Chapter 08 17th OB

1-1
Copyright © 2015 Pearson Education, Inc.

Chapter 8: Motivation:
From Concepts to Applications
8-2

Learning Objectives
After studying this chapter, you should be able to:
Describe the job characteristics model and the way it
motivates by changing the work environment.
Compare the main ways jobs can be redesigned.
Explain how specific alternative work arrangements can
motivate employees.
Describe how employee involvement measures can motivate
employees.
Demonstrate how the different types of variable-pay
programs can increase employee motivation.
Show how flexible benefits turn benefits into motivators.
Identify the motivational benefits of intrinsic rewards.
8-3

Job Characteristics Model
Identifies five job Characteristics:
characteristics and their 1. Skill variety
relationship to personal 2. Task identity
and work outcomes.
3. Task significance
4. Autonomy
5. Feedback
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Skill Variety
The degree to which a job requires a variety of
different activities (how may different skills are
used in a given day, week, month?).
Task Identity
The degree to which the job requires completion of a
whole and identifiable piece of work (from
beginning to end) that results in a visible outcome.
Task Significance
The degree to which the job has a substantial
impact on the lives or work of other people.
.
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Job Characteristics Model (cont’d)
Autonomy
The degree to which the job provides substantial freedom
and discretion to the individual in scheduling the work and
in determining the procedures to be used in carrying it out.
Feedback
The degree to which carrying out the work
activities required by a job results in the
individual obtaining direct and clear
information about the effectiveness of his or
her performance.
© 2007 Prentice
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Job Characteristics Examples
Skill Variety- i.e. the job of an owner-operator of a garage
who does electrical repairs, rebuilds engines and interacts
with customers
Task Identity - i.e. the job of a cabinet maker who designs a
piece of furniture, selects the wood, builds the object and
finishes it to perfection
Task Significance - i.e. the job of a nurse handling the
diverse needs of patients in an intensive care unit of a
hospital

Job Characteristics Examples
Autonomy - i.e. a salesperson scheduling his or her
own work each day.
Feedback - the job of a factory worker who
assembles iPods and tests them to see if they operate
properly

 Jobs with skill variety, task identity, task significance,
autonomy, and for which feedback of results is given,
directly affect three psychological states of employees:
Knowledge of results
Meaningfulness of work
Personal feelings of responsibility for results

LO 1 Describe the Job Characteristics Model
and the Way It Motivates by
Changing the Work Environment
8-10

The first three dimensions— skill variety, task identity, and
task significance —combine to create meaningful work the
incumbent will view as important, valuable, and worthwhile.
From a motivational standpoint, the JCM proposes that
individuals obtain internal rewards when they learn
(knowledge of results) that they personally (experienced
responsibility) have performed well on a task they care about
(experienced meaningfulness).
1-11

Describe the job characteristics model and
LO 1 evaluate the way it motivates by changing
the work environment
Much evidence supports the JCM concept that the
presence of a set of job characteristics—variety,
identity, significance, autonomy, and feedback—
does generate higher and more satisfying job
performance.
 A few studies have tested the job characteristics
model in different cultures, but the results aren’t very
consistent.
Copyright © 2015 Pearson Education, Inc. 8-12

LO 2 Compare the Main Ways Jobs
Can Be Redesigned
Repetitive jobs provide little variety, autonomy, or
motivation.
Job Rotation
 Referred to as cross-training.
 Periodic shifting from one task to another.
 Strengths: reduces boredom, increases motivation,
and helps employees better understand their work
contributions.
 Weaknesses: creates disruptions, requires extra time
for supervisors addressing questions and training
time, and reduced efficiencies. 8-13

Can Be Redesigned
 Relational Job Design
 To make jobs more prosocially motivating:
 Connect employees with the beneficiaries of their work.
 Relate stories from customers who have found the company’s
products or services to be helpful.
 Meet beneficiaries firsthand.
 Employees see that their actions affect a real person, and that their
jobs have tangible consequences.
 Connections make customers or clients more accessible in memory
and more emotionally vivid.
 Leads employees to consider the effects of their actions more.
 Fosters higher levels of commitment.
8-14

Job Enrichment
Job Enrichment - The vertical expansion of jobs. This
is done by increasing the depth of a job by adding
the responsibility for planning, organizing,
controlling and evaluating the job.
Expanding jobs vertically gives employees
responsibilities and control formerly reserved for
management.

