1. Harris, an employer, is dissatisfied with the lack of improvement in his staff's performance despite giving everyone a $500 bonus. 2. To better motivate his staff, Harris needs to understand and apply contemporary motivation theories which explain how and why people are motivated. 3. Motivation theories cover needs, cognitive processes, consequences of behaviors, and can help Harris structure work, rewards, feedback and goals to satisfy different needs and motivate high performance from his staff.

1. Driving My
Company
G105 Enterprise Skills
Problem 04: Motivation
6th Presentation

2. Learning Objectives
1. Describe and compare the contemporary
theories of motivation
2. Apply the motivation theories to
structure work and rewards to motivate
staff
3. Explain how to provide feedback and
modify behaviours through rewards and
punishment

3. Problem Analysis
No
Improvement
in
Performance!
$500 bonus for
Harris the everyone:
Employer Sourcing; Sales; How?
Admin

4. What Is Motivation?
• Motivation
– Motivation is an internal process by which a person’s efforts are
energized, directed, and sustained towards attaining a goal.
– may be intrinsic, extrinsic, or both.
Intrinsic Motivation Extrinsic Motivation
• Drives behaviour performed for • Drives behaviour performed for
the sake of activity itself external rewards or to avoid
• Comes from internal desire punishment
such as: • Comes from outside the person:
• interest • salary and other tangibles
• need for challenge • intangible rewards such as
• personal satisfaction praises from the boss
© 2007 Prentice Hall, Inc. All rights reserved. 16–4
Money is but one motivator. People are motivated by different things.
 Harris needs to find out what works for his staff, beyond monetary rewards.

5. Motivation
• Rewards and punishments are used by organisations to motivate.
• Effectiveness of rewards varies – explained by motivation theories.
Content Theories Process Theories Reinforcement
(focus on: Needs) (focus on: Cognitive Theories
Process) (focus on:
Consequences)
• Hierarchy of Needs • Expectancy Theory • Operant Conditioning
(Maslow) (Vroom) (Skinner)
• 2-Factor Theory • Equity Theory (Adams) • Organisation
(Herzberg) • Goal Setting Theory Behaviour
• 3 Needs Theory (Locke) Modification (Luthans
(McClelland) & Kreitner)

6. Limitations & Assumptions
Whenever we apply motivation theories, we have to keep in mind
the following limitations & assumptions:
1.Motivation theories assume that we know what motivates
other people, and what their needs, wants, priorities, and values
are (which in reality is not true)
2.Motivation is a very complex issue involving many factors:
i. A motivator that works for one person may not work for
another ;
ii. What works for a person at one point in time may not
work in the future; &
iii. No single motivator is likely to work on its own.

7. Maslow’s Hierarchy of Needs
• Lower level needs must be
satisfied first before higher
level needs are ‘activated’.
• Satisfied needs cease to
motivate.  the money may cater to
lower level needs that no longer motivate
Harris’ employees
• Unsatisfied needs can cause
frustration/stress  lower
needs take precedence.

8. Herzberg’s Two-Factor Theory
To motivate staff, Harris’ focus should be on the increasing
motivators while maintaining adequacy in the hygiene factors.
Hygiene Factors Motivating Factors
• inadequacy results in frustration • source of motivation
and lack of motivation • intrinsic factors / content of work
• beyond adequacy, does not • e.g. differentiate the bonus amount =
motivate achievement & recognition of good
• extrinsic factors / context of work performance
• e.g. flat $500

9. McClelland’s Three Acquired
Needs Theory
David McClelland’s research indicates that individuals are motivated
based on three major needs:
 To motivate his staff, Harris must understand what needs his
employees are motivated by and structure work, assign roles, provide
rewards, and behave accordingly to meet those needs.
nAch nPow nAff
• The drive to excel, to • The need to make • The desire for
achieve a set of others behave in a friendly & close
standards, to strive way they would not interpersonal
to succeed have behaved relationships
• E.g. otherwise • E.g.
• Set stretch goals • E.g. • Praise, lunch together
• Provide timely • Give titles & assign • Show care & concern
performance feedback leadership roles
• Listen to feedback

10. Expectancy Theory
Outcome /
Effort Performance
Reward
P to O Expectancy
(Instrumentality)
E to P Expectancy likelihood of being rewarded Valence
(Expectancy) for performance preference for
belief that effort will Reward
influence performance •Not effective as $500 is given
positively regardless of performance •Is $500
•Could differentiate amount attractive?
•Provide periodic to strengthen instrumentality •Differentiate
feedback to strengthen by relating it to performance- amount to
expectancy related goals or criteria (e.g. improve valence
sales targets, cost reduction,
on time billing)
• Expectancy, Instrumentality and Valence must be high to motivate staff
to work towards the reward

11. Equity Theory
• Most highly-motivated employees are those who perceive their rewards
are equal to their contributions.
Differentiate bonus amount
so that those who work
harder & perform better are
better compensated
Individual’s outcomes relational partner’s outcomes
Individual’s own inputs relational partner’s inputs
Ensure employees’
compensation are in line
with industry’s
• When people feel fairly treated, they are more likely to be motivated;
when they feel unfairly treated, they will be easily de-motivated

12. Goal Setting Theory
Harris would have to ensure that each element of the goal-setting theory must be
present to motivate staff.
Goal Organisational Intrinsic
Acceptance Support Rewards
S.M.A.R.T Goal Directed
Performance Satisfaction
Goals Effort
Goal Individual Traits Extrinsic
Commitment & Abilities Rewards
Put in more effort
to discuss & set Spend time to provide feedback;
goals with staff Make sure staff are confident of own abilities;
provide training if necessary.

