Principles of Management - Motivating and Rewarding Employees - Quick Guides | Management

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Study GuidePrinciples of Management–Motivating and RewardingEmployees1. Motivation Theories: BehaviorMotivation theories help us understandwhy people choose to work hard—or not—at work.Process theories, in particular, focus onhow employees decide what actions to takebased on theirneeds, expectations, rewards, and outcomes.These theories explain how effort, performance, and rewards are connected in real workplacesituations. The most important behavior-based motivation theories areEquity Theory, ExpectancyTheory, Reinforcement Theory, and Goal-Setting Theory.1.1Understanding Equity TheoryEquity theory, developed byJ. Stacy Adams, explains motivation by focusing onfairness.According to this theory, employees compare:•Theeffortthey put into their work•Therewardsthey receive in returnWhen employees believe that their effort is fairly rewarded,equity exists, and they feel satisfied andmotivated.(Refer to Figure 1: The Equity Theory)

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Study GuideHowever, employees do not judge fairness in isolation. They also compare their rewards with those ofother employees doing similar work. If they believe others receive better rewards for the sameeffort,inequity occurs.1.2Reactions to Perceived InequityWhen employees feel they are treated unfairly, they may respond in several ways:•Reduce their effort at work•Ask for higher rewards or better treatment•Try to make their work seem more valuable than others’•Transfer to another position or leave the organizationEquity theory highlights an important idea:people act based on their perceptions, not on whatmanagers think is fair.1.3Manager’s Role in Maintaining EquityManagers must try to prevent or reduce feelings of unfairness, especially when givingvisiblerewardslike promotions or pay raises. Effective managers:•Clearly explain why rewards are given•Communicate how performance is evaluated•Encourage fair and realistic comparisonsWhen employees understand the reasons behind decisions, negative reactions to perceived inequityare less likely.1.4Expectancy TheoryTheExpectancy Theory, introduced byVictor Vroom, explains motivation as a logical process.Employees are motivated when they believe that:1.Theireffort will lead to good performance2.Good performance will lead torewards3.The rewards will help themachieve personal goalsMotivation is strongest when employees believe their effort is worthwhile and the reward is attractive.

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Study Guide1.5How Managers Can Use Expectancy TheoryTo motivate employees, managers should:•Clearly explain performance expectations•Connect rewards directly to performance•Make sure rewards are meaningful to employees•Help employees believe they are capable of successWhen effort, performance, and rewards are clearly linked, motivation increases.1.6Reinforcement TheoryReinforcement theory is based onE. L. Thorndike’s Law of Effect, which states that behavior isinfluenced by its consequences.This theory focuses onshaping behavior through rewards and consequences, rather than internalmotivation.1.7Four Reinforcement TechniquesManagers can influence behavior using four methods:1.Positive ReinforcementoRewarding desirable behavior(e.g., praise, promotion, pay raise)oIncreases the likelihood of repeating the behavior2.AvoidanceoShowing employees what negative outcomes they avoid by behaving properly3.ExtinctionoIgnoring unwanted behavior so it stops over timeoUseful only when the behavior is minor and temporary4.PunishmentoApplying negative consequences (e.g., suspension, pay reduction)oUsed to discourage undesirable behavior

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Study Guide1.8Management Lessons from Reinforcement TheoryManagers should remember that:•Employees learn what behaviors are acceptable•Rewards should be given immediately after good behavior•Employees must know how to earn rewards•Not rewarding good performance can reduce motivation1.9Goal-Setting TheoryTheGoal-Setting Theory, developed byEdwin Locke, states thatclear goals motivate people toperform better. Goals give employees direction and define how much effort is needed.In general,challenging goals lead to higher performance, especially when employees are involvedin setting them.1.10Factors That Improve Goal AchievementEmployees perform best when:•They are committed to the goal•They believe they can achieve it•The tasks are simple and familiar•They receive regular feedbackIt is also important to note that goal-setting works best inNorth American cultures, where individualachievement is emphasized.1.11Using Goal-Setting EffectivelyManagers should:•Set clear and specific goals•Involve employees in goal creation when possible

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Study Guide•Provide regular feedback on progressWell-defined goals help employees stay focused and motivated.2. Management Philosophies and MotivationA manager’sphilosophyplays a big role in shaping the workplