SECTION 2:

PEOPLE IN
BUSINESS
 CHAPTER 6

F I R S T LY – W E A R E G O I N G T O
L O O K A T – M O T I VA T I N G
WORKERS
 THIS
CHAPTER How workers are motivated and
LOOKS why it´s important to have
AT:
motivated workers
 OPEN YOUR BOOKS ON PAGE 71
F I R S T LY. . . .

TAKE OUT YOUR NOTEBOOKS

AND BE READY TO WRITE
DOWN THE KEY TERMS
 W H AT I S
M O T I VA T I O N
AND WHY IS IT
I M P O R TA N T I N
BUSINESS?
THE DICTIONARY DEFINES IT AS:

Reasons why we act or behave in a certain way

T H I N K , PA I R , S H A R E . . . .

IN YOUR
NOTEBOOKS –
WRITE DOWN TWO DISCUSS YOUR SHARE YOUR IDEAS
THINGS THAT MIGHT POINTS WITH YOUR WITH THE REST OF
MOTIVATE YOU TO PARTNER THE CLASS
WORK HARDER AT
SCHOOL
THINK...

HOW WOULD YOU MOTIVATE IN PAIRS COME UP WITH SOME

PEOPLE TO USE THE STAIRS IDEAS
INSTEAD OF THE
ESCALATORS....
WA T C H . . .
• https://www.youtube.com/watch?v=SByymar3bds

Thoughts...?
What do you think about the type of motivation used here...?
 OPINION ON
VIDEO---

• Did you notice that

people weren't forced
into using the stairs,
instead they were
motivated to use it?

• Why is the distinction

important?
INNOCENT SMOOTHIES

https://www.youtube.com/watch?v=ba_Hpyo
A8wc
 BUSINESS
DEFINITION The factors that influence the
OF behavior of workers towards
achieving set business goals
M O T I VA T I O N
W H Y I S I T I M P O RTA N T T H AT B U S I N E S S E S
H AV E W O R K E R S W H O A R E M O T I VA T E D ?

 Write down as many reasons as you can think about

 Work in Pairs
 You have one minute
 They can't function without good employees

They will work harder for the business

BUSINESSES
WA N T T O H AV E
S TA F F W H O A R E Produce more products

M O T I VAT E D T O
WORK Make more money for the business
BECAUSE...
Employees will be happy to be at work

They will stay working in the business

They will speak well about the business to others

 Businesses need to have staff who are
motivated and who enjoy their work

SO, WE It´s very important to the business that

KNOW they have these motivated workers
T H AT. .

They must come up with ways to keep

the employees motivated and happy
 H I S T O R Y O F M O T I VA T I O N

• It is often said that a business is nothing without its employees – it simply cannot function
without them

• That is why, over the last 200 years, employers have been looking at how to motivate
their employees to be more productive and to work in the most efficient ways possible
H I S T O R Y O F M O T I VA T I O N -
• Motivating employees has been a problem for businesses since the start of
the Industrial Revolution in the 1750s.
• Initially, factory owners tried to increase efficiency by introducing machines to
replace their employees. This process was called automation

But there was a problem.....

 H I S T O R Y O F M O T I VA T I O N . .
• However, by the beginning of the 20th century, businesses noticed that their employees
were not creating more output
• The machines were only as good as the people who used them, so businesses needed to
find ways to make their employees work harder without wasting resources
• Since then, many businesses have tried different approaches to motivate their workforces.
Some companies, such as the Ford Motor Company and the General Electric Company,
have tried increasing employees’ pay.
• In some cases, employees’ output increased as a result of higher pay but in others it did
not.
M O T I VA T I O N N O WA D A Y S
• Busineses such as The Coca-Cola Company and Google have chosen to use
different methods to get the best from their employees.
• They give the workers things like free food, personalised workspaces and the
opportunity for better training.
• As a result, their employees increased their output and became more productive.
• However, this can be more expensive for businesses than pay increases.
VIDEO..
• Watch this video to find out more about the benefits Google offers its employees
• https://www.youtube.com/watch?v=9ANgEo40VSE

• NEXT SLIDE – Questions to answer as you watch the video

 THINK...

