CHAPTER 13

Motivation and
Performance

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• Learning Objectives (1 of 2)

1. Explain what motivation is and why managers

need to be concerned about it.
2. Describe from the perspectives of expectancy
theory and equity theory what managers should
do to have a highly motivated workforce.
3. Explain how goals and needs motivate people
and what kinds of goals are especially likely to
result in high performance.

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• Learning Objectives (2 of 2)

4. Identify the motivation lessons that

managers can learn from operant
conditioning theory and social learning
theory.
5. Explain why and how managers can use
pay as a major motivation tool.

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• The Nature of Motivation (1 of 3)

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

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• The Nature of Motivation (2 of 3)

Direction
• Possible behaviors a person could engage in
Effort
• How hard people work
Persistence
• Refers to whether, when faced with
roadblocks and obstacles, people keep trying
or give up

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• The Nature of Motivation (3 of 3)

Intrinsically motivated behavior

• Behavior performed for its own sake
Extrinsically motivated behavior
• Behavior performed to acquire material or
social rewards or to avoid punishment
Prosocially motivated behavior
• Behavior performed to benefit or help others

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• Outcomes and Inputs

Outcome
• Anything a person gets from a job or an
organization
• Pay, job security, benefits, vacation time
Input
• Anything a person contributes to his or her job
or organization
• Time, effort, skills, knowledge, work behaviors

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• Figure 13.1 The Motivation
Equation

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• Expectancy Theory (1 of 3)

Expectancy theory
• The theory that motivation will be high when
workers believe that high levels of effort lead to
high performance and that high performance leads
to the attainment of desired outcomes
• 1960s, Victor H. Vroom

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• Expectancy Theory (2 of 3)

Expectancy
• A person’s perception about the extent to which effort
(an input) results in a certain level of performance
Instrumentality
• A person’s perception about the extent to which
performance at a certain level results in the
attainment of outcomes
Valence
• How desirable each of the available outcomes from
the job is to a person

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• Figure 13.2 Expectancy,
Instrumentality, and Valence

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• Expectancy Theory (3 of 3)

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• Need Theories

Need theories
• Theories of motivation that focus on what
needs people are trying to satisfy at work and
what outcomes will satisfy those needs
Need
• A requirement or necessity for survival and
well-being

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• Maslow’s Hierarchy of Needs (1 of 2)

Maslow’s hierarchy of needs

• The hierarchy of needs is an arrangement of
five basic needs that motivate behavior
• Maslow proposed that the lowest level of
unmet needs is the prime motivator and that
only one level of needs is motivational at a
time.

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• Table 13.1 Maslow’s Hierarchy of
Needs (2 of 2)
Levels Needs Description Examples of How Managers Can Help People
Satisfy These Needs at Work
Highest-Level Self-actualization Needs The needs to realize one’s full Giving people the opportunity to use their
Needs potential as a human being. skills and abilities to the fullest extent
possible.
Below Highest- Esteem Needs The needs to feel good about Granting promotions and recognizing
Level Needs oneself and one’s capabilities, accomplishments.
to be respected by others, and
to receive recognition and
appreciation.
Medium-Level Belongingness Needs Needs for social interaction, Promoting good interpersonal relations and
Needs friendship, affection, and love. organizing social functions such as company
picnics and holiday parties.
Above Lowest- Safety Needs Needs for security, stability, Providing job security, adequate health care
Level Needs and a safe environment. benefits, and safe working conditions.
Lowest-Level Physiological Needs Basic needs for things such as Providing a level of pay that enables a person
Needs food, water, and shelter that to buy food and clothing and have adequate
must be met in order for a housing.
person to survive.

The lowest level of unsatisfied needs motivates behavior; once this level of needs is satisfied, a
person tries to satisfy the needs at the next level.

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• Alderfer’s ERG Theory (1 of 2)

Alderfer’s ERG theory

• The theory that three universal needs—for
existence, relatedness, and growth—
constitute a hierarchy of needs and motivate
behavior
• Proposed that needs at more than one level
can be motivational at the same time

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• Alderfer’s ERG Theory (2 of 2)
Levels Needs Description Examples of How
Managers Can Help People
Satisfy These Needs at
Work
Highest-Level Needs Growth needs The needs for self- Allowing people to
development and creative continually improve their
and productive work skills and abilities and
engage in meaningful work
Medium-Level Needs Relatedness needs The needs to have good Promoting good
interpersonal relations, to interpersonal relations and
share thoughts and providing accurate
feelings, and to have open feedback
two-way communication
Lowest-Level Needs Existence needs Basic needs for food, water, Providing enough pay for
clothing, shelter, and a the basic necessities of life
secure and safe and safe working
environment conditions

As lower-level needs are satisfied, a person is motivated to satisfy higher-level needs. When a person
is unable to satisfy higher-level needs (or is frustrated), motivation to satisfy lower-level needs
increases.

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• Herzberg’s Motivation-Hygiene
Theory (1 of 2)
Herzberg’s motivator-hygiene theory
• This need theory distinguishes between
motivator needs and hygiene needs and
proposes that motivator needs must be met
for motivation and job satisfaction to be high.
• Interesting work, autonomy, responsibility, the
ability to grow and develop on the job, sense
of accomplishment and achievement help to
satisfy motivator needs.

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• Herzberg’s Motivation-Hygiene
Theory (2 of 2)
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.