13. Reinforcement Theories
Consequences
Behaviours
of Behaviour
Desired +ve reinforcement
Org Behaviours
-ve reinforcement
Antecedents
Undesired Extinction
Org Behaviours
Punishment
Set out the
expectations clearly Map out the consequences of their behaviours
to his staff

14. OB Mod
Four Alternative Consequences
Application
Positive
Reinforcement
Punishment
e.g. differentiate the
Manager’s Use
bonus amounts
-ve Consequence Consequence +ve
Extinction
Negative e.g. remove bonus
Reinforcement for those who have
not been performing
Withdrawal

15. Operant Conditioning
• A behaviour is a function of its consequence.
– A behaviour that is reinforced/rewarded will be repeated & vice-versa.
• Schedules of Reinforcement:
Fixed Interval
Continuous
Partial Variable Interval
Fixed Ratio
Variable Ratio → most
effective for steady & long-term change
* Don’t just depend on year-end
bonus
* Time rewards to follow
immediately after performance

16. Integrating Contemporary
Theories of Motivation
© 2007 Prentice Hall, Inc. All rights reserved.

17. Harris can…
1. Set the right expectations (behaviours, performance goals, and rewards).
2. Understand the different needs of his staff and provide rewards that satisfy those
needs or are valued by your staff.
3. Focus on the motivators to encourage staff to perform better – provide growth
opportunity, recognition, etc. Be creative in coming up with motivators.
4. Set goals, together with his staff, that are attainable if the staff puts in the effort
and ensure that the link between performance and rewards is clear.
5. Be equitable - fair compared to other companies selling OEM computer parts, &
between high performers and mediocre performers within his company (e.g. top
salesman vs purchaser who just reissues purchase contracts without review).
6. Time rewards to follow immediately after performance but use a variable ratio
schedule.
7. Differentiate rewards between high performers, mediocre performers, and poor
performers, so that high performers are rewarded and those who aren’t are
punished or at least not rewarded.
8. Make sure that the motivators and processes he put in place to motivate his staff
are aligned and do not work against one another.

18. Conclusion
Rewards and punishments are used to motivate staff but their
effectiveness varies. The motivation theories explain why some
are motivated while others are not.
Using the theories, Harris can:
•structure his rewards based on the needs of the staff.
•ensure all elements that influence how the staff view the
rewards have been considered in structuring the rewards.
•reinforce the right behaviours of the staff.

19. EXTENDED LEARNING

20. Expectancy Theory
Outcome /
Effort Performance
Reward
E to P Expectancy
(Expectancy)
belief that effort will
influence performance
Positively
• Expectancy (E to P Expectancy) is the belief that increased effort will lead to
increased performance i.e. if I work harder then this will be better. <For e.g., If I
study an extra hour every day, I will improve my exam score by 1 grade.> This
is affected by such things as:
– Having the right resources available (e.g. raw materials, time)
– Having the right skills to do the job
– Having the necessary support to get the job done (e.g. supervisor support,
or correct information on the job)

21. Expectancy Theory
Outcome /
Effort Performance
Reward
P to O Expectancy
(Instrumentality)
likelihood of being rewarded
for performance
• Instrumentality (P to O Expectancy) is the belief that if you perform well that
a valued outcome will be received i.e. if I do a good job, there is something in it
for me. This is affected by such things as:
– Clear understanding of the relationship between performance and
outcomes – e.g. the rules of the reward ‘game’
– Trust in the people who will take the decisions on who gets what outcome
– Transparency of the process that decides who gets what outcome

22. Expectancy Theory
Outcome /
Effort Performance
Reward
Valence
preference for
Reward
• Valence (Outcome) is the importance that the individual places upon the
expected outcome. For example, if I am mainly motivated by money, I might
not value offers of additional time off.

23. Expectancy Theory
Outcome /
Effort Performance
Reward
E to P Expectancy (Expectancy)
P to O Expectancy (Instrumentality) Valence
belief that effort will
likelihood of being rewarded preference for
influence performance
for performance Reward
Positively
• Individuals change their level of effort according to the value they place on the
outcomes they receive from the process and on their perception of the strength
of the links between effort and outcome.
• So, if I perceive that any one of these is true:
– My increased effort will not increase my performance;
– My increased performance will not increase my rewards; or
– I don’t value the rewards on offer
...then Expectancy theory suggests that I will not be motivated.
• This means that even if an organisation achieves two out of three, that
employees would still not be motivated; all three are required for positive
motivation.  Expectancy, Instrumentality and Valence must be high
to motivate staff to work towards the reward.

