Some theories of motivation have focused on what things motivate workers. These are called content theories because they focus on the content of the motivators. Although money is the motivator that comes most readily to mind, some people respond more to other sources of satisfaction.
 Three researchers whose content theories of motivation are widely used are Abraham Maslow, David McClelland, and Frederick Herzberg.

Maslow’s Hierarchy of Needs
Psychologist Abraham Maslow assumed that people are motivated by unmet needs. When a person’s need for something is not met, the person feels driven, or motivated, to meet that need. To give a basic example, a person who needs food feels hungry and therefore eats something.
According to Maslow’s theory, the needs that motivate people fall into five basic categories:
1. Physiological needs are required for survival: food, water, sex, and shelter.
2. Security needs keep you free from harm. In modern society, these might include insurance, medical checkups, and a home in a safe neighborhood.
3. Social needs include the desire for love, friendship, and companionship. People seek to satisfy these needs through the time they spend with family, friends, and co-workers.
4. Esteem needs are the needs for self-esteem and the respect of others. Acceptance and praise are two ways these needs are met.
5. Self-actualization needs describe the desire to live up to your full potential. People on the path to meeting these needs will not only be doing their best at work and at home but also be developing mentally, spiritually, and physically.
 Maslow argues that these needs are organized into a hierarchy (see Figure 11.2). The most basic needs are at the bottom of the hierarchy. People try to satisfy these needs first. At the top of the hierarchy are the needs people try to satisfy only when they have met most of their other needs. However, people may be seeking to meet more than one category of needs at a time.

 According to this view, people tend to rely on their jobs to meet most of their physiological and security needs through paychecks and benefits such as health insurance. Needs higher on the hierarchy can be satisfied in many places. For example, people satisfy some of their social needs through their relationships with family and friends outside work, and they may seek to meet their selfactualization needs through volunteer work or membership in a religious organization. Nevertheless, people can also satisfy higher-level needs in the workplace. An employee who is applauded for solving a difficult problem or who takes pride in skillfully performing a craft such as carpentry is meeting some higher-level needs at work.

 Greater interest in Corporate Social Responsibility at many organizations, coupled with many employees’ enthusiasm for serving the community, has led some firms to meet employees’ higher-level needs with organized opportunities to do good. For instance, Boston Consulting Group lets employees spend up to a year working for a nonprofit organization, with their pay subsidized by BCG. Today’s young workers have a reputation for being especially motivated to serve. Applications to AmeriCorps, which arranges for young people to serve nonprofits around the United States, have been soaring over the past few years. Of course, meaningful work can also take place within businesses, and companies also see young employees’ desire to make a difference. Marriott International motivates by offering a management training program in which employees tackle assignments in all facets of hotel operations. When Claire Pignataro graduated from college, she was delighted to take a job with Marriott, not so much for the pay, but because the company would let her do something she loves: planning social and corporate events at one of its hotels.

 Maslow’s hierarchy is a widely cited view of motivation, but it has shortcomings. Critics (including Maslow himself) have noted that the theory is based on clinical work with neurotic patients and was not tested much for Relevance to the work setting. Are the needs identified by Maslow really all-inclusive? Do they describe people of many cultures, or just the majority of U.S. workers? The lack of studies investigating the hierarchy of needs makes it impossible to answer such questions with certainty. However, the popularity of Maslow’s theory implies that it can be helpful in offering suggestions about what motivates people.

 Applied to a work situation, Maslow’s theory means the supervisor must be aware of the current needs of particular employees. During a serious recession, a factory supervisor may find that many employees are highly motivated just to keep their jobs so they can pay their bills. In contrast, employees who are less worried about keeping a job may respond well to efforts to meet social needs. At Wyndham International, when David Mussa became vice president, employees rarely stayed long, so he took the time to discuss work with small groups of employees. Mussa had thought that the problem would be money to meet physiological needs. Instead, he learned that the problem was esteem needs. Many of the employees felt the company did not value them, mainly because they rarely received feedback or coaching to help them do their job better. They wanted their supervisors to be more involved and show that they cared. So Mussa hired more supervisors, giving each one more time to spend coaching employees—in fact, supervisors were required to do so.

 In this era of increasing numbers of single parents and two-income families in the workforce, a practical concern of many employees is their need for flexibility in their work hours to balance the demands of home and work. Some organizations have responded with “family-friendly” policies, which typically include flexible work arrangements such as the following:
• Flextime—This policy grants employees some leeway in choosing which 8 hours a day or which 40 hours a week to work.
Part-time work—For employees who can afford to work less than full time, this option frees them to spend more time meeting other needs. It is economically appealing to organizations because few offer a full range of benefits to parttime employees.
• Job sharing—To create part-time jobs, two employees share the duties of a single position.
Telecommuting—Some employees can and want to work from home, keeping in touch by means of computer and telephone lines.
 Figure 11.3 shows estimates of the percentage of 945 U.S. companies offering various flexible work arrangements.

 At IBS, which distributes tools, supplies, and components for manufacturers, managers believe the company’s small size allows them to be flexible in meeting employees’ needs. Michelle St. John, IBS’s operations manager, says, “We allow employees to take time for what they need and make it up later.” St. John, like many human resources experts, sees family-friendly policies as an important way to get and keep the best workers.
 Recent surveys have found flexible work arrangements at almost three-fourths of companies, with flextime available at more than half. (See Figure 11.3.) Other family-friendly benefits include referral services to help workers find day care for their children or elder care for aging parents.However, some employees have seen these policies as benefiting certain employees at the expense of others. To learn how some firms are responding to this concern, see the “Supervision and Ethics” box.

McClelland’s Achievement-Power-Affiliation Theory
In the 1960s, David McClelland developed a theory of motivation based on the assumption that through their life experiences, people develop various needs. His theory focuses on three such needs:
1. The need for achievement—the desire to do something better than it has been done before.
2. The need for power—the desire to control, influence, or be responsible for other people.
3. The need for affiliation—the desire to maintain close and friendly personal relationships.
 According to McClelland, people have all these needs to some extent. However, the intensity of the needs varies from one individual to the next. The nature of a person’s early life experiences may cause one of these needs to be particularly strong.

 The relative strength of the needs influences what will motivate a person. A person with a strong need for achievement is more motivated by success than by money. This person tends to set challenging but achievable goals and to assess risk carefully. Someone with a strong need for power tries to influence others and seeks out advancement and responsibility. A person with a strong need for affiliation gives ambition a back seat in exchange for approval and acceptance.At IBS, which distributes tools, supplies, and components for manufacturers, managers believe the company’s small size allows them to be flexible in meeting employees’ needs. Michelle St. John, IBS’s operations manager, says, “We allow employees to take time for what they need and make it up later.” St. John, like many human resources experts, sees family-friendly policies as an important way to get and keep the best workers. Recent surveys have found flexible work arrangements at almost three-fourths of companies, with flextime available at more than half. (See Figure 11.3.) Other family-friendly benefits include referral services to help workers find day care for their children or elder care for aging parents. However, some employees have seen these policies as benefiting certain employees at the expense of others. To learn how some firms are responding to this concern, see the “Supervision and Ethics” box. McClelland’s Achievement-Power-Affiliation Theory In the 1960s, David McClelland developed a theory of motivation based on the assumption that through their life experiences, people develop various needs. His theory focuses on three such needs: 1. The need for achievement—the desire to do something better than it has been done before. 2. The need for power—the desire to control, influence, or be responsible for other people. 3. The need for affiliation—the desire to maintain close and friendly personal relationships. According to McClelland, people have all these needs to some extent. However, the intensity of the needs varies from one individual to the next. The nature of a person’s early life experiences may cause one of these needs to be particularly strong. The relative strength of the needs influences what will motivate a person. A person with a strong need for achievement is more motivated by success than by money. This person tends to set challenging but achievable goals and to assess risk carefully. Someone with a strong need for power tries to influence others and seeks out advancement and responsibility. A person with a strong need for affiliation gives ambition a back seat in exchange for approval and acceptance.

 This theory offers a way to understand the behavior of the salespeople at a Westinghouse sales office. The manager in charge of that office told his 16 employees that he would buy and cook lunch for them if they met their sales goals. In the following 19 months, they exceeded their quotas 18 times. That exceptional performance made such an impression on headquarters that the company offered to pay for the meals. The manager declined reimbursement, however. Despite the widespread assumption that salespeople are motivated by money, the manager saw a need for affiliation: The staff members enjoyed their boss’s personal attention as he bought and grilled steaks for them to share. Changing this interaction into a corporate reward program would remove its motivational power. Similarly, Pfizer inspired its older, more experienced sales reps by bringing them together into peer groups that competed with one another and coached the pharmaceutical company’s younger representatives. The veteran salespeople, whose performance had declined as they increasingly felt isolated, improved when they began to enjoy stronger relationships with one another and a clearer role with respect to their younger colleagues.
 McClelland’s theory differs from Maslow’s in that it assumes different people have different patterns of needs, whereas Maslow’s theory assumes the same pattern of needs for all people. Thus, McClelland considers individual differences.
 Both theories, however, imply that supervisors must remember that employees are motivated by a variety of possibilities.

Herzberg’s Two-Factor Theory
Frederick Herzberg’s research led to the conclusion that employee satisfaction and dissatisfaction stem from different sources. According to this Two-factor theory, dissatisfaction results from the absence of what Herzberg calls hygiene factors, which include salary and relationships with others. For example, someone whose pay is poor (e.g., a physical therapist earning $5,000 less than the average pay for the position) is going to be dissatisfied with the job. In contrast, satisfaction results from the presence of what Herzberg calls motivating factors, which include opportunities offered by the job. Thus, an employee who sees a chance for promotion is likely to be more satisfied with the current job than one who does not. Table 11.1 lists the items that make up hygiene and motivating factors.

 Herzberg found that employees are most productive when the organization provides a combination of desirable hygiene factors and motivating factors. According to this theory, an organization cannot ensure that its employees will be satisfied and productive simply by giving them a big pay raise every year. Employees also need motivating factors such as the ability to learn new skills and assume responsibility. Like the other content theories, Herzberg’s theory tells supervisors that they need to consider a variety of ways to motivate employees.


In the 1980s, more and more companies began offering flextime and other family-friendly work arrangements as a way to help employees balance the demands of work and home. Eventually, though, some employees began to complain that this effort to address the needs of particular workers was not being applied in a way that was completely fair to everyone. Sometimes one person’s scheduling demands were favored in a way that made the job harder for coworkers. In other situations, an employee’s part-time work hours might pose difficulties for customers. If productivity suffered, the benefits to one employee could hurt the company’s owners and anyone else who received pay linked to overall company performance.
 Realizing these shortcomings of family-friendly arrangements, companies have begun looking at ways to make their policies fairer to everyone and bring them more in line with business needs. For example, at the accounting firm RSM McGladrey, employees are expected to prepare a written report justifying how a flexible work schedule would help clients and co-workers, not just themselves. By forcing employees to rethink their needs, the firm actually helped some of them come up with better plans. Michelle Krapfl, a manager in RSM’s office in Cedar Rapids, Iowa, had arranged to work 30 hours a week, but she consistently had to stay longer, and “flexibility” at her office was looking like something more rigid. When Krapfl and other colleagues with flexible arrangements submitted their reports, it became evident that Krapfl was not in the best position at her company for someone who wanted to work part-time. She transferred to another unit, where she now works with other employees and a supervisor who have part-time positions and support one another to complete assignments on time.
 Another solution is to put employees themselves in charge of how they will get the work done under a flexible arrangement. At the Phoenix office of Chubb Corporation, an insurance company, employees have some flexibility in what hours they work, but they are responsible for figuring out how the team will complete their work within those hours. Most employees chose to adjust work hours, selecting compressed workweeks and flexible lunch hours, as well as some flexibility in starting and ending times. This control motivated them to plan their work flow carefully each morning so that they could enjoy working the hours most convenient to them. As a result, Chubb teams have become far more efficient, benefiting the company as well as themselves.
Table 11.1
Figure 11.2
Figure 11.3
Another way to explain how motivation works is to look at the process of motivation instead of specific motivators. Theories that pertain to the motivation process are known as process theories. Two major process theories are Vroom’s expectancy-valence theory and Skinner’s Reinforcement Theory.
Vroom’s Expectancy-Valence Theory
Assuming that people act as they do to satisfy their needs, Victor Vroom set out to explain what determines the intensity of motivation. He decided that the degree to which people are motivated to act in a certain way depends on three things:
1. Valence—the value a person places on the outcome of a particular behavior. For example, a person may highly value the prestige and the bonus that result from submitting a winning suggestion in a contest for improving quality.
2. Expectancy—the perceived likelihood that the behavior will lead to the outcome. A person in the example may believe that his or her idea has a 50–50 chance of winning the quality improvement contest.
3. Instrumentality—the perceived probability that the promised reward will actually be received. In order for an employee to submit a winning suggestion, he or she should be fairly certain that the behavior will be rewarded as promised.
 Vroom’s expectancy–valence theory says that the strength of motivation equals the perceived value of the outcome times the perceived probability that the behavior will result in the outcome (see Figure 11.4). In other words, people are most motivated to seek results they value highly and think they can achieve.

 This theory is based on employees’ perceptions of rewards and whether they are able to achieve them. Employees may place different values on rewards than a supervisor, and they may have different opinions about their abilities. If a supervisor believes that a good system of rewards is in place but that employees are not motivated, the supervisor might investigate whether employees think they are expected to do the impossible. To learn this, supervisors must be able to communicate well.
 At Lee County Fleet Management, located in Fort Myers, Florida, fleet manager Marilyn Rawlings applied these principles by repeatedly showing employees they could meet high standards. She works with each employee to prepare a plan for personal growth, including Goal Setting. Rawlings encourages each employee to set one goal that is a stretch, and then she helps that employee achieve those goals. Rawlings says, “I want people to see that they can accomplish things that they don’t think they can do.” That experience may change their perceptions so that they will see themselves as able to accomplish more. When Rawlings wanted her organization to obtain the Automotive Service Excellence (ASE) Blue Seal of Excellence, she needed to have two additional technicians become certified by the ASE. The only two who were not yet certified had chosen not to try because they didn’t believe they could pass the test. Rawlings raised the value of the outcome by telling each employee that obtaining the certification would make them a hero to the group—and that she would hold a celebration for everyone when the group won the award. The two technicians both tried the exam, and both passed.

