Employee Reward and Recognition Systems
Employee Reward and Recognition Systems
In a competitive business climate, more business owners are looking at improvements in quality
while reducing costs. Meanwhile, a strong economy has resulted in a tight job market. So while
small businesses need to get more from their employees, their employees are looking for more
out of them. Employee reward and recognition programs are one method of motivating
employees to change work habits and key behaviors to benefit a small business.
As noted, although employee recognition programs are often combined with reward programs
they retain a different purpose altogether. They are intended to provide a psychological—rewards
a financial—benefit. Although many elements of designing and maintaining reward and
recognition systems are the same, it is useful to keep this difference in mind, especially for small
business owners interested in motivating staffs while keeping costs low.
Merit pay increases, then, are not part of an employee reward system. Normally, they are an
increase for inflation with additional percentages separating employees by competency. They are
not particularly motivating since the distinction that is usually made between a good employee
and an average one is relatively small. In addition, they increase the fixed costs of a company as
opposed to variable pay increases, such as bonuses, which have to be "re-earned" each year.
Finally, in many small businesses teamwork is a crucial element of a successful employee's job.
Merit increases generally review an individual's job performance, without adequately taking into
account the performance within the context of the group or business.
DESIGNING A REWARD PROGRAM
The keys to developing a reward program are as follows:
Identification of company or group goals that the reward program will support
Identification of the desired employee performance or behaviors that will reinforce the
company's goals
Determination of key measurements of the performance or behavior, based on the
individual or group's previous achievements
Determination of appropriate rewards
Communication of program to employees
In order to reap benefits such as increased productivity, the entrepreneur designing a reward
program must identify company or group goals to be reached and the behaviors or performance
that will contribute to this. While this may seem obvious, companies frequently make the
mistake of rewarding behaviors or achievements that either fail to further business goals or
actually sabotage them. If teamwork is a business goal, a bonus system rewarding individuals
who improve their productivity by themselves or at the expense of another does not make sense.
Likewise, if quality is an important issue for an entrepreneur, the reward system that he or she
designs should not emphasize rewarding the quantity of work accomplished by a business unit.
Properly measuring performance ensures the program pays off in terms of business goals. Since
rewards have a real cost in terms of time or money, small business owners need to confirm that
performance has actually improved before rewarding it. Often this requires measuring something
other than financial returns: reduced defects, happier customers, more rapid deliveries, etc.
When developing a rewards program, an entrepreneur should consider matching rewards to the
end result for the company. Perfect attendance might merit a different reward than saving the
company $10,000 through improved contract negotiation. It is also important to consider
rewarding both individual and group accomplishments in order to promote both individual
initiative and group cooperation and performance.
Lastly, in order for a rewards program to be successful, the specifics need to be clearly spelled
out for every employee. Motivation depends on the individual's ability to understand what is
being asked of her. Once this has been done, reinforce the original communication with regular
meetings or memos promoting the program. Keep your communications simple but frequent to
ensure staff members are kept abreast of changes to the system.
Bonuses
Bonus programs have been used in American business for some time. They usually reward
individual accomplishment and are frequently used in sales organizations to encourage
salespersons to generate additional business or higher profits. They can also be used, however, to
recognize group accomplishments. Indeed, increasing numbers of businesses have switched from
individual bonus programs to one which reward contributions to corporate performance at group,
departmental, or company-wide levels.
According to some experts, small businesses interested in long-term benefits should probably
consider another type of reward. Bonuses are generally short-term motivators. By rewarding an
employee's performance for the previous year, they encourage a short-term perspective rather
than future-oriented accomplishments. In addition, these programs need to be carefully
structured to ensure they are rewarding accomplishments above and beyond an individual or
group's basic functions. Otherwise, they run the risk of being perceived of as entitlements or
regular merit pay, rather than a reward for outstanding work. Proponents, however, contend that
bonuses are a perfectly legitimate means of rewarding outstanding performance, and they argue
that such compensation can actually be a powerful tool to encourage future top-level efforts.
Profit Sharing
Profit sharing refers to the strategy of creating a pool of monies to be disbursed to employees by
taking a stated percentage of a company's profits. The amount given to an employee is usually
equal to a percentage of the employee's salary and is disbursed after a business closes its books
for the year. The benefits can be provided either in actual cash or via contributions to employee's
401(k) plans. A benefit for a company offering this type of reward is that it can keep fixed costs
low.
The idea behind profit sharing is to reward employees for their contributions to a company's
achieved profit goal. It encourages employees to stay put because it is usually structured to
reward employees who stay with the company; most profit sharing programs require an
employee to be vested in the program over a number of years before receiving any money.
Unless well managed, profit sharing may not properly motivate individuals if all receive the
share anyway. A team spirit (everyone pulling together to achieve that profit) can counter this—
especially if it arises from the employees and is not just management propaganda.
Stock Options
Previously the territory of upper management and large companies, stock options have become
an increasingly popular method in recent years of rewarding middle management and other
employees in both mature companies and start-ups. Employee stock-option programs give
employees the right to buy a specified number of a company's shares at a fixed price for a
specified period of time (usually around ten years). They are generally authorized by a
company's board of directors and approved by its shareholders. The number of options a
company can award to employees is usually equal to a certain percentage of the company's
shares outstanding.
Like profit sharing plans, stock options usually reward employees for sticking around, serving as
a long-term motivator. Once an employee has been with a company for a certain period of time
(usually around four years), he or she is fully vested in the program. If the employee leaves the
company prior to being fully vested, those options are canceled. After an employee becomes
fully vested in the program, he or she can purchase from the company an allotted number of
shares at the strike price (or the fixed price originally agreed to). This purchase is known as
"exercising" stock options. After purchasing the stock, the employee can either retain it or sell it
on the open market with the difference in strike price and market price being the employee's gain
in the value of the shares.
Offering additional stock in this manner presents risks for both the company and the employee. If
the option's strike price is higher than the market price of the stock, the employee's option is
worthless. When an employee exercises an option, the company is required to issue a new share
of stock that can be publicly traded. The company's market capitalization grows by the market
price of the share, rather than the strike price that the employee purchases the stock for. The
possibility of reduction of company earnings (impacting both the company and shareholders)
arises when the company has a greater number of shares outstanding. To keep ahead of this
possibility, earnings must increase at a rate equal to the rate at which outstanding shares increase.
