Motivating, Satisfying, and Leading Employees

Chapter 9

Motivating, Satisfying, and Leading Employees

Chapter Overview

Psychological contracts in the workplace are the set of expectations held by employees concerning what they will contribute to an organization and what the organization will in return provide to them.  Psychological contracts have changed significantly in the last decade.  Employers offer less security but more benefits, while employees offer less loyalty but are often willing to work longer hours and assume more responsibility.

Good human relations – positive interactions between employers and employees – lead to high levels of job satisfaction and morale.  As a result, employees are more productive and more loyal, with a lower level of grievances, absenteeism, and turnover.

Theories of employee motivation have changed dramatically over the years.  The most important models are summarized below:

• Classical Theory:  People are motivated solely by money.  This theory impacted business via scientific management, which focused on analyzing jobs and finding more efficient ways to perform tasks.
• Behavior Theory:  People’s needs play a role in motivation.  Employees perform better when they believe that management is paying attention to them.  This theory was first demonstrated in the Hawthorne Studies.
• Human Resources Model:  There are two kinds of managers – Theory X managers who believe that people are inherently uncooperative and must be constantly punished or rewarded, and Theory Y managers who believe that people are naturally responsible and self-motivated to be productive.
• Maslow’s Hierarchy of Needs Model:  People have different needs which they attempt to satisfy in their work.  Lower level needs must be satisfied before people seek to meet higher level needs.
• Two-Factor Theory:  If basic hygiene needs are not met, workers will be dissatisfied.  Only by increasing more complex motivation factors can companies increase employee performance.
• Expectancy Theory:  People will work hard if they believe that their efforts will lead to desired rewards.
• Equity Theory:  Motivation depends on the way employees evaluate their treatment by an organization, relative to its treatment of other workers.

 

Managers can use several strategies to improve employee satisfaction and motivation.  The principle of reinforcement or behavior modification theory proposes that rewards and punishments can control behavior.  Management by objectives, participative management, and empowerment can improve human relations by increasing the level of employee commitment and involvement in the organizational team.  Job enrichment, job redesign, and modified work schedules can build job satisfaction by adding motivation factors to jobs in which they are normally lacking.

Effective managerial leadership is a key contributor to employee satisfaction and motivation.  Autocratic managers typically issue orders that they expect employees to obey.  Democratic managers generally seek subordinates’ input into decisions.  Free-rein managers more often advise than make actual decisions.  The contingency approach to leadership suggests that managers should assess each situation individually and exercise a leadership style based on the elements of the situation.

Chapter Objectives

1. Describe the nature and importance of psychological contracts in the workplace.
2. Discuss the importance of job satisfaction and employee morale and summarize their roles in human relations in the workplace.
3. Identify and summarize the most important theories of employee motivation.
4. Describe some of the strategies used by organizations to improve job satisfaction and employee motivation.
5. Discuss different managerial styles of leadership and their impact on human relations in the workplace.

 

REFERENCE OUTLINE

Opening Case:  Bringing the Bounty Back to P & G

• Psychological Contracts in Organizations

 

• The Importance of Satisfaction and Morale
• Recent Trends in Managing Satisfaction and Morale

• Motivation in the Workplace
• Classical Theory
• Behavior Theory:  The Hawthorne Studies
• Contemporary Motivational Theories
• Human Resources Model:  Theories X & Y
• Maslow’s Hierarchy of Needs Model
• Two-Factor Theory
• Expectancy Theory
• Equity Theory

 

• Strategies for Enhancing Job Satisfaction and Morale
• Reinforcement / Behavior Modification Theory
• Management by Objectives (MBO)
• Participative Management and Empowerment
• Team Management
• Job Enrichment and Job Redesign
• Job Enrichment Programs
• Job Redesign Programs

a.   Combining Tasks

• Forming Natural Work Groups
• Establishing Client Relationships
• Modified Work Schedules
• Work-Share Programs
• Flextime Programs and Alternative Workplace Strategies
• Telecommuting and Virtual Offices
• Advantages and Disadvantages

• V.  Managerial Styles and Leadership
• A.  Managerial Styles
• The Contingency Approach of Leadership
• Motivation and Leadership in the Twenty-First Century—Changing Patterns of Motivation

 

LECTURE OUTLINE

• Psychological Contracts in Organizations  (Use PowerPoint 9.3.)

 

A psychological contract is the set of expectations held by employees concerning what they will contribute to an organization and what the organization will provide the employees in return.

Notes:  ______________________________________________________________________________________________________________________________________________________________________________________________________

• The Importance of Satisfaction and Morale  (Use PowerPoint 9.4.)

 

Levels of job satisfaction and morale among employees depend largely upon employees’ motivation levels and the leadership exhibited by management.

• Recent Trends in Managing Satisfaction and Morale  (Use PowerPoint 9.5.)

 

Worker layoffs and downsizing programs implemented by companies in the last decade have created low morale among many workers.  Firms have responded by announcing and implementing solid plans for future growth in an attempt to rebuild employee morale.

Notes:  ______________________________________________________________________________________________________________________________________________________________________________________________________

• Motivation in the Workplace  (Use PowerPoint 9.6.)

 

Theories that address employee motivation are divided into three categories:  classical theory, behavior theory, and many contemporary motivational theories.

• Classical Theory

 

According to the classical theory, employees are motivated solely by money.  Fred Taylor, the father of scientific management, proposed that paying workers more money would prompt them to produce more.

• Behavior Theory:  The Hawthorne Studies

 

A group of Harvard researchers studied the relationship between changes in the physical work environment and worker output.  The result, known as the Hawthorne effect, surprisingly revealed that productivity rose to almost any management action.  The study concluded that employees responded with increased output because the management action or changes in the physical work environment were interpreted as special attention.

• Contemporary Motivational Theories  (Use PowerPoint 9.7, 9.8, 9.9, 9.10, 9.11.)

 

• Human Resources Model:  Theories X and Y.  McGregor’s Theory X is the managerial assumption that workers are lazy and need direction; Theory Y is the managerial assumption that workers are energetic, cooperative, and self-motivated.

• Maslow’s Hierarchy of Needs Model.  Maslow proposed that workers each have a set of needs that they seek to fulfill in their jobs and that these needs are arranged in a hierarchy of importance.  Those needs are physiological, safety, social, self-esteem, and self-actualization.  Maslow further proposed that lower-level needs must be met before higher-level needs and that once one set of needs is met, it ceases to motivate behavior.

 

• Two-Factor Theory.  Frederick Herzberg proposed that job satisfaction depends on motivating factors, such as recognition in the workplace, as well as the presence of hygiene factors, such as work conditions.  Hygiene factors do not enhance satisfaction, but they do prevent dissatisfaction.  Research suggests that the theory works only in some situations.

• Expectancy Theory.  This theory states that employees are especially motivated to work toward rewards when they have a greater probability of success in achieving them.  This theory explains why people may not work as hard when their salaries are based solely on seniority, for example.

 

• Equity Theory.  This theory focuses on employees’ perceptions of fairness and unfairness in the workplace.  Many people evaluate their treatment relations to an employee’s treatment of others.

Notes:  ______________________________________________________________________________________________________________________________________________________________________________________________________

• Strategies for Enhancing Job Satisfaction and Motivation  (Use PowerPoint 9.12.)

 

• Reinforcement / Behavior Modification Theory  (Use PowerPoint 9.13.)

Many managers try to control employees’ behaviors through rewards, including praise, pay, promotion, and job security, as well as through punishments, such as suspensions and reductions in pay.

 

 

• Management by Objectives  (MBO)  (Use PowerPoint 9.14.)

MBO is a system of collaborative goal setting, extending through all levels of an organization.  MBO is primarily concerned with the implementation of plans in organizations.

• Participative Management and Empowerment  (Use PowerPoint 9.15.)

 

In participative management and empowerment, employee suggestions and opinions are welcomed.  Employees may feel more committed to the firm’s goals if they have helped to shape them.

• Team Management

 

Participative programs may not be for everyone.  The key may be to invite participation only to the extent that employees want to have input and only if participation will have real value for the firm.

• Job Enrichment and Job Redesign  (Use PowerPoint 9.16.)

 

Both of these programs typically increase worker satisfaction in jobs that lack motivating factors.

• Job Enrichment Programs.  These programs attempt to add motivating factors to job activities.

 

• Job Redesign Programs.  These programs attempt to create a better fit between employees and their jobs by restructuring work.  Job redesign can usually be carried out through combining tasks, forming natural work groups, and/or establishing client relationships.

• Combining Tasks.  Enlarging jobs and increasing their variety can make employees feel that their work is more meaningful.
• Forming Natural Work Groups.  People who perform different jobs on the same projects are candidates for natural work groups that help employees see the place and importance of their jobs in the total structure of the firm.

 

• Establishing Client Relationships.  Allowing employees to interact with customers can increase job variety.

• Modified Work Schedules  (Use PowerPoint 9.17, 9.18, 9.19.)

 

• Work-Share Programs.  These programs allow employees to share a single, full-time job.  Employees appreciate the schedule flexibility to accommodate their personal needs and firms can reduce turnover and save on the cost of benefits.

• Flextime Programs and Alternative Workplace Strategies.  These programs allow workers to choose their working hours by adjusting a standard work schedule.

 

• Telecommuting and Virtual Offices.  Telecommuting, a new form of flextime, allows employees to perform some or all of their jobs away from standard office settings; virtual offices are redesigned conventional office space made to accommodate jobs and schedules that do not depend much on assigned spaces.

• Advantages and Disadvantages.  Some advantages include:  (a) more freedom in employees’ personal lives; (b) ability of employees to coordinate work around family members’ schedules; (c) an increased sense of freedom for employees; and (d) higher commitment and satisfaction for employees.  Some disadvantages include:  (a) the inability of employees to meet deadlines; (b) coordinating work schedule with family members’ schedules; and, (c) employer perceptions that unobserved workers are not actually working.

 

Notes:  ______________________________________________________________________________________________________________________________________________________________________________________________________

• Managerial Styles and Leadership  (Use PowerPoint 9.20.)

 

Leadership is the process of motivating others to work to meet specific organizational or personal objectives.

• Managerial Styles  (Use PowerPoint 9.21.)

 

Managerial styles are patterns of behavior that a manager exhibits in dealing with subordinates.  An autocratic style is one in which managers expect orders to be obeyed without question.  While retaining final decision-making power, managers who adopt a democratic style welcome input from subordinates.  A free-rein style allows subordinates to make their own decisions with a very basic set of guidelines.  Most managers typically do not exhibit any one particular style of leadership.

• The Contingency Approach to Leadership

 

Managerial responses are usually situational.  With the contingency approach, a manager’s behavior is dependent on the specific elements unique to each situation.  This approach recommends that human relations skills are critical and that people from differing cultures behave differently, expecting different things from their managers.

• Motivation and Leadership in the Twenty-First Century  (Use PowerPoint 9.22.)

 

The diversity in the contemporary workforce makes motivating behavior more complex for managers; today’s leaders are also finding it necessary to change their own behavior.  Leadership is becoming more democratic throughout organizations as employees become more empowered.

• Changing Patterns of Motivation.  There is now a trend toward job security, not money, as a motivator.  Additionally, contemporary motivators are flexible work hours, casual dress, telecommuting, nap time, massages, day care, and the opportunity to bring a pet to work.

 

Notes:  ______________________________________________________________________________________________________________________________________________________________________________________________________

 

 

 

 

Answers to Questions and Exercises

Questions for Review

1. Describe the psychological contract you currently have or have had in the past with an employer.  If you have never worked, describe the psychological contact that you have with the instructor in this class.

 

Answers will vary, but should all revolve around the concept of contributions and inducements.

2. Do you think that most people are relatively satisfied or dissatisfied with their work?  Why are they mainly satisfied or dissatisfied?

 

Answers will vary.

3. Compare and contrast Maslow’s hierarchy of needs with the two-factor theory of motivation.

 

The two are somewhat similar in that they both depict hierarchical needs, however Maslow describes five basic needs, while Herzberg describes two categories of needs.  In both cases, lower-level needs must be satisfied first.  However, in Maslow’s model, when needs are met they cease to be motivating, while in Herzberg’s model hygiene factors only affect motivation in that they are absent or fail to meet expectations.

4. How can participative management programs enhance employee satisfaction and motivation?

 

Participative management encourages employees to offer opinions and suggestions on how they do their jobs and on how the firm is operated.  As a result of helping to shape the organization’s goals, employees are more committed to achieving them.  Furthermore, virtually all employees appreciate knowing that managers will listen to their input.

Questions for Analysis

5. Some evidence suggests that recent college graduates show high levels of job satisfaction.  Levels then drop dramatically as they reach their late twenties, only to increase gradually once they get older.  What might account for this pattern?

 

Early levels of satisfaction might stem from the excitement of landing a first career job.  As workers reach their late twenties, a range of factors might account for the drop:  perceived inequities among their co-workers and between their co-workers and management, boredom with the daily grind, a lack of anticipated advancement, financial pressure for family obligations, etc.  In later years, job satisfaction may increase as workers either gain more responsibility and control of their work life or come to terms with their jobs as they stand.

6. As a manager, under what sort of circumstances might you apply each of the theories of motivation discussed in this chapter?  Which would be easiest to use?  Which would be hardest?  Why?

 

Answers will vary.  Students may note that classical theory would be easy to apply, but too simplistic to be effective.  Two-factor theory, expectancy theory, and equity theory allow for more complexity, and include clear, applicable motivating factors.  Behavior theory, the human resources model, and Maslow’s hierarchy may be the most difficult to apply since they are somewhat vague and limited in terms of specific applications.

7. Suppose you realize one day that you are dissatisfied with your job.  Short of quitting, what might you do to improve your situation?

 

Answers will vary, although analyzing the source of dissatisfaction should clearly be the first step, followed by at least discussing the causes with management.

8. List five U.S. managers who you think would also qualify as great leaders.

 

Answers will vary.

Application Exercises

9. At the library or using the Internet, research the manager or owner of a company in the early 20th century and the manager or owner of a company in the 1990s.  Compare and contrast the two in terms of their times, leadership styles, and views of employee motivation.

 

Students’ answers will vary.

10. Interview the manager of a local manufacturing company.  Identify as many different strategies for enhancing job satisfaction at that company as you can.

 

Answers will vary, but should include discussions of the strategies reviewed in the chapter.

 

Answers to Exercising Your Ethics

1. What are the ethical issues in this case?

 

The new HR manager is deeply concerned that the behavior modification approach demonstrates a lack of respect for employees.

2. What do you think most managers would do in this situation?

 

Answers will vary.

3. What would you do?

 

Answers will vary, but students will probably consider the possibility of including elements of expectancy theory while implementing the behavior modification approach.

Answers to Building Your Business Skills

1. What is your group’s most important recommendation?  Why do you think it is likely to succeed?

 

Answers will vary, but will most likely focus on revamping the pay/incentive structure to reward those employees for performance, thereby increasing accountability.

2. Changing the corporate culture to make it less paternalistic may reduce employees’ sense of belonging to a family.  If you were an employee, would you consider a greater focus on profits to be an improvement or a problem?  How would it affect your motivation and productivity?

 

Answers will vary, but students should recognize that the new corporate culture will be alienating for some and will only be effective for others if the company generously shares rewards with employees.

3. What steps would you take to improve the attitude and productivity of longtime employees who resist change?

 

Answers will vary, but students should consider that the change process would likely be long term.  It may be most effective to begin the process with newer employees, working backward to longtime employees who tend to be less flexible.  Behavior modification and reinforcement may be the most effective strategies.

 

Classroom Activities

1. This activity is based on data collected by students via a short survey.  Ask students to survey a small group of working individuals, finding out what motivates those workers in the workplace.  Surveys may simply be designed in a way that allows respondents to merely fill in their top two motivators in the workplace, for example; or, students can design the survey to include numerous options from which the respondents will pick any two.  Once the data are collected, compare results in class.  Is there a trend in how the respondents answered?  What were the top choices of the respondents?

 

2. According to Maslow, our needs are arranged in a hierarchy, with our most basic needs being met first.  According to the model, safety needs may not take precedence over physiological needs as long as the physiological needs are unmet.  Working in groups of three or four, students should come up with real-life and/or hypothetical examples of physiological needs that definitely take precedence over safety needs, safety needs that take precedence over social needs, etc.