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Dear Sir, Subject: Submission of term paper on Employee Motivation. This report focuses on the employee motivational activities at Potent Product Fa cility of Renata Limited. In writing the report different motivational tools use d to motivate knowledge worker are studied. We would like to express our gratitude for your guidance in constructing the out line of this report. It has been a huge learning experience for us. Looking forw ard to answer any queries you may have. Sincerely ___________________
This paper is prepared with the aim to illustrate the definition and importance of Employee Motivation in a changing environment, studying a working Framework a nd illustrating different motivational tools used for knowledge workers. Potent Product Facility of Renata Limited, a sophisticated pharmaceutical plant is take n as the study case. The definition and importance of Employee Motivation are illustrated both in gen eral and in the context of Renata. Different motivational tools used by PPF to m otivate their knowledge workers are studied. They are variable pay program- ‘Bonus’, skill based pay, motivating professionals by various incentives like challenge, autonomy, recognition, reward, outings, educational excursions etc. These motiv ational tools are well explained from motivational theories like Maslow’s Hierarch y of Need, Expectancy Theory, ERG Theory, Equity Theory , Goal Setting Theory an d David McClellands Theory of Needs etc.. Motivational activities are well maintained at PPF. As a result, they experience d formidable success in getting MHRA certificate from U.K. as only the second ph armaceutical company in Bangladesh. Their model can be taken for lesson for othe r pharmaceutical companies.
CONTENTS Page No Executive Summary ………………………….……………….…………..…………………………….3 1.0 Introduction ……………………………………………………….…..….…..................5 1.1 Origin of the Report. ……………………………………………………......................5 1.2 Objective…………………………………………………………………………………………………5 1.2.1 Broad Objective……………………………………………………………………….5 1.2.2 Specific Objetive …………………………………………………………………….5 1.3 1.4 2.0 3.0 3.1 3.2 3.3 3.4 3.5 3.6 3.7 3.8 Methodology ………………………………………………………………………… ……………5 Limitations……………………………………………………………………………………………6 Organisational Profile ………………………………………………..……................6 Literature Review ……………………………………………………………......…………..9 Definition of Motivation ……………………………………………………………………. 9 Theories of Motivation.………..……………................……….…………………….9 Motivation Through Job Design.…………..…………………………………………..15 Motivation Through Reward ……………………………………………………………..16 Motivation Through Employee Participation………………………………………18 Why study and apply employee motivation principles………………………20 Motivation is the key to performance improvement………….…………….21 Different Motivational Practices………………………………………………………….22
4.0 4.1 4.1.1 4.1.2 4.1.3
Findings………………………………………………………………………………………………….24 Motivational Tools Used at PPF ………………………………………………………….24 Variable Pay Program …………………………………………………………….24 Skill Based Pay ………………………………………………………..…………….25 Motivating Professional …………………………………………...…………….26
5.0 Conclusion – A Success Story ………………………………..…………..…………….30 6.0 Recommendations………………………………………………………………………………..31 References…………………………………………………..……………..…………………………………33
1.0 Introduction: Employee Motivation is getting more attentions these days. To survive in a changing environment, organisations must respond to changes. So it is no longer sufficient to have a successful employee management strategy, o rganisations now need a successful employee motivation policy. Motivation is one of the most frequently researched topics in Management. To keep the employees g oing and attaining their objective, organizations need to keep them motivated. T here are several motivational tools to keep the employees motivated. Organizatio ns need to pick the right tool based on the education level, skill level, behavi oural characteristics etc. of the employees. 1.1 Origin of the Report: This group required to prepare a term paper on a f ew aspects of any company’s employee motivation system for the “Organisational Behav ior” course at EMBA, DU. This paper is based on motivational tools used by the man agement of Potent Product Facility, Renata Limited. 1.2 Objective:
1.2.1 Broad Objective: Aim of this paper is to illustrate the definition and i mportance of employee motivation in changing environment. An Employee Motivation
Framework, which is being employed in an organization, is studied and illustrat ed. 1.2.2 Specific Objective: Potent Product Facility of Renata Limited, which is a sophisticated potent medicine producing facility, is taken as study case. Thei r framework for different motivational tools used to motivate knowledge workers are studied and illustrated. 1.3 Methodology: For preparing the paper the writers relies on both primary and secondary sources. Primarily the data is collected through observation and c onversation with the Officials of Potent Product Facility, Renata Limited. Secon dary data sources such as the internet, texts like “Management” by Kreitner, “Organiza tional Behaviour” by Stephen P. Robbins and “Organizational Behaviour” by Keith Davis are also used to prepare the paper. 1.4 Limitations: The authority of the Renata Limited thinks some of the info rmation as sensitive. They provided only the information they thought to be exch angeable regarding the topic. As maximum information was collected through inter view the authenticity of the information may vary a little with the fact. Due to resource constraint it was not possible to make research a bit more 2.0 Organisational Profile:
Name of Company: Renata Limited Type of Company: Listed Public Limited (Dhaka Stock Exchange) Main Business: Manufacture and Marketing of Human Pharmaceuticals and Animal The rapeutics. It has two production sites. The original 12-acre site is located in Mirpur, Dhaka, while the new 17-acre site located in Rajendrapur, Gazipur began operations in 2009. History: The Company started its operations as Pfizer (Bangladesh) Limited in 19 72. For the next two decades it continued as a highly successful subsidiary of P fizer Corporation. However, by the late 1990s the focus of Pfizer had shifted fr om formulations to research. In accordance with this transformation, Pfizer dive sted its interests in many countries, including Bangladesh. Specifically, in 199 3 Pfizer transferred the ownership of its Bangladesh operations to local shareho lders, and the name of the company was changed to Renata Limited. No. of Employees: 2,213 employees. Distributors and Affiliations: Its Alliance-Partners are as follows: 1. Novartis Vaccines (Rabipur, Vaxem HiB, and Agrippal) 2. BASF, Germany (Animal Nutrition Products) 3. InterVax, Canada (Meningococcal Vaccine) 4. Evans Vanodine, UK (Disinfectant) 5. Zinpro, USA (Metal Amino Acid Complexes) 6. Biomin Laboratories, Singapore (Mycotoxin Binders and Nutraceuticals) International Presence: Guyana, Jordan, Hong Kong, Kenya, Myanmar, Philippines, Sri Lanka, Vietnam, and United Kingdom. Investment: 100% Shareholding in Renata Agro Industries Limited Bankers: Agrani Bank, Standard Chartered Bank, Eastern Bank, HSBC, Sonali Bank, City Bank, and Mutual Trust Bank Renata Ltd.’s Vision: To establish Renata permanently among the best of innovative branded generic com panies.
Renata Ltd.’s Mission: To provide maximum value to our customers, shareholders, colleagues, and communi ties where we live and work. Production Facilities: Renata has five manufacturing facilities on two separate sites. Potent Product f acility is one of those located in original Mirpur site. Potent Product Facility (Mirpur, Dhaka) Organisational Structure: PPF has a flat organisational structure as it does not have a large number of employees. Here the Plant Manager has the total responsi bility to run the plant and reports directly to the Managing Director. Head of Quality Assurance looks after the Quality Assurance issues and acts as a QA Mana ger. Head of the other departments are responsible for all the activities of the concerned department and reports to the Plant manager except for Head of Qualit y Control who reports to Quality Assurance Manager. Effective Quality Management System: The effective quality management is achieved through systematic sampling, testin g, validation and monitoring of materials, facilities, systems and procedures, w hich can have direct impact on the quality of the products throughout their shel f life. The standard operating procedures duly authorised for all operations inc luding production, quality control, dispatching, safety, environmental control, housekeeping and engineering are the core of Quality Management System. The evaluation of impact on quality efficacy and safety of the products is a par t of planned deviation procedure and change control. On completion of the manufacture, the batch manufacturing record including the b atch packing record along with the quality control reports are submitted to QA f or review as part of the batch assessment procedure prior to release of the batc h for sale. All the raw materials and packing materials are tested before approval so vendor audit is not essential. Area: 22,500 SFT or 2,090 m2 Manufacturing Capabilities: Tablet Packaging Capabilities: Blister pack and pot-fill Other facilities are mentioned below: General Facility (Mirpur, Dhaka) Area: 196,730 SFT or 18,277 m2 Manufacturing Capabilities: Tablet, Capsule, Soft Gel, Effervescent Tablet, Dry Syrup, Sterile Dry Fill, Sterile Liquid Fill, Large Volume Parenteral (Pilot), L yophilisation (Pilot), and Premix Packaging Capabilities: Blister pack, bottle dry-fill, pot-fill, and strip packa ging Cephalosporin Facility (Rajendrapur, Gazipur) Area: 50,500 SFT or 4,692 m2 Manufacturing Capabilities: Tablet, Capsule, Dry Syrup, and Sterile Dry Fill Packaging Capabilities: Blister pack Penicillin Facility (Rajendrapur, Gazipur) Area: 27,500 SFT or 2,555 m2 Manufacturing Capabilities: Tablet, Capsule, Dry Syrup, and Sterile Dry Fill Packaging Capabilities: Blister pack
Sachet Filling Facility (Mirpur, Dhaka) Area: 11,300 SFT or 1,090 m2 Manufacturing Capabilities: Powder Packaging Capabilities: Sachet (Dry Fill) Description of the surrounding: The immediate neighbouring environment consists of small-scale industries engage d mainly in manufacturing garment and dairy products. Properties nearby are used as residential homes, pharmaceuticals, dairy, garments and some other small sca le industries. 3.0 Literature Review: The job of a manager in the workplace is to get thing s done through employees. To do this the manager should be able to motivate empl oyees. But that s easier said than done. Motivation practice and theory are diff icult subjects, touching on several disciplines. In spite of enormous research, basic as well as applied, the subject of motivati on is not clearly understood and more often than not poorly practiced. To unders tand motivation one must understand human nature itself. Human nature can be very simple, yet very complex too. An understanding and appr eciation of this is a prerequisite to effective employee motivation in the workp lace and therefore effective management and leadership. This paper on employee motivation concentrates on various theories regarding hum an nature in general and motivation in particular. 3.1 Definition of Motivation: The psychological process that gives behavior purpose and direction. 