1. What are the benefits of google 2. Do you think they work? 3. Would you like to work here?
offering these work methods to Why or why not?
employees
• Can you think of any other businesses who are famous for treating their
employees well???
HOMEWORK – INTERVIEW ONE
O F Y O U R PA R E N T S
• Survey in book page 73
• Ask your parents the questions and fill out the form
• Due: for Thursday
 CHECK HOMEWORK

Table - Page 73
 T H E I M P O R T A N C E O F H AV I N G
W E L L M O T I VA T E D E M P L O Y E E S
W R I T E D O W N K E Y T E R M S ( PA G E
73)
CLASS ACTIVITY
• Page 74

• Read activity 6.1 and answer questions 1-4

WA T C H
• https://www.youtube.com/watch?v=SI-rsong4xs
best job in the world tourism Queensland

How do you think you´d feel if you had this job? Why?
 MASLOW´S THEORY
• Maslow was an American Phycologist who came up with a theory about how people are
motivated.
• He created a pyramid and at the bottom, he put what he thought people need the most of
and what is most important, working his way up through the pyramid,
 C O N S I S T S O F T H E F O L L O W I N G FA C T O R S
• Physical needs – Anything needed for survival - food, water, clothing or shelter
• Safety and security needs – Anything that provides physical safety or security such as
job security (knowing we´re not going to lose our jobs), health, financial security, having a
clean and safe place to work.
• Social needs – Anything that allows people to mix, socialise, form friendships and find
acceptance
• Esteem needs – Anything that allows people to find respect and achievement through the
recognition of others, your boss telling you that you did a good job, praise
• Self-actualisation – Achieving or reaching a person's maximum potential, trying to the
best person they can.
 CONCEPT OF HUMAN NEEDS
MASLOW HIERARCHY
Place each of these where you
think they should be on the
pyramid -

Physical Needs
Esteem needs
Safety needs
Social needs
Self actualisation
THE CONCEPT OF HUMAN NEEDS-
MASLOW´S HIERARCHY

Physical Needs
 THE LOWEST TIER IS THE MOST
BASIC NEED A HUMAN HAS

Once this has been met you are motivated

to reach the next level, and so on
MASLOW´S
HIERARCHY Until you reach the top.

Once each need has been satisfied it is no

longer a motivator
 M A S L O W ' S T H E O RY

• People always start at the bottom of the hierarchy (physical needs)

• As each need is met, they move on to the next level.
• As each need is satisfied, it is no longer a motivator
• Useful tool for managers because they can provide for the needs of their employees
• If they are able to do this, their employees will be more motivated and therefore more
productive.
D I S A D VA N T A G E S / L I M I T A T I O N S O F
MASLOW
A C T I V I T Y PA G E 7 5 - 7 6

Do activity 6.2
 EXAM PRACTICE
6 Mark question

You must talk about 2 points

First, you talk about the 1st point

1. Identify the knowledge (theory) (1 mark)

2. Apply this to the case study (1 Mark)
3. Analysis – say why this is important/good for the business (1Mark)

Then repeat all of this for the 2nd point

Print this out
A N S W E R S T O C A S E S T U D Y. .
TAY L O R ’ S
THEORY OF
SCIENTIFIC
MANAGEMENT

Also – called the Theory of

the Economic Man
Taylor believed employees were only motivated by money
 H E R Z B E R G ´ S T W O FA C T O R T H E O R Y

Firstly – lets take a look at the video

Car example -
https://www.youtube.com/watch?v=KJ8ap4kWPxo
H E R Z B E R G ´ S T W O FA C T O R T H E O R Y

Herzberg had another theory about motivation. He came up with two lists that he said
motivated people to work.

He called one of the lists "Motivators" and the other one "Hygiene Factors"

He said the list of motivators were the things that actually motivated workers and the
hygiene factors were things that didn´t motivate the workers, but if they weren´t present
then the workers would be demotivated.
 Draw a table in your notebooks, like the one below (2 columns, 2 rows)
Achievement
Hygiene Motivators
Factors
Responsibility

Relationships with others

Salary or wage

Advancement (promotion)
1. Place each of these under the appropriate
Recognition of achievement (praise)
heading – think carefully about your choices.
Company policy and rules
2. When you´ve finished discuss it with your
partner to see if you have the same answers Supervision (having a good manager)

The work itself (enjoying what you do)

3. Merits for the 5 people who got the most
correct Working conditions (safe, clean, bright etc)
 S O B A S I C A L LY. . . H E R Z B E R G S AY S :

The hygiene factors don´t motivate employees but if they´re not present or they are taken
away the employees can become dissatisfied and demotivated without them

The motivators increase motivation if they are introduced or improved.