 Skinner’s Reinforcement Theory
From the field of psychology comes reinforcement theory, pioneered by B. F. Skinner. Reinforcement theory maintains that people’s behavior is influenced largely by the consequences of their past behavior. Generally, people keep doing things that have led to consequences they like, and people avoid doing things that have had undesirable consequences. For example, praise feels good to receive, so people tend to do things that, in their experience, result in praise.
 Reinforcement theory implies that supervisors can encourage or discourage a particular kind of behavior by the way they respond to the behavior. They can administer reinforcement, which can involve either giving a desired consequence or ending a negative consequence in response to behavior the supervisor wants. Or the supervisor can administer punishment, which is an unpleasant consequence of the behavior the supervisor wants to end. As described in this chapter, when salespeople performed well, they earned bonuses or won contests—a form of reinforcement. Using reinforcement theory to motivate people to behave in a certain way is known as behavior modification. In everyday language, we call it “using the carrot and the stick.”
 For long-term results, reinforcement is more effective than punishment. Psychologists have found that repeated punishment (or failure) can lead to an unhappy consequence called “learned helplessness.” This means that if employees are punished repeatedly for failing in some aspect of their work, these employees will eventually believe that they are unable to succeed at the job. These employees begin to approach the job passively, believing that they will fail no matter what.
 Research has indicated that behavior modification programs can be successfully applied in organizational settings. In order to implement these programs, a supervisor should consider the following ideas. First, offer different types of rewards for employees according to the quality of their performance. Second, clearly communicate any feedback to employees by telling them what they are doing right and wrong. Third, if an employee requires punishment of some sort, be sure to deliver this punishment in the absence of other employees. Finally, supervisors should provide rewards and punishments that are substantial and communicate that they are taking the behavior modification program seriously.

 Together, Vroom’s and Skinner’s process theories support the idea that supervisors motivate most effectively when they place less emphasis on punishing infractions and more on giving employees a desirable goal and the resources that enable them to achieve that goal. An example of a supervisor focused on correcting negative behavior involves employee safety. An employee cut his head one day when he forgot to take off his baseball cap and put on a hard hat. Management responded by forbidding all employees from wearing baseball caps to work. Annoyed by the directive, employees showed up for work the next day wearing all kinds of headgear other than baseball caps: cowboy hats, sombreros, and even “Cat in the Hat” style hats. They applied their creativity to a power struggle with management, rather than to safety. In contrast, when Union Square Hospitality Group wanted the chefs at its various restaurants to focus more on cutting costs, it gave them information and tools for better decision making. Whenever more than one chef is working with the same supplier, Union Square negotiates a quantity discount and then distributes information about the deal to all the chefs so that they can decide whether to participate in the arrangement. Chefs first signed on to deals for basics like paper towels and bottled water. Eventually, as they saw costs falling with no compromise in quality, they began to experiment with food suppliers, too. As in this second example, supervisors can empower workers to focus on meeting the organization’s goals, rather than simply piling on rules, which workers may resist. For another situation in which goals and resources can motivate employees, see “Supervisory Skills.”
 Figure 11.4

Most of these motivation theories have one element in common: Supervisors must consider individual differences in designing rewards. What motivates one person may not motivate another, so supervisors need to offer a variety of rewards. At the same time, to avoid discrimination, employers must distribute benefits fairly.
 The types of rewards a supervisor may use are not entirely under his or her control. Not only does a supervisor have to follow the organization’s policies, but he or she must also obey a variety of laws requiring that employers provide certain types of benefits. For example, federal laws set requirements for overtime pay, rest breaks, health insurance for retirees, and many other areas. Most organizations have a human resources professional or department responsible for helping the organization comply with laws related to benefits. The details of these laws are beyond the scope of this book.
 However, the requirements of the Family and Medical Leave Act of 1993 are worth noting because they affect the supervisor’s role in scheduling work and staffing the department. Under this law, organizations with 50 or more employees within a 75-mile radius must give employees up to 12 weeks of unpaid leave to care for a newborn, adopted, or foster child within one year of the child’s arrival. These employers also must offer this time off if employees need to care for a seriously ill child, parent, or spouse or if they themselves have medical conditions that prevent them from doing their jobs. During the time off, the employer must continue to pay the employee’s health insurance premiums. The employer also must guarantee that the employee will be able to return to his or her job or an equivalent one. If the need for the leave is foreseeable, the employee must give the organization 30 days’ notice.
 In some organizations, the supervisor faces a significant challenge in planning and scheduling because of employees’ leave. A recent survey by the Society for Human Resource Management found that about one-third of the workforces of the surveyed companies had requested medical leave during the preceding year, and one-sixth had requested family leave. Aleave can make it challenging to motivate the employees who shoulder the extra work. About one-third of the companies in the same survey reported employees had complained that co-workers took leave for reasons the complainers found questionable.
The content theories of motivation imply that money motivates people when it meets their needs. Recently, the federal minimum wage rose to $6.55 per hour. For a worker with at least two dependents, this rate of pay would not keep the household above the poverty level, so a minimum-wage job might motivate such employees to work overtime whenever possible, look for a second job, or seek training, promotions, or some other route to better pay. In contrast, a high school student might welcome the steady income stream from a minimum-wage job. The opportunity to earn more can be very important to a college student, considering the high cost of college tuition and the potentially great impact of a college degree on the student’s future lifestyle. A retired person or a married person whose spouse earns a comfortable income might work primarily for nonfinancial rewards such as a sense of accomplishment or the satisfaction derived from performing a needed service.

