EQUITY THEORY

As a Motivation Tool

Pashni Abeysinghe 2005/MBA/WE/01 Sumudu Hettiarachchi 2005/MBA/WE/27 S. Januka Jayanga 2005/MBA/WE/30 Suneth Jayawardena- 2005/MBA/WE/33 Murad Rahimdeen 2005/MBA/WE/64

Motivation
Concept used to describe the factors within an individual which arouse, maintain and channel behavior towards a goal or a goal directed behavior.

Motivation
Individuals think, feel and do differently.

It is dangerous to assume that you know what is motivating someone because you really can't "read their mind". Therefore different models to explain motivation have been developed

Background of the Organisation

A multinational Business Process Outsourcing company which provides accounting solutions to UK based companies 600 odd staff. 90% - Aged 20-27 90% Professional accountancy exams. Very fluent in English. Recruitment criteria says two years of previous experience. As a result people are carrier minded and eager for promotions and increments.

Concerns
Within the 1st 1 years staff grew from 50-170. Large number of highly qualified and experienced staff who where waiting for promotions and increments Availability of positions for promotions and increments where limited The management therefore had to carefully choose whom to promote and how to maintain a sense of perceived fairness within the rest of the organization

Challenges
Keeping staff turnaround low in order to increase productivity and sustain growth. Within the first year, in order to attract the high quality staff required employees were recruited by offering more than what they were currently paid in their previous organizations. This caused salary discrepancies within the same level of staff resulting in a huge amount of de-motivation amongst operational staff. Since there was a lot of qualified staff with the same level of experience as soon as one person was promoted the rest were inquiring as to why he or she who had the same experience and qualification did not receive the promotion. Therefore to ensure equal opportunities.

Goals

Keeping staff turnaround low in order to increase productivity and sustain growth.

Therefore to ensure equal opportunities.

Selecting a Motivation Theory

Minimize the feeling of unfairness, favouration and the lack of appreciation amongst the staff

Create a sense of perceived equity within the organization

THEORY OF EQUITY

Equity Theory at a glance

INPUTS
Effort, loyalty, commitment, skill, ability, determination, enthusiasm, personal sacrifice, etc.

OUTPUTS
pay, perks, benefits, bonus and commission, Recognition, reputation, praise and thanks, interest, responsibility, travel, training, development, sense of achievement and advancement, promotion, etc.

Strike a fair balance

Practical application of the Equity Theory

INPUTS
Education & Qualifications Experience
Required educational and experience levels needed for each promotion level is clearly defined and communicated

OUTPUTS
Salary increments Promotions High recognition

Effort and Ability A performance evaluation calculator that clearly set and communicated.

IJP ( Internal Job Posting) Upon fulfillment of the set criteria employees are placed on a pool where the highest scorers will be pick from a pool as soon as an opportunity arises for promotions.

Conclusion
fdfdfdfdgfdfd

Outputs Inputs

Thank you.