HERZBERG -
Having enough chairs in his classroom for everyone doesn´t motivate you to come
to class, but not having enough chairs and having to sit on the floor would be
annoying and demotivating

Can you think of any other examples?

HOMEWORK
Watch – this video
https://www.youtube.com/watch?v=b_6H8STFF14
Do the attached work sheet
https://micibiza-my.sharepoint.com/:w:/r/personal/warren_micibiza_com/_layouts/
15/Doc.aspx?sourcedoc=%7BE35002EA-18B8-4D62-B17F-5CC2632CA9BD%7
D&file=Herzberg-Activity-Sheet.docx&action=default&mobileredirect=true
ACTIVITY 6.3

Page 79
M E T H O D S O F M O T I VA T I O N
2 Types:
KEY TERMS:
A C T I V I T Y I N PA I R S

1. Each of you will be given a piece of paper

2. It will contain either the name of the method of motivation or the definition
3. By going around and asking each other questions you will have to find the person that
matches with the term and definition
4. When you find the person the matches your term you both must learn the definition,
research the advantages and disadvantages and then come up and explain it to the rest of the
class.
5. If you have any questions you can ask me
F I N A N C I A L M E T H O D S O F M O T I VA T I O N
Lesson Objectives
• Understand the following key terms:
• Remuneration
• Wages and Salary
• Piece rate pay
• Time rate pay
• Bonuses and Commission
• Profit Sharing
• Understand why different payment methods might be suitable
for different types of jobs
 The four main types of pay…
Payment system How it works
Time rate (basic pay = wages)

Piece rate (basic pay = wages)

Salary

Commission

Bonus

Fringe Benefits

Share Options

Copy into your books..

Wages and salaries
Two main methods of paying people for their work:

Wages
• Paid weekly or monthly
• Sometimes paid in cash but mostly nowadays, into peoples’
bank accounts
• Mainly used as pay for more manual work
Salaries
• Annual (Yearly) rates of pay
• Normally paid monthly
• Paid straight into a bank account.
• People on a salary tend not to be paid overtime, but are
expected to put in any extra time necessary to do the job.
B E N E F I T S & L I M I TAT I O N S
 Workers paid according to time
Time rates (hours) worked
Often used for jobs where it is Paid a fixed rate per hour
difficult to measure individual output which can easily be calculated

Workers may have to clock in or Rate for an hour’s work

sign in is called BASIC rate

Workers need to be monitored

or supervised to make sure
they work the hours they are
supposed to and that high work It does not matter how much
levels are maintained. they produce or how hard
they work. They will get paid
the same. Time rate is often
If employee works longer than criticised for this.
normal hours they will usually
get paid OVERTIME.
Case Studies: Simon and Jennie
 Hourly Rate Case Study – Simon
• Simon is 18 and is working part time while he is
studying Business and Management at university.
• He has a contract of employment to work 20-hours per
week in a restaurant at lunchtimes and in evenings.
• He is paid every Friday at an hourly rate of £6.15
according to time worked, but also receives tips paid
directly from customers.
20 Hours
• How muchperdoesWeek
he makeX per week (before tips)?
= £123 per week
6.15 per hour
Hourly Rate Case Study - Jenny
Jenny works in a call centre as a customer service advisor
Jenny is paid £10 per hour
Jenny also gets time and a half on a Saturday and this week she worked 10-2.

She works from 10 – 5 on Monday to Friday.

She gets paid overtime if she works evenings 6 - 8.
This week she has worked 2 evening shifts (on Monday and Wednesday) at
premium pay rate which is paid double

1. What will Jenny’s wages be for the week?

2. What are the implications of Jenny working so many hours in one week?
Task: Complete Jennie’s Payslip -
Answer

?? ?? ?? ??

?
? ??
Task: Complete Jennie’s Payslip -
Answer

?? ?? ?? ??

