Chapter 15

Motivation and Leadership

©2004 by Nelson, a division of Thomson Canada Limited

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What Would You Do?
Leadership: Dealing with tragedy  Sandler O’Neill is an investment banking firm located in the World Trade Center on September 11  Top leaders are lost in tragedy  Can new leadership help the firm survive this catastrophic event?
©2004 by Nelson, a division of Thomson Canada Limited

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Learning Objectives: What is Motivation?
After reading the next section, you should be able to: 1. explain the basics of motivation

©2004 by Nelson, a division of Thomson Canada Limited

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Basics of Motivation

Exhibit 15.1 ©2004 by Nelson, a division of Thomson Canada Limited

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Basics of Motivation
   

Effort and performance Need satisfaction Extrinsic and intrinsic motivation Motivating with the basics

©2004 by Nelson, a division of Thomson Canada Limited

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Work Performance and Motivation

Exhibit 15.2 ©2004 by Nelson, a division of Thomson Canada Limited

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Effort and Performance
Job performance = Motivation x Ability x Situational constraints

Job performance

how well someone performs a job effort put forth on the job knowledge, skills, and talent of job incumbent factors beyond individual’s control impacting performance
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Motivation

Ability

Situational constraints

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Need Satisfaction

Needs

physical or psychological requirements that must be met

 

Unmet needs motivate people Four approaches
   

Maslow Alderfer McClelland Herzberg
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Need Satisfaction and Motivation

Exhibit 15.3 ©2004 by Nelson, a division of Thomson Canada Limited

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Extrinsic and Intrinsic Rewards

Extrinsic rewards
 

tangible and visible to others contingent on performance natural rewards associated with performing a task for its own sake
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Intrinsic rewards
 

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Rewards and Motivation

Exhibit 15.5 ©2004 by Nelson, a division of Thomson Canada Limited

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Motivating with the Basics
   

Ask people what their needs are Satisfy lower-order needs first Expect people’s needs to change Satisfy higher-order needs by looking for ways to allow employees to experience intrinsic rewards
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©2004 by Nelson, a division of Thomson Canada Limited

Learning Objectives: How Perceptions and Expectations Affect Motivation
After reading the next two sections, you should be able to: 2. use equity theory to explain how employees’ perceptions of fairness affect motivation 3. use expectancy theory to describe how workers’ expectations about rewards, effort, and the link between rewards and performance influence motivation
©2004 by Nelson, a division of Thomson Canada Limited

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Equity Theory
 

Components of equity theory How people react to perceived inequity Motivating with equity theory

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Components of Equity Theory

Inputs

employee contributions to the organization rewards employees receive from the organization others with whom people compare themselves comparison of outcomes to inputs

Outcomes

Referents

Outcome/Input ratio

©2004 by Nelson, a division of Thomson Canada Limited

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Outcome/Input Ratios

Exhibit 15.6 ©2004 by Nelson, a division of Thomson Canada Limited

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Inequity
When people perceive that their O/I ratio is different from their referent’s. Underreward
 

referent’s O/I ratio is greater than yours experience anger or frustration referent’s O/I is less than yours possibly experience guilt

Overreward
 
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How People React to Perceived Inequity (Underreward)
  

 

Reduce inputs Increase outcomes Rationalize inputs or outcomes Change the referent Leave

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Equity and Motivation

Exhibit 15.7 ©2004 by Nelson, a division of Thomson Canada Limited

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Motivating with Equity Theory

 

Look for and correct major inequities Reduce employees’ inputs Make sure decision-making processes are fair
 

distributive justice procedural justice
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Expectancy Theory
Components of expectancy theory

Motivating with expectancy theory

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Components of Expectancy Theory

Valence

the attractiveness or desirability of a reward perceived relationship between effort and performance perceived relationship between performance and rewards

Expectancy

Instrumentality

Motivation = Valence x Instrumentality x Expectancy
©2004 by Nelson, a division of Thomson Canada Limited

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Expectancy and Motivation

Exhibit 15.8 ©2004 by Nelson, a division of Thomson Canada Limited

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Motivating with Expectancy Theory

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Systematically gather information to find out what employees want from their jobs Clearly link rewards to performance Empower employees to make decisions that enhance expectancy perceptions 24

Learning Objectives: What is Leadership?
After reading the next two sections, you should be able to: 4. explain what leadership is 5. describe who leaders are and what effective leaders do

©2004 by Nelson, a division of Thomson Canada Limited

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Leadership
Leaders versus managers Substitutes for leadership: Do leaders always matter?