3.2 Theories of Motivation: • Maslow’s needs hierarchy theory • Herzberg’s two-factor theory • Expectancy theory • Alfred’s ERG Theory • Goal Setting Theory • David McClellands Theory of Needs Figure.1: Individual Motivation and Job Performance • Maslow’s Needs Hierarchy Theory People have needs, and when one need is relatively fulfilled, other emerge in pr edictable sequence to take its place. Maslow’s hierarchy of needs: Physiological needs: food, water, sleep, and sex. Safety needs: safety from the elements and enemies. Love/Social needs: desire for love, affection, and belonging. Esteem needs: self-perception as a worthwhile person. Self-actualization: becoming all that one can become. Figure.2: Maslow’s hierarchy of needs Relevance of Maslow’s Theory for Managers: Beyond physical and safety needs, which higher order need will emerge cannot be predicted. A fulfilled need does not motivate an individual. Effective managers can anticipate emerging needs based on individual need profil es and provide opportunities for fulfillment. The esteem level of needs satisfied by jobs and recognition provides managers wi th the greatest opportunity to motivate better performance. • Herzberg’s Two-Factor Theory: A theory of motivation based on job satisfaction. A satisfied employee is motiva ted from within to work harder. A dissatisfied worker is not self-motivated to w ork. Conclusion: Enriched jobs are the key to self-motivation. Hygiene Factors/Intrinsic Factor / Satisfiers: factors associated with the natur e of the task itself (job content).
Motivation Factor/Extrinsic Factors / Dissatisfiers - factors associated with th e job context or work environment. Hygiene factors include: o The organization o Its policies and its administration o The kind of supervision (leadership and management, including perception s) which people receive while on the job o Working conditions (including ergonomics) o Interpersonal relations o Salary o Status o Job security These factors do not lead to higher levels of motivation but without them there is dissatisfaction. The second component in Herzbergs Two-Factor theory involves what people actual ly do on the job and should be engineered into the jobs employees do in order to develop intrinsic motivation with the workforce. The motivators are o Achievement o Recognition o Growth / advancement o Interest in the job These factors result from internal instincts in employees, yielding motivation r ather than movement. Both these approaches (hygiene and motivation) must be done simultaneously. Implications of Herzberg’s Theory Satisfaction is not the opposite of dissatisfaction.There is a need to think car efully about what motivates employees. Meaningful, interesting, and challenging (enriched) work is needed to satisfy an d motivate employees. Problems with theory Assumption of job performance improving with satisfaction is weakly, at best, su pported. One person’s dissatisfier is another person’s satisfier. • Expectancy Theory (Vroom): A model that assumes motivational strength is determined by perceived probabilit ies of success. According the theory motivation is product of three factors. Valence X Expectancy X Instrumentality = Motivation Valence: How much one wants a reward. Expectancy: One’s estimate of the probability that effort will result in successfu l performance. Instrumentality: One’s estimate that performance result in receiving the reward. A basic expectancy model One’s motivational strength increases as one’s perceived effort-performance and perf ormance-reward probabilities increase the likelihood of obtaining a valued rewar d.
Figure.3: A basic expectancy model Relevance of Expectancy Theory to Managers Employee expectations can be influenced by managerial actions and organizational experience. Training increases employee confidence in their efforts to perform.
Listening provides managers with insights into employees’ perceived performance-re ward probabilities. • Alderfer s ERG theory: 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 req uirements. 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 maint aining important interpersonal relationships. These social and status desires re quire interaction with others if they are to be satisfied, and they align with M aslow s social need and the external component of Maslow s esteem classification . Finally, Alderfer isolates growth needs an intrinsic desire for personal develo pment. These include the intrinsic component from Maslow s esteem category and t he characteristics included under self-actualization. • Goal Setting theory: Goal setting: the process of improving performance with objectives, deadlines, o r quality standards A General Goal-Setting Model Properly conceived goals trigger a motivational process that improves performanc e Figure.4: A Model of How Goals Can Improve Performance Personal Ownership of Challenging Goals Characteristics of effective goals: Specificity makes goals measurable. Difficulty makes goals challenging. Participation gives personal ownership of the goal. How Do Goals Actually Motivate? Goals are exercises in selective perception. Goals encourage effort to achieve something specific. Goals encourage persistent effort. Goals foster creation of strategies and action plans. Practical Implications of Goal-Setting Theory The developed ability to effectively set goals can be transferred readily to any performance environments. • McClelland s Need Theory: McClelland s Need Theory, created by a psychologist David McClelland, is a motiv ational model that attempts to explain how the needs for achievement, power, and affiliation affect the actions of people from a managerial context. It is often taught in classes concerning management or organizational behavior. Need for Achievement People who are achievement-motivated typically prefer to master a task or situat ion. They prefer working on tasks of moderate difficulty, prefer work in which t he results are based on their effort rather than on luck, and prefer to receive feedback on their work. Need for Affiliation People who have a need for affiliation prefer to spend time creating and maintai ning social relationships, being a part of groups, and desire feeling loved and accepted. People in this group do not typically make effective managers because they worry too much about how others will feel about them.