 If money is to work as a motivator, employees must believe they are able to achieve the financial rewards the organization offers. Thus, if a theater company offers its staff a bonus for selling a given number of season ticket subscriptions over the telephone, the bonus will motivate the employees only if they believe they can sell that many tickets. Or if an organization pays a bonus for employee suggestions that improve quality, the bonus will motivate employees only if they believe they are capable of coming up with ideas.
The way a pay plan is structured can influence the degree to which employees are motivated to perform well. Some pay plans offer bonuses, commissions, or other kinds of pay for meeting or exceeding objectives. For instance, a growing number of organizations tie raises and bonuses to success in retaining existing customers and meeting established quality goals (see Figure 11.5). Others pay employees a higher rate for learning additional skills, including how to operate lift trucks and computer-controlled machinery or how to develop computer applications to do business globally. Such pay plans are said to use financial incentives.A recent survey found that more than 10 cents out of every payroll dollar went to some form of variable pay.
 Supervisors rarely have much say in the type of pay plan an organization uses. However, they can motivate better if they understand the kinds of pay plans that offer a financial incentive. Knowing whether the organization’s pay system is designed to motivate gives a supervisor clues about the needs of employees for nonfinancial incentives. If the organization’s pay plan includes financial incentives but the employees remain unmotivated, a supervisor might look for other kinds of motivators. On the other hand, if the organization’s pay plan contains no financial incentives, a supervisor might seek permission to include money for bonuses in the department’s budget.

Piecework System

The piecework system pays people according to how much they produce. This method is often used to pay independent contractors, that is, people who are selfemployed and perform work for the organization. For example, a magazine might pay a writer a fixed rate for each word, or a clothing manufacturer might pay a seamster a set amount for each shirt sewed. Farm workers may be paid according to how much they harvest. Unlike independent contractors, however, few employees are paid under this system.
Production Bonus System
Production department employees may receive a basic wage or salary plus a bonus that consists of a payment for each unit produced. Thus, an employee might earn $8.50 or more an hour plus $0.20 for each unit produced. This is called a production bonus system. If employees do not appear to be motivated by a production bonus system, the bonus may not be large enough to be worth the extra effort. Employees who work faster earn more money under such a system, but the pay system does not necessarily encourage high-quality work.
 There are other types of bonus as well, such as bonuses paid for recommending new employees, delivering exceptional service, or meeting performance targets. Saga Software, an enterprise software developer based in Reston, Virginia, gives out nearly $300,000 in on-the-spot performance bonuses. Nearly half the firm’s 800 employees earned between $500 and $5,000 in one recent year; if they chose to defer all or part of the bonus, the firm marked the award up by 50 percent.


In a sales department, employees may earn commissions, or payment linked to the amount of sales completed. For example, a real estate agent listed a house for a brokerage. Upon the sale of the house, the agent might receive a commission of 2 percent of the sale price. The selling agent and the brokerage also would get commissions.
 Although commissions are most commonly paid to salespeople, companies have applied this type of pay to other positions where the company charges a client for the work the employee completes. At Pinard’s Small Engine Repair, a shop located in Manchester, New Hampshire, service technicians receive a commission based on the amount billed for their work. The technicians keep track of the time they spend on billable work. Employees who spend at least half of their time doing billable repairs earn a commission of at least 4 percent of the amount billed for their work. Technicians can earn higher percentages for spending more of their time on billable work. A technician who spends at least 80 percent of his or her time on billable hours will earn a commission of 7 percent—a much larger commission, considering that the amount billed is also likely to be greater. Thus, the pay system encourages technicians at Pinard’s to work more efficiently. The shop supports this arrangement by setting up work arrangements so that technicians are free to concentrate on repairs, rather than helping out in the store or answering phones.
 Most organizations that pay commissions also pay a basic wage or salary. Otherwise, the financial uncertainty can worry employees to the point that it interferes with motivation. Some people, however, like the unlimited earnings potential of a commission-only job.
Payments for Suggestions
To build employee participation and communication, many companies pay employees for making suggestions on how to cut costs or improve quality. Typically, the suggestion must be adopted or save some minimum amount of money before the employee receives payment. The size of the payment may be linked to the size of the benefit to the organization. In other words, an idea with a bigger impact results in a bigger payment.

Group Incentive Plans

Organizations today are focusing increasingly on ways to get employees and their supervisors to work together as teams. Afinancial incentive to get people to work this way is the group incentive plan, which pays a bonus when the group as a whole exceeds some objective.An organization measures the performance of a work unit against its objectives, and then pays a bonus if the group exceeds the objectives. At Continental Airlines, every employee receives at least $65 in cash for each month that the airline ranks among the top three in on-time performance as rated by the U.S. Transportation Department or completes at least 80 percent of its flights on schedule. For every month that Continental ranks first, the bonus rises to $100 each.
A frequently used type of group incentive is the profit-sharing plan. Under this kind of plan, the company sets aside a share of its profits earned during a given period, such as a year, and divides these profits among the employees.The assumption is that the better the work done, the more the company will earn and, therefore, the bigger the bonuses. In the past, profit sharing was limited chiefly to executives, but more companies today are sharing profits among all employees.
 InterDyn Cargas, which sells business software and consulting services, uses a profit-sharing plan as a way to keep employees focused on team success rather than individual performance alone. One-fifth of InterDyn’s profits are set aside and divided among employees every six months, with somewhat more allocated to employees who have been at the company longer.
 An increasing number of companies are adopting a gainsharing program, under which the company encourages employees to participate in making suggestions and decisions about improving the way the company or work group operates. As performance improves, employees receive a share of the greater earnings. Thus, gainsharing seeks to motivate not only by giving financial rewards but also by making employees feel they have an important role as part of a team.
Figure 11.5

