“The one best way of increasing work motivation for an organization is through employee reward schemes”. Discuss. Motivation is a critical factor in a business as research shows that work motivation has a strong positive impact on job performance (Colquitt, page 202). “Why do we need motivated employees? The answer is survival” (Smith, 1994). Research shows that motivated employees are more productive than unmotivated employees. This is because motivated employees work to the best of their ability to achieve their personal or organisational goals.
The manager’s objective is to make sure that the work force is motivated. This is arguably the most complex function the manager has to perform because individuals motivation needs keeps changing constantly (Bowen & Radhakrishna, 1991). Rewarding employees for their work is one way of motivating them however academic research indicates that other methods of motivating employees have a stronger impact on job performance this includes self-efficacy and goal setting theory.
The definition of motivation given is “the psychological process that gives behavior purpose and direction” (Kreitner, 1995), “a predisposition to behave in a purposive manner to achieve specific, unmet needs” (Buford, Bedeian, & Lindner, 1995), “the drive to satisfy an unsatisfied need of an individual” (Higgins, 1994), and “the will to achieve” (Bedeian, 1993). There are 3 concepts of motivation, Intrinsic, Extrinsic and Effort. Intrinsic motivation is motivation that comes from within the employee himself. It is felt when task performance serves as its own reward” (Colquitt, page 184). Some examples of intrinsic motivation are enjoyment, skill development and knowledge gain. Extrinsic motivation is when an employee is motivated by external rewards.
“It is motivation that is controlled by some contingency that depends on task performance” (Colquitt, page 184). Some examples of extrinsic motivation are pay, bonuses and praise. Effort has been defined persistence, intensity towards task performance in a positive direction (Colquitt, Page …). Rewards are a type of extrinsic motivation. Abraham Maslow proposed that motivation is based a number of human needs” (Hollyforde & Whiddett, 2002, Page 94). His needs hierarchy suggests that lower most needs to be satisfied before moving to achieve higher level needs. These needs are physiological needs (the need for food, water and shelter), safety needs (the need for job security, insurance), love and belonging needs (the need to belong to a family or group), esteem needs (the need for confidence, achievement, respect), and self actualisation needs (the need for personal growth and development) (Maslow, 1943).
They are usually illustrated by a pyramid with the most basic needs (physiological needs) at the bottom of the pyramid and the higher level one (self actualisation) at the top. Maslow feels that people are motivated to satisfy the physiological and safety needs first as they are the most basic needs an individual requires and once they are satisfied the people are driven to the higher lever needs (Hollyforde & Whiddett, 2002, Page 95). This means that when one basic level need is satisfied another higher level need emerges.
Alderfer’s theory the ERG theory is a continuation of Maslow’s hierarchy of needs theory (Hollyforde & Whiddett, 2002, Page 70). Alderfer thought that these needs can be better categorised into 3 core needs: Existence needs, Relatedness needs and Growth needs. Existence needs are the one which Maslow defined as physiological and safety needs, Relatedness needs are the love and belonging needs and Growth needs are self-esteem and self actualisation needs. Unlike maslow’s needs hierarchy, Alderfer regards existence of more than one need at a time, but more from existence to growth (Hollyforde & Whiddett, 2002, Page 71).
Existence needs are at one end as they are the most concrete, as they are the basic needs and Growth needs are on the other hand are the least concrete, as they are never fully satisfied. Another thing that Alderfer mentions is that “people may work on one or more of the levels at the same time but will generally move along a continuum from existence to growth”(Hollyforde & Whiddett, 2002, Page 73), unlike Maslow’s theory were only one level of need can be satisfied at a time.
McClelland summarises the needs into 3 different needs which are Need for achievement, Need for Power and Need for affiliation. This is the Acquired needs theory. The Thematic Apperception Test (TAT) is a test which is frequently used to measure an employee’s motivation to satisfy various needs. “A meta-analysis of 105 studies that the TAT is a valid measure of the need for achievement” (Buelens et al, 2006, Page 183). Achievement theories propose that motivation and performance depemds upon the strength of one’s drive for achievement. (Buelens et al, 2006, Page 185).
The need for Achievement is when someone wants to accomplish something difficult, wants to master, manipulate or organise physical objects, human beings or ideas, wants to independent as much as possible, wants to overcome obstacles and attain high standards, wants to rival and surpass others or wants to increase self-regard by successful exercise of talent (Buelens et al, 2006, Page 185). “The need for power reflects an individual’s desire to influence, coach, teach or encourage others to achieve” (Buelens et al, 2006, Page 186). Individuals with high need for power like to work.
There is positive and negative side to the need. “The negative face of power is characterised by an ‘if I win, you lose’ mentality. In contrast, people with a positive orientation to power focus on accomplishing group goals and helping employees obtain the feel of competence” (Buelens et al, 2006, Page 186). Individuals with strong affiliation needs spend much of their time socialising (Buelens et al, 2006, Page 186). Victor H. Vroom (1964) defines motivation as a process of making choices among different activities, a process he claims is controlled by the employee itself .
The employee makes choices based on his assumptions of how well the expected results of a particular action is going to lead to the desired outcome (ref: if nothing then give motivation handbook). Motivation is a product of the employees belief that the effort put in will lead to successful performance of the task (Expectancy), the belief that performance will lead to desired outcome (Instrumentality) and the value of the outcome itself (Valence) (Colquitt, pages 181-183).
He presents this with a simple formula: Work Motivation = V x I x E, were V= valence, I= instrumentality and E=expectancy. Valence can be positive or negative. Positive valences are out comes that an employee prefers having, for example salary in increase, bonuses, and more in formal rewards whereas negative valence are outcomes that employees prefer not having, for example disciplinary actions, demotions and terminations. In this way employees are motivated to perform better either to achieve positive valence or to avoid negative valence (Colquitt, page 183). Self efficacy is defined as a personal judgement of how well one can perform a course of action required to deal with various situations” (Bundara, 1982). “Employees who feel more efficacious for a particular task will tend to exert high levels of expectancy and therefore be more likely to choose to exert high levels of effort” (Colquitt, page 181). When an employee is considering efficacy levels for a given task, the employee first considers his past accomplishments, how good or bad has he performed in similar sort of task in the past.
Next he considers vicarious experiences by discussing with other employees who have performed similar task in the past. Verbal persuasion also has a strong impact on self efficacy, because friends, co-workers and leaders can persuade employees that they can easily get the job done. Efficacy is directed by emotion cues, if the employee is uncertain about or has fear and this creates doubts about task achievement/ completion, whereas enthusiasm can boost their confidence levels.
Meta-analyses by Sadri and Robertson (1993) and Stajkovic and Luthans (1998) provide evidence that self-efficacy beliefs influence the level of work motivation and job performance (Lathans, 2007, Page 207). Studies show that self efficacy has a strong positive impact on job performance (Luthans & Stajkovic, 1998). “To predict what an employee will do in a given situation requires knowledge of how values are translated by the person into specific goals.
Thus goals are the immediate precursor of action” (Latham, 2007, Page 176). This is “one topic that replaced expectancy theory for researchers, a work motivation theory unconcerned with individual differences in needs, desires or instrumentality perceptions” (Schneider, 1985, p. 577). Locke’s “goal setting theory views goals as the primary driver of the intensity and persistence of effort” (Colquitt, Page 187). Goals are the objective of an individual that is required to be achieved within a set time limit.
This theory argues that when employees are assigned specific and difficult goals they work harder to perform well and this result in higher levels of performance than assigning no goals, easy goals or do your best goals. Assigning specific and difficult goals motivates employees because they see the task as a new challenge and something they have done in the past would not be as challenging as a new one (Colquitt, Page 187). For example, if your boss says “Hand in the report by Monday 9 am,” you would know exactly how hard to work and for how long to complete the report in time.
This theory talks about difficult goals but the goal are supposed to attainable. If the goals are very difficult and the employee fails to complete it this will lead to demotivation (Colquitt, Page 189). To deal with this problem, “managers are now trained to indentify five to seven S. M. A. R. T goals for each employee and to link rewards directly to goal achievement. The S. M. A. R. T. acronym summarizes many beneficial goal characteristic, standing for Specific, Measurable, Achievable, Results-based, Time-sensitive” (Colquitt, Page 192).
Feedbacks are updates on employee’s progress towards achieving the goal. Feedback leads to higher performance and motivation effects are strongest when employees are given feedback (Colquitt, Page190). Adams Equity Theory suggests that motivation is depended on individual’s beliefs and circumstances and dependent on what happens to others (Colquitt, Page 193). Adams’ theory states that employees strive for not only individual equity but also other workers (Adams, 1965). It states that people usually compare ratios of their inputs relative to their outcomes to ratios of others inputs and outcomes (Latham, 2007).
These comparisons can either be internal comparison, when an employee is comparing himself with someone in the same company or external comparison, when the employee compares himself with someone from a different company. Some examples of inputs are Effort put in the job, Performance, Skills and Experience and examples of outcomes are the Pay, Fringe benefits, Status and Rewards. Employees are motivated when they are fully satisfied that Equity is achieved. This is done when the ratio of the employee’s outcomes over inputs is equal to other employee outcomes over inputs (Colquitt, Pages 194-6).
Herzberg thought that the factors that led to job satisfaction were different from those which led to job dissatisfaction and so developed the Job design theory of work motivation the two factor theory, motivation factor and the hygiene. He believed that the hygiene factors are those that reduce dissatisfaction and the motivation factors are those that increase motivation (Buelens, Pages 187-8) Rewards are one way of motivating employees but research shows that it is not the ‘one best way’. Studies over the years have proven that there is no one best way to motivate employee.
Research indicates that the motivating force that has the strongest impact on job performance is Self-efficacy (Colquitt, Page 200). This is because people who have confidence in themselves tend to outperform those who doubt their capabilities. The second most powerful motivator is said to be the Goal setting theory, people who work towards achieving difficult goals tend to do better than those working towards achieving easy goals. Next in line are the Expectancy theory and finally the perception of equity theory which has a weaker effect on job performance.