Otherwise, the company must repurchase shares on the open market to reduce the number of
outstanding shares.
One benefit to offering stock options is a company's ability to take a tax deduction for
compensation expense when it issues shares to employees who are exercising their options.
Another benefit to offering options is that while they could be considered a portion of
compensation, current accounting methods do not require businesses to show options as an
expense on their books. This tends to inflate the value of a company. Companies should think
carefully about this as a benefit, however. If accounting rules were to become more conservative,
corporate earnings could be impacted as a result.
RECOGNITION PROGRAMS
For small business owners and other managers, a recognition program may appear to be merely
extra effort on their part with few tangible returns in terms of employee performance. While
most employees certainly appreciate monetary awards for a job well done, many people merely
seek recognition of their hard work. For an entrepreneur with more ingenuity than cash available,
this presents an opportunity to motivate employees.
Nor will the entrepreneur be far off the mark. As Patricia Odell reported, writing for Promo,
"Cash is no longer the ultimate motivator." Odell cited data from the Forum for People
Performance Management and Measurement at Northwester University—which had discovered
that non-cash awards tend to be more effective; the exception was rewarding increasing sales.
"The study found," Odell wrote, "that non-cash awards programs would work better than cash in
such cases as reinforcing organizational values and cultures, improving teamwork, increasing
customer satisfaction and motivating specific behaviors among other programs."
In order to develop an effective recognition program, a small business owner must be sure to
separate the program from the company's system of rewarding employees. This ensures a focus
on recognizing the efforts of employees. To this end, although the recognition may have a
monetary value (such as a luncheon, gift certificates, or plaques), money itself is not given to
recognize performance.
Recognition has a timing element: it must occur so that the performance recognized is still fresh
in the mind. If high performance continues, recognition should be frequent but cautiously timed
so that it doesn't become automatic. Furthermore, like rewards, the method of recognition needs
to be appropriate for the achievement. This also ensures that those actions which go farthest in
supporting corporate goals receive the most attention. However, an entrepreneur should remain
flexible in the methods of recognition, as different employees are motivated by different forms of
recognition. Finally, employees need to clearly understand the behavior or action being
recognized. A small business owner can ensure this by being specific in what actions will be
recognized and then reinforcing this by communicating exactly what an employee did to be
recognized.
Recognition can take a variety of forms. Structured programs can include regular recognition
events such as banquets or breakfasts, employee of the month or year recognition, an annual
report or yearbook which features the accomplishments of employees, and department or
company recognition boards. Informal or spontaneous recognition can take the form of privileges
such as working at home, starting late/leaving early, or long lunch breaks. A job well done can
also be recognized by providing additional support or empowering the employee in ways such as
greater choice of assignments, increased authority, or naming the employee as an internal
consultant to other staff. Symbolic recognition such as plaques or coffee mugs with inscriptions
can also be effective, provided they reflect sincere appreciation for hard work. These latter
expressions of thanks, however, are far more likely to be received positively if the source is a
small business owner with limited financial resources. Employees will look less kindly on
owners of thriving businesses who use such inexpensive items as centerpieces of their reward
programs.
Both reward and recognition programs have their place in small business. Small business owners
should first determine desired employee behaviors, skills, and accomplishments that will support
their business goals. By rewarding and recognizing outstanding performance, entrepreneurs will
have an edge in a competitive corporate climate.
BIBLIOGRAPHY
Brandi, JoAnna. "9 Ways to Keep Employees Engaged." Entrepreneur. 12 April 2005.
Grimaldi, Lisa. "Study proves recognition pays off." Meetings & Conventions. August 2005.
Odell, Patricia. "Live from the Mo Show: Non-Cash Awards More Effective." Promo. 28
September 2005.
Parker, Owen, and Liz Wright. "Pay and Employee Commitment: The Missing Link." Ivey
Business Journal. January 2001.
Rauch, Maggie. "Communications Gap: Majority of businesses give managers little guidance on
recognition." Incentive. September 2005.
Ventrice, Cindy. "Make Their Day! Employee Recognition That Works." Berrett-Koehler
Publishers. April 2003.
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Motivation
Companies use both positive reinforcement and negative reinforcement to motivate employees.
Many managers believe that using positive motivation techniques encourages employees to
produce more and better quality work. For example, some companies select an employee as
"Employee of the Week." This technique praises the winning employee, while positively
encouraging other employees to keep trying to do well. Other managers believe negative
reinforcement motivates employees to stop bad behavior. For example, a company may issue a
written-warning system, or threaten employees with termination to get them to perform a certain
way.
Rewards
Companies reward their employees with both tangible goods, as well as praise. For example, a
sales department may offer a monthly bonus to the highest earner. Not all tangible rewards come
in the form of money. Some companies host free lunches, or give away company gear to good
workers. Many managers choose to reward their best employees by simply praising them for a
job well done, or by recognizing the hard work they put in to a project.
Advantages
By using positive reinforcement to motivate employees, a manager may build a good relationship
with his employee that fosters a sense of trust. In a good manager-subordinate relationship,
employees may feel respected and comfortable in their working environment. Providing rewards,
both tangible and in the form of praise, can make employees happier. Happier employees often
perform better at work.
Disdvantages
Using negative enforcement as a form of motivation could cause employees to become
dissatisfied with their jobs. Unhappy workers typically produce less quality work, become
sluggish or fail entirely to meet deadlines . Applying too much motivation or offering too many
rewards can also have a negative effect. Employees can
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Reinforcement
Essentially the two types of reinforcement are positive and negative. Positive reinforcement is
using beneficial incentives to boost morale and productivity, such as performance based bonuses,
sales commissions, achievement rewards, pay raises and promotions. Negative reinforcement is
using unfavorable tools to achieve desired results, such as bad performance reviews, verbal and
written warnings, suspension, pay reduction or dismissal warnings.
Benefits
Benefits as motivators can boost job performance. Pay raises, bonuses, stock options and profit
sharing are examples of positive motivators. These motivators reward employees for not only
doing their job, but doing it well and with enthusiasm. However, these motivators are to retain
normal levels or morale but do not necessarily increase overall motivation levels. Management
Help includes money as a myth of motivating small business employees as "things like money, a
nice office and job security can help people from becoming less motivated, but they usually don't
help people to become more motivated."