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• McClelland’s Needs for Achievement,
Affiliation, and Power (1 of 2)
Need for achievement
• The extent to which an individual has a strong
desire to perform challenging tasks well and
to meet personal standards for excellence

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• McClelland’s Needs for Achievement,
Affiliation, and Power (2 of 2)
Need for affiliation
• Concerned about establishing and
maintaining good interpersonal relations,
being liked, and having the people around him
or her get along with each other
Need for power
• A desire to control or influence others

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• Equity Theory (1 of 2)

Equity theory
• A theory of motivation that focuses on
people’s perceptions of the fairness of their
work outcomes relative to their work inputs

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• Equity Theory (2 of 2)
Condition Person Equals, less Referent Example
than, or
greater
than
Equity Outcomes = Outcomes An engineer perceives that he contributes
Inputs Inputs more inputs (time and effort) and receives
proportionally more outcomes (a higher salary
and choice job assignments) than his referent.

Underpayment Outcomes < Outcomes An engineer perceives that he contributes

inequity Inputs (less than) Inputs more inputs but receives the same outcomes
as his referent.

Overpayment Outcomes > Outcomes An engineer perceives that the contributes the
inequity Inputs (greater Inputs same inputs but receives more outcomes than
than) his referent.

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• Inequity

Underpayment inequity
• The inequity that exists when a person
perceives that his or her own outcome–input
ratio is less than the ratio of a referent
Overpayment inequity
• The inequity that exists when a person
perceives that his or her own outcome–input
ratio is greater than the ratio of a referent

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• Equity and Justice in Organizations
(1 of 2)

Distributive justice
• A person’s perception of the fairness of the
distribution of outcomes in an organization
Procedural justice
• A person’s perception of the fairness of the
procedures that are used to determine how to
distribute outcomes in an organization

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• Equity and Justice in Organizations
(2 of 2)

Interpersonal justice
• A person’s perception of the fairness of the
interpersonal treatment he or she receives from
whoever distributes outcomes to him or her
Informational justice
• A person’s perception of the extent to which his
or her manager provides explanations for
decisions and the procedures used to arrive at
them

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• Goal-Setting Theory

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 and
explaining why goals have these effects
• Must be specific and difficult

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• Learning Theories

Learning theories
• Theories that focus on increasing employee
motivation and performance by linking the
outcomes that employees receive to the
performance of desired behaviors and the
attainment of goals

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• Operant Conditioning Theory

Operant conditioning
• People learn to perform behaviors that lead to
desired consequences and learn not to
perform behaviors that lead to undesired
consequences.

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• Operant Conditioning Tools (1 of 2)

Positive reinforcement
• Gives people outcomes they desire when they
perform organizationally functional behaviors
Negative reinforcement
• Eliminating or removing undesired outcomes
when people perform organizationally
functional behaviors

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• Operant Conditioning Tools (2 of 2)

Extinction
• Curtailing the performance of a dysfunctional
behavior by eliminating whatever is
reinforcing it
Punishment
• Administering an undesired or negative
consequence when dysfunctional behavior
occurs

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• Avoiding Side Effects of
Punishment
Downplay the emotional element involved.
Try to punish dysfunctional behaviors as
soon as they occur.
Try to avoid punishing someone in front of
others.

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• Organizational Behavior
Modification
Organizational behavior modification
• The systematic application of operant
conditioning techniques to promote the
performance of organizationally functional
behaviors and discourage the performance of
dysfunctional behaviors

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• Figure 13.4 Five Steps in
Organizational Behavior Modification
(OB MOD)

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• Social Learning Theory (1 of 3)

Social learning theory

• A theory that takes into account how learning
and motivation are influenced by people’s
thoughts and beliefs and their observations of
other people’s behavior

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• Social Learning Theory (2 of 3)

Vicarious learning
• Occurs when a person becomes motivated to
perform a behavior by watching another
person perform the behavior and be positively
reinforced for doing so
• Also called observational learning

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• Social Learning Theory (3 of 3)

Self-reinforcer
• Any desired or attractive outcome or award
that a person gives himself or herself for good
performance
Self-efficacy
• A person’s belief about his or her ability to
perform a behavior successfully

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• Pay and Motivation (1 of 2)

Pay as a motivator
• Expectancy theory
• Instrumentality, the association between performance and
outcomes, must be high for motivation to be high.

• Need theory
• Pay is used to satisfy many needs.

• Equity theory
• Pay is given in relation to inputs.

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• Pay and Motivation (2 of 2)

Pay as a motivator
• Goal setting theory
• Pay is linked to attainment of goals.

• Learning theory
• Outcomes (pay) are distributed upon performance of
functional behaviors.

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• Merit Pay and Performance

Merit pay plan

• A compensation plan that bases pay on
individual, group or organization performance
• Individual plan: when individual performance
(sales) can be accurately measured

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• Salary Increase or Bonus?

Employee stock option

• A financial instrument that entitles the bearer
to buy shares of an organization’s stock at a
certain price, during a certain period of time,
or under certain conditions

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• Video: New Belgium Brewery

How does the open-book management style

at New Belgium Brewery motivate the
employees?

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• Example – Warren Buffet

Investor Warren Buffett is giving away a

large portion of his fortune to the
Gates Foundation.
He is doing it now because he believes in
the work the foundation is doing with world
health issues and improving U.S. libraries
and high schools.

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