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Managers versus Leaders

Exhibit 15.9 ©2004 by Nelson, a division of Thomson Canada Limited

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Substitutes for Leadership: Do Leaders Always Matter
Leadership substitutes

subordinate, task, or organizational characteristics that make leaders redundant or unnecessary

professional orientation, intrinsically satisfying work, cohesive work groups

Leadership neutralizers

subordinate, task, or organizational characteristics that interfere with a leader’s actions

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subordinate’s ability, intrinsically satisfying work, organizational rewards beyond leader’s control 28

Who Leaders Are and What Leaders Do
 

Leadership traits Leadership behaviours

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Leadership Traits
      

Drive Desire to lead Honesty/integrity Self-confidence Emotional stability Cognitive ability Knowledge of the business
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What Really Works
Leadership Traits Do Make a Difference
Intelligenc e

Dominance

Extroversion

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What Really Works
Performance and Charisma

Charisma and Perceived Leader Effectiveness

Charisma and Leader Satisfaction

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Leadership Behaviours

Initiating structure

degree to which leader structures followers’ roles by setting goals, giving directions, setting deadlines, and assigning tasks extent to which a leader is friendly, approachable, supportive, and shows concern for employees
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Consideration

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Learning Objectives: Situational Leadership
After reading the next two sections, you should be able to: 6. explain Fiedler’s contingency theory 7. discuss Hersey & Blanchard’s situational theory
©2004 by Nelson, a division of Thomson Canada Limited

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Putting Leaders in the Right Situation: Fiedler’s Contingency Theory

 

Leadership style: Least preferred co-worker Situational favourableness Matching leadership styles to situations

©2004 by Nelson, a division of Thomson Canada Limited

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Fiedler’s Contingency Theory

Exhibit 15.12 ©2004 by Nelson, a division of Thomson Canada Limited

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Leadership Style: Least Preferred Co-worker

Leadership style is the way a leader generally behaves toward followers

leaders are generally incapable of changing their leadership styles

Style is measured by the Least Preferred Co-worker scale (LPC)
 

relationship-oriented task-oriented

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Situational Favourableness

How a particular situation either permits or denies the leader’s ability to lead Three factors
  

leader-member relations task structure position power
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©2004 by Nelson, a division of Thomson Canada Limited

Situational Favourableness

Exhibit 15.14 ©2004 by Nelson, a division of Thomson Canada Limited

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Matching Leadership Styles to Situations

Exhibit 15.15 ©2004 by Nelson, a division of Thomson Canada Limited

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Adapting Leader Behaviour: Hersey & Blanchard’s Situational Theory
Situational leadership

leaders need to adjust their leadership styles to match followers’ maturity ability and willingness of worker to take responsibility for directing one’s own work four levels of maturity:
   

Worker maturity
 

M1 M2 M3 M4

– – – –

neither willing nor able willing but not able able but not willing able and willing

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Leadership Styles

Leader chooses style based on worker’s maturity for a specific task Four styles:
  

 ©2004 by Nelson, a division of Thomson Canada Limited

telling — high task/low relationship selling — high task and relationship participating — low task/high relationship delegating — low task and

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Strategic Leadership
After reading this next section, you should be able to: 8. explain how visionary leadership (i.e., charismatic and transformational leadership) helps leaders achieve strategic leadership
©2004 by Nelson, a division of Thomson Canada Limited

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Visionary Leadership
Charismat ic leadersh ip

Transformatio nal leadership

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Charismatic Leadership

Creates an exceptionally strong relationship between leader and followers Charismatic leaders:

  

articulate a clear vision based on strong values model those values communicate high expectations to followers display confidence in followers’ abilities
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©2004 by Nelson, a division of Thomson Canada Limited

Types of Charismatic Leaders

Ethical charismatics
    

provide development opportunities for followers open to positive and negative feedback recognize others’ contributions share information emphasize interests of the group control and manipulate followers do what is best for themselves not the organization only want positive feedback only share information beneficial to themselves
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Unethical charismatics
   

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Transformational Leadership

©2004 by Nelson, a division of Thomson Canada Limited

Generates awareness and acceptance of group’s purpose and mission Gets employees to see beyond their own needs and self-interest Goes beyond charismatic leadership 47 Different from transactional

Transformational Leadership
Transformational leaders are visionary and they use:
  

Inspirational motivation Intellectual stimulation Individualized consideration

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What Really Happened?
Leadership: Dealing with Tragedy  Deceased employees’ families
 

given pay check for the rest of the year insurance coverage for five years

Jimmy Dunne became manager and provided strong leadership

developed skills in negotiation, calmness, patience, support, while maintaining strong business focus
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©2004 by Nelson, a division of Thomson Canada Limited