In our society, money is considered a private matter, and most people do not like to talk about what they earn. Thus, in private (nongovernment) organizations, employees generally do not know one another’s earnings, though supervisors know what their subordinates earn. In contrast, government employees’ earnings are public information, often published in local papers, because taxpayers ultimately pay their wages and salaries.
 Does secrecy help or hurt the usefulness of money as a motivator? Certainly, it does not make sense to disclose information if it only embarrasses employees. Most employees overestimate what others earn. This overestimation can result in dissatisfaction because employees believe they are underpaid in comparison.
 To motivate employees with the possibility of a raise and a belief that pay rates are fair, the organization must let them know what they can hope to earn. A typical compromise between maintaining privacy and sharing information is for the organization to publish pay ranges. These show the lowest and highest wage or salary the organization will pay an employee in a particular position. Employees do not know how much specific individuals earn, but the ranges show what they can expect to earn if they get a raise, promotion, or transfer to another position.

In observing the behavior of managers, Douglas McGregor noted that many tend to have a group of attitudes that reflect their beliefs about workers and the workplace. He termed this set of attitudes Theory X. To summarize, a Theory X manager assumes that people dislike work and try to avoid it, that they therefore must be coerced to perform, that they wish to avoid responsibility and would prefer to be directed, and that their primary need is for security. Not surprisingly, these beliefs influence how supervisors and other managers behave. Theory X supervisor would adopt an autocratic leadership role, keeping a close eye on employees and looking for occasions when they need to be disciplined to keep them performing adequately.

 McGregor advises that managers can benefit from adopting a much different set of attitudes, which he terms Theory Y. According to Theory Y, working is as natural an activity as resting or playing, and people will work hard to achieve objectives to which they are committed. They can learn to seek responsibility and to be creative in solving organizational problems. Supervisors and other managers who adhere to Theory Y focus on developing the potential of their employees. Their style of leadership tends to be democratic. Table 11.2 summarizes these two sets of assumptions.

 Today, a common view among people studying management is that Theory Y is appropriate for many situations. To see what a Theory Y manager looks like, consider Don T. Davis, who manages the Beverly Hills, California, branch of Smith Barney, a brokerage division of Citigroup. Davis focuses on providing the office’s 85 financial consultants with the resources they need to serve their clients. Explains Davis, “I’ve been around here a long time. I’m able to call someone [at Citigroup] and say, ‘I need you to help me out here.’” Every day, Davis takes several walks around the brokerage offices, making himself available to the financial consultants in case they have problems or need encouragement. He often accompanies them on calls to prospects so he can better coach them in sales and teamwork. He also identifies situations in which he can help employees by pairing them with those who have expertise in products the client needs. In one situation, a financial consultant was having difficulty getting a new client set up, so Davis arranged for this major prospect to travel to New York and meet experts at Citicorp. The trip smoothed the process for the financial consultant, who has since been able to set up services for that client.

 In the 1980s, management experts extended their view of managing and leading to include Theory Z. Theory Z supervisors seek to involve employees in making decisions, consider long-term goals when making plans, and give employees relatively great freedom in carrying out their duties. This theory is based on comparisons of management styles in the United States and Japan. It assumes that whereas Japanese workers are more productive than their U.S. counterparts, the difference stems in part from different management styles. Thus, Theory Z was developed in an attempt to adapt some Japanese management practices to the U.S. workplace. The Japanese practices include employee Involvement and lifetime employment.
Table 11.2

When employees find their work interesting, they are more likely to give it their full attention and enthusiasm. In general, work is interesting when it has variety and allows employees some control over what they do. Work can be made more interesting through Job Rotation, Job Enlargement, Job Enrichment, and increased customer contact.
Job rotation involves moving employees from job to job to give them more variety. For example, the employees in a production department may take turns operating all the machines in the factory. Job rotation requires that employees have relatively broad skills. As a result, the supervisor or company must provide for cross-training, or training in the skills required to perform more than one job. The opportunity to learn new skills through cross-training can in itself motivate employees.
Job enlargement is an effort to make a job more interesting by adding more duties to it. Thus, a machine operator might be responsible not only for running a particular machine but also for performing maintenance on the machine and inspecting the quality of the parts produced with the machine. As with job rotation, this approach assumes that variety in a job makes it more satisfying, with the result that employees are more motivated.
Job enrichment is the incorporation of motivating factors into a job. Herzberg called the factors that enrich a job “motivators.” Generally, an enriched job gives employees more responsibility to make decisions and more recognition for good performance. Thus, enriched jobs are more challenging and, presumably, more rewarding. For example, instead of requiring salespeople in a department store to call a supervisor whenever a customer has a complaint, the store might authorize them to handle complaints as they see fit. They would have to call a supervisor only if solving the problem would cost the store more than some set amount, say, $500.
 When modifying jobs to make them more interesting, the organization and supervisor must remember that not all employees are motivated by the same things at the same time. Thus, while some employees may eagerly accept the new variety in their jobs, others are likely to be less enthusiastic. Some workers may think jobs are being redesigned simply to get more work out of people for the same amount of money. A supervisor must be careful to emphasize the advantages of the new arrangement and listen to employee reactions.
 Work also can be made more meaningful by giving employees some contact with the people who receive and use their products (goods or services). Nurses and salespeople are routinely in contact with the people they serve, but production workers and accounting personnel have less customer contact. Sometimes a supervisor can arrange to have workers visit the users of the products. For example,a group of production workers might be sent to visit a customer who is having trouble operating a machine the company manufactures. The workers not only would be able to help the customer but might also get some ideas for making the machine better. Accounting personnel might meet the people in the company who use their reports to make sure they understand and are satisfied with the reports.
Effective motivation can lead to performance beyond employees’ own expectations of themselves. When someone expects a lot of us, we often find that we can do a lot. When little is expected, we tend to provide little. In either case, the expectations are self-fulfilling.
 The direct relationship between expectations and performance is known as the Pygmalion effect. The name comes from the Greek myth of Pygmalion, a king of Cyprus who carved a statue of a beautiful maiden and then fell in love with her. He so wished she were real that she became real.
 According to the Pygmalion effect, a supervisor who says to an employee, “You’re so dense, you never get the procedures right,” will not motivate effectively. Instead, the employee will decide that understanding procedures is beyond his or her capacity. Therefore, a supervisor who wishes employees to set high standards for themselves must think and speak with the assumption that the employees are capable of meeting high standards. A supervisor might say, “These procedures are complicated, but I’m sure that if you study them regularly and ask questions, you can learn to follow them.”

