulate intrinsic motivation
 – Personal...
E X H I B I T 7–2
                                                                                                        ...
Implications for Managers
        Implications for Managers
In Order to Motivate Employees
– Recognize individual differen...
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Organizational Behavior - Session 3

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Transcript of "Organizational Behavior - Session 3"

  1. 1. Motivation: From Concepts to Applications Lecturer: Do Tien Long 09 04 51 54 46 dotienlong_mc@yahoo.com.vn Organisational Behavior, Do Tien Long
  2. 2. What Is Motivation? Direction Intensity Persistence Organisational Behavior, Do Tien Long
  3. 3. What is Motivation? What is Motivation? Motivation The processes that account for an individual’s intensity, direction, and persistence of effort toward attaining a goal. Key Elements Key Elements 1. Intensity: how hard a person tries 1. Intensity: how hard a person tries 2. 2. Direction: toward beneficial goal Direction: toward beneficial goal 3. 3. Persistence: how long a person tries Persistence: how long a person tries Organisational Behavior, Do Tien Long
  4. 4. Hierarchy of Needs Theory (Maslow) Hierarchy of Needs Theory (Maslow) Hierarchy of Needs Theory There is a hierarchy of five needs— physiological, safety, social, esteem, and self-actualization; as each need is substantially satisfied, the next need becomes dominant. Self-Actualization The drive to become what one is capable of becoming. Organisational Behavior, Do Tien Long
  5. 5. Maslow’s Hierarchy of Needs Maslow’s Hierarchy of Needs Lower-Order Needs Higher-Order Needs Needs that are satisfied Needs that are satisfied externally; physiological internally; social, esteem, and safety needs. and self-actualization Self needs. Esteem Social Safety Physiological E X H I B I T 6–1 E X H I B I T 6–1 Organisational Behavior, Do Tien Long
  6. 6. Assumptions of Maslow’s Hierarchy Assumptions of Maslow’s Hierarchy Movement up the Pyramid •Individuals cannot move to the next higher level until all needs at the current (lower) level are satisfied. •Individuals therefore Maslow Application: Maslow Application: must move up the hierarchy in order A homeless person A homeless person will not be motivated to will not be motivated to meditate! meditate! Organisational Behavior, Do Tien Long
  7. 7. Having Little Ambition Theory X Disliking Work Managers See Workers As… Avoiding Responsibility Self-Directed Theory Y Enjoying Work Managers See Workers As… Accepting Responsibility Organisational Behavior, Do Tien Long
  8. 8. Herzberg’s Two-Factor Theory Herzberg’s Two-Factor Theory Bottom Line: Satisfaction and Dissatisfaction are not Opposite Ends of the Same Thing! Hygiene Factors: Separate constructs Motivators: •Salary – Hygiene Factors---Extrinsic •Achievement & Related to Dissatisfaction •Work •Responsibility Conditions •Growth – Motivation Factors--- •Company Intrinsic and Related to Policies Satisfaction Organisational Behavior, Do Tien Long
  9. 9. Contrasting Views of Satisfaction and Contrasting Views of Satisfaction and Dissatisfaction Dissatisfaction E X H I B I T 6–3 E X H I B I T 6–3 Organisational Behavior, Do Tien Long
  10. 10. David McClelland’s Theory of Needs David McClelland’s Theory of Needs Need for Achievement Need for Affiliation The drive to excel, to achieve in The desire for friendly and relation to a set of standards, to close personal strive to succeed. relationships. Need for Power Bottom Line: Individuals have The need to make others behave in a way that they different levels of needs would not have behaved in each of these areas, otherwise. and those levels will drive their behavior Organisational Behavior, Do Tien Long
  11. 11. Matching High Achievers and Jobs Matching High Achievers and Jobs E X H I B I T 6–4 E X H I B I T 6–4 Organisational Behavior, Do Tien Long
  12. 12. Cognitive Evaluation Theory Cognitive Evaluation Theory Cognitive Evaluation Theory Providing an extrinsic reward for behavior that had been previously only intrinsically rewarding tends to decrease the overall level of motivation. The theory may only be relevant to jobs that are neither extremely Hint: For this theory, dull nor extremely interesting. think about how fun it is to read in the summer, but once reading is assigned to you for a grade, you don’t want to do it! Organisational Behavior, Do Tien Long
  13. 13. What Would Herzberg Say? What What Would Herzberg Say? What Would Maslow Say? Would Maslow Say? E X H I B I T 6–5 E X H I B I T 6–5 Organisational Behavior, Do Tien Long