Need for Power This motivational need stems from one s desire to influence, teach, or encourage others. People in this category enjoy work and place a high value on discipline . The downside to this motivational type is that group goals can become zero-sum in nature. For one to win, another must lose. However, this can be positively a pplied to help accomplish group goals and to help others in the group feel compe tent about their work. McClelland proposes that those in the top management positions should have a hig h need for power and a low need for affiliation. He also believes that although individuals with a need for achievement can make good managers, they are not sui ted to being in the top management positions. 3.3 Motivation Through Job Design: Job Design The delineation of task responsibilities as dictated by organizational strategy, technology, and structure. Strategy One: Fitting People to Jobs Improving the motivation of routine-task personnel • Realistic job previews: honest explanations of what a job actually entails. • Job rotation: moving people from one specialized job to another. • Limited exposure: Using incentive such as contingent time off (CTO) to motivate performance Strategy Two: Fitting Jobs to People • Job enlargement: combining two or more specialized tasks (horizontal loading) to increase motivation. • Job enrichment: redesigning a job to increase its motivating potential by introd ucing planning and decision-making responsibility (vertical loading). Five Core Dimensions of Work 1. Skill variety: the variety of activities required in carrying out the wo rk. 2. Task identity: the completion of a “whole” and identifiable piece of work. 3. Task significance: how substantial an impact the job has on the lives of other people. 4. Autonomy: the freedom, independence, and discretion that one has to do t he job. 5. Job feedback: how much performance feedback the job provides to the work er. Figure.5: Motivation through job design 3.4 Motivation Through Reward: • Extrinsic Rewards Payoffs granted to the individual by other rewards. o Money, employee benefits, promotions, recognition, status symbols, and p raise. • Intrinsic Rewards Self-granted and internally experienced payoffs. o Sense of accomplishment, self-esteem, and self-actualization. Improving Performance with Extrinsic Rewards o Rewards must satisfy individual needs. Cafeteria compensation: a plan that allows employees to select their own mix of benefits. o Employees must believe effort will lead to reward. o Rewards must be equitable. o Rewards must be linked to performance. Personal and Social Equity
3.5 Motivation Through Employee Participation: • Participative Management The process of empowering employees to assume greater control of the workplace. Setting goals Making decisions Solving problems Designing and implementing organizational changes Three approaches to participation Quality control circles Open-book management Self-managed teams Quality Control (QC) Circles Voluntary problem-solving groups of five to ten employees from the same work are a who meets regularly to discuss quality improvement and ways to reduce costs. Assume responsibility for recommending, implementing, and evaluating solutions t o quality problems. Voluntary participation taps into the creative potential of every employee. Open-Book Management (OBM) Sharing a company’s key financial data and statements with all employees and provi ding the education that will enable to understand how the company makes money an d how their action affect its success and bottom line. Benefits of OBM: Displays a high degree of trust in employees. Creates strong commitment to employee training. Teaches patience when waiting for results. Figure.6: The Four S.T.E.P. Approach to Open-Book Management The STEP approach to Open-Book Management (OBM) Step 1: Exposure to financial data. Step 2: Training employees in the business model. Step 3: Empowering employees to make decisions. Step 4: Sharing in profits, bonuses, and incentive compensation. Self-Managed Teams (Autonomous Work Groups): High performance teams (with assigned membership) that assume traditional manage rial duties such as staffing and planning as part of their normal work routine. Self-management fosters creativity, motivation, and productivity Building Employee Support for Participation A profit-sharing or gain-sharing plan. A long-term employment relationship with good job security. A concerted effort to build and maintain group cohesiveness. Protection of individual employee’s rights. 3.6 Why study and apply employee motivation principles? Quite apart from the benefit and moral value of an altruistic approach to treati ng colleagues as human beings and respecting human dignity in all its forms, res earch and observations show that well motivated employees are more productive an d creative. The inverse also holds true. The schematic below indicates the poten tial contribution the practical application of the principles this paper has on reducing work content in the organization.
