C H A P T E R

4
F O U R

Applied Motivation
Practices

McGraw-Hill Ryerson 1 © The McGraw-Hill Companies, Inc. 2001

IKEA’s Big Thank-You Bonus

Stephen Benson (shown) and

other IKEA employees
received a large bonus when
the company pledged an
entire day’s sales revenue to
employees. The event also
doubled previous sales
records at the Scandinavian S. Oatway, Calgary Herald

home furnishings retailer.

McGraw-Hill Ryerson 2 © The McGraw-Hill Companies, Inc. 2001

The Meaning of Money

• Money and employee needs

– affects existence, relatedness,
growth needs, as well as need for
achievement and power

• Money and attitudes

– Money ethic -- not evil, represents
success, should be budgeted
carefully

• Money and self-identity

– Partly defines who we are
© Corel Corp. With permission

McGraw-Hill Ryerson 3 © The McGraw-Hill Companies, Inc. 2001

Types of Organizational Rewards

• Membership and seniority-

based rewards
• Job status-based rewards
• Competency-based
rewards
• Performance-based
rewards

© Corel Corp. With permission

McGraw-Hill Ryerson 4 © The McGraw-Hill Companies, Inc. 2001

Membership/Seniority Based Rewards

• Fixed wages, seniority increases

• Advantages
– guaranteed wages may attract job
applicants
– seniority-based rewards reduce turnover

• Disadvantages
– doesn’t motivate job performance
– discourages poor performers from leaving

McGraw-Hill Ryerson 5 © The McGraw-Hill Companies, Inc. 2001

Job Status-Based Rewards

• Includes job evaluation and status perks

• Advantages:
– job evaluation tries to maintain pay equity
– motivates competition for promotions

• Disadvantages:
– employees exaggerate duties, hoard
resources
– creates psychological distance across
hierarchy

McGraw-Hill Ryerson 6 © The McGraw-Hill Companies, Inc. 2001

Competency-Based Rewards

• Underlying characteristics that lead to

superior performance
• Skill-based pay
– pay increases with skill modules learned

• Advantages
– More flexible work force, better quality,
consistent with employability

• Disadvantages
– Potentially subjective, higher training costs
McGraw-Hill Ryerson 7 © The McGraw-Hill Companies, Inc. 2001
Performance-Based Rewards

• Share ownership
Organizational • Share options
rewards • Profit sharing

Team • Gainsharing
rewards • Special bonuses

• Piece rate
Individual • Commissions
rewards • Merit pay
• Bonuses

McGraw-Hill Ryerson 8 © The McGraw-Hill Companies, Inc. 2001

Performance Reward Effectiveness

• Positive effects
• Create an “ownership culture”
• Adjusts pay with firm's prosperity

• Negative effects
• Rewards undermine intrinsic motivation
• Rewards rupture relationships
• Rewards are quick fixes
• Rewards discourage risk taking

McGraw-Hill Ryerson 9 © The McGraw-Hill Companies, Inc. 2001

Improving Reward Effectiveness

• Link rewards to performance

• Ensure rewards are relevant
• Team rewards for
interdependent jobs
• Ensure rewards are valued
• Beware of unintended
consequences

© Corel Corp. With permission

McGraw-Hill Ryerson 10 © The McGraw-Hill Companies, Inc. 2001

Job Design

• Assigning tasks to a job, including the

interdependency of those tasks with other
jobs

• Technology doesn’t determine job scope

• Employees expected to perform a variety of

work (employability)

McGraw-Hill Ryerson 11 © The McGraw-Hill Companies, Inc. 2001

Evaluating Job Specialization

Advantages Disadvantages
• Less time changing • Job boredom
tasks
• Discontentment pay
• Lower training costs
• Lower quality
• Job mastered quickly
• Lower motivation
• Better person-job
matching

McGraw-Hill Ryerson 12 © The McGraw-Hill Companies, Inc. 2001

Job Characteristics Model
Core Job Critical
Psychological Outcomes
Characteristics States

