Chapter - Motivation

Sk Alamgir Hossain
Assistant Professor
Department of Finance
Jagannath University
 Planning Ahead — Study Questions
➢ What is motivation?

➢ What are the different types of individual needs?

➢ What are the process theories of motivation?

➢ What role does reinforcement play in motivation?

➢ What are the challenges of motivation in the new

workplace?

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Motivation

Any influence that triggers, directs or

maintains behavior
Research is based upon different variables
that affect motivation
Individual Differences
Organizational Contexts
Manager Behaviors
Process Theories
Motivation
➢ Basic motivational concepts
Motivation—the forces within the individual that
account for the level, direction, and persistence
of effort expended at work.
Reward—a work outcome of positive value to
the individual
Extrinsic rewards—valued outcomes given to
someone by another person.
Intrinsic rewards—valued outcomes that occur
naturally as a person works on a task.

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Motivation

➢ To achieve maximum motivational potential in

linking rewards to performance …
Respect diversity and individual differences to best
understand what people want from work.

Allocate rewards to satisfy the interests of both

individuals and the organization.

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Types of motivation theories

➢ Types of motivation theories

Content theories
Human needs and how people with different needs may
respond to different work situations.
Process theories
How people give meaning to rewards and make decisions on
various work-related behaviors.
Reinforcement theory
How people’s behavior is influenced by environmental
consequences.

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Content Theories of
Motivation
Maslow’s Alderfer’s Herzberg’s McClelland’s
Need Hierarchy ERG Theory Theory Learned Needs

Self- Need for

Actualization Achievement
Growth Motivators
Need for
Esteem
Power

Need for
Belongingness Relatedness
Affiliation

Safety Hygienes
Existence
Physiological
Practical Implications of
Content Theories

People have different needs at

different times

Offer employees a choice of rewards -

- a flexible reward system

Do not rely too heavily on financial

rewards
they mainly address lower level needs
Maslow’s Hierarchy

Each individual has needs, or feelings of

deficiency that drive their behavior
Once a need is satisfied, then it is no
longer motivating
Needs are in a hierarchy that an individual
moves up as they satisfy levels of needs
 14.3

Maslow’s Hierarchy

Self-
Actualization

Esteem

Affiliation

Security

Physiological

Adapted from Figure 14.2

Levels of Needs

Physiological/Survival needs
Food, Clothing, Shelter, Air
Security
Feel safe, absence of pain, threat, or illness
Affiliation
friendship, company, love, belonging
first clear step up from physical needs
Need levels (cont.)

Esteem Needs
self-respect, achievement, recognition,
prestige
cues a persons worth
Self-Actualization
personal growth, self-fulfillment, realization of
full potential
Where are YOU on the hierarchy???
Alderfer’s ERG

Consolidates Maslow into 3 categories

Existence-physiological and security
Relatedness-affiliation
Growth-esteem and self-actualization
 14.4

ERG Model of Motivation

Frustration-Regression Satisfaction-Progression

Growth Needs

Relatedness Needs

Existence Needs

Adapted from Figure 14.3

Frustration-Regression

Differs from Maslow

When unable to satisfy upper level needs,
the individual will revert to satisfying
lower level needs
Interesting point from research....growth
stimulates growth
McClelland’s Learned
Needs

Needs are acquired through interaction

with environment
Not a higherarchy, but degrees of each
type of need or motive
Types of Needs

N Ach-motive to meet some standard of

excellence or to compete
N Aff-motive to develop and maintain
close and meaningful relationships
N Pow-desire to influence and control
others and the environment
Herzberg’s Two Factor
Theory

Some variable prevent job dissatisfaction

and some variables produce motivation
Hygiene factors-basic needs that will
prevent dissatisfaction
light, temperature, pay, parking
Motivators
when present cause high levels of motivation
interesting work, advancement, growth, etc.
Herzberg’s Two Factor
14.6

Theory
High
Motivation

Low Motivation

Low Dissatisfaction

Dissatisfaction
Low High Low High
Hygienes Motivators

Adapted from Figure 14.4

Herzberg’s two-factor theory.

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Process Theories

Reinforcement Theory
Expectancy
Equity
Justice Theory
Goal Setting
Types of Reinforcement

Positive Reinforcement-rewards
Punishment-Application of a negative
outcome
Negative Reinforcement-removal of
negative outcomes when behavior is
performed
Extinction-absence of reinforcement
(removal of positive reinforcement)
Drawbacks
 14.9

Reinforcement Process
Stimulus
(situation)

Response
(behavior)

Consequences
(rewards and punishments)

Future Behavior

Source: From L. W. Porter and E. E. Lawler III.

