Business Leadership 1

Motivation Theories
 The Nature of Motivation
Motivation
– The psychological forces that determine the
direction of a person’s behavior in an
organization, a person’s level of effort, and a
person’s level of persistence.
– Explains why people behave the way they do in
organizations
 The Nature of Motivation
• Direction - possible behaviors the individual
could engage in

• Effort - how hard the individual will work

• Persistence - whether the individual will keep

trying or give up
 The Nature of Motivation
• Intrinsically Motivated Behavior
– Behavior that is performed for its own sake.
• The source of the motivation that comes from actually
performing the behavior.
• The sense of accomplishment and achievement
derived from
doing the work
itself
 The Nature of Motivation
• Extrinsically Motivated Behavior
– Behavior that is performed to acquire material or
social rewards or to avoid punishment.
• The source of the motivation is the consequences of
the behavior and not the behavior itself.
 Expectancy Theory
Motivation will be high when workers believe:
– High levels of effort will lead to high performance.
– High performance
will lead to the
attainment of
desired outcomes.
 Expectancy Theory
• Expectancy - does my effort lead to any
outcome?
• Instrumentality - does that outcome have any
consequence?
• Valence - do I care about those
consequences?
 Expectancy Theory
Major Factors of Motivation
– Expectancy - the belief that effort (input) will
result in a certain level of performance
– Instrumentality - the belief that performance
results in the attainment of outcomes
– Valence - how desirable each of the available
outcomes from the job is to a person
Expectancy, Instrumentality, and
Valence
Expectancy Theory
 Expectancy Theory
• M (motivation) = E * I * V
• Need ALL components to work. If one of these
components is 0, M = 0
 Need Theories
• Need
– A requirement or necessity for survival and well-
being.
• Need Theories
– People are motivated to obtain outcomes at work
that will satisfy their needs
 Maslow’s Hierarchy of Needs
• Maslow’s Hierarchy of Needs
– Maslow proposed that all people seek to satisfy
five basic kinds of needs: physiological needs,
safety needs, belongingness needs, esteem needs
and self-actualization needs. These needs
constitute a hierarchy of needs.
 Maslow’s Hierarchy of Needs
Needs Description Examples
Highest-level
Self- Realize one’s Use abilities
needs
actualization full potential to the fullest

Feel good Promotions

Esteem
about oneself and recognition

Social Interpersonal
Belongingness
interaction, love relations, parties

Job security,
Safety Security, stability
health insurance

Lowest-level Food, water, Basic pay level

Physiological
needs shelter to buy items

Lower-level needs must be satisfied before

higher-level needs are addressed.
 Alderfer’s ERG Theory
• Alderfer’s ERG Theory
– The theory that three universal needs – for
existence, relatedness, and growth – constitute a
hierarchy of needs and motivate behaviors.
 Alderfer’s ERG Theory

Needs Description Examples

Highest-level
needs Self-development, Continually
Growth creative work improve skills

Interpersonal Good relations,

Relatedness relations, feelings accurate feedback

Food, water, Adequate pay

Lowest-level Existence clothing, and shelter for necessities
needs

After lower level needs satisfied, person seeks higher needs. When
unable to satisfy higher needs, lower needs motivation is raised.
 Alderfer’s ERG Theory
• As lower level needs become satisfied, a
person seeks to satisfy higher-level needs
• A person can be motivated by needs at more
than one level at the same time
• When people experience need frustration
they will focus on satisfying the needs at the
next-lowest level
Herzberg’s Motivation-Hygiene Theory
• 1) Outcomes that lead to higher motivation
and job satisfaction.
• 2) Outcomes that can prevent people from
being dissatisfied.
Herzberg’s Motivation-Hygiene Theory
• Motivator needs relate to the nature of the work
itself—autonomy, responsibility, interesting work.
• Hygiene needs are related to the physical and
psychological context of the work—comfortable
work environment, pay, job security.
• Unsatisfied hygiene needs create dissatisfaction;
satisfaction of hygiene needs does not lead to
motivation or job satisfaction.
Overview Needs Theories
 Self-Determination Theory
• Satisfaction of three psychological needs leads
to intrinsic motivation:
– Autonomy
– Belongingness (Relatedness)
– Competence

• External rewards can reduce intrinsic

motivation.
 Self-Determination Theory
• Think about your current school life.
– According to Self-Determination Theory, how
could you improve your academic motivation?
 Equity Theory
• Perceptions about fairness determine
motivation.

• Comparison of the ratios of what you bring to

a situation (inputs) and what you get out of it
(outcomes) to others’ ratios of inputs and
outcomes.

• When people perceive inequity they become

distressed. They will try to restore equity!
 Equity Theory

Inputs: time, effort, Outcomes: pay,

loyalty, education, benefits, bonus,
flexibility, skill, prior recognition, praise, …
experience, training, …
Equity Theory
Example of Equity theory: employee vs. CEO salary.
 Equity Theory
• What employees can do to reduce inequity:
– Change inputs/outputs (see table below)
– Change your perceptions: “I thought I worked at a normal pace but
actually I work very hard so I deserve my higher salary”
– Choose a different referent: “I don’t earn as much as Mike but I earn
more than my father when he was young.”

Change: Example:

Input (Person) Decrease inputs by being less productive

Output (Person) Increase outcomes by asking for a raise

Input (Other) Increase other’s inputs by pressuring them to work harder

Output (Other) Decrease other’s outcomes by sabotage

 Reinforcement Theory (Skinner)
• Operant Conditioning
– Behavior followed by a satisfying consequence is
strengthened (more likely to happen)
– Behavior followed by a dissatisfying consequence
will be avoided
 Reinforcement Theory (Skinner)
• Operant Conditioning
– People learn to perform behaviors that lead to
desired consequences and learn not to perform
behaviors that lead to undesired consequences.
 Operant Conditioning Tools
• Positive Reinforcement
– Gives people outcomes they desire when they
perform organizationally functionally behaviors
• Positive reinforcers: Pay, praises, or promotions
 Operant Conditioning Tools
• Negative Reinforcement
– Eliminating undesired outcomes once the
functional behavior occurs
• Negative reinforcers: undesirable outcomes such as
criticisms, pay cuts, suspension are taken away if you
show good behavior
 Operant Conditioning Tools
• Positive Punishment
– Administering an undesired consequence to stop a
dysfunctional behavior.
• Manager administers an undesired consequence to
worker (verbal reprimand, demotion).
• Negative Punishment = Extinction
– Restricting the demonstration of a dysfunctional
behavior by eliminating whatever is reinforcing it.
– E.g., After getting into a fight with his sister over who gets
to play with a new toy, the mother takes the toy away.
Give (+) something desirable
 Take (-) something
undesirable away.
THE - does not mean the
result is bad!!!!!!
 Give (+) something
undesirable.
THE + does not mean it is
nice!!!!!!
Take (-) something desirable
away.
= extinction
 Reinforcement vs. Punishment
Punishment:
• Only tells which behavior is not desired.
• Employees can avoid leader and hide behavior.
• Must be severe enough to offset the rewards of the
behavior.
Reinforcement:
• Leader can be away, employees will try to show their
behavior.
• This is easier and better for the leader as the
employees will try to communicate the good
behavior.
 Schedules of reinforcement
• Continuous Reinforcement
– Once the reward is withdrawn, the person may
stop performing the desired behavior.

• Partial Reinforcement
– Fixed: reinforcement after a fixed time period or
fixed number of responses (e.g., giving a bonus
after every 10th sale).
– Variable: reinforcement after varying time periods
or numbers of responses; better than fixed
interval/ratio.
 Reinforcement Theory… Easy?
• Linking specific behaviors to the attainment of
specific outcomes can motivate high performance
and prevent behaviors that detract from
organizational effectiveness.
• This seems easy but…
• Positive behavior is often ignored, or worse, negative
behavior is rewarded
– E.g., An employee goes above and beyond the call of duty, yet her
actions are ignored or criticized, or she gets more work to do.
– E.g., Employees with disruptive habits may receive no
punishments because the leader is afraid of the reaction the
person will give when confronted.
– E.g., Employees get rewarded by the number of parts produced,
regardless of the amount of defects.
 Learning theories
• Learning
– A relatively permanent change in knowledge or
behavior that results from practice or experience.
 Social Learning theory
• Social learning theory
– People can learn through observations of other
people’s behavior.

Albert Bandura Monkey see, monkey do

 Social Learning Theory
• Vicarious learning = observational learning
– Learning that occurs when the learner becomes
motivated to perform a behavior by watching
another person perform.
 Goal Setting Theory
• A theory that focuses on identifying the types
of goals that are most effective in producing
high levels of motivation and performance.
 Goal Setting Theory
• Goals tell an employee what needs to be done
and how much effort is needed.
– Specific goals increase performance.
– Challenging but achievable goals, when accepted,
result in higher performance than do easy goals.
– Feedback leads to higher performance than does
non-feedback.
• Goals point out what is important to the firm.
– Workers should be encouraged to develop action plans to
attain goals.
Goal Setting Theory

• Goals motivate people to

contribute more inputs to
their jobs

• Goals help people focus their

inputs in the right direction
Performance vs Mastery Goals
SMART GOALS
 SMART Goals

Is this goal SMART?

Ensure training programs are provided for volunteers this
year.

NO

How can it be improved?

Ensure two training programs (in June and December)
are provided for volunteers this year.
 Summary of Motivation Theories
• Need theories
1. Hierarchy of needs (Maslow)
2. ERG Theory (Alderfer)
3. Motivation – Hygiene Theory (Herzberg)
4. Self-Determination Theory
• Process theories
1. Vroom: Expectancy theory
2. Equity theory
3. Operant conditioning (reinforcement theory)
• Social Learning Theory (observational learning)
• Goal setting theory
 Possible Questions
• What is motivation? Which 3 components are important?
• What is the difference between intrinsic and extrinsic motivation?
• Give examples of needs theories. You need to be able to explain
them too.
• Explain the expectancy theory of Vroom in detail.
• How can you increase someone’s self-efficacy?
• What is operant conditioning?
• What is a positive (negative) punishment?
• What is a positive (negative) reinforcement?
• What is extinction?
• Compare punishment with reinforcement. What are the
benefits/downsides of each?
• What are – based on Goal Setting Theory – the best kind of goals?
• What does the “social learning theory” tell us about how we learn?