  14. 14. Goal-Setting Theory (Edwin Locke) Goal-Setting Theory (Edwin Locke) Basic Premise: That specific and difficult goals, with self-generated feedback, lead to higher performance. But, the relationship between goals and performance will depend on •goal commitment –“I want to do it & I can do it” •task characteristics (simple, well-learned) •national culture Organisational Behavior, Do Tien Long
  15. 15. Goal Setting in Action: MBO Goal Setting in Action: MBO Programs Programs Management By Objectives Programs Management By Objectives Programs ••Company wide goals & objectives Company wide goals & objectives ••Goals aligned at all levels Goals aligned at all levels ••Based on Goal Setting Theory Based on Goal Setting Theory Organisational Behavior, Do Tien Long
  16. 16. What is MBO? What is MBO? Management by Objectives (MBO) A program that encompasses specific goals, participatively set, for an explicit time period, with feedback on goal progress. Key Elements Key Elements 1. Goal specificity 1. Goal specificity 2. 2. Participative decision making Participative decision making 3. 3. An explicit time period An explicit time period 4. Performance feedback 4. Performance feedback Organisational Behavior, Do Tien Long
  17. 17. Cascading of Objectives Cascading of Objectives E X H I B I T 6–1 E X H I B I T 6–1 Organisational Behavior, Do Tien Long
  18. 18. Linking MBO and Goal-Setting Linking MBO and Goal-Setting Theory Theory MBO Goal-Setting Theory Goal Specificity Yes Yes Goal Difficulty Yes Yes Feedback Yes Yes Participation Yes No (qualified) Organisational Behavior, Do Tien Long
  19. 19. Why MBOs Fail Why MBOs Fail Unrealistic expectations about MBO results Lack of commitment by top management Failure to allocate reward properly Cultural incompatibilities Organisational Behavior, Do Tien Long
  20. 20. Self-Efficacy Self-Efficacy •An individual’s feeling that s/he can complete a task (e.g. “I know I can!”) •Enhances probability that goals will be achieved Not to be confused with: Self Esteem, which is…. Individuals’ degree of liking or disliking themselves. Organisational Behavior, Do Tien Long
  21. 21. Self-Efficacy and Goal Setting Self-Efficacy and Goal Setting Organisational Behavior, Do Tien Long
  22. 22. Four Ways of Increasing Self Efficacy Four Ways of Increasing Self Efficacy (Bandura) (Bandura) 1. Enactive Mastery 2. Vicarious Modeling 3. Verbal Persuasion 4. Arousal Note: Basic Premise/Mechanism of Pygmalion and Galatea Effects Organisational Behavior, Do Tien Long
  23. 23. Reinforcement Theory Reinforcement Theory Argues that behavior is a function of its consequences. Assumptions: Assumptions: •Behavior is environmentally caused. •Behavior is environmentally caused. •Behavior can be modified (reinforced) by •Behavior can be modified (reinforced) by providing (controlling) consequences. providing (controlling) consequences. •Reinforced behavior tends to be repeated. •Reinforced behavior tends to be repeated. Organisational Behavior, Do Tien Long
  24. 24. Equity Theory Equity Theory Equity Theory Individuals compare their job inputs and outcomes with those of others and then respond to eliminate any inequities. Referent Referent Comparisons: Comparisons: Self-inside Self-inside Self-outside Self-outside Other-inside Other-inside Other-outside Other-outside Organisational Behavior, Do Tien Long
  25. 25. Equity Theory (cont’d) Equity Theory (cont’d) E X H I B I T 6–8 E X H I B I T 6–8 Organisational Behavior, Do Tien Long
  26. 26. Equity Theory (cont’d) Equity Theory (cont’d) Choices for dealing with inequity: Choices for dealing with inequity: 1. Change inputs (slack off) 1. Change inputs (slack off) 2. 2. Change outcomes (increase output) Change outcomes (increase output) 3. 3. Distort/change perceptions of self Distort/change perceptions of self 4. 4. Distort/change perceptions of others Distort/change perceptions of others 5. 5. Choose a different referent person Choose a different referent person 6. Leave the field (quit the job) 6. Leave the field (quit the job) Organisational Behavior, Do Tien Long
  27. 27. Equity Theory (cont’d) Equity Theory (cont’d) Propositions relating to inequitable pay: Propositions relating to inequitable pay: 1. Overrewarded hourly employees produce more 1. Overrewarded hourly employees produce more than equitably rewarded employees. than equitably rewarded employees. 2. Overrewarded piece-work employees produce 2. Overrewarded piece-work employees produce less, but do higher quality piece work. less, but do higher quality piece work. 3. Underrewarded hourly employees produce lower 3. Underrewarded hourly employees produce lower quality work. quality work. 4. Underrewarded employees produce larger 4. Underrewarded employees produce larger quantities of lower-quality piece work than quantities of lower-quality piece work than equitably rewarded employees. equitably rewarded employees. Organisational Behavior, Do Tien Long