3.7 Motivation is the key to performance improvement: There is an old saying you can take a horse to the water but you cannot force it to drink; it will drink only if it s thirsty - so with people. They will do wha t they want to do or otherwise motivated to do. Whether it is to excel on the wo rkshop floor or in the ivory tower they must be motivated or driven to it, eit her by themselves or through external stimulus. Are they born with the self-motivation or drive? Yes and no. If no, they can be
motivated, for motivation is a skill which can and must be learnt. This is essen tial for any business to survive and succeed. Performance is considered to be a function of ability and motivation, thus: • Job performance =f(ability)(motivation) Ability in turn depends on education, experience and training and its improvemen t is a slow and long process. On the other hand motivation can be improved quick ly. There are many options and an uninitiated manager may not even know where to start. As a guideline, there are broadly seven strategies for motivation. • Positive reinforcement / high expectations • Effective discipline and punishment • Treating people fairly • Satisfying employees needs • Setting work related goals • Restructuring jobs • Base rewards on job performance These are the basic strategies, though the mix in the final recipe will vary f rom workplace situation to situation. Essentially, there is a gap between an ind ividuals actual state and some desired state and the manager tries to reduce thi s gap. Motivation is, in effect, a means to reduce and manipulate this gap. It is induc ing others in a specific way towards goals specifically stated by the motivator. Naturally, these goals as also the motivation system must conform to the corpor ate policy of the organization. The motivational system must be tailored to the situation and to the organization. In one of the most elaborate studies on employee motivation, involving 31,000 me n and 13,000 women, the Minneapolis Gas Company sought to determine what their p otential employees desire most from a job. This study was carried out during a 2 0 year period from 1945 to 1965 and was quite revealing. The ratings for the var ious factors differed only slightly between men and women, but both groups consi dered security as the highest rated factor. The next three factors were; • advancement • type of work • company - proud to work for Surprisingly, factors such as pay, benefits and working conditions were given a low rating by both groups. So after all, and contrary to common belief, money is not the prime motivator. (Though this should not be regarded as a signal to rew ard employees poorly or unfairly.) 3.8 Different Motivational Practices: Because knowledge is intimately and i nextricably bound up with people’s egos and occupational meanings, it does not eme rge or flow easily across role or functional boundaries. Therefore, the presence of motivation to create, share, and use knowledge is an intangible critical suc cess factor for virtually all projects. Finding new sources of motivation to inc rease participation is a constant challenge. The motivational aids or incentives used cannot be trivial, as some of project managers had learned. One gave out a irline frequent flyer mileage for browsing or contributing to a discussion datab ase. He found that the free miles were enough to prompt an initial use of the sy stem, but insufficient to drive ongoing activity. Another manager of an expert n etwork planned to give out chocolate-covered ice cream bars—admittedly high qualit y ones—to any expert who contributed a biography to the system. Needless to say, t his incentive was insufficiently motivating. Motivational approaches to encourage more effective employee behaviors should be long-term and tied in with the rest of the evaluation and compensation structur e. If incentives are short-term, they should be highly visible. Shortly after Bu ckman Laboratories introduced a new knowledge sharing network, the best 150 “knowl edge sharers” were rewarded with an elaborate company trip to a resort. The high p rofile event generated considerable discussion among those not chosen and immedi ately increased participation on the new knowledge sharing network. Texas Instru ments recently created an annual “Not Invented Here but I Did It Anyway” award to ac knowledge both those who borrow good ideas from within and outside the company, and also those who shared them.
Here are 12 motivational tools that can be used by organizations to make their e mployees motivated at individual level. 1. Recognizing obstacles and learning to remove them can make our vision a reali ty. The individual who is extremely motivated and successful has been motivated by a vision. 2. The quest for freedom is the basis for motivation. Total freedom is not neces sarily desirable or possible, but the pursuit of that ideal is what motivates us to succeed. 3. People who develop a vision control their own life and destiny. With no visio n, life and destiny are controlled by outside forces. One must change his thinki ng habits in order to change his life, and he changes his habits by keeping the desired results in sight. 4. Developing a major goal, but taking a specified path to get there. People hav e many smaller goals to reach before they get to the final result. By learning t o accomplish these smaller goals, they will be motivated to take on the larger c hallenges. 5. Getting into the habit of finishing what one has started. An unfinished proje ct is of no value. Leaving things unfinished is a habit that must be changed. 6. Finding support through friends, acquaintances, and co-workers. If people are surrounded with motivated, visionary people, they will naturally develop the at tributes that helped the visionary people get that way. Mutual interests and lik e-minded associates can be excellent motivational tools. 7. Another motivational tool is failure. Failure teaches to keep trying until we get it right. No one ever became successful without prior failures. Failure is a by-product of imagination and creativity. It challenges to take risks and teac hes to keep trying until we get it right. 8. The fear of failure is a common factor among those who procrastinate. If one wants to succeed in reaching their goals, he must be willing to take a risk and lose. Many people trade joy, satisfaction, and fulfillment for a job that is con sidered conventional and safe. 9. The unfulfilling job is not the failure; not pursuing dreams is the real fail ure. Developing a vision requires conquering fears and finding motivation from w ithin. 10. The power of dreams is the primary factor in becoming motivated. Productivit y will be the result of developing habits and attitudes that keep one on the rig ht track. 11. By changing bad habits and focusing on specific goals, motivation will come even when one wishes one could quit and times are tough. 12. By identifying the behaviors that one needs to change, developing a vision o f what he would like to achieve, and striving to attain that goal, he will becom e a naturally motivated, highly efficient, productive person. 4.0 Findings:
Necessity of Motivational Activities at PPF: As PPF focuses on export market, Kn owledge or intellectual asset is more important than other physical and financia l assets at PPF. As a part of Renata’s vision to become globally visible in the ph armaceutical industries, PPF is established with the focus to enter the European market. But to enter in a European market PPF needs to prove that it can produc e medicine maintaining European standard of quality and to maintain product qual ity, total quality management system is much more important than good and sophis ticated machineries, good building facility etc. Again, the quality requirements for medicinal products are upgrading everyday. To cope up with this change, PPF management needs to have highly motivated knowledge employees so that it can re ach its goal. 4.1 Motivational Tools Used at Potent Product Facility (PPF), Renata Limited : Employee performance is a function of the interaction of ability, motivation a
nd opportunity to perform, that is P = f (A X M X O). If any of these is inadequ ate, performance will be negatively affected. An individual’s intelligence, skills and scope to perform must be considered in addition to motivation if employee p erformances are to be accurately explained and predicted. If it is considered th at workers are highly capable and are provided with sufficient scope to work, th en motivation will play a vital role to take the organization to its desired goa l. Here some common tools of motivation are discussed that Renata has used in th e PPF project and obtained a positive outcome. 4.1.1 Variable Pay Program-‘Bonus’: Piece-rate plan, wage incentives, profit shari ng, bonus and gain sharing are all forms of variable-pay programs. What differen tiates these forms of compensation from more traditional programs is that instea d of paying a person only for the time on job or seniority, a portion of employe es pay is based on some individual and/or organizational measure of performance. Unlike ore traditional base-pay program, variable pay is not an annuity. At PPF, apart from the regular base pay, annual bonus is awarded to those execut ives who have successfully achieved their set goal. Every year an annual apprais al judges the overall performance and contribution of the executives. Theoretical View Point: Variable Pay is most compatible with expectancy theory predictions. Individuals should perceive a strong relationship between their performance and the rewards they perceive if motivation is to be maximized. If rewards are awarded completel y on nonperformance factors i.e. seniority or job title-then these employees are likely to reduce their effort. By tying pay to performance, earnings recognize in contribution rather than being a form of entitlement. Low performers find tha t their pay stagnates, while high performers enjoy pay increases commensurate wi th their contribution. 4.1.2 Skill Based Pay: Skill based pay is an alternative to job-based pay. Rat her than having an individual’s job title define his or her pay category, skill-ba sed pay (or sometimes called competency-based pay) sets pay levels on the basis their competency. This is a very common practice at PPF. As this project has started with a goal to achieve the world class standard and international market share, continuous effort form all units e.g. production, marketing etc is highly demanded. Special emphasis has been given on the self development. Salary for any executive is re structured on the basis of the performance and self development. Theoretical View Point: Skill based pay plans are consistent with several motivation theories. Because t hey encourage employee to learn, expand their skill, and grow, they are consiste nt with ERG theory. Among employees whose lower order needs are substantially sa tisfied, the opportunity to experience growth can be a motivator. Paying people to expand their skill levels is also consistent with research on t he achievement need. High achievers have a compelling drive to do things better or more efficiently. By learning new skills or improving the skills the already hold, high achievers will find their job more challenging. Skill based pay may additionally have equity implications, when employees make t heir input-outcome comparisons, skill may provide a fairer input criterion for d etermining pay. This may increase the perception of equity and help optimize emp loyee motivation. Research has discovered that increased use of skill as a basis of pay appears particularly strong among organizations facing aggressive foreig n competition and those companies with speed to market concern. 4.1.3 Motivating Professional: In contrast to generation ago, the typical empl oyee today is more likely to be a highly trained professional than a blue-collar factory worker. Professional are typically different from non professional. The se professional receive a great deal of intrinsic satisfaction from their work. They have a strong and long term commitment to their field of expertise. Their l