?
? ??
Advantages and disadvantages of time rate
• Advantages
• Easy to calculate the wages
• Worker knows exactly what they will be paid for working a
certain period of time
• Disadvantages
• This system is time-consuming (wages have to be calculated
and paid every week).
• Good and bad workers get paid the same amount of money.
• Supervisors need to make sure workers are doing a good job,
which adds costs for the business.
• Clocking-in system needed to track number of hours worked
by employees.
Piece Rate Getting paid a certain amount for
every unit of output or ‘piece’ made.

Workers may lose money Often used in

or not get paid if that work factories or where
is rejected or poor quality. output can be
measured

Businesses The harder you

have to spend work, the more you
money on produce, the more
quality control you get paid.

May result in poor Good fast workers will

quality work being People can work at get paid more than lazy
produced a pace they are ones
comfortable with
Piece Rate Case Study – Layla
Layla works from home packaging greeting cards.
Her contract does not set any hours of work and she
is free to start and finish whenever she wishes.
She is paid on the last working day of every month at
an agreed piecework rate of £0.514 per envelope
packed.

Last month she packaged 1,972 cards, how much

did she earn?
0.514 X 1,972 per item = £1,013.61
Advantages and disadvantages of piece rate
• Advantages of piece rate
• It encourages the workers to work faster and produce more
goods.
• Disadvantages of piece rate
• Workers may concentrate on making large quantities and
ignore quality. Low quality products may damage the
reputation of the business. Businesses may require a
quality control system which is expensive.
• Workers who are careful in their work will not earn as much
as those who rush, which may be seen as unfair. This could
cause friction between workers.
• If machinery breaks down, employees will earn less money.
Performance related pay
• Payment for reaching an agreed target
• Normally to do with developing skills or ability.

Bonus
• Extra payments paid over and above the basic wage or salary
• Used as a reward for reaching a target (not only Sales)

Commission
• Paid extra for selling successfully
• Sales staff may be paid a basic salary plus a percentage of the value of
sales (bonus for sales).
B E N E F I T S & L I M I TAT I O N S
.Workers receive a percentage share of the profit that the business makes. This
should motivate staff as they might feel they directly benefit more if the
business is more successful.

Profit
Sharing
B E N E F I T S A N D L I M I TAT I O N S
Fringe Benefits
These are rewards given to staff (have monetary value) and are sometimes known as
perks.
• Children’s education fees paid
• Accommodation paid for by the business
• Discounts on the company’s products
• Free Health care
• Company vehicle
• Free accommodation
• Share options (company shares given to employees)
• Generous expense accounts (for food and clothing)
• Pension paid for by the business
• Free trips abroad/holidays
Task
Max works as a cleaner, he gets paid £25 per house he
completes. He tries to do as many as possible in a day
to get as much money has possible.

1)What are the possible implications of this?

2)What could happen if Max’s boss paid him an hourly
rate instead?
1) What are the possible implications of this?
He might work as quickly as possible to earn as much
money as possible. This means the quality of his work
might suffer and customers might complain
2) What could happen if Max’s boss paid him an hourly
rate instead?
Max might work slower and clean fewer houses each day.
As a result, his boss might have to charge a higher price
to
clean each house
Financial Rewards: Summary

Piece Rate
Bonus

Wages Salaries
Fringe
Benefits
Share
Options Commission
Hourly Rate
Choose the right method for these workers….
Worker Pay system Why chosen
Warehouse
supervisor
Lorry driver

Double glazing To give incentive to

Salary + Commission
sales person make more sales
Hand bag sewer

Cleaner

Bank employee

Butcher

Nurse

Secretary

Car assembler
 Worker Pay system Why chosen
Warehouse Might have to work extra
Salary hours
supervisor
Just pay for the hours
Lorry driver Wages - Hourly rate he/she works
Double glazing Gives incentive to make
Salary + Commission more sales
sales person
Gives incentive to make
Hand bag sewer Wages - Piece rate more bags
Just pay for the hours
Cleaner Wages - Hourly rate he/she works
Might have to work extra
Bank employee Salary hours
Just pay for the hours
Butcher Wages - Hourly rate worked
Nurse Might have to work
Salary
extra hours
Secretary Might have to work
Salary extra hours
Car assembler
Gives incentive to
Wages - Piece rate
assemble cars quicker
Which is which ?
Look at these job adverts and explain what the payment method
for each one is:

£17,000 £2 £8 per
Per year
Salary Piece rate
Per box hourRate
Flat
pay
Up to 6 per Overtime
hour X2

Company car +
Fringe
15 % staff £8,000 per year
Benefits
discount Salary + and
Commission
10 % sales bonus
Complete the following match up activity..
Workers who tend to be self
employed and do particular pieces
of work for a business as a
supplier
Part-time Workers
Employees who work for part of
the working week
Freelance Workers
Workers who do mostly physical
work e.g. assembly line worker
Temporary Workers

Workers who do non-physical work

Manual / Blue Collar Workers e.g. office staff / teacher

Non-Manual / White Collar Workers with no permanent

Workers contract of employment and work
for a short period of time for an
employer
Full-time Workers
Employees who work for the
whole week
ACTIVITY
ACTIVITY 6.5
CASE STUDY
CORRECT ZARA CASE STUDY
 AO1 Knowledge and understanding AO2 Application AO3 Analysis

Award [1 mark] for each relevant Award [1 mark] for each relevant link to Award [1 mark] for each relevant
point [max. 2 marks]. the case study [max. 2 marks]. explanation [max. 2 marks].

Question 1
Relevant points might include:
•To motivate employees [AO1] in order to reduce the high levels of labour turnover [AO2].
•To attract potential new employees [AO1] because they would have an incentive to share in the €500 million profit [AO2].
•To increase productivity among employees [AO1] and encourage them to sell more fashion products [AO2].

Question 2
Relevant points might include:
•Money may not be motivating for the employees [AO1]. Zara offered profit-sharing of €500 million but this has to be
divided over many thousands of employees over two years [AO2], which may result in a low payment being received [AO3].
•Other factors may be more motivating than payment, such as the standard of working conditions [AO1]. Zara employees
were also concerned about the long working hours [AO3]. Herzberg stated that working hours were a hygiene factor, which
was not being met here [AO3].
•Some employees may not be financially motivated [AO1]. They may want additional responsibility and would be less
motivated by sharing profit [AO3]. Zara is a global fashion brand with growing sales, which may indicate that it could offer
further positions of responsibility [AO2].
N O N F I N A N C I A L M E T H O D S M O T I VA T I O N
Learning Objectives
• Understand what Non-Financial Methods of Motivation are:
• Job rotation
• Job enlargement
• Job enrichment
• Team Work
• Quality Circles
• Know how to advise a business as to how motivation
might be improved
Motivating factors:
Non-financial motivators

• In addition to financial rewards, businesses

might have non-financial methods to
motivate staff
• Non-financial methods make work more
interesting or enjoyable and employees have
more Job satisfaction
• Job satisfaction is enjoyment derived from
feeling that you have done a good job can
greatly motivate employees!
 What makes a job
satisfying?
• Employees have different ideas about this
• Some include:
• Pay
• Opportunities for promotion
• Working conditions
• Working hours
• Colleagues
• Nature of the work
• Recognition for work done well
• Fringe benefits or non-financial rewards
• Job Status
Non Financial Methods for
Increasing employee job satisfaction
There are several ways in which a business can
increase the job satisfaction of its employees by
modifying the way that they work:
• Job rotation
• Job enlargement
• Job enrichment
• Team Work
• Quality Circles
Job rotation
• Job rotation involves workers swapping round and doing each
specific task for only a limited time and then changing around
again
• Increases the variety in the work itself and also makes it easier
for managers to move workers around the factory if people are
ill and their jobs need covering
• However, it does not make the tasks themselves more
interesting
Example of job rotation
Pack
product Packing boxes into
Filling into larger boxes for
Machine boxes transportation or
Labelling
storage

Every hour, each person changes jobs

Job enlargement
• Job enlargement is where extra tasks of a
similar level or work are added to a worker’s job
description
• The extra tasks should not add extra work or
increased responsibility to the employee
• Greater variety to the work
• Increased job satisfaction
 Example of job enlargement

Put stock Help customers Check stock Work on

on shelves find stock on levels Checkout
shelves
Job enrichment
• Job enrichment involves looking at jobs and adding tasks that
require more skill and/or responsibility
• Additional training may be necessary to enable the employee
to take on the extra tasks
• For example, employees may be given responsibility for a whole area
of work
• If managers can design jobs so that they provide scope for
fulfilling higher human needs, workers will often become more
committed because they get more satisfaction from their jobs,
again raising productivity
 Example of job enrichment