Goal Setting
An important part of improving employee motivation and performance is clear, attainable goals.
Informing your employees of goals you have set for your small business improves focus and
team cohesion. Business consultant Harvey Wigder states, "if people are communicated to and if
they understand the ground rules, they know that if things don't work they're not going to get
incentives."
Employee Input
Regularly engage your small business employees on issues that effect productivity and morale.
Being engaged imparts parity and demonstrates your ability to be an effective leader as one in
touch with employee concerns. NOLO suggests asking employees for ways to improve working
conditions: "if the answer is better lighting, or a more efficient computer, or a chance to work at
home one day a week, you can often reward the employee by following through on the request."
Considerations
According to Accel Team, research consistently shows that employees who are well motivated
perform better and add value to a small business. However, "the inverse also holds true."
Meaning unmotivated employees produce less and do not substantially contribute to businesses.
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References (4)
Owen Richason grew up working in his family's small contracting business. He later became an
outplacement consultant, then a retail business consultant. Richason is a former personal finance
and business writer for "Tampa Bay Business and Financier." He now writes for various
publications, websites and blogs.
Positive & Negative Effects of Employee
Motivation
by Mark Applegate, Demand Media
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Job Satisfaction
An employee rightly motivated by a supervisor should perform better in his specific job role,
provided the supervisor understands the role and provides clear coaching. Your small business
mission statement should point an employee to a definition of success. For example, if you
motivate your employee by clearly stating that success in his position means detailing every car
in the lot every other day, and you reward him when he does it, he understands what is expected.
Performance
Motivated employees perform better. If you offer commission to a salesperson, she typically tries
harder to sell more. If you thank an employee for good customer service, she will likely strive to
duplicate it since she feels appreciated. Likewise, if you motivate by threatening to reduce the
hours of an underperforming employee, she may also try harder to prevent the negative
consequence of the motivation. This "carrot and stick" approach to motivation is common in
many realms.
Turnover
If your attempts at motivation are flawed, poorly executed or unrealistic, they may lead to
increased turnover. This may come in the form of dismissals or attrition. Employees may see
others being rewarded for good performance and feel slighted. Employees that do not understand
the rationale for motivation or what is expected of them sometimes do not communicate this
angst, they merely stop trying or resign. Staff turnover is expensive and time-consuming,
especially for a small business.
Dishonesty
If you motivate wrongly, you may teach staff to be dishonest. Commission sales, not by
definition but in special cases, can lead to integrity failure. If you do not tie customer satisfaction
in with sales statistics when you motivate your employee, you by default are endorsing sales at
any cost. This may lead to bait-and-switch techniques, employee quarreling over sales and over
customers, and fabricating statistics. The resulting reduction in customer and employee
satisfaction may be costly.
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References (3)
Resources (2)
Natural vs. Rational based on whether the underlying theory of human cognition is based on
natural forces (drives, needs, desires) or some kind of rationality (instrumentality,
meaningfulness, self identity).
Content vs. Process based on whether the focus is on the content ("what") motivates vs process
("how") motivation takes place.
A number of motivational theories emphasize the distinction between conscious and unconscious
motivations. In evolutionary psychology, the "ultimate", unconscious motivation may be a cold
evolutionary calculation, the conscious motivation could be more benign or even positive
emotions. For example, while it may be in the best interest of a male's genes to have multiple
partners and thus break up with or divorce one before moving onto the next, the conscious
rationalization could be, "I loved her at the time". [2]
Freud is associated with the idea that human beings have many unconscious motivations that
cause them to make important decisions because of these unconscious forces, such as choosing a
partner.
Rational motivations
The idea that human beings are rational and human behaviour is guided by reason is an old one.
However, recent research (on Satisficing for example) has significantly undermined the idea of
homo economicus or of perfect rationality in favour of a more bounded rationality. The field of
behavioural economics is particularly concerned with the limits of rationality in economic
agents.
Motivation can be divided into two types: intrinsic (internal) motivation and extrinsic (external)
motivation.
Intrinsic motivation
Intrinsic motivation refers to motivation that is driven by an interest or enjoyment in the task
itself, and exists within the individual rather than relying on external pressures or a desire for
reward. Intrinsic motivation has been studied since the early 1970s.The phenomenon of intrinsic
motivation was first acknowledged within experimental studies of animal behavior. In these
studies, it was evident that the organisms would engage in playful and curiosity driven behaviors
in the absence of reward. Intrinsic motivation is a natural motivational tendency and is a critical
element in cognitive, social, and physical development.[3] Students who are intrinsically
motivated are more likely to engage in the task willingly as well as work to improve their skills,
which will increase their capabilities.[4] Students are likely to be intrinsically motivated if they:
attribute their educational results to factors under their own control, also known as autonomy or
locus of control
believe they have the skills to be effective agents in reaching their desired goals, also known as
self-efficacy beliefs
Extrinsic motivation
Social psychological research has indicated that extrinsic rewards can lead to overjustification
and a subsequent reduction in intrinsic motivation. In one study demonstrating this effect,
children who expected to be (and were) rewarded with a ribbon and a gold star for drawing
pictures spent less time playing with the drawing materials in subsequent observations than
children who were assigned to an unexpected reward condition.[6] However, another study
showed that third graders who were rewarded with a book showed more reading behavior in the
future, implying that some rewards do not undermine intrinsic motivation.[7] While the provision
of extrinsic rewards might reduce the desirability of an activity, the use of extrinsic constraints,
such as the threat of punishment, against performing an activity has actually been found to
increase one's intrinsic interest in that activity. In one study, when children were given mild
threats against playing with an attractive toy, it was found that the threat actually served to
increase the child's interest in the toy, which was previously undesirable to the child in the
absence of threat.[8]
For those children who received no extrinsic reward, self-determination theory proposes that
extrinsic motivation can be internalized by the individual if the task fits with their values and
beliefs and therefore helps to fulfill their basic psychological needs.