  28. 28. Justice and Equity Theory Justice and Equity Theory Organisational Behavior, Do Tien Long
  29. 29. Three types of Justice Three types of Justice Distributive Justice Procedural Justice Perceived fairness of the The perceived fairness of outcome (the final distribution). the process used to determine the outcome “Who got what?” (the final distribution). “How was who gets what decided?” Interactional Justice The degree to which one is treated with dignity and respect. “Was I treated well?” Organisational Behavior, Do Tien Long
  30. 30. Expectancy Theory Expectancy Theory Ethical Values and Behaviors of Leaders Bottom line • All three links between the boxes must be intact or motivation will not occur. Thus, • Individuals must feel that if they try, they can perform And • If they perform, they will be rewarded And • When they are rewarded, the reward will be something they care about Organisational Behavior, Do Tien Long
  31. 31. Chapter Check-Up: Motivation If you study really hard and only get a B on an exam, but your classmate barely studies at all and gets an A, what theory will help explain why you feel less motivated to go to class? Organisational Behavior, Do Tien Long
  32. 32. Chapter Check-Up: Motivation What theory would say that this man, who knows he works hard and is performing well, will be motivated by a gym membership for being a high performer? Organisational Behavior, Do Tien Long
  33. 33. Chapter Check-Up: Motivation Expectancy Theory. Would a gym membership be considered a motivator or hygiene factor, according to Herzberg? Discuss with a classmate. Organisational Behavior, Do Tien Long
  34. 34. Putting It All Together Putting It All Together Organisational Behavior, Do Tien Long
  35. 35. Job Design Theory Job Design Theory Job Characteristics Model Characteristics: Characteristics: Identifies five job 1. Skill variety 1. Skill variety characteristics and their 2. 2. Task identity Task identity relationship to personal and work outcomes. 3. 3. Task significance Task significance 4. 4. Autonomy Autonomy 5. 5. Feedback Feedback Organisational Behavior, Do Tien Long
  36. 36. Job Design Theory (cont’d) Job Design Theory (cont’d) Job Characteristics Model – Jobs with skill variety, task identity, task significance, autonomy, and for which feedback of results is given, directly affect three psychological states of employees: • Knowledge of results • Meaningfulness of work • Personal feelings of responsibility for results – Increases in these psychological states result in increased motivation, performance, and job satisfaction. Organisational Behavior, Do Tien Long
  37. 37. The Job Characteristics Model The Job Characteristics Model Source: J.R. Hackman and G.R. Oldham, Work Design (excerpted from pp. 78–80). © 1980 by Addison- E X H I B I T 7–1 E X H I B I T 7–1 Wesley Publishing Co., Inc. Reprinted by permission of Addison-Wesley Longman, Inc. Organisational Behavior, Do Tien Long
  38. 38. Job Design Theory (cont’d) Job Design Theory (cont’d) Skill Variety The degree to which a job requires a variety of different activities (how may different skills are used in a given day, week, month?). Task Identity The degree to which the job requires completion of a whole and identifiable piece of work (from beginning to end). Task Significance The degree to which the job has a substantial impact on the lives or work of other people. Organisational Behavior, Do Tien Long
  39. 39. Job Design Theory (cont’d) Job Design Theory (cont’d) Autonomy The degree to which the job provides substantial freedom and discretion to the individual in scheduling the work and in determining the procedures to be used in carrying it out. Feedback The degree to which carrying out the work activities required by a job results in the individual obtaining direct and clear information about the effectiveness of his or her performance. Organisational Behavior, Do Tien Long
  40. 40. Computing a Motivating Potential Computing a Motivating Potential Score Score People who work on jobs with high core dimensions are People who work on jobs with high core dimensions are generally more motivated, satisfied, and productive. generally more motivated, satisfied, and productive. Job dimensions operate through the psychological states in Job dimensions operate through the psychological states in influencing personal and work outcome variables rather than influencing personal and work outcome variables rather than influencing them directly. influencing them directly. Organisational Behavior, Do Tien Long