oyalty is more often to their profession that to their employer. To keep current in their field, they need regularly update their knowledge, and their commitmen t to their profession means they rarely define their workweek in terms of 8 to 5 and five days a week. When motivation is concerned, money and promotions typically are low on their pr iority. They tend to be well paid. In contrast, job challenge tends to ranked hi gh. They like to tackle problems and find solutions. Professional also value sup port. They want others to think what they are working on is important. The followings are a few example of how PPF motivates its knowledge workers, whi ch is the main concern at PPF as it is dealing with knowledge based project: • Knowledge worker must be provided with ongoing challenging projects. In recent past, the most challenging task for the PPF, Renata team was to get th e MHRA certificate which is a UK based certification for export in Europe and Re nata would be the second company in Bangladesh to get it. This basically certifi es the quality maintained through out the production process. For the profession als it was a stimulating challenge that drove them to work for even 16 hours a d ay which can’t be achieve through any other means. Another challenge before this company is to set up an infrastructure that can ge t a bigger market share globally and sustain even after 2016 when incentives for LDC will not be awarded to them anymore. • Autonomy should be given to them to follow their interests. Professionals should be allowed to structure their work in ways that they find productive. Renata allows its design and production engineers to design and operate the plan t as they plan. They are allowed to set their goal and measures to attain these goals. This autonomy enhances their enthusiasm and always better results are ach ieved at the end. • Knowledge based professionals can be motivated if they are rewarded with educ ational opportunities e.g. workshops, trainings, attending conferences that allo w them to keep current in their fields. Keeping this in mind, higher authority of Renata decided to send some newly recr uit engineers abroad for a World Pharmaceutical Fair in Spain, usually attended by very high ranked officials. Then they were sent to Pecking University of Chin a to attend a conference. These exposures obviously boosted their encouragement. • Knowledge worker should be rewarded with recognition and continuous support from senior management. Their projects should be provided funding and other resource s for infrastructure. The top management of Renata always gives highest priority to PPF and recognizes its achievements. Funding and resources are never a problem for PPF. • Usually the annual general sales meeting of Renata Limited is held at holiday re sort in or outside the country with lots of entertainment just to motivate the a chievers. • Sometimes special holiday packages, out of the country, are awarded to high achi evers of Renata following any success. • Annually Renata arranges Family Days only to enhance the employee belongingness to the organization. Also pictures of newborns of employees are exhibited in lar ge screen only to congratulate them. Theoretical View Point: If the motivating tools used by PPF are analyzed from t he theoretical point of view; it is very evident that these are linked to differ ent theories. From the early theories of motivations, Maslow’s hierarchy of needs theories is very much visible. As it is already mentioned that professionals or knowledge based workers are usually well paid, the Physiological and safety nee ds are not major concerns. But the higher order needs e.g., esteem and self actu alization are very important. Internal esteem factors such as self respect, auto nomy and achievements and external factors such as status, recognition and atten tion are some prime motivating factors. As PPF patronize the workers’ growth and a ttainment the highest stage of capabilities, so self actualization is also a con cern for knowledge based worker. ERG theory can be linked with the practices mentioned above. ERG states that the re are three groups of core needs; existence, relatedness and growth. For knowle
dge based worker growth needs-an intrinsic desire for personal development is ve ry important. Motivational tools for professionals of Renata can be linked with Goal setting T heory of motivation which states that goal specificity, challenge and feedback h ave significant impact on performance. Specificity of goals itself acts as an in ternal stimulus. If factors such as ability and acceptance of the goals are held constant, it can be said that the more difficult the goal, the higher level of performance. Once an employee accepts a harder task, he or she will exert a high level of effort until it is achieved, lowered or abandoned. Feedback on how wel l any worker is progressing towards their goals, acts to guide behavior. Self ge nerated feedback-where the employee is able to monitor his or her own progress, has been proved to be a more powerful motivator than externally generated feedba ck. In addition to these, goal commitment, adequate self efficacy, task characte ristics and national culture are four factors that influence the goal-performanc e relationship.
5.0 Conclusion - A Success Story: Study of the employee motivational tools o f PPF gives an indication that they are doing well in this case. Motivational to ols are good enough to motivate employees to go for challenges. A recent formidable success also proves that the management of PPF is doing real ly well. It has already been stated before that the biggest challenge for PPF wa s to get the MHRA (Medicines and Healthcare Product Regulatory Agency, UK) Certi ficate, which will enable Renata to enter into the European medicine market. Ren ata faced the MHRA Audit few months back and successfully passed the audit and i n line to get the certificate now. Thus they are becoming the second company in Bangladesh after Square Pharmaceuticals to achieve that. But the more impressive part is that Renata spent only 2 years and 0.2 billion BDT in comparison to Squ are’s 7 years and 3 billion BDT, to pass this audit. Again all works related to au dit is done by Renata’s own employees whereas Square spent millions of BDT for aud it related works, which is done in their case by European expert. Another pharma ceutical giant in Bangladesh, Beximco has been trying for MHRA or equivalent cer tificate for 15 years, spending more money than Square but in vein. They could n ot get close to achieve that. So clearly Renata has done far better than its competitor in terms of achieving certificates for quality products. This became possible for them because of moti vated knowledge workers. Other pharmaceuticals can take Renata’s model as a guide in the quest of success. 6.0 Recommendation: Different motivational tools used by PPF to motivate the ir knowledge workers are found to be variable pay program- ‘Bonus’, skill based pay, motivating professionals by various incentives like challenge, autonomy, recogn ition, reward, outings, educational excursions etc. But still they can do more. Some suggestions are pointed belowRe-Structuring of Basic Salary: Basic salary given to the employees is poor comp are to their gross salary. As per the Two Factor Theory it is and hygiene factor and it can cause lack of job satisfaction among the employees. Renata claims th at they do it to lessen the income tax burden of the employee. Company should raise its basic salary though they have counter logic for this. R enata tries to minimize the loss by giving five bonuses in a year but still it i s not up to the mark as yearly increments, amount of bonus, provident fund, grat uity and many other money related benefits are dependent on employee’s basic salar y. Therefore company should take care of the situation which is a responsibility towards the employee. Development of Child Care Centre: Company policy needs to be improved in favor o f its female employees who are at the same time in their motherhood. There is no