Operant conditioning
Operant conditioning, a term coined by B.F. Skinner, is a method of learning that occurs through
rewards and punishments for behaviour. Skinner believed that internal thoughts and motivations
could not be used to explain behaviour; instead to look at external, observable causes of human
behaviour. His theory explained how we acquire the range of learned behaviors we exhibit each
and every day.[9]
This model is usually used when discussing motivation within the context of tourism. Push
factors determine the desire to go on holiday, whereas pull factors determine the choice of
destination. Push motives are connected with internal forces, for example the need for relaxation
or escapism, while pull factors are the external factors, such as landscape, cultural image or the
climate of a destination, that induce a traveller to visit a certain location.[citation needed] Push factors
can be stimulated by external and situational aspects of motivation in the shape of pull factors.
Then again pull factors are issues that can arise from a location itself and therefore ‘push’ an
individual to choose to experience it.[10] Since then, a large number of theories have been
developed over the years in many studies there is no single theory that illustrates all motivational
aspects of travelling. Many researchers have highlighted that because several motives may occur
at the same time it should not be assumed that only one motive drives an individual to perform
an action, as was presumed in previous studies.[11] On the other hand, since people are not able to
satisfy all their needs at once, they usually seek to satisfy some or a few of them.[12]
Self-control
Drives
A drive or desire can be described as a deficiency or need that activates behavior that is aimed at
a goal or an incentive.[13] These drives are thought to originate within the individual and may not
require external stimuli to encourage the behavior. Basic drives could be sparked by deficiencies
such as hunger, which motivates a person to seek food whereas more subtle drives might be the
desire for praise and approval, which motivates a person to behave in a manner pleasing to
others. Another basic drive is the sexual drive which like food motivates us because it is essential
to our survival.[14] The desire for sex is wired deep into the brain of all human beings as glands
secrete hormones that travel through the blood to the brain and stimulates the onset of sexual
desire.[14] The hormone involved in the initial onset of sexual desire is called
dihydroepiandrosterone (DHEA).[14] The hormonal basis of both men and women's sex drives is
testosterone.[14] Men naturally have more testosterone than women do and so are more likely than
woman to think about sex, have sexual fantasies, seek sex and sexual variety (whether positions
or partners), masturbate, want sex at an early point in a relationship, sacrifice other things for
sex, have permissive attitudes for sex, and complain about low sex drive in their partners.[14]
By contrast, the role of extrinsic rewards and stimuli can be seen in the example of training
animals by giving them treats when they perform a trick correctly. The treat motivates the
animals to perform the trick consistently, even later when the treat is removed from the process.
Incentive theory
A reward, tangible or intangible, is presented after the occurrence of an action (i.e. behavior)
with the intention of causing the behavior to occur again. This is done by associating positive
meaning to the behavior. Studies show that if the person receives the reward immediately, the
effect is greater, and decreases as delay lengthens. Repetitive action-reward combination can
cause the action to become habit. Motivation comes from two sources: oneself, and other people.
These two sources are called intrinsic motivation and extrinsic motivation, respectively.
Reinforcers and reinforcement principles of behavior differ from the hypothetical construct of
reward. A reinforcer is any stimulus change following a response that increases the future
frequency or magnitude of that response, therefore the cognitive approach is certainly the way
forward as in 1973 Maslow described it as being the golden pineapple. Positive reinforcement is
demonstrated by an increase in the future frequency or magnitude of a response due to in the past
being followed contingently by a reinforcing stimulus. Negative reinforcement involves stimulus
change consisting of the removal of an aversive stimulus following a response. Positive
reinforcement involves a stimulus change consisting of the presentation or magnification of a
positive stimulus following a response. From this perspective, motivation is mediated by
environmental events, and the concept of distinguishing between intrinsic and extrinsic forces is
irrelevant.
Applying proper motivational techniques can be much harder than it seems. Steven Kerr notes
that when creating a reward system, it can be easy to reward A, while hoping for B, and in the
process, reap harmful effects that can jeopardize your goals.
Incentive theory in psychology treats motivation and behavior of the individual as they are
influenced by beliefs, such as engaging in activities that are expected to be profitable. Incentive
theory is promoted by behavioral psychologists, such as B.F. Skinner and literalized by
behaviorists, especially by Skinner in his philosophy of Radical behaviorism, to mean that a
person's actions always have social ramifications: and if actions are positively received people
are more likely to act in this manner, or if negatively received people are less likely to act in this
manner.
Incentive theory distinguishes itself from other motivation theories, such as drive theory, in the
direction of the motivation. In incentive theory, stimuli "attract", to use the term above, a person
towards them, as opposed to the body seeking to reestablish homeostasis and pushing towards
the stimulus. In terms of behaviorism, incentive theory involves positive reinforcement: the
reinforcing stimulus has been conditioned to make the person happier. For instance, a person
knows that eating food, drinking water, or gaining social capital will make them happier. As
opposed to in drive theory, which involves negative reinforcement: a stimulus has been
associated with the removal of the punishment—the lack of homeostasis in the body. For
example, a person has come to know that if they eat when hungry, it will eliminate that negative
feeling of hunger, or if they drink when thirsty, it will eliminate that negative feeling of thirst.
Escapism and seeking are major factors influencing decision making. Escapism is a need to
breakaway from a daily life routine, turning on the television and watching an adventure film,
whereas seeking is described as the desire to learn, turning on the television to watch a
documentary. Both motivations have some interpersonal and personal facets for example
individuals would like to escape from family problems (personal) or from problems with work
colleagues (interpersonal). This model can also be easily adapted with regard to different studies.
Drive-reduction theory
There are a number of drive theories. The Drive Reduction Theory grows out of the concept that
people have certain biological drives, such as hunger. As time passes the strength of the drive
increases if it is not satisfied (in this case by eating). Upon satisfying a drive the drive's strength
is reduced. The theory is based on diverse ideas from the theories of Freud to the ideas of
feedback control systems, such as a thermostat.
Drive theory has some intuitive or folk validity. For instance when preparing food, the drive
model appears to be compatible with sensations of rising hunger as the food is prepared, and,
after the food has been consumed, a decrease in subjective hunger. There are several problems,
however, that leave the validity of drive reduction open for debate. The first problem is that it
does not explain how secondary reinforcers reduce drive. For example, money satisfies no
biological or psychological needs, but a pay check appears to reduce drive through second-order
conditioning. Secondly, a drive, such as hunger, is viewed as having a "desire" to eat, making the
drive a homuncular being—a feature criticized as simply moving the fundamental problem
behind this "small man" and his desires.