  41. 41. Job Design and Scheduling Job Design and Scheduling Job Rotation The periodic shifting of a worker from one task to another. Job Enlargement The horizontal expansion of jobs. Job Enrichment The vertical expansion of jobs. Organisational Behavior, Do Tien Long
  42. 42. Guidelines for Enriching a Job Guidelines for Enriching a Job E X H I B I T 7–2 E X H I B I T 7–2 Source: J.R. Hackman and J.L. Suttle, eds., Improving Life at Work (Glenview, IL: Scott Foresman, 1977), p. 138. Organisational Behavior, Do Tien Long
  43. 43. Alternative Work Arrangements Alternative Work Arrangements Flextime Employees work during a common core time period each day but have discretion in forming their total workday from a flexible set of hours outside the core. Job Sharing The practice of having two or more people split a 40- hour-a-week job. Organisational Behavior, Do Tien Long
  44. 44. Example of a Flextime Schedule Example of a Flextime Schedule E X H I B I T 7–3 E X H I B I T 7–3 Organisational Behavior, Do Tien Long
  45. 45. Alternative Work Arrangements, Alternative Work Arrangements, cont. cont. Telecommuting Employees do their work at home on a computer that is linked to their office. Categories of telecommuting jobs: Categories of telecommuting jobs: • • Routine information handling tasks Routine information handling tasks • • Mobile activities Mobile activities • • Professional and other knowledge-related tasks Professional and other knowledge-related tasks Organisational Behavior, Do Tien Long
  46. 46. Telecommuting Telecommuting Advantages Disadvantages (Employer) – Larger labor pool – Less direct supervision – Higher productivity of employees – Less turnover – Difficult to coordinate – Improved morale teamwork – Reduced office-space – Difficult to evaluate costs non-quantitative performance Organisational Behavior, Do Tien Long
  47. 47. Performance = f(A x M x O) Performance = f(A x M x O) Source: Adapted from M. Blumberg and C.D. Pringle, “The Missing Opportunity in Organizational Research: Some Implications for a Theory of Work Performance,” Academy of Management E X H I B I T 6–9 E X H I B I T 6–9 Review, October 1982, p. 565. Organisational Behavior, Do Tien Long
  48. 48. What is Employee Involvement? What is Employee Involvement? Employee Involvement Program A participative process that uses the entire capacity of employees and is designed to encourage increased commitment to the organization’s success. Organisational Behavior, Do Tien Long
  49. 49. Examples of Employee Involvement Examples of Employee Involvement Programs Programs Participative Management A process in which subordinates share a significant degree of decision-making power with their immediate superiors. Organisational Behavior, Do Tien Long
  50. 50. Examples of Employee Involvement Examples of Employee Involvement Programs (cont’d) Programs (cont’d) Representative Participation Works Councils Workers participate in Groups of nominated or elected organizational decision employees who must be consulted when management makes making through a small decisions involving personnel. group of representative employees. Board Representative A form of representative participation; employees sit on a company’s board of directors and represent the interests of the firm’s employees. Organisational Behavior, Do Tien Long
  51. 51. Examples of Employee Involvement Examples of Employee Involvement Programs (cont’d) Programs (cont’d) Quality Circle A work group of employees who meet regularly to discuss their quality problems, investigate causes, recommend solutions, and take corrective actions. Organisational Behavior, Do Tien Long
  52. 52. Linking EI Programs and Motivation Linking EI Programs and Motivation Theories Theories Theory Y Theory Y Two-Factor Two-Factor (Believing (Believing Employee Employee Theory Theory employees employees Involvement Involvement want to be Programs ((Intrinsic Intrinsic want to be Programs Motivation) involved) Motivation) involved) ERG Theory ERG Theory ((Employee Employee Needs) Needs) Organisational Behavior, Do Tien Long
  53. 53. Rewarding Employees: Four Aspects Rewarding Employees: Four Aspects •What to Pay (Internal vs. external equity) •How to Pay (e.g Piece rate, merit based, bonuses, profit sharing, gain sharing, ESOPs, skill-based pay) •What Benefits to Offer (e.g.,Flexible benefits) •How to Recognize Employees Organisational Behavior, Do Tien Long