 An individual who recognizes the value of high expectations is minor-league baseball player Alex Gordon. When the Kansas City Royals selected him in 2005, he became the number two pick in that year’s draft, and expectations for his baseball career soared. Gordon’s reaction? As he prepared for the start of a game, playing with the Wichita Wranglers Class AAteam, he told a reporter, “I actually liked the expectations. It gives me that little bit more motivation to do well.”
The content theories of motivation indicate that a variety of rewards may motivate but that not all employees will value the same rewards at the same time. The supervisor’s challenge is to determine what rewards will work for particular employees at particular times. This means appreciating the needs people are trying to meet and the variety of ways a supervisor can provide rewards.
 An attractive award motivates employees in and of itself, but supervisors and other managers can add to the attraction by making the experience of receiving the award pleasant, too. At Hormel Foods in Rochester, Minnesota, receiving annual profit-sharing checks is part of a late-year celebration. The company serves milk and cookies and passes out the checks in what plant manager Mark Coffey calls a “fun and festive day.” Production supervisor Bill Hacker agrees that the check distribution time in November is “always a happy day around here.”Supervisors at any company that distributes group incentives could add to their motivational value by contributing to a positive mood at those times.

 Of course, there are some limits to a supervisor’s discretion in giving rewards. Company policy or a union contract may dictate the size of raises employees get and the degree to which raises are linked to performance as opposed to seniority or some other measure. However, supervisors can use the theories of motivation, coupled with their own experience, to identify the kinds of rewards over which they have some control. For example, a supervisor has great freedom in administering rewards such as praise and recognition. Many supervisors have some discretion in job assignments. Employees who have a high need for achievement (McClelland’s theory) or are trying to meet esteem or self-actualization needs (Maslow’s theory) may appreciate opportunities for additional training. Employees who have a high need for affiliation or are seeking to meet social needs may appreciate being assigned to jobs in which they work with other people.
The rewards a supervisor uses should be linked to employee performance. Unfortunately, employees seldom see a clear link between good job performance and higher pay. If there is a connection, employees should be aware of it and understand it. Another means of connecting rewards to performance is in the way supervisors express praise. “Tips from the Firing Line” suggests a way to offer performance-related praise. Linking rewards to the achievement of realistic objectives is a way to help employees believe they can attain desired rewards. As Vroom’s expectancy–valence theory described, rewards are most likely to motivate employees when the employees view them as achievable.
 At Great Scott Broadcasting, an independent broadcasting company in Pottstown, Pennsylvania, sales reps for the company’s eight radio stations in Maryland and Delaware must be knowledgeable about audience demographics, marketing protocol, and other key information about selling radio spots. With a game called Trivia Feud, general manager Cathy Deighan ensures that the reps have the information they need to answer clients’ questions quickly and accurately. The competitive 15-minute game is played at every weekly sales meeting— “It can get pretty crazy,” says Deighan—and each person on the winning team gets a prize, such as a gift certificate for dinner, a free car wash, or cash.
 The use of objectives is a basic way to link rewards to performance. For example, the Management by Objectives (MBO) system provides rewards when employees meet or exceed the objectives they have helped set for themselves. Thus, if a museum’s cafeteria workers are supposed to leave their work areas spotless at the end of each shift, they know whether they have done what is necessary to receive their rewards, such as regular pay raises or extra time off.
 Using clear objectives to help motivate employees is an important way to make sure that when employees try hard, they are trying to do the right things. Rackspace, a Web-hosting service based in San Antonio, Texas, links rewards to its goal of delivering “fanatical” customer support. The company is divided into teams that bring together employees from various functions, including account management and tech support. Each team is responsible for meeting its own set of financial and service goals, including customer turnover, growth in existing customers’ business with Rackspace, and number of referrals from customers. Each month, if teams meet their goals, team members receive bonuses in amounts up to 20 percent of their salaries. Customer praise gets posted on the walls, and individuals receive recognition through the monthly Straitjacket Award; employees grant this award by voting for the employee whose customer support was most fanatical.