Drive reduction theory cannot be a complete theory of behavior, or a hungry human could not
prepare a meal without eating the food before he finished cooking it. The ability of drive theory
to cope with all kinds of behavior, from not satisfying a drive (by adding on other traits such as
restraint), or adding additional drives for "tasty" food, which combine with drives for food in
order to explain cooking render it hard to test.
Suggested by Leon Festinger, cognitive dissonance occurs when an individual experiences some
degree of discomfort resulting from an inconsistency between two cognitions: their views on the
world around them, and their own personal feelings and actions. For example, a consumer may
seek to reassure themselves regarding a purchase, feeling in retrospect that another decision may
have been preferable. Their feeling that another purchase would have been preferable is
inconsistent with their action of purchasing the item. The difference between their feelings and
beliefs causes dissonance, so they seek to reassure themselves.
While not a theory of motivation, per se, the theory of cognitive dissonance proposes that people
have a motivational drive to reduce dissonance. The cognitive miser perspective makes people
want to justify things in a simple way in order to reduce the effort they put into cognition. They
do this by changing their attitudes, beliefs, or actions, rather than facing the inconsistencies,
because dissonance is a mental strain. Dissonance is also reduced by justifying, blaming, and
denying. It is one of the most influential and extensively studied theories in social psychology.
Content theories
Motivation, as defined by Pritchard and Ashwood, is the process used to allocate energy to
maximize the satisfaction of needs.[15]
Content theory of human motivation includes both Abraham Maslow's hierarchy of needs and
Herzberg's two-factor theory. Maslow's theory is one of the most widely discussed theories of
motivation.
The American motivation psychologist Abraham H. Maslow developed the hierarchy of needs
consisting of five hierarchic classes. According to Maslow, people are motivated by unsatisfied
needs. The needs, listed from basic (lowest-earliest) to most complex (highest-latest) are as
follows:
Belongingness/Love/Friendship
Self-esteem/Recognition/ Achievement
Self actualization
The basic requirements build upon the first step in the pyramid: physiology. If there are deficits
on this level, all behavior will be oriented to satisfy this deficit. Essentially, if you have not slept
or eaten adequately, you won't be interested in your self-esteem desires. Subsequently we have
the second level, which awakens a need for security. After securing those two levels, the motives
shift to the social sphere, the third level. Psychological requirements comprise the fourth level,
while the top of the hierarchy consists of self-realization and self-actualization.
Human beings have wants and desires which influence their behavior. Only unsatisfied needs
influence behavior, satisfied needs do not.
Needs are arranged in order of importance to human life, from the basic to the complex.
The person advances to the next level of needs only after the lower level need is at least
minimally satisfied.
The further the progress up the hierarchy, the more individuality, humanness and psychological
health a person will show.
Frederick Herzberg's two-factor theory concludes that certain factors in the workplace result in
job satisfaction, but if absent, they don't lead to dissatisfaction but no satisfaction. The factors
that motivate people can change over their lifetime, but "respect for me as a person" is one of the
top motivating factors at any stage of life.
He distinguished between:
Motivators; (e.g. challenging work, recognition, responsibility) which give positive satisfaction,
and
Hygiene factors; (e.g. status, job security, salary and fringe benefits) that do not motivate if
present, but, if absent, result in demotivation.
The name hygiene factors is used because, like hygiene, the presence will not improve health,
but absence can cause health deterioration.
Herzberg's theory has found application in such occupational fields as information systems and
in studies of user satisfaction such as computer user satisfaction.
Alderfer, expanding on Maslow's hierarchy of needs, created the ERG theory. This theory posits
that there are three groups of core needs — existence, relatedness, and growth, hence the label:
ERG theory. The existence group is concerned with providing our basic material existence
requirements. They include the items that Maslow considered to be physiological and safety
needs. The second group of needs are those of relatedness- the desire we have for maintaining
important personal relationships. These social and status desires require interaction with others if
they are to be satisfied, and they align with Maslow's social need and the external component of
Maslow's esteem classification. Finally, Alderfer isolates growth needs as an intrinsic desire for
personal development. These include the intrinsic component from Maslow's esteem category
and the characteristics included under self-actualization.
Self-determination theory
Since the early seventies Edward L. Deci and Richard M. Ryan[citation needed] have conducted
research that eventually led to the proposition of the self-determination theory (SDT). This
theory focuses on the degree to which an individual’s behaviour is self-motivated and self-
determined. SDT identifies three innate needs that, if satisfied, allow optimal function and
growth: competence,[16][17] relatedness,[18] and autonomy.[19][20] These three psychological needs
motivate the self to initiate specific behaviour and mental nutriments that are essential for
psychological health and well-being. When these needs are satisfied, there are positive
consequences, such as well-being and growth, leading people to be motivated, productive and
happy. When they are thwarted, people's motivation, productivity and happiness plummet.[citation
needed]
Humans are inherently proactive with their potential and mastering their inner forces (such as
drive and emotions).
Humans have an inherent tendency towards growth, development and integrated functioning.
Optimal development and actions are inherent in humans but they do not happen automatically.
Achievement motivation
Achievement motivation was studied intensively by David C. McClelland, John W. Atkinson and
their colleagues since the early 1950s.[30] Their research showed that business managers who
were successful demonstrated a high need to achieve no matter the culture. There are three major
characteristics of people who have a great need to achieve according to McClelland’s research.
1. They would prefer a work environment in which they are able to assume responsibility for
solving problems.
2. They would take calculated risk and establish moderate, attainable goals.
3. They want to hear continuous recognition, as well as feedback, in order for them to know how
well they are doing.[31]
Cognitive theories
Goal-setting theory
Goal-setting theory is based on the notion that individuals sometimes have a drive to reach a
clearly defined end state. Often, this end state is a reward in itself. A goal's efficiency is affected
by three features: proximity, difficulty and specificity. Good goal setting incorporates the
SMART criteria, in which goals are: specific, measurable, accurate, realistic, and timely. An ideal
goal should present a situation where the time between the initiation of behavior and the end
state is close. This explains why some children are more motivated to learn how to ride a bike
than to master algebra. A goal should be moderate, not too hard or too easy to complete. In both
cases, most people are not optimally motivated, as many want a challenge (which assumes some
kind of insecurity of success). At the same time people want to feel that there is a substantial
probability that they will succeed. Specificity concerns the description of the goal in their class.
