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What is the link between motivation,

performance, and rewards?


What are the essentials of performance
management?
How do job designs influence motivation and
performance?
What are the motivational opportunities of
alternative work arrangements?

Copyright © 2010 John Wiley & Sons, Inc. 6-2


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Copyright © 2010 John Wiley & Sons, Inc.
• Reinforcement – immediately
rewarding positive behaviors with
valued outcomes.
• Equity – assuring fairness in type and
distribution of rewards.
The Integrated Model • Content – acknowledging individual
combines four key differences in motivational value
theories of • Expectancy – creating a linkage
organizational behavior: among ‘effort>performance>reward’.

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Intrinsic rewards
 Positively valued work outcomes that the
individual receives directly as a result of task
performance.

Extrinsic rewards
 Positively valued work outcomes that are given
to an individual or group by some other person
or source in the work setting.

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Pay for performance – the concept that
monetary rewards are in whole, or in part,
linked to accomplishments (individual or
team).
 Programs that provide incentives for employees to
increase their outputs.
 In the 2008-09 economic recession, HRGURU finds
that employers are finding that ‘cash is still king’
when it comes to incentives.

Copyright © 2010 John Wiley & Sons, Inc. 6-6


Merit pay
 Compensation system that directly ties an
individual’s salary or wage increase to measures of
performance accomplishments during a specific
time period.
 Seeks to create a belief among employees that the
way to achieve high pay is to perform at high levels.
 Bonus – additional monetary award that meets
specified benchmarks.

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Gain sharing
 Gives workers the opportunity to earn more
by receiving shares of any productivity gains
that they help to create.

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Profit-sharing plans
 Reward employees based on overall
organizational profit.
 Criticism: organizational profits are not always
a direct result of employees’ efforts,

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Skill-based pay
 Rewards people for acquiring and
developing job relevant skills.

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Stock Options
 Provide employees with an opportunity to
buy shares of stock at a future date at a
fixed price.

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Employee stock ownership plans (ESOPs)
 May give stock to employees, or allow stock
to be purchased at a price below market
value.

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Performance management
 Fair and accurate measurement and
application of rewards, and the
various human resource management
decisions and actions based on such
measurement.

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Performance management is:
 Evaluative - lets people know where they
stand relative to objectives and standards;

 Developmental – provides insights into


individual strengths and weaknesses that are
useful for personal development.

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Performance Measurement
 Output measures

 assess actual work results

 Activity measures

 assess work efforts or inputs

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Performance appraisal
 Formal procedure for
measuring and
documenting a person’s
work performance.

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Comparative Methods of
Performance Appraisal
Paired Forced
Ranking
Comparisons Distribution
Raters rank
Raters compare Raters place a
order
each person specific
individuals from
with every other proportion of
best to worst on
person. employees into
overall
each
performance.
performance

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 Rating scales
 Graphic - Raters assign scores on a list of dimensions
related to high performance outcomes in a given job.

 Behavioral - Raters identify observable job behaviors,


and specifically describe superior or inferior
performance.

 Critical incident diaries


 Rater records incidents of unusual success or failure in a
given performance aspect.

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360° Evaluation
 Includes not only the evaluations of bosses,
peers, and subordinates, but also self-ratings,
customer ratings, and ratings by others with
whom the employee deals with outside the
immediate work unit.

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Think of a performance management
discussion you have had with a
manager?
 Did you look forward to the meeting?

 Put yourself in the manager’s place.


 What would you change about the procedure?

 Which evaluation tool will be most beneficial?

Copyright © 2010 John Wiley & Sons, Inc. 6-23


To be meaningful, an appraisal system
must be:
 Reliable - provide consistent results across
time.

 Valid - actually measure people on relevant


job content.

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Job design
 Process through which managers plan and
specify job tasks and the work arrangements
that allow them to be accomplished.

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Scientific management
 Sought to improve work efficiency by
creating small, repetitive tasks and training
workers to do these tasks well.

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Job simplification
 A scientific management
approach that standardizes work
procedures and employs people in
clearly defined and highly
specialized tasks.
 Intent is to increase efficiency, but
it may be decreased due to the
motivational impact of
unappealing jobs.

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Job enlargement
 Increases task variety by combining into
one job two or more tasks that were
previously assigned to separate workers.

Job rotation
 Increases task variety by periodically
shifting workers among jobs involving
different tasks.

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Job enrichment
 The practice of enhancing job content by
building motivating factors such as
responsibility, achievement, recognition, and
personal growth into the job.

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Concerns about job enrichment
 Job enrichment can be very costly.

 Controversy concerning whether pay must


be increased when jobs are enriched.

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Job characteristics model
 Provides a data-based approach to
creating job designs with good person-job fit
that maximize the potential for motivation
and performance.

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Motivating potential score
 MPS indicates the degree to which the job is
capable of motivating people.

 A job’s MPS can be raised by enriching the


core characteristics.

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 When the core characteristics are highly
enriched, three critical psychological states
are positively influenced:
 Experienced meaningfulness of work

 Experienced responsibility for work outcomes

 Knowledge of actual results of work activities

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Moderators that influence the degree of
positive outcomes of enriched jobs:
 Employee growth-need strength is high.

 The employee has the required knowledge


and skills.
 Employee is satisfied with the work context
(salary, supervision, relationships).

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Managerial and global implications of
enriching jobs
 Not everyone’s job should be enriched.

 Job enrichment can apply to groups.

 Culture has a substantial impact on job


enrichment.

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Alternative work arrangements
 A key feature of contemporary
organizations.

 Designed to provide work-life balance and


increase employee motivation, performance
and job satisfaction.

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Compressed work weeks – any scheduling of work that allows a full
time job to be completed in fewer than the standard five days.
 Advantages
 For workers: added time off.

 For organizations: lower absenteeism and improved


recruiting of new employees.

 Disadvantages
 For workers: increased fatigue and family adjustment
problems.

 For organizations: work scheduling problems, customer


complaints, possible union opposition.

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Flexible working hours
 Gives individuals a daily choice in the timing of their
work commitments.
 Advantages:
 For workers: shorter commuting time, more leisure time,
more job satisfaction, and greater sense of responsibility.

 For organizations: less absenteeism, tardiness, and


turnover; more commitment, and higher performance.

Copyright © 2010 John Wiley & Sons, Inc. 6-40


Job sharing
 One full-time job is assigned to two or more persons
who divide the work according to agreed-upon
hours.

 Advantages:
 For workers: less burnout and higher energy level.

 For organizations: attracting talented people who


would otherwise be unable to work.

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Work sharing
 Workers agree to cut back on the number of
hours they work in order to protect against
layoffs.
 Some employers may mandate a cutback due to
economic necessity.

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Telecommuting - Work done at home or in a remote
location utilizing technology to communicate with
a central office or other employment location.

 Advantages
 For workers: flexibility, comforts of home, and choice of work
locations consistent with one’s lifestyle.
 For organizations: costs savings, efficiency, and improved
employee satisfaction.

 Disadvantages
 For workers: isolation from co-workers, decreased identification
with work team, family distractions.

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Advantages of part-time work
 For workers: appeals to people who want to supplement other
jobs or do not want full-time work.
 For organizations: lower labor costs, ability to better
accommodate peaks and valleys of business cycle, and better
management of retention.

Disadvantages
 For workers: added stress and potentially diminished
performance if holding two jobs, failure to qualify for benefits,
and lower pay rates than full-time counterparts.
› For organizations: when a person holds multiple part-time jobs,
the work burdens can be stressful; performance may suffer on
the job.

Copyright © 2010 John Wiley & Sons, Inc. 6-44

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