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  1. 1. Motivation and Performance Management
  2. 2. Focus on motivation before exam
  3. 3. Goals <ul><li>Many different ways to motivate employees. </li></ul><ul><li>People have preferences for different types of motivation. </li></ul><ul><li>Link Motivation to leadership style </li></ul><ul><li>Link Motivation to organizational culture. </li></ul>
  4. 4. Performance <ul><li>Performance = motivation X ability X situational factors (leadership support, resources, peer support, etc). </li></ul><ul><li>Attributions. </li></ul><ul><li>Ability is relatively fixed. Ability linked to wages. </li></ul><ul><li>Supervisors can work largely on motivation or situational factors. In this class focus on leadership support and peer support (teams). Other classes resource (ex. MIS). </li></ul>
  5. 5. Focus on Motivation for now.
  6. 6. Motivation is important in management <ul><li>Basic job motivation. Most firms have average workers. Exceptional firms motivate average workers. (note some firms have high pay and select talented employees). </li></ul><ul><li>Change efforts </li></ul><ul><li>Supervision is easier if people are trying. </li></ul>
  7. 7. Think of a time when you were highly motivated <ul><li>Describe the circumstances. </li></ul>
  8. 8. Intrinsic vs. Extrinsic Motivation <ul><li>Intrinsic Motivation being driven by positive feelings associated with doing well on a task or job </li></ul><ul><li>Extrinsic Motivation motivation caused by the desire to attain specific outcomes </li></ul>8-18 McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.
  9. 9. A Model of Intrinsic Motivation Opportunity Rewards Accomplishment Rewards From Task Activities From Task Purpose 8-19 Figure 8-6 McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved. Sense of Progress Sense of Meaningfulness Sense of Competence Sense of Choice
  10. 10. Models of intrinsic motivation <ul><li>Video </li></ul><ul><li>How do they create meaning, choice, competence, progress? </li></ul>
  11. 11. . The Job Characteristics Model 8-15 Figure 8-5 McGraw-Hill <ul><li>High work </li></ul><ul><li>effectiveness </li></ul><ul><li>High growth </li></ul><ul><li>satisfaction </li></ul><ul><li>High general job satisfaction </li></ul><ul><li>High intrinsic </li></ul><ul><li>work motivation </li></ul>Outcomes <ul><li>Knowledge of the </li></ul><ul><li>actual results of </li></ul><ul><li>the work activities </li></ul><ul><li>Experienced </li></ul><ul><li>responsibility for outcomes of the work </li></ul><ul><li>Experienced </li></ul><ul><li>meaningfulness of work </li></ul>Critical psychological state <ul><li>Feedback from </li></ul><ul><li>job </li></ul><ul><li>Autonomy </li></ul><ul><li>Skill variety </li></ul><ul><li>Task identity </li></ul><ul><li>Task significance </li></ul>Core job characteristics <ul><li>Moderators </li></ul><ul><li>Knowledge and skill </li></ul><ul><li>Growth need strength </li></ul><ul><li>Context satisfaction </li></ul>
  12. 12. Advantages of intrinsic Motivation <ul><li>Low cost </li></ul><ul><li>Persistence is high </li></ul><ul><li>Unleash employees for change. </li></ul><ul><li>Builds relationships internally and externally </li></ul>
  13. 13. Disadvantages <ul><li>Control freaks nightmare </li></ul><ul><li>Strategic change is difficult. </li></ul>
  14. 14. Intrinsic Motivation <ul><li>Often ignored in today’s work environment. </li></ul><ul><li>Its what many of the best firms do! Very few average or below average firms do not. </li></ul><ul><li>Not leadership per se but more organizational culture. </li></ul><ul><li>Leadership style needs to be supportive to create the culture. </li></ul>
  15. 15. Extrinsic Motivation <ul><li>Many different approaches. </li></ul><ul><li>Debate highlighted these issues. </li></ul>
  16. 16. First, What can be used as rewards
  17. 17. Punishments.
  18. 18. Equity approaches <ul><li>Discussed earlier. </li></ul>
  19. 19. Negative and Positive Inequity A. An Equitable Situation Self Other 9-5 Figure 9-1 McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved. $2 1 hour = $2 per hour $4 2 hours = $2 per hour
  20. 20. Factors Considered When Making Equity Comparisons Outcomes Inputs 9-2 Table 9-1 McGraw-Hill . Challenging assignments Experience Fringe benefits Education/training Pay/bonuses Time Time off with pay/Job security Recognition Past Performance Ability and Skill Effort
  21. 21. Outcomes Inputs Factors Considered When Making Equity Comparisons 9-3 Table 9-1 cont. McGraw-Hill Pleasant/safe working environment Loyalty to organization Status symbols Seniority Career advancement/promotions Creativity Opportunity for personal growth/development Age
  22. 22. Since perceptual many ways to manage Examples Methods 9-9 Table 9-2 l Ask for a raise; ask for a new title;seek outside intervention <ul><li>Person can attempt to increase his or her outcomes </li></ul>Don’t work as hard; take longer breaks <ul><li>Person can attempt to increase his </li></ul><ul><li>or her inputs </li></ul>Work harder; attend school or a specialized program <ul><li>Person can increase his or her inputs </li></ul>Ask for less pay <ul><li>Person can decrease his or her outcomes </li></ul>
  23. 23. Management <ul><li>Perceived Justice is important to employee. </li></ul><ul><li>Some are more equity sensitive than others. </li></ul><ul><li>Depends. </li></ul><ul><li>Some questions. Debate if pay should be made public. What would equity theory suggest? </li></ul>
  24. 24. <ul><li>Susan is a single parent. She needs to come in late to drop her kids at school. How do you manage this? How could equity theory guide your choices? </li></ul><ul><li>Can you be best friends or have intimate relations with your one subordinate? </li></ul><ul><li>Here is a tough one. Which leadership style is most equity sensitive? Least equity sensitive? </li></ul>
  25. 25. Expectancy theory is closely linked to reward theory. <ul><li>Assumes People will do what is most rewarding for them. </li></ul><ul><li>So as students, choice to work and earn more money or study. </li></ul><ul><li>Work for a course where all get As or course where full range distribution. </li></ul><ul><li>Work in a course where can get an A or work in a course where lucky to get B but unlikely to fail. </li></ul>
  26. 26. Employees make the same choices. <ul><li>What gets you ahead on your job. Playing golf with your boss or doing a good job. </li></ul><ul><li>Your job is MIS systems. You are the nerd of all nerds. Love programming and hate people. Job requires meeting clients needs. Spend more time programming or talking to clients? </li></ul>
  27. 27. <ul><li>Effort Performance Outcomes </li></ul>
  28. 28. Vroom’s Expectancy Theory <ul><li>Expectancy belief that effort leads to a specific level of performance </li></ul><ul><li>Instrumentality a performance outcome perception </li></ul><ul><li>Valence the value of a reward or outcome </li></ul>9-14 McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.
