1. New generation organizations
Motivating employees through creative working practices
hat makes people happy with their jobs? Is it high salaries or bonuses, or
W opportunities for promotion? The writers whose work is highlighted in this review
suggest that innovative business strategies which value a company’s human
resources are the most important factors in keeping employees enthusiastic and motivated
about their jobs.
The study of motivation is a science in itself, which incorporates aspects of human
psychology, social and cultural factors and individual values and beliefs. A simplified
explanation is that motivation can be either internal or external. While either of these primary
factors consists of many complex influences, internal and external motivation can be viewed
as pull/push determinants. Someone who is externally motivated depends on outside factors
to push him or her to complete a task or project, or just to get out of bed and go to work in the
morning. Those factors may be the salary or wage packet required to pay the rent and buy
the groceries, or perhaps the lure of a company car or annual bonus. Keeping a roof over
one’s head and food on the table is a legitimate reason to show up at the office or on the shop
floor every day so realistically, most employees are somewhat influenced by external
motivators. This becomes a problem when external factors provide the only motivation. While
life’s basic needs mean that most people desire employment, internal motivation is
associated with wishing to be employed in a particular position by a firm whose
organizational values and work requirements are closely aligned with the personal values
and skills of its employees. As Dee Hocks, founder of Visa credit card, was fond of saying:
‘‘money motivates neither the best people nor the best in people’’ and it is true that people
who are internally motivated experience a ‘‘pull’’ at accomplishing a task and doing a job to
the best of their ability. Internal motivation is associated with reduced employee absence,
increased job satisfaction, high levels of creativity and a reduced need for direct
supervision. Employees who experience internal motivation enjoy their jobs, get on well with
their colleagues and take pride in their work.
So what type of organization fosters this all-important internal motivation in employees? Dr
Carter McNamara from the University of Texas calls them ‘‘new generation organizations’’.
These are companies with several key characteristics such as strong staff involvement, few
rules and regulations, authority based on ability, and team working. Such organizations tend
to have a flatter, more decentralized management structure.
W.L. Gore & Associates
W.L. Gore & Associates is a prime example of one of these peak-performing organizations.
The company name hints at the philosophy underpinning its success. Who are these
‘‘Associates’’ of founder, Bill Gore? You would be wrong if you guessed that they were some
high- powered business people. In Gore-speak, associates are the most important people in
the firm, the employees. They also own 25 percent of the company. W.L. Gore’s unorthodox
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2. management practices are aimed at maximizing creativity and encouraging information
sharing. The firm operates within a non-hierarchical management structure known as the
‘‘flat lattice system’’. Associates are encouraged to discover where in the organization their
particular talents and interests lie and then to spend some of their working time on new
projects of their own devising. If an associate has an idea for a new product, it is up to
him/her to recruit other staff to work with them, becoming a sponsor (manager) by election
rather than by appointment. An example of a small project initiated by associates, which
became a big winner for the company, is the invention of plastic coated acoustic guitar
strings.
Nucor
While Gore associates are part owners of the company they work for, another firm has
achieved success just by treating employees as if they are owners. American Steel Giant,
Nucor puts every employee’s name on the front of its annual report, acknowledging the
importance of the people who work for the firm.
Nucor’s unusual salary structure may be the hardest thing for workers in steel firms taken
over by Nucor to accept. A steel worker’s basic pay at Nucor may be only half of the rate paid
by other steel manufacturers. However, that basic pay is tied to very generous bonuses for
defect-free steel over an entire shift. The production of faulty steel is penalized so shift
workers really need to trust each other and to share a common work ethic and high
standards. Another unusual aspect of Nucor is executive pay. While CEO salaries have been
rising to ridiculous multiples of employee pay, Nucor’s CEO takes home a salary that is only
23 times that of the average steel worker, and his bonuses are dependent on company
performance. If Nucor has a bad year, so does its chief executive. Not that poor performance
looks very likely now that Nucor has taken the lead as the biggest steel producer in the USA.