The goal should be objectively defined and intelligible for the individual. A classic example of a
poorly specified goal is to get the highest possible grade. Most children have no idea how much
effort they need to reach that goal.
Social-cognitive models of behavior change include the constructs of motivation and volition.
Motivation is seen as a process that leads to the forming of behavioral intentions. Volition is seen
as a process that leads from intention to actual behavior. In other words, motivation and volition
refer to goal setting and goal pursuit, respectively. Both processes require self-regulatory efforts.
Several self-regulatory constructs are needed to operate in orchestration to attain goals. An
example of such a motivational and volitional construct is perceived self-efficacy. Self-efficacy
is supposed to facilitate the forming of behavioral intentions, the development of action plans,
and the initiation of action. It can support the translation of intentions into action.
John W. Atkinson, David Birch and their colleagues developed the theory of "Dynamics of
Action" to mathematically model change in behavior as a consequence of the interaction of
motivation and associated tendencies toward specific actions.[32][33] The theory posits that change
in behavior occurs when the tendency for a new, unexpressed behavior becomes dominant over
the tendency currently motivating action. In the theory, the strength of tendencies rises and falls
as a consequence of internal and external stimuli (sources of instigation), inhibitory factors, and
consummatory in factors such as performing an action. In this theory, there are three causes
responsible for behavior and change in behavior:
1. Instigation (Ts) - increases tendency when an activity has intrinsic ability to satisfy;
2. Inhibition (Taf) - decreases tendency when there are obstacles to performing an activity; and
Unconscious motivation
Some psychologists believe that a significant portion of human behavior is energized and
directed by unconscious motives. According to Maslow, "Psychoanalysis has often demonstrated
that the relationship between a conscious desire and the ultimate unconscious aim that underlies
it need not be at all direct."
Psychologists David C. McClelland and John W. Atkinson argued that motivation should be
unconscious. They refined measures of motivation by means of content analysis of imaginative
thought using, for example, the Thematic Apperception Test.'[36][37]
Starting from studies involving more than 6,000 people, Professor Steven Reiss has proposed a
theory that found 16 basic desires that guide nearly all human behavior.[38][39] The 16 basic desires
that motivate our actions and define our personalities are:
Honor, the need to be loyal to the traditional values of one's clan/ethnic group
Attribution theory
The attribution theory is a theory developed by psychologist, Fritz Heider that describes the
processes by which individuals explain the causes of their behavior and events.[40] A form of
attribution theory developed by psychologist, Bernard Weiner describes an individual’s beliefs
about how the causes of success or failure affect their emotions and motivations. Bernard
Weiner’s theory can be defined into two perspectives: intrapersonal or interpersonal. The
intrapersonal perspective includes self-directed thoughts and emotions that are attributed to the
self. The interpersonal perspective includes beliefs about the responsibility of others and other
directed affects of emotions; the individual would place the blame on another individual.[41]
Individuals formulate explanatory attributions to understand the events they experience and to
seek reasons for their failures. When individuals seek positive feedback from their failures, they
use the feedback as motivation to show improved performances. For example, using the
intrapersonal perspective, a student who failed a test may attribute their failure for not studying
enough and would use their emotion of shame or embarrassment as motivation to study harder
for the next test. A student who blames their test failure on the teacher would be using the
interpersonal perspective, and would use their feeling of disappointment as motivation to rely on
a different study source other than the teacher for the next test.
Practical applications
The control of motivation is only understood to a limited extent. There are many different
approaches of motivation training, but many of these are considered pseudoscientific by critics.
To understand how to control motivation it is first necessary to understand why many people
lack motivation.
Employee motivation
It has been suggested that this section be merged into Work motivation. (Discuss) Proposed since
October 2013.
Workers in any organization need something to keep them working. Most of the time, the salary
of the employee is enough to keep him or her working for an organization. An employee must be
motivated to work for a company or organization. If no motivation is present in an employee,
then that employee’s quality of work or all work in general will deteriorate. People differ on a
personality dimension called locus of control. This variable refers to individual's beliefs about
the location of the factors that control their behavior. At one end of the continuum are high
internals who believe that opportunity to control their own behavior rests within themselves. At
the other end of the continuum there are high externals who believe that external forces
determine their behavior. Not surprisingly, compared with internals, externals see the world as an
unpredictable, chancy place in which luck, fate, or powerful people control their destinies.[42]
When motivating an audience, you can use general motivational strategies or specific
motivational appeals. General motivational strategies include soft sell versus hard sell and
personality type. Soft sell strategies have logical appeals, emotional appeals, advice and praise.
Hard sell strategies have barter, outnumbering, pressure and rank. Also, you can consider basing
your strategy on your audience personality. Specific motivational appeals focus on provable
facts, feelings, right and wrong, audience rewards and audience threats.[43]
The job characteristics Model (JCM), as designed by Hackman and Oldham attempts to use job
design to improve employee motivation. They show that any job can be described in terms of
five key job characteristics:[44][45]
1. Skill Variety - the degree to which the job requires the use of different skills and talents
2. Task Identity - the degree to which the job has contributed to a clearly identifiable larger project
3. Task Significance - the degree to which the job has an impact on the lives or work of other
people
4. Autonomy - the degree to which the employee has independence, freedom and discretion in
carrying out the job
5. Task Feedback - the degree to which the employee is provided with clear, specific, detailed,
actionable information about the effectiveness of his or her job performance
The JCM links the core job dimensions listed above to critical psychological states which results
in desired personal and work outcomes. This forms the basis of this 'employee growth-need
strength." The core dimensions listed above can be combined into a single predictive index,
called the Motivating Potential Score.