Also
Types emails, reports Deals with phone
and company enquiries
Receptionist employed documents
to greet visitors and
customers

Training will be needed – receptionist will

need to know about the company’s products
in order to deal with enquiries
Autonomous work groups or
team working
• A group of workers is given responsibility for a particular
process, product or development
• They can decide as a group how to complete the tasks or
organise the jobs
• Workers can become more involved in decision making and
take responsibility for the process
• Employees have more control over their jobs and are feel more
committed, therefore increasing job satisfaction
N O N F I N A N C I A L B E N E F I T S A N D L I M I TAT I O N S
Autonomous work groups or
teamworking
BOSS

Team of workers is responsible for assembling the car

Team decides how the process is to be completed
Tasks are allocated by the team themselves – they make the decisions
Quality Circles
• A quality circle is a group of
workers who do the same or
similar work, who meet regularly
to identify, analyze and solve
work-related problems
• This motivates staff as they
contribute their ideas and they
feel valued
Team Working and Delegation
Team Working
• Production teams are organised into groups or teams and given
responsibility for completing a whole task

Delegation
• Managers pass authority for the performance of tasks to lower
level workers. This is often combined with empowerment – e.g.
allowing workers to make decisions about how tasks are
performed
N O N F I N A N C I A L B E N E F I T S A N D L I M I TAT I O N S

Teamwork
Revision summary: motivating factors at all levels
Fringe
Reasonable
Benefits Holidays
level of pay
Chance to use
Creativity

Safe and
Chance to take
Clean Work Motivational Factors Responsibility
Environment

Job Security Independence

Friendly Chance of
Colleagues Interesting and Promotion
Prestige and
Stimulating
Recognition
Tasks
Individual Case Studies
Individual
Case
Studies -
Duncan
Individual
Case
Studies -
Sita
Individual
Case
Studies -
Tim
Did You Change your mind?
Financial or non-financial?
• For the following jobs,
which type of reward
would be most suitable
and why?
• Car production
worker
• Hotel receptionist
• Teacher
• Shop assistant
• Managing Director
• Taxi driver
What would you give?
Simon owns a business “Suits You”. It is a private limited company
and produces suits for men using batch production. The business
has 100 production workers who are paid an hourly rate. The
business has expanded rapidly, and profits have also grown over
the last three years.
Simon is quite autocratic in his management style and believes his
workers should be happy because they have a job.
Identify and Explain two methods Simon could use to motivate his
production workers [6 marks]
Let’s Look at a Model Answer
K
Method 1:Introduce fringe benefits
Fringe benefits are benefits that are not related to
workers’ financial needs, for example, Simon could pay
for workers’ lunches or their health insurance. This could
motivate workers because they will know they are cared
for if something were to happen to them, as a result,
An

workers will be less stressed and make fewer mistakes.

Ap?
Let’s Look at a Model Answer
K

Job Rotation
This involves workers swapping around and doing
different tasks for a limited amount of time. This increases
the variety of work, for
Ap
example, sewing 30 shirts and then
sewing 30 pairs to pants. This motives workers to work
faster soAnthey can move onto the next job which will increase
productivity.
Complete the following match up activity..
Workers who tend to be self
employed and do particular pieces
of work for a business as a
supplier
Part-time Workers
Employees who work for part of
the working week
Freelance Workers
Workers who do mostly physical
work e.g. assembly line worker
Temporary Workers

Manual / Blue Collar Workers who do non-physical work

Workers e.g. office staff / teacher

Non-Manual / White Collar Workers with no permanent

Workers contract of employment and work
for a short period of time for an
employer
Full-time Workers
Employees who work for the
whole week
ACTIVITY 6.7
Also give homework
CHOOSING WHICH METHOD TO
USE
HOMEWORK -
ASSIGNMENTS FROM KOGNITY
QUIZLET PRACTICE
Play on chrome
https://quizlet.com/be/511630474/methods-of-motivation-financial-flash-cards/
https://quizlet.com/gb/602687420/non-financial-methods-of-motivation-flash-cards/

Kahoot
https://create.kahoot.it/details/604d14f1-16e1-4020-9fe4-f6ef43b5e791