child care centre for the employees though many working mothers are present. Au thority is planning to build one as soon as they sorts out the problem regarding availability of space for the purpose.Being a productive company where so many female employees are engaged should arrange one child care centre. This will in turn be beneficial for the company as the mothers would be less concern for thei r child and be able to give more concentration to work and motivated to achieve their se goals. Along with solid compensation and improving company policy Renata can reinforce some of its non-monetary motivational activities and step to more success with s trongly motivated employees. They need to regularly track the needs and wants of individual employees as it keeps changing over the period of time. Some techniq ues of non-monetary motivational tools are discussed belowApplause: It is a form of recognition, but a very specific form. Physica lly praising the employees by giving them a round of applause for specific achie vements is of great use. It can be done wherever and whenever the manager wants to. Career Path: Employees need to know what is potentially ahead for them, what opportunities there are for growth. This issue is a sometimes forgotten ing redient as to the importance it plays in the overall motivation of people. Career paths should be set within the organization. Although there are some spec ific circumstances were a company requires looking for talent out side it. But t he organisation should always first consider internal personnel. If the authorit y does this then it means they are sending a very positive message to every one that there are indeed further career opportunities within the organization. Job Titles: When someone talks about job titles he is tapping the self-e steem of people. How someone feels about the way they are perceived in the workf orce is a critical component to overall attitude and morale. Authority should sh are their employee’s job title in front of other to make them feel proud. Bottom l ine, authority is dealing with pride...and pride enhances a positive attitude... and a positive attitude is the foundation for continuing success. On-the –Spot Praise: This is too associated with recognition but the key i s timing. Promptness equals effectiveness and effectiveness allows boosting up t he morale of employee. Good Work Environment: A recent industry study shows just how inaccurate results can be. Employers were asked to rank what they thought motivated their people and then employees were asked to rank what really did motivate them. Employers felt "working conditions" was a nine (or next to last) in terms of imp ortance. And according to employees it was number two. Working conditions are ve ry important to the way employees feel about where they work. Cosmetically, working condition should be nice looking. There should be fresh pl ants among other features that generally make people feel good about their envir onment. Work space should be enough for them to work comfortably .This little th ings can intensively motivate a person. Leadership Roles: Senior mangers can give people leadership roles to rew ard their performance and also to help them identify future promotable people. M ost people are stimulated by leadership roles even in spot appearances. For exam ple, when visitors come to the workplace higher management can allow an employee to take the role of visitors guide. Other Factors: Bonuses and commissions get cashed, spent and forgotten. But there are some other factors that can motivate the employees more than any m onetarily benefits. For example1. Team Spirit- Having a picture taken of entire staff including the CEO an d having it enlarged and hanging it in a visible spot can really trigger the mot
ivation out of employees. Most people like to physically see themselves as part of a group or team. 2. Social Gatherings- Scheduled offsite events enhance bonding which in tu rn helps team spirit, which ultimately impacts organisation’s positive work enviro nment. 3. Casual Dress Day- Using holidays to create theme colour casual days such as red and green before Bijoy Dibosh, blue on a rainy season etc . 4. Time Off- Contests can be implemented that earn time off. People will c ompete for 15 minutes or 1/2 hour off just as hard as they will for a cash award . The organisation can put goals in place (padded of course) and when these goal s are reached by individuals, teams or the entire staff, time off can be rewarde d. 5. Additional Responsibility- There are definitely employees in the organiz ation who are begging for and can handle additional responsibility. Senior manag ers need to identify who they are and if possible could match responsibilities t o their strengths and desires. 6. Stress Management- There are many articles and books available on the su bject. Organisation can make this reference material available to the people and encourage them to use it. If possible, in-house seminar on stress management te chniques can be arranged. So that production time is not lost.
References 1. Kreitner – Management. 9th edition, Houghton Miffin Company. 2. Polanyi, Michael - The Tacit Dimension. Online description. 3. Stephen P. Robbins – Organizational Behavior 11th edition, Prentice Hall 4. Keith Davis, John w Newstrom – Organizational Behavior 12th edition, The McGraw Companies. 5. Following Web Addresses were visited: www.biztrain.com/motivation/stories/20ways.htm WWW.humanresources.about.com/.../motivationrewardretention/Employee Motivation_R ecognition_Rewards_Retention.htm http://en.wikipedia.org/wiki/Motivation
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