Skill variety Work

motivation
Task identity Meaningfulness
Task significance Growth
satisfaction

Autonomy Responsibility General

satisfaction
Feedback Knowledge Work
from job of results effectiveness

Individual
differences

McGraw-Hill Ryerson 13 © The McGraw-Hill Companies, Inc. 2001

James Walton’s Work Motivation

As founder of Vancouver-based
Storm Brewing Ltd., James
Walton has plenty of motivational
potential in his job. He performs
a variety of tasks, has a lot of
autonomy, completes work from
beginning to end, sees the value
of his product in the marketplace,
and gets feedback from the work
itself. Ian Lindsay, Vancouver Sun

McGraw-Hill Ryerson 14 © The McGraw-Hill Companies, Inc. 2001

Job Design Strategies

• Job rotation
– Moving from one job to
another

• Job enlargement
– increasing number of tasks
performed within a job

• Job enrichment
– Increasing employee
autonomy and the resulting
feelings of responsibility Ian Lindsay, Vancouver Sun

McGraw-Hill Ryerson 15 © The McGraw-Hill Companies, Inc. 2001

Job Rotation vs
vs.. Job Enlargement

Job Rotation
Job 1 Job 2 Job 3
Operate Camera Operate Sound Report Story

Job Enlargement

Job 1 Job 2 Job 3

Operate Camera Operate Camera Operate Camera

Operate Sound Operate Sound Operate Sound
Report Story Report Story Report Story

McGraw-Hill Ryerson 16 © The McGraw-Hill Companies, Inc. 2001

Job Enrichment Strategies

• Empowering employees
– giving employees more autonomy
– feeling of control and self-efficacy

• Forming natural work units

– completing an entire task
– assigning employees to specific clients

• Establishing client relationships

– employees put in direct contact with clients

McGraw-Hill Ryerson 17 © The McGraw-Hill Companies, Inc. 2001

Obstacles to Job Design

• Difficult to accurately measure job

characteristics
• More team than individual job design
• Resistance to change
• Problem finding optimal level of
enrichment and specialization

McGraw-Hill Ryerson 18 © The McGraw-Hill Companies, Inc. 2001

Elements of Self-Leadership
Constructive Designing Self-
Personal Self-
Thought Natural Reinforce-
Goal Setting Patterns Rewards Monitoring ment

• Personal goal setting

– Employees set their own goals
– Apply effective goal setting practices

McGraw-Hill Ryerson 19 © The McGraw-Hill Companies, Inc. 2001

Elements of Self-Leadership
Constructive Designing Self-
Personal Self-
Thought Natural Reinforce-
Goal Setting Rewards Monitoring ment
Patterns

• Positive self-talk
– Talking to ourselves about thoughts/actions
– Potentially increases self-efficacy

• Mental imagery
– Mentally practising a task
– Visualizing successful task completion

McGraw-Hill Ryerson 20 © The McGraw-Hill Companies, Inc. 2001

Elements of Self-Leadership
Constructive Designing Self-
Personal Self-
Thought Natural Reinforce-
Goal Setting Patterns Monitoring ment
Rewards

• Finding ways to make the job itself more

motivating
– eg. altering the way the task is
accomplished

McGraw-Hill Ryerson 21 © The McGraw-Hill Companies, Inc. 2001

Elements of Self-Leadership
Constructive Designing Self-
Personal Self-
Thought Natural Reinforce-
Goal Setting Patterns Rewards Monitoring ment

• Keeping track of your progress toward

the self-set goal
– Looking for naturally-occurring feedback
– Designing artifical feedback

McGraw-Hill Ryerson 22 © The McGraw-Hill Companies, Inc. 2001

Elements of Self-Leadership
Constructive Designing Self-
Personal Self-
Thought Natural Reinforce-
Goal Setting Patterns Rewards Monitoring
ment

• “Taking” a reinforcer only after

completing a self-set goal
– eg. Watching a movie after writing two more
sections of a report
– eg. Starting a fun task after completing a
task that you don’t like

McGraw-Hill Ryerson 23 © The McGraw-Hill Companies, Inc. 2001

C H A P T E R

4
F O U R

Applied Motivation
Practices

McGraw-Hill Ryerson 24 © The McGraw-Hill Companies, Inc. 2001