The motivating potential score (MPS) can be calculated, using the core dimensions discussed
above, as follows:
Jobs that are high in motivating potential must be high on at least one of the three factors that
lead to experienced meaningfulness, and also must be high on both Autonomy and Feedback.[46]
If a job has a high MPS, the job characteristics model predicts that motivation, performance and
job satisfaction will be positively affected and the likelihood of negative outcomes, such as
absenteeism and turnover, will be reduced.[46]
Employee recognition is not only about gifts and points. It's about changing the corporate culture
in order to meet goals and initiatives and most importantly to connect employees to the
company's core values and beliefs. Strategic employee recognition is seen as the most important
program not only to improve employee retention and motivation but also to positively influence
the financial situation.[47] The difference between the traditional approach (gifts and points) and
strategic recognition is the ability to serve as a serious business influencer that can advance a
company’s strategic objectives in a measurable way. "The vast majority of companies want to be
innovative, coming up with new products, business models and better ways of doing things.
However, innovation is not so easy to achieve. A CEO cannot just order it, and so it will be. You
have to carefully manage an organization so that, over time, innovations will emerge."[48]
Drugs
Some authors, especially in the transhumanist movement, have suggested the use of "smart
drugs", also known as nootropics, as "motivation-enhancers". These drugs work in various ways
to affect neurotransmitters in the brain. It is generally widely accepted that these drugs enhance
cognitive functions, but not without potential side effects.[49] The effects of many of these drugs
on the brain are emphatically not well understood, and their legal status often makes open
experimentation difficult.[citation needed]
Education
Motivation in education can have several effects on how students learn and how they behave
towards subject matter.[50] It can:
Because students are not always internally motivated, they sometimes need situated motivation,
which is found in environmental conditions that the teacher creates.
If teachers decided to extrinsically reward productive student behaviors, they may find it difficult
to extricate themselves from that path. Consequently student dependency on extrinsic rewards
represents one of the greatest detractors from their use in the classroom.[51]
The majority of new student orientation leaders at colleges and universities recognize that
distinctive needs of students should be considered in regard to orientation information provided
at the beginning of the higher education experience. Research done by Whyte in 1986 raised the
awareness of counselors and educators in this regard. In 2007, the National Orientation Directors
Association reprinted Cassandra B. Whyte's research report allowing readers to ascertain
improvements made in addressing specific needs of students over a quarter of a century later to
help with academic success.[52]
1. Intrinsic motivation occurs when people are internally motivated to do something because it
either brings them pleasure, they think it is important, or they feel that what they are learning is
significant. It has been shown that intrinsic motivation for education drops from grades 3-9
though the exact cause cannot be ascertained. [55] Also, in younger students it has been shown
that contextualizing material that would otherwise be presented in an abstract manner increases
the intrinsic motivation of these students. [56]
2. Extrinsic motivation comes into play when a student is compelled to do something or act a
certain way because of factors external to him or her (like money or good grades).
Cassandra B. Whyte researched and reported about the importance of locus of control and
academic achievement. Students tending toward a more internal locus of control are more
academically successful, thus encouraging curriculum and activity development with
consideration of motivation theories.[57][58]
Academic motivation orientation may also be tied with one's ability to detect and process errors.
Fisher, Nanayakkara, and Marshall conducted neuroscience research on children's motivation
orientation, neurological indicators of error monitoring (the process of detecting an error), and
academic achievement. Their research suggests that students with high intrinsic motivation
attribute performance to personal control and that their error-monitoring system is more strongly
engaged by performance errors. They also found that motivation orientation and academic
achievement were related to the strength in which their error-monitoring system was engaged.[59]
Motivation has been found to be an important element in the concept of Andragogy (what
motivates the adult learner), and in treating Autism Spectrum Disorders, as in Pivotal Response
Therapy.
Doyle and Moeyn have noted that traditional methods tended to use anxiety as negative
motivation (e.g. use of bad grades by teachers) as a method of getting students to work.
However, they have found that progressive approaches with focus on positive motivation over
punishment has produced greater effectiveness with learning, since anxiety interferes with
performance of complex tasks.[60]
For many indigenous students (such as Native American children), motivation may be derived
from social organization; an important factor educators should account for in addition to
variations in Sociolinguistics and Cognition.[61] While poor academic performance among Native
American students is often attributed to low levels of motivation, Top-down classroom
organization is often found to be ineffective for children of many cultures who depend on a sense
of community, purpose, and competence in order to engage.[62] Horizontally-structured,
community-based learning strategies often provide a more structurally supportive environment
for motivating indigenous children, who tend to be driven by “social/affective emphasis,
harmony, holistic perspectives, expressive creativity, and nonverbal communication.”[63] This
drive is also traceable to a cultural tradition of community-wide expectations of participation in
the activities and goals of the greater group, rather than individualized aspirations of success or
triumph.[64]
In some indigenous communities, young children can often portray a sense of community-based
motivation through their parent-like interactions with siblings.[65] Furthermore, it is commonplace
for children to assist and demonstrate for their younger counterparts without being prompted by
authority figures. Observation techniques and integration methods are demonstrated in such
examples as weaving in Chiapas, Mexico, where it is commonplace for children to learn from "a
more skilled other" within the community.[66] The child's real responsibility within the Mayan
community can be seen in, for example, weaving apprenticeships; often, when the "more skilled
other" is tasked with multiple obligations, an older child will step in and guide the learner.[66]
Sibling guidance is supported from early youth, where learning through play encourages
horizontally-structured environments through alternative educational models such as "Intent
Community Participation."[67] Research also suggests that that formal Westernized schooling can
actually reshape the traditionally collaborative nature of social life in indigenous communities [68]
This research is supported cross-culturally, with variations in motivation and learning often
reported higher between indigenous groups and their national Westernized counterparts than
between indigenous groups across international continental divides.[69]
Self-determination in education
Self-determination is the ability to make choices and exercise a high degree of control, such as
what the student does and how they do it (Deci et al., 1991; Reeve, Hamm, & Nix, 2003; Ryan &
Deci, 2002). Self-determination can be supported by providing opportunities for students to be
challenged, such as leadership opportunities, providing appropriate feedback and fostering,
establishing and maintaining good relationships between teachers and students. These strategies
can increase students' interest, competence, creativity and desire to be challenged and ensure that
students are intrinsically motivated to study. On the other hand, students who lack of self-
determination are more likely to feel their success is out of their control. Such students lose
motivation to study, which causes a state of "helpless learning". Students who feel helpless
readily believe they will fail and therefore cease to try. Over time, a vicious circle of low
achievement develops.