Managerial Attitudes and Performance. Homewood, Adapted from Figure 14.6
Ill.: Irwin, 1968, p. 165. Used with permission
Types of Rewards

Extrinsic-external rewards such as money,

fringe benefits, job security
Intrinsic-internal satisfaction outcomes
from doing work
Satisfaction-employee’s attitude about
work situations
Intrinsic motivation and Intrigue??????
Equity Theory

Individuals try to find a balance between

their inputs and outputs relative to a
referent other
However, a referent other is not always
present
Equity theory and the role of
social comparison.

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Results of Inequity

Equity-I am being treated fairly

Under-rewarded-will look to increase
rewards, or decrease inputs to match
rewards
Over-rewarded-will change referent to
match cognitions or increase inputs
Leaving and distortion
Reinforcement Theory

Behaviors are functions of consequences

that they produce
If a behavior is followed by a pleasant
experience it will be repeated
In order to change behaviors the
consequences must be changed
Overreward Versus
Underreward Inequity
Comparison
You
Other
Outcomes
Overreward Outcomes
Inequity
Inputs Inputs

Underreward Outcomes
Inequity Outcomes

Inputs Inputs
Goal-setting theory

➢ Goal-setting theory
Developed by Edwin Locke.
Properly set and well-managed task goals can be
highly motivating.
Motivational effects of task goals:
Provide direction to people in their work.
Clarify performance expectations.
Establish a frame of reference for feedback.
Provide a foundation for behavioral self-management.

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➢Key issues and principles in the goal-
setting process:
Set specific goals.
Set challenging goals.
Build goal acceptance and commitment.
Clarify goal priorities.
Provide feedback on goal accomplishment.
Reward goal accomplishment.

Management - Chapter 14
31
➢ Goal-setting theory
Participation in goal setting …
Unlocks the motivational potential of goal
setting.
Management by objectives (MBO) promotes
participation.
When participation is not possible, workers will
respond positively if supervisory trust and
support exist.
Management - Chapter 14
32
Effect of Goal Difficulty on
Performance
High
Task Performance

Area of
Optimal
Goal
Difficulty

Low Moderate Challenging Impossible

Goal Difficulty
Expectancy Theory

Combines goal setting and reinforcement

theories
Three questions drive motivation
With effort can I perform?
With performance, will I be rewarded?
Do I value the rewards?
Elements in the expectancy
theory of motivation.

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Terms

Expectancy-belief that effort will lead to

performance
Instrumentality-performance leads to
rewards (does performance level matter)
Valence-value of rewards
Expectancy Theory of
Motivation
E-to-P P-to-O Outcomes
Expectancy Expectancy & Valences

Outcome 1
+ or -

Outcome 2
Effort Performance + or -

Outcome 3
+ or -
Managerial implications of
expectancy theory.

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An integrated approach to
motivational dynamics.

➢ Integrated model of motivation

Motivation leads to work effort that, when combined
with appropriate individual abilities and organizational
support, leads to performance accomplishment.
The motivational impact of any rewards received for
this performance accomplishment depends on equity
and reinforcement considerations.
Ultimately, satisfaction with rewards should lead to
increased motivation to work hard in the future.

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An integrated approach to
motivational dynamics.

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the challenges of motivation in
the new workplace

➢ Pay for performance

Paying people for performance is consistent with:
Equity theory.
Expectancy theory.
Reinforcement theory.
Merit pay
Awards a pay increase in proportion to individual
performance contributions.
Provides performance contingent reinforcement.
May not succeed due to weakness in performance appraisal
system or lack of consistency in application.

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the challenges of motivation in
the new workplace

➢ Incentive compensation systems:

Skill-based pay.
Links pay to the number of job-relevant skills
an employee masters.
Bonus pay plans.
One-time or lump-sum payments based on the
accomplishment of specific performance
targets or some extraordinary contribution.

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the challenges of motivation in
the new workplace

➢ Incentive compensation systems:

Profit-sharing plans.
Some or all employees receive a proportion of net profits
earned by the organization.
Gain-sharing plans.
Groups of employees share in any savings realized through
their efforts to reduce costs and increase productivity.
Employee stock ownership plans.
Employees own stock in the company that employs them.

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