Lecture 8

Motivating & Leading

Employees
ABIZ 0680/1000
Dr. Jared Carlberg

Today
• psychological contracts
• job satisfaction & employee morale
• theories of employee motivation
• improving job satisfaction & morale
• managerial styles & leadership

Psychological Contract
• the employee’
employee’s perception of his/her
contribution and the firm’
firm’s inducements
– the employee contributes expertise and effort to
the agribusiness
– the agribusiness provides inducements to the
employee in the form of pay and benefits
• if either party is unhappy with the contract,
they can seek to change it
– firms managing these implied contracts effectively
will have happier, more productive workers

1
 Job Satisfaction & Morale
• job satisfaction is the amount of contentment/
happiness/fulfillment a job provides
– does the person like their job or not?
• morale is the degree to which an employee
possesses a positive attitude toward a job
– are employees in good spirits & enthusiastic?

• job satisfaction, along with compensation &

other factors, determines morale

Why Is Morale Important?

• maintaining morale requires resources
– so why bother?

• because satisfied employees are less likely to:

– call in sick
– disrupt operations
– file grievances
– quit

• clearly, morale is an important concern!

Motivation
• encouraging desirable behaviour/outcomes
behaviour/outcomes
– e.g. facilitating employee excellence

• theories of motivation fall into three

categories:
– classical theory & scientific management
– behaviour theory
– contemporary motivation theories

2
 Classical Theory of Motivation
• oldest theory of motivation (early 20th century)
– asserts that workers are motivated only by money

• suggested that employees would work harder if

they were paid more
– and firms that found the most efficient methods of
production would do better than others
– this became known as scientific management
– led to a multitude of “time and motion”
motion” studies to
discover the optimal way to perform a task

Behaviour Theory
• says that ANY attention paid to employees
increases productivity
– productivity goes up if employees think management
is paying attention!

• experimental studies found that:

– increasing/decreasing lighting had same effect
– changing pay did not improve productivity

Contemporary Motivation Theories

• contemporary essentially means “modern”
modern”
• these theories focus on importance of good
human relations in motivating employees

• several modern theories have arisen

– HR model: Theory X and Theory Y
– Maslow’
Maslow’s Hierarchy of Needs
– two-
two-factor theory
– expectancy theory
– equity theory
– goal setting theory

3
 Human Resources Model
• McGregor studied managers’
managers’ attitudes
toward human resources
– discovered two broad types of attitudes

• summarized them as
– Theory X : people do not want to work and
need incentives to do so
• implies employees are basically lazy
– Theory Y : hypothesizes that people are
self-
self-motivated and want to succeed
• says people do not need to be forced to excel

Maslow’
Maslow’s Hierarchy of Needs Model
• says people have several levels of needs
– physiological
– security
– social
– esteem
– self-
self-actualization

• Maslow said workers are motivated by their

lowest level of unattained needs
– e.g. once someone’
someone’s physiological needs are satisfied,
they are motivated by their security needs

Two-Factor Theory
• suggests that job satisfaction depends
on two factors

• hygiene factors relate to working

conditions
– good working conditions ensure that no
dissatisfaction exists

• motivating factors relate to recognition,

achievement, and responsibility
– motivating factors enhance employee
satisfaction

4
 Expectancy Theory
• says people work toward goals they have a
reasonable expectation of achieving
– cannot motivate people with rewards for goals they
do not expect to attain

• three types of issues affect expectations:

– effort-
effort-performance issues
– performance-
performance-reward issues
– rewards-
rewards-personal goals issues

Equity Theory
• focuses on the concept of “fairness”
fairness”

• employees look at how they are treated on

two fronts:
– inputs vs. outputs: am I getting as much out of
this job as I put into it?
– am I getting as much out of my job as those who
perform similar tasks for this firm?

• employees who see themselves as being

treated unfairly often act to “tip the scales”
scales”

Goal Setting Theory

• strives to discover the types of goals that best

motivate employees

• two characteristics of effective goals:

– they are difficult but attainable
– they are specific: a quantifiable target is set
• e.g. “increase output by 10%”
10%” rather than “do your best”
best”

• goals are most effective if employees have a

hand in defining them

5
 Enhancing Job Satisfaction
& Morale
• have to use knowledge about motivation
– what can agribusinesses do to keep morale high &
keep employees satisfied?

• 6 types of programs are commonly used:

– reinforcement/behaviour
reinforcement/behaviour modification
– management by objectives
– participative management
– team management
– job enrichment & job redesign
– modified work schedules

Reinforcement/Behaviour
Modification Theory
• involves a system of rewards and
punishments to elicit desired behaviour

• reinforcement is associating specific

outcomes with specific behaviours
– can be “positive”
positive” or “negative”
negative”

• firms can also punish employees for

improper or undesirable behaviour

Management By Objectives
• system of collaborative goal-
goal-setting
– extends from organization’
organization’s top to its bottom

• involves managers & employees in setting

goals and evaluating progress
– employees feel more involved and empowered
when they are part of decision making

6
 Participative Management
• management philosophy whereby workers
have a voice in management of the firm
– help define their own jobs
– participate in traditional management
decisions

• this can be a key method for empowering

workers
– helps them feel more important to the firm

Team Management
• employees may be given responsibility for
making narrow decisions
– e.g. how to divide tasks among co-
co-workers

• workers also part of bigger decisions

– production scheduling
– work procedures
– hiring of new people

Job Enrichment & Job Redesign

• job enrichment adds motivating factors to
existing job activities
– e.g. provide more responsibility or decision
making authority
• job redesign allows employees to reshape
some of their duties to provide a better
“fit”
fit”
– three common ways to do this:
• combining tasks
• forming natural workgroups
• establishing client relationships

7
 Modified Work Schedules
• many firms allow flexible work schedules to
accommodate a changing workforce

• 4 main types of modified work schedules:

– flextime
– compressed workweek
– telecommuting
– workshare programs

• modified work schedules help employees

balance their personal & professional lives

Leadership

• inspiring others to trust your judgment

and join with you in working toward a
common goal

• anyone can manage--

manage--it
it takes something
more to lead!

Managerial Styles

• the “best”
best” style depends upon the situation, the
employee, and the company!

• an autocratic manager gives orders and expects

unquestioning obedience
• a democratic manager seeks opinions but
retains final decision making privileges
• a free-
free-reign manager advises employees, and
gives authority for decisions to them

8
 The Changing Face of
Motivation & Leadership
• motivation & leadership are changing in the 21st
century
– in general, firms are more accommodating of workers
diverse goals and philosophies
– incomes have risen to the level where workers want
other aspects of their jobs to improve
– managerial styles are becoming less autocratic

• this is the new management world into which

you will soon enter!

Next Class
• topic: Labour-
Labour-Management Relations
• reading: Chapter 9
• unions & unionism
• labour laws
• union certification & types of unions
• collective bargaining
• discussion question: define and discuss
five types of unions