  54. 54. Rewarding Employees: Variable Pay Rewarding Employees: Variable Pay Programs Programs Variable Pay Programs A portion of an employee’s pay is based on some individual and/or organization measure of performance. • Piece rate pay plans • Profit sharing plans • Gain sharing plans Organisational Behavior, Do Tien Long
  55. 55. Variable Pay Programs (cont’d) Variable Pay Programs (cont’d) Piece-rate Pay Plans Workers are paid a fixed sum for each unit of production completed. Profit-Sharing Plans Organization wide programs that distribute compensation based on some established formula designed around a company’s profitability. Gain Sharing An incentive plan in which improvements in group productivity determine the total amount of money that is allocated. Organisational Behavior, Do Tien Long
  56. 56. Rewarding Employees Rewarding Employees Employee Stock Ownership Plans (ESOPs) Company-established benefit plans in which employees acquire stock as part of their benefits. Organisational Behavior, Do Tien Long
  57. 57. Skill-Based Pay Plans Skill-Based Pay Plans Pay levels are based on how many skills employees have or how many jobs they can do. Benefits of Skill-based Pay Plans: Benefits of Skill-based Pay Plans: 1. 1. Provides staffing flexibility. Provides staffing flexibility. 2. 2. Facilitates communication across the organization. Facilitates communication across the organization. 3. 3. Lessens “protection of territory” behaviors. Lessens “protection of territory” behaviors. 4. 4. Meets the needs of employees for advancement (without Meets the needs of employees for advancement (without promotion). promotion). 5. Leads to performance improvements. 5. Leads to performance improvements. Organisational Behavior, Do Tien Long
  58. 58. Skill-Based Pay Plans (cont’d) Skill-Based Pay Plans (cont’d) Drawbacks of Skill-based Pay Plans: Drawbacks of Skill-based Pay Plans: 1. Lack of additional learning opportunities that will 1. Lack of additional learning opportunities that will increase employee pay. increase employee pay. 2. Continuing to pay employees for skills that have 2. Continuing to pay employees for skills that have become obsolete. become obsolete. 3. Paying for skills which are of no immediate use to the 3. Paying for skills which are of no immediate use to the organization. organization. 4. Paying for aaskill, not for the level of employee 4. Paying for skill, not for the level of employee performance for the particular skill. performance for the particular skill. Organisational Behavior, Do Tien Long
  59. 59. Linking Skill-based Plans and Linking Skill-based Plans and Motivation Theories Motivation Theories Equity Equity Reinforcement Reinforcement Skill Based Pay Skill Based Pay Theory Plans Theory Theory Theory Plans McClelland’s McClelland’s ERG Theory ERG Theory Need for Need for (Growth) (Growth) Achievement Achievement Organisational Behavior, Do Tien Long
  60. 60. Flexible Benefits Flexible Benefits Employees tailor their benefit program to meet Core-Plus Plans: their personal need by Core-Plus Plans: aacore of essential benefits core of essential benefits picking and choosing and aamenu-like selection of and menu-like selection of from a menu of benefit other benefit options. other benefit options. options. Modular Plans: Modular Plans: Flexible Spending Plans: Flexible Spending Plans: predesigned benefits predesigned benefits allow employees to use their allow employees to use their packages for specific packages for specific tax-free benefit dollars to tax-free benefit dollars to groups of employees. groups of employees. purchase benefits and pay purchase benefits and pay service premiums. service premiums. Organisational Behavior, Do Tien Long
  61. 61. Employee Recognition Programs Employee Recognition Programs Intrinsic rewards: stimulate intrinsic motivation – Personal attention given to employee – Approval & appreciation for a job well done – Growing in popularity and usage Benefits of programs – Fulfill employees’ desire for recognition – Inexpensive to implement – Encourages repetition of desired behaviors Drawbacks of programs – Susceptible to manipulation by management Organisational Behavior, Do Tien Long
  62. 62. E X H I B I T 7–2 E X H I B I T 7–2 From the Wall Street Journal, October 21, 1997. Reprinted by permission of Cartoon Features Syndicate. Organisational Behavior, Do Tien Long
  63. 63. Implications for Managers Implications for Managers In Order to Motivate Employees – Recognize individual differences. – Use goals and feedback. – Allow employees to participate in decisions that affect them. – Link rewards to performance. – Check the system for equity. Organisational Behavior, Do Tien Long
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