Physical activity is body movement that works your muscles and requires more energy than
resting. According to a blog by the American Intercontinental University, college students should
make time for exercise to maintain and increase motivation. AIU states that regular exercise has
impeccable effects on the brain. With consistent running routines, there are more complex
connections between neurons, meaning the brain is able to access its brain cells more flexibly.
By performing well physically, motivation will be present in education because of how well the
brain is performing. After exercising, the brain can have more desire to obtain knowledge and
better retain the information. In addition, exercise can relieve stress. Exercising can ease anxiety
and relieve negative effects of stress on the body. Without stress factors, individuals can perform
better and more efficiently, since their minds will have a more positive outlook. This positive
mood will help keep students motivated and more open and willing to succeed academically.
Lastly, exercise increases focus and concentration that could also help students maintain their
motivation and focus on their studies. AIU claims that exercise may have improved the students’
ability to participate and retain information during the class after they had exercised. Being able
to retain information and being willing to participate keeps students motivated and performing
well academically.[70]
Sleep is a natural periodic state of rest for the mind and body. According to the American
Academy of Sleep Medicine, it is important and essential for students to obtain the right amount
of sleep in order to succeed in academics. AASM states that getting good nights of sleep is one
of the best ways to maximize performance on finals. It is possible that the more chaotic and
sporadic one’s sleeping schedule is, the harder it will be for that individual to get an A or B on an
exam. Dr. Kushida from AASM proclaims that sleep loss may lead to learning and memory
impairment. In addition, she also comments that lack of sleep can lead to decreased attention and
vigilance. So, with small amounts of sleep, individuals cannot maintain all their memory or focus
needed to score well in their classes. Therefore, sleep is a requirement in education if the
individual wants to succeed academically. The right amount of sleep will enable individuals to
keep their motivation and good grades in education. Without sleep, students and individual’s
memory capacity can become so minimal that it is possible for them not to even remember what
they are supposed to do in a day’s time. In addition, with a lack of sleep, students cannot
physically withhold and function for a long time, since their bodies will not have the energy. So,
with enough sleep, students’ minds will be clearer and have more potential to contain
information. At the same time, students would be granted with more motivation and energy since
their minds and bodies will be more willing to obtain information.[71]
Business
It has been suggested that this section be merged into Work motivation. (Discuss) Proposed since
October 2013.
According to Maslow, people are motivated by unsatisfied needs.[72] The lower level needs such
as Physiological and Safety needs will have to be satisfied before higher level needs are to be
addressed. We can relate Maslow's Hierarchy of Needs theory with employee motivation. For
example, if a manager is trying to motivate his employees by satisfying their needs; according to
Maslow, he should try to satisfy the lower level needs before he tries to satisfy the upper level
needs or the employees will not be motivated. Also he has to remember that not everyone will be
satisfied by the same needs. A good manager will try to figure out which levels of needs are
active for a certain individual or employee.
Maslow has money at the lowest level of the hierarchy and shows other needs are better
motivators to staff. McGregor places money in his Theory X category and feels it is a poor
motivator. Praise and recognition are placed in the Theory Y category and are considered
stronger motivators than money.
The average workplace is about midway between the extremes of high threat and high
opportunity. Motivation by threat is a dead-end strategy, and naturally staff are more attracted to
the opportunity side of the motivation curve than the threat side. Motivation is a powerful tool in
the work environment that can lead to employees working at their most efficient levels of
production.[73]
Nonetheless, Steinmetz also discusses three common character types of subordinates: ascendant,
indifferent, and ambivalent who all react and interact uniquely, and must be treated, managed,
and motivated accordingly. An effective leader must understand how to manage all characters,
and more importantly the manager must utilize avenues that allow room for employees to work,
grow, and find answers independently.[74]
The assumptions of Maslow and Herzberg were challenged by a classic study[75] at Vauxhall
Motors' UK manufacturing plant. This introduced the concept of orientation to work and
distinguished three main orientations: instrumental (where work is a means to an end),
bureaucratic (where work is a source of status, security and immediate reward) and solidaristic
(which prioritizes group loyalty).
Other theories which expanded and extended those of Maslow and Herzberg included Kurt
Lewin's Force Field Theory, Edwin Locke's Goal Theory and Victor Vroom's Expectancy theory.
These tend to stress cultural differences and the fact that individuals tend to be motivated by
different factors at different times.[76]
In contrast, David McClelland believed that workers could not be motivated by the mere need for
money—in fact, extrinsic motivation (e.g., money) could extinguish intrinsic motivation such as
achievement motivation, though money could be used as an indicator of success for various
motives, e.g., keeping score. In keeping with this view, his consulting firm, McBer & Company,
had as its first motto "To make everyone productive, happy, and free." For McClelland,
satisfaction lay in aligning a person's life with their fundamental motivations.
Elton Mayo found that the social contacts a worker has at the workplace are very important and
that boredom and repetitiveness of tasks lead to reduced motivation. Mayo believed that workers
could be motivated by acknowledging their social needs and making them feel important. As a
result, employees were given freedom to make decisions on the job and greater attention was
paid to informal work groups. Mayo named the model the Hawthorne effect. His model has been
judged as placing undue reliance on social contacts within work situations for motivating
employees.[77]
William Ouchi introduced Theory Z, a hybrid management approach consisting of both Japanese
and American philosophies and cultures.[78] Its Japanese segment is much like the clan culture
where organizations focus on a standardized structure with heavy emphasis on socialization of its
members. All underlying goals are consistent across the organization. Its American segment
retains formality and authority amongst members and the organization. Ultimately, Theory Z
promotes common structure and commitment to the organization, as well as constant
improvement of work efficacy.
Rewarding of nominators
Games
Motivational models are central to game design, because without motivation a player will not be
interested in progressing further within a game.[80] Several models for gameplay motivations have
been proposed, including Richard Bartle's. Jon Radoff has proposed a four-quadrant model of
gameplay motivation that includes cooperation, competition, immersion and achievement.[81] The
motivational structure of games is central to the gamification trend, which seeks to apply game-
based motivation to business applications.[82]
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