  29. 29. Factors that Influence and Employee’s Expectancy Perceptions <ul><li>Self-esteem </li></ul><ul><li>Self-efficacy </li></ul><ul><li>Previous success at the task </li></ul><ul><li>Help received from a supervisor and subordinates </li></ul><ul><li>Information necessary to complete the task </li></ul><ul><li>Good materials and equipment to do work with </li></ul>9-15
  30. 30. Factors that influence Instrumentalities <ul><li>Written statements/policies </li></ul><ul><li>Historical evidence. </li></ul><ul><li>Past perceptions from experiences of self and others </li></ul><ul><li>Role ambiguity </li></ul>
  31. 31. Valences <ul><li>Individual differences. </li></ul>
  32. 32. Lets go back to Mary Martin <ul><li>Using expectancy theory, what would you do using expectancy theory. </li></ul>
  33. 33. Managerial implications <ul><li>Make reward systems explicit and clear. </li></ul><ul><li>Make job standards explicit and clear. </li></ul><ul><li>Prepare people to succeed at job standards. </li></ul><ul><li>Links to which leadership style. </li></ul><ul><li>Expectancies are supervisory based. Instrumentalities can be supervisor or organizational culture. </li></ul>
  34. 34. Prerequisites to Linking Performance and Rewards <ul><li>Managers should: </li></ul><ul><li>Develop and communicate performance standards </li></ul><ul><li>Give valid and accurate performance ratings </li></ul><ul><li>Determine the relative mix of individual vs. team contribution to performance and reward accordingly </li></ul><ul><li>Use the performance ratings to differentially allocate rewards among employees </li></ul>9-20 McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.
  35. 35. video
  36. 36. Problems <ul><li>Very general and difficult to implement in reality. </li></ul>
  37. 37. MBO/Goal Setting <ul><li>My favorite extrinsic mode of motivation. </li></ul><ul><li>Effective managers work with subordinates to set specific, objective performance standards. All jobs. </li></ul><ul><li>Retails sales easiest. </li></ul><ul><li>Police officer </li></ul><ul><li>Football athletic trainer. </li></ul>
  38. 38. Locke’s Model of Goal Setting Encouraging the development of goal- attainment strategies or action plans Increasing one’s persistence Regulating one’s effort Directing one’s attention Goals motivate the individual by... Task performance 9-22 Figure 9-3
  39. 39. Insights from Goal Setting Research <ul><li>Difficult goals lead to higher performance </li></ul><ul><li>Specific, difficult goals lead to higher performance for simple rather than complex tasks </li></ul><ul><li>Feedback enhances the effect of specific, difficult goals </li></ul><ul><li>Participative goals, assigned goals, and self-set goals are equally effective </li></ul><ul><li>Goal commitment and monetary incentives affect goal-setting outcomes </li></ul>9-24 Table 9-4 .
  40. 40. MBO <ul><li>Starts at the top. Officers set strategic goals. Target. 5% revenue Growth through repeat customers -- quality and choice at a low price. </li></ul><ul><li>Store manager goals </li></ul><ul><li>Dept manager goals </li></ul><ul><li>Floor attendants goals </li></ul><ul><li>Check out goals </li></ul>
  41. 41. Goes beyond goals <ul><li>Goals are a tool to both motivate and identify performance problems (performance management). </li></ul><ul><li>Goals setting done jointly long time frame. </li></ul><ul><li>Monitor (indirectly) if goals are being attained. </li></ul><ul><li>Provide feedback daily, weekly, monthly </li></ul>
  42. 42. <ul><li>Supervisor monitors. </li></ul><ul><li>Gives recognition if goals on target </li></ul><ul><li>Problems solves if goals are not on target. Done in supportive manner. What does supervisor need to do to help? What does subordinate need to do to help? </li></ul><ul><li>Bonuses given if goals are met. </li></ul>
  43. 43. Research supports <ul><li>But not widely used. </li></ul>
  44. 44. Managerial implications <ul><li>Steps to adoption are specific and clear. </li></ul><ul><li>Monitoring and feedback. </li></ul><ul><li>Leadership style. </li></ul><ul><li>Organizational culture. </li></ul>
  45. 45. Dark side <ul><li>Game playing/Ethical lapses with outcome measurements. </li></ul><ul><li>Poor goal assessment. </li></ul>
  46. 46. Motivation <ul><li>Different approaches </li></ul><ul><li>Choice based on beliefs about employees, leadership style and organizational culture. </li></ul><ul><li>All can be proven to be effective at achieving different things. </li></ul>