Can Be Redesigned
8-16

Compare and contrast the main
LO 2 ways jobs can be redesigned
Some newer versions of job enrichment
concentrate specifically on improving the
meaningfulness of work.
 One method is to relate employee experiences
to customer outcomes.
 Another method for improving the
meaningfulness of work is providing employees
with mutual assistance programs.
Copyright © 2015 Pearson Education, Inc. 8-17

Compare and contrast the main
LO 2 ways jobs can be redesigned
The evidence on job enrichment shows it
reduces absenteeism and turnover costs and
increases satisfaction, but not all programs are
equally effective.
Some recent evidence suggests job enrichment
works best when it compensates for poor feedback
and reward systems.
Work design may also not affect everyone in the
same way.

Alternative Work Arrangements
Flextime
Employees work during a common core time
period each day but have discretion in forming
their total workday from a flexible set of hours
outside the core.
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LO 3 Explain How Specific Alternative Work
Arrangements Can Motivate Employees
8-20

Job Sharing
 Two or more people split a 40-hour-a-week job.
Declining in use.
Can be difficult to find compatible pairs of employees
who can successfully coordinate the intricacies of one
job.
Increases flexibility and can increase motivation and
satisfaction when a 40-hour-a-week job is just not
practical.
8-21

Telecommuting
 Employees who do their work at home at least two
days a week on a computer that is linked to their
office.
Virtual office
Well-known organizations that actively
encourage telecommuting include AT&T, IBM,
American Express, Sun Microsystems
8-22

LO 3 How Specific Alternative Work
Arrangements Motivate Employees
As the OB poll indicates, people with more education are

more apt to work from home.
8-23

Telecommuting Advantages
 Larger labor pool
 Higher productivity
 Less turnover
 Improved morale
 Reduced office-space costs
8-24

Telecommuting Disadvantages
 Employer
Less direct supervision of employees.
Difficult to coordinate teamwork.
Difficult to evaluate non-quantitative
performance.
 Employee
May not be noticed for his or her efforts.
8-25

The Social and Physical Context Of Work
 The job characteristics model shows most
employees are more motivated and satisfied when
their intrinsic work tasks are engaging.
 Research demonstrates that social aspects and
work context are as important as other job design
features.
8-26

Employee Involvement Programs
Participative Management
A process in which subordinates share a
significant degree of decision-making power
with their immediate superiors.
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LO 4 Describe How Employee Involvement
Measures Can Motivate Employees
Participative management
 Acts as a panacea for poor morale and low
productivity.
 Trust and confidence in leaders is essential.
 Studies of the participation-performance have
yielded mixed results.
8-28

Give examples of employee involvement
LO 4 measures and show how they can
motivate employees
Common to all participative management

programs is joint decision making.
But for it to work, employees must: a.) be
engaged in issues relevant to their interests so
they’ll be motivated; b.) they must have the
competence and knowledge to make a useful
contribution, and c.) trust and confidence must
exist among all parties.

Examples of Employee Involvement Programs
(cont’d)
Representative Works Councils
Participation Groups of nominated or elected
employees who must be
Workers participate in consulted when management
organizational decision makes decisions involving
making through a small personnel.
group of representative
employees.
Board Representative
A form of representative
participation; employees sit on
a company’s board of directors
and represent the interests of
the firm’s employees.
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LO 4 Describe How Employee Involvement
Measures Can Motivate Employees
Linking Employee Involvement Programs and Motivation
Theories
 Theory Y is consistent with participative management.
 Theory X aligns with autocratic style.
 Two-factor theory aligns with employee involvement
programs in providing intrinsic motivation.
 Extensive employee involvement programs clearly have the
potential to increase employee intrinsic motivation in work
tasks.
8-31

LO 5 Demonstrate How the Different
Types of Variable-Pay Programs Can Increase
Employee Motivation
What to Pay: Establishing a Pay Structure
 Complex process that entails balancing internal equity and
external equity.
 Some organizations prefer to pay leaders by paying above
market.
 Paying more may net better-qualified and more highly
motivated employees who may stay with the firm longer.
8-32

Types of Variable-Pay Programs Can
Increase Employee Motivation
How to Pay: Rewarding Individual Employees Through
Variable-Pay Programs
 Many organizations are moving away from paying
solely on credentials or length of service.
Piece-rate plans
Merit-based pay
Bonuses
Profit sharing
Gain sharing
Employee stock ownership plans
 Earnings therefore fluctuate up and down. 8-33

Employee Motivation
Piece-Rate Pay
 Workers are paid a fixed sum for each unit of production
completed.
 A pure piece-rate plan provides no base salary and pays the
employee only for what he or she produces.
 Limitation: not a feasible approach for many jobs.
Although incentives are motivating and relevant for some
jobs, it is unrealistic to think they can constitute the only
piece of employees’ pay.
8-34