Nucor, like W.L. Gore operates with a flattened management structure where workers are
valued and ready to take responsibility for their own actions. A recent example of this was
when the electrical grid failed at one Nucor plant. Electricians from the company’s other
plants around the country quickly made up a team to fix the problem and get the stricken
plant back in working order. The electricians hadn’t been asked to rush to the rescue by a
supervisor and there was no financial incentive for them to do so. Yet they worked around the
clock and fixed the electrical grid failure in record time. The electricians acted so quickly
because rather than feeling that Nucor is a firm they work for, they feel it is their firm. In a way
it is, as profit sharing is an important company strategy, but more than that, Nucor is a firm
that listens to, and values its employees. There are open lines of communication between
managers and workers and managers admit that many of the best ideas come from shop
floor workers.
How can HR help?
Companies that use the talents of their employees successfully, like Nucor and WL Gore, are
the most successful because they generate internal motivation in their workers. One way of
giving employees the opportunity to find the niche where they can fully utilize their talents
and realize internal motivation is through an internal talent market. Some organizations, such
as universities have used talent markets in an informal way for a long time. This may be as
simple as posting all vacancies on an internal web site and inviting interested employees to
send in their CVs. Big companies have formalized the process so that along with internal
advertising and the acceptance of unsolicited CVs, a certain amount of internal
head-hunting goes on. The HR department plays an important role at each step of the
process; first by screening applicants, and ensuring that there is a balanced group of
applicants for interview, then by facilitating the interview process. Where managerial
candidates are invited to apply, HR can help to identify key features which match the job and
identify internal candidates with those characteristics.
In any company, matching the right person with the right job, valuing employees and
enabling them to make meaningful contributions to the organization are all ways to create a
motivated work force. Internal motivation creates hard workers because of the kick that
employees get from a job well done rather than working solely to pick up a paycheck every
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3. ‘‘ Dee Hocks, founder of Visa credit card, was fond of saying:
‘money motivates neither the best people nor the best in
people.’ ’’
month. This may require some creative reorganization including implementing a flattened
management structure and initiating incentive programs based on individually relevant
needs. However, it is clear from present trends that the most successful commercial firms of
the twenty-first century will be those willing and able to transform themselves into ‘‘new
generation organizations’’. As this review has demonstrated, happy, motivated employees
not only create good working environments, they also make significant contributions to
company profits!
Comment
This review was based on: ‘‘The power of the individual’’ by Patrick Kiger; ‘‘Making a market
in talent’’ by Lowell L. Bryan, Claudia I. Joyce and Leigh M. Weiss and ‘‘The art of motivation’’
by Nanette Byrnes.
Kiger’s article on the manufacturing firm W.L.Gore and Associates looks at the philosophy
behind the firm’s unconventional work practices. The company rewards creativity and
enables employees, called associates by the firm, to develop their talents and skills in an
atmosphere which values the individual. Associates are encouraged to spend time on their
own projects. Some of these have gone on to be big winners for the firm, such as Glide
dental floss, which was developed from an associate’s idea. As W.L. Gore has expanded it
has had to formalize some of its practices, setting up meetings, for example, rather than
relying on corridor chats to share ideas and spread information.
Bryan, Joyce and Weiss’s article described the concept of the internal talent market and
explained how firms can get the best out of employees by ensuring that people are in
positions which best match their talent and skills. The article explained how the talent market
functions for different grades of staff and detailed the important role of the HR department.
Byrnes’ article on the steel firm Nucor showed that even huge conglomerates can benefit
from innovative working practices. Nucor’s employees are so important that each of their
names is printed on the cover of the firm’s annual report. One of Nucor’s most controversial
practices is its pay structure where a low basic pay is boosted by bonuses and profit sharing
Keywords:
based on performance.
Motivation (psychology),
Organizations, Additional material was sourced from: www.ccfbest.org/management/valuing
Management strategy, employees.htm www.incentiveprograms.com/science_theories.asp and www.lab
Innovation managers.org/resources/enews/200101.shtml
References
Bryan, L.L., Joyce, C.I. and Weiss, L.M. (2006), ‘‘Making a market in talent’’, The McKinsey Quarterly,
No. 2, pp. 99-109, ISSN 0047-5394.
Byrnes, N. (2006), ‘‘The art of motivation’’, Business Week, May 1, pp. 57-62, ISSN 0007-7135.
Kiger, P.J. (2006), ‘‘Power of the individual’’, Workforce Management, February 27, pp. 1, 23-27, ISSN
1092-8332.
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