24. Goal Setting Theory
• Goal setting theory assumes behavior results from a person’s
conscious goals and intentions.
• Goal setting is motivating if the goals are Specific, Measureable,
Attainable, Realistic and Time Bound.
• Research suggests that specific challenging goals have been shown
to lead to high performance only if people accept and are committed
to the goal.
• The resulting goal-directed effort turns into performance when the
individual has the abilities to do the job and there are sufficient
resources and support from the organisation.
• The satisfaction that the individual gets is based on his performance
as well as his level of abilities (how hard he had to try) and his
satisfaction with the support from the organisation.
• His satisfaction can be from intrinsic or extrinsic rewards.

25. Goal Setting Theory
• In order to generate high performance,
1. Goals should be specific, rather than vague.
2. Feedback should be provided (especially workers giving feedback
on their own outputs).
3. The individuals should be committed to the goals.
4. The individuals should believe in their own ability to accomplish the
goals.

26. Operant Conditioning
• Schedules of Reinforcement:
Fixed Interval
Partial
Continuous
Variable
Interval
Fixed Ratio
Variable
Ratio
• Continuous reinforcement means that the behavior is followed by a
consequence each time it occurs.
• Intermittent schedules are based either on the passage of time (interval
schedules) or the number of correct responses emitted (ratio schedules).

27. Operant Conditioning
• The consequence can be delivered
based on the same amount of
passage of time or the same
number of correct responses
(fixed) or it could be based on a
slightly different amount of
time or number of correct
responses that vary around a
particular number (variable).
Interval - refers to time period • This results in an four classes of
Ratio refers to no. of correct responses intermittent schedules.
Note: Continuous reinforcement is actually a specific example of a fixed ratio
schedule with only one response emitted before a consequence occurs.

28. Operant Conditioning
• Fixed interval -- the first correct response after a
set amount of time has passed is reinforced. The
time period required is always the same.
• Variable interval -- the first correct response
after a set amount of time has passed is reinforced.
After the reinforcement, a new time period (shorter
or longer) is set with the average equaling a
specific number over a sum total of trials
• Fixed ratio -- a reinforcer is given after a specified
Interval - refers to time period number of correct responses. This schedule is best
Ratio refers to no. of correct responses
for learning a new behavior
Note: Continuous reinforcement is
• Variable ratio -- a reinforcer is given after a set
actually a specific example of a
number of correct responses. After reinforcement
fixed ratio schedule with only one
the number of correct responses necessary for
response emitted before a
reinforcement changes. This schedule is best for
consequence occurs.
maintaining behavior.

29. References
Textbooks
1. McShane S. L. and Von Glinow M. A. (2009) Organizational Behavior: Essentials, 2nd ed. McGraw-Hill/Irwin.
2. Huczynski, A. and Buchanan, D. (2001) Organizational Behaviour: An introductory text, 4th ed. Essex: Financial
Times/Prentice Hall.
3. Ivancevich, J. M. and Matteson, M. R. (2002) Organizational Behaviour and Management, 6th ed. McGraw-Hill.
4. Miner, J. B. (2005) Organizational Behavior I: Essential theories of motivation and leadership. New York: M.E. Sharpe, Inc.
5. Newstrom, J. W. (2007) Organizational Behavior: Human behaviour at work, 12th ed. McGraw-Hill/Irwin.
6. Robbins, S. P. (2001) Organizational Behavior, 9th ed. Prentice-Hall International.
Websites
1. Adams’ Equity Theory. http://www.mindtools.com/pages/article/newLDR_96.htm Retrieved on 12 Apr 2010.
2. Employee Motivation. Theory and Practice. http://www.accel-team.com/motivation/ Retrieved on 12 Apr 2010.
3. Expectancy Theory of Motivation. http://www.arrod.co.uk/archive/concept_vroom.php. Retrieved on 12 Apr 2010.
4. Motivation & Employee Productivity. www.cobracm.org/Quality/Fordham/Motivation%20&%20Advanced%20Motivation.ppt .
Retrieved on 12 Apr 2010.
5. Psychology 101. Chapter 4: Learning Theory and Behavioural Psychology. http://allpsych.com/psychology101/reinforcement.html.
Retrieved on 12 Apr 2010.
6. The 2 Factor Hygiene and Motivation Theory. http://accel-team.com/human_relations/hrels_05_herzberg.html. Retrieved on 12 Apr
2010.
7. Two-Factor Theory. http://www.valuebasedmanagement.net/methods_herzberg_two_factor_theory.html. Retrieved on 12 Apr
2010.
8. David McClelland’s Motivational Needs Theory. http://www.businessballs.com/davidmcclelland.htm. Retrieved on 12 Apr 2010.