Merit-Based Pay
 Based on performance appraisal ratings.
 Allows employers to differentiate pay based on
performance.
 Creates perceptions of relationships between performance
and rewards.
 Limitations:
Based on annual performance appraisal; merit pool
fluctuations based on economic conditions; unions
typically resist merit-based pay plans.
8-35

Employee Motivation
Bonuses
 An annual bonus is a significant component of total
compensation for many jobs.
 Increasingly include lower-ranking employees.
Many companies now routinely reward production
employees with bonuses when profits improve.
 Downside: employees’ pay is more vulnerable to cuts.
8-36

Employee Motivation
 Skill-Based Pay
 Bases pay levels on how many skills employees have or how many jobs
they can do.
 Increases the flexibility of the workforce.
 Facilitates communication across the organization because people gain
a better understanding of each other’s jobs.
 Limitations:
 People can “top-out” and learn all the skills.
 Don’t address performance.
8-37

Employee Motivation
Profit-Sharing Plans
 Organization-wide programs that distribute compensation
based on some established formula centered around a
company’s profitability.
 Appear to have positive effects on employee attitudes at
the organizational level.
Employees have a feeling of psychological ownership.
8-38

Employee Motivation
 Gainsharing
 Uses improvements in group productivity from one period to the next
to determine the total amount of money allocated.
 Common among large manufacturing companies and in some
healthcare organizations.
 Ties rewards to productivity gains rather than profits.
 Employees can receive incentive awards even when the organization
isn’t profitable.
 Because the benefits accrue to groups of workers, high performers
pressure weaker ones to work harder, improving performance for the
group as a whole.
8-39

Employee Stock Ownership Plan (ESOP)
 A company-established benefit plan in which employees
acquire stock, often at below-market prices, as part of their
benefits.
 Increases employee satisfaction and innovation.
Employees need to psychologically experience ownership.
 Can reduce unethical behavior.
8-40

Evaluation of Variable Pay
 Do variable-pay programs increase motivation and
productivity? The answer is a qualified yes.
Studies generally support the idea that organizations with
profit-sharing plans have higher levels of profitability than
those without them.
 Are there cultural differences?
Maybe, but more research is needed.
8-41

LO 6 Show How Flexible Benefits
Turn Benefits Into Motivators
Flexible Benefits: Developing a Benefits Package
 Flexible benefits individualize rewards.
Allow each employee to choose the compensation
package that best satisfies his or her current needs and
situation.
Replaces the “one-benefit-plan-fits-all” programs
designed for a male with a wife and two children at
home that dominated organizations for more than 50
years.
8-42

LO 6 Show How Flexible Benefits
Turn Benefits Into Motivators
There are three basic types of programs:
1. Modular plans: pre-designed with each module put
together to meet the needs of a specific group of
employees.
2. Core-plus plans: a core of essential benefits and a menu-
like selection of other benefit options.
3. Flexible spending plans: employees set aside pretax
dollars up to the amount offered in the plan to pay for
particular benefits, such as healthcare and dental
premiums.
8-43

LO 7
Identify the Motivational
Benefits of Intrinsic Rewards
Intrinsic Rewards: Employee Recognition Programs
 Organizations are increasingly recognizing that important
work rewards can be both intrinsic and extrinsic.
 Rewards are intrinsic in the form of employee recognition
programs and extrinsic in the form of compensation
systems.
Financial incentives might be more motivating in the
short-term, but nonfinancial rewards are more
important in the long-term.
8-44

Implications for Managers
 Recognize individual differences.
 Spend the time necessary to understand what’s
important to each employee.
 Design jobs to align with individual needs and
maximize their motivation potential.
 Use goals and feedback.
 You should give employees firm, specific goals,
and they should get feedback on how well they
are faring in pursuit of those goals.
8-45

Implications for Managers
 Allow employees to participate in decisions that affect
them.
 Employees can contribute to setting work goals,
choosing their own benefits packages, and solving
productivity and quality problems.
 Link rewards to performance.
 Rewards should be contingent on performance, and
employees must perceive the link between the two.
 Check the system for equity.
 Employees should perceive that experience, skills,
abilities, effort, and other obvious inputs explain
differences in performance and hence in pay, job
assignments, and other obvious rewards. 8-46

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means, electronic, mechanical, photocopying, recording, or otherwise,
without the prior written permission of the publisher. Printed in the
United States of America.
Copyright © 2014 Pearson Education

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Copyright © 2015 Pearson Education, Inc.

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Copyright © 2015 Pearson Education, Inc.

Copyright © 2015 Pearson Education, Inc.

Copyright © 2015 Pearson Education, Inc.

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As the OB poll indicates, people with more education are

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Common to all participative management

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