Johanna Rothman helps project teams of information technology experts learn to work together effectively. As team leader and consultant, she has found that vague expressions of praise are much less effective than specific, personal statements. Rothman recommends that groups use a format she calls “appreciations.” Here is Rothman’s formula for an appreciation:
I appreciate you, [name], for [specific action]. [That action] [tell the action’s effect on you or the group].
 According to Rothman, the second part of an appreciation may feel awkward to say, but it is the part that really motivates people to continue the desired behavior.
 Rothman illustrates her formula with several examples, including the following two (edited):
 I appreciate you, Ron, for thinking about the project and testing intelligently. I’ve worked with testers who didn’t know about our projects and didn’t have the benefits I wanted from the testing. You found things I didn’t know I’d put into the software code.
 I appreciate you, Dawn, for reviewing my first draft of the project architecture so quickly. Because you reviewed it quickly, I had time to reorganize it, and our customers really like the way the product is organized now.
Most of the theories of motivation emphasize that different things motivate individuals to different degrees. A supervisor who wishes to succeed at motivating has to remember that employees will respond in varying ways. A supervisor cannot expect that everyone will be excited equally about cross-training or overtime pay. Some employees might prefer an easy job or short hours, so that they have time and energy for outside activities. Even employees in a particular group, such as part-time workers, can have different preferences For example, some parttimers may prefer the shorter hours, while others took part-time jobs hoping they would be a steppingstone to a full-time position. Among those who prefer parttime, some may see the job as a way to pay the bills while freeing time for other roles, such as artist, actor, or parent. In contrast, students working part-time may be eager to apply lessons from school on the job and begin developing a career through the part-time work. Effective supervisors not only respect these differences but also find ways these diverse employees can contribute—say, giving students challenging assignments to develop their skills, noticing when the artist’s unique perspective contributes important ideas, and recognizing that parenting responsibilities change so that these part-timers may be looking for greater responsibility at work in the future.Figure 11.7 shows how U.S. workers rated job characteristics in a Gallup poll.
 As much as possible, a supervisor should respond to individual differences. When a particular type of motivation does not seem to work with an employee, a supervisor should try some other motivator to see if it better matches the employee’s needs.
Figure 11.7
One way to learn about employees’ needs and benefit from their ideas is to encourage employees to participate in planning and decision making. Employees tend to feel more committed when they can contribute to decisions and solutions. They also are likely to cooperate better when they feel like part of a team.
 As described in the “Supervision across Industries” box, Whole Foods Market gives teams of employees great decision-making authority. The supermarket chain extended this practice to a recent decision about health insurance benefits. The company had a self-insured plan, but claims overwhelmed the plan’s funds, so Whole Foods developed a plan using medical savings accounts. The company deposits money into employee accounts, and the employees, who pay no premiums, pick up the first $500 of prescription costs and $1,000 of other medical bills. After that, bills are paid from the savings accounts. After a one-year trial, Whole Foods had its employees evaluate whether to continue the new savings account approach or opt for traditional insurance coverage. By an overwhelming margin, the employees voted to keep the medical savings accounts. Part of the appeal is likely that Whole Foods workers tend to be relatively young and healthy; in a recent year, only 10 percent of employees spent all the money in their accounts, and the remaining dollars rolled over into the next year’s account. Because the employees don’t have to pay insurance premiums, more of them elect the insurance coverage as part of their benefits package. And Whole Foods is delighted, because the arrangement is helping it control health coverage expenses.
People want and need to know how well they are doing. Part of a supervisor’s job is to give employees feedback about their performance. When the supervisor tells employees that they are meeting or exceeding objectives, the employees know they are doing something right. When a supervisor tells employees that they are falling short of objectives, the employees know they need to improve. Most people will try to improve when given a chance to do so.
 Praise is an important kind of feedback. In monitoring employees, a supervisor should look for signs of excellent performance and let the employees know, in specific terms, that the good work is appreciated and that it benefits the organization.

 There are many ways to deliver praise. For example, a nursing supervisor might write a memo to a nurse, in which the supervisor comments on the nurse’s courteous manner with patients and how it gives patients a good impression of the hospital. Or, a police force supervisor might remark to an officer that the officer’s paperwork is always complete and legible. When Dave Marin was a bank manager, he invented a simple method of praise that surprised him with its impact. While preparing for a sales meeting, he bought a bag of stones and marked each one with a large U. The message: “You rock.” Marin gave one out to each employee he praised at the meeting. Thinking the rocks were a little silly, Marin was surprised when employees started asking him if he would be giving them out at the next meeting. He was even more surprised when, years later, he began hearing that employees had kept their rewards as a valued possession. Their value did not, of course, come from the worth of the rocks themselves, but from the treasure of public praise.

 A supervisor does not have to use a dramatic approach to praising a behavior. Praise is so easy to give and its potential rewards are so great that the supervisor can and should use it routinely, as long as it is sincere.
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