MGT 330

Principles Of Management

• CHAPTER 12
MOTIVATING AND
REWARDING
EMPLOYEES

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 Lesson Plan
• Gain a better understanding of the motivation process
• Review six theories of motivation
– Maslow’s Hierarchy of Needs
– McGregor’s Theory X and Theory Y
– Herzberg’s Motivation-Hygiene Theory
– McClelland’s Three Needs Theory
– Adam’s Equity Theory
– Vroom’s Expectancy Theory
• Review contemporary issues in motivation

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 MOTIVATION
What is it ?
What motivates you ?
What motivates others ?
How might learning about
motivation help you
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 MOTIVATION
 “The willingness to exert
high levels of effort to reach
organizational goals,
conditioned by the effort’s
ability to satisfy some
individual need”
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The Motivation Process
Unsatisfied
Unsatisfied Need
Need

Tension
Tension

Drives
Drives

Search
Search Behavior
Behavior

Satisfied
Satisfied Need
Need

Reduction
Reduction of
of Tension
Tension
 Early Theories of Motivation
• Maslow’s Hierarchy of Needs
• McGregor’s Theory X and Theory Y
• Herzberg’s Motivation-Hygiene Theory
 Early Theories of Motivation
• Maslow’s Hierarchy of Needs
– 5 needs
– motivate until substantially satisfied
• McGregor’s Theory X and Theory Y
• Herzberg’s Motivation-Hygiene Theory
Maslow’s Hierarchy of Needs

Self
Actualization

Esteem

Social

Safety

Physiological
Early Theories of Motivation
• Maslow’s Hierarchy of Needs
• McGregor’s Theory X and Theory Y
– view of human nature
• Herzberg’s Motivation-Hygiene Theory
Theory X and Theory Y

Theory
Theory XX Theory
Theory YY

Avoid
Avoid Work
Workis
isNatural
Natural
Work
Work

Must
Mustbe
be Self-
Self-
Controlled
Controlled Direction
Direction

Avoid
Avoid Seek
Seek
Responsibility
Responsibility Responsibility
Responsibility

Good
GoodDecisions
Decisions
Seek
SeekSecurity
Security Widely
WidelyDispersed
Dispersed
 Early Theories of Motivation
• Maslow’s Hierarchy of Needs
• McGregor’s Theory X and Theory Y
• Herzberg’s Motivation-Hygiene Theory
– satisfaction vs no satisfaction
– dissatisfaction vs no dissatisfaction
Contrasting Views of Satisfaction-
Dissatisfaction
Traditional View

Satisfaction Dissatisfaction

Herzberg’s View
Motivators
Satisfaction No Satisfaction

Hygiene Factors
No Dissatisfaction Dissatisfaction
 Motivation-Hygiene Theory
Supervision
Company Policy
Achievement Supervisor
Recognition Relations
Work Itself Working Conditions
Responsibility Salary
Advancement Peers
Growth Personal Life
Subordinate
Relations
Status
Security

Extremely
ExtremelySatisfied
Satisfied Neutral
Neutral Extremely
ExtremelyDissatisfied
Dissatisfied
CONTEMPORARY THEORIES
OF MOTIVATION
 McClelland - 3 needs Theory
 Adams - Equity Theory
 Vroom - Expectancy Theory

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 McClelland’s
Three-Needs Theory
• Need for Achievement (nAch)
– Drive to excel, strive to succeed
– Want personal responsibility, feedback and an
intermediate amount of risk
• Need for Power (nPow)
– Desire to be influential
– Best managers
• Need for Affiliation (nAff)
– Desire to be liked and accepted
 CONTEMPORARY THEORIES
OF MOTIVATION

 McClelland - 3 needs Theory

 Adams - Equity Theory
 Vroom - Expectancy Theory

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 Equity Theory
– People compare their job inputs-outputs
ratio with relevant others
– Adjust work motivation according to
results
 Equity Theory Relationships
PERCEIVED RATIO COMPARISON* EMPLOYEE’S ASSESSMENT

Outcomes A Outcomes B
Inputs A
< Inputs B
Inequity (under-rewarded)

Outcomes A Outcomes B
Inputs A = Inputs B
Equity

Outcomes A Outcomes B
Inputs A
> Inputs B
Inequity (over-rewarded)
Equity Theory Relationships

You Comparison

Outcomes A Outcomes B
=
Inputs A Inputs B
Equity Theory Relationships

You Comparison You Comparison

2 4 2 4
< =
2 2 1 2
 Equity Theory

Equity
Equity Theory
Theory

Inputs
Inputs Outcomes
Outcomes

Referents
Referents

Perceived
Perceived Inequities
Inequities May
May Lead
Lead To:
To:

Change
Change Change
Change New
New
Distort
Distort Quit
Quit
Others
Others Self
Self Referent
Referent
CONTEMPORARY THEORIES
OF MOTIVATION

McClelland - 3 needs Theory

 Adams - Equity Theory
Vroom - Expectancy Theory

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 Expectancy Theory
• Individuals tend to act in certain ways based
on the expectation that the act will be
followed by a given outcome and the
attractiveness of the outcome.
• Focus is on the linkages:
– Effort and Performance
– Performance and Rewards
– Attractiveness (Rewards and Individual Goals)
 Individual
Simplified
Effort
A Expectancy
Individual
Performance Theory
B

Organizational
Rewards

C
A = Effort-performance linkage
B = Performance-reward linkage Individual
Goals
C = Attractiveness
 Contemporary Issues in
Motivation
• Motivating a Diverse Workforce
– Requires flexibility
– Employees have different needs and goals
• Pay for Performance (rather than time)
– Piece rate, profit sharing, bonuses ...
• ESOPs
– Employees become owners, need communication as well as
stock
• Minimum Wage Employees
– Non-monetary incentives, praise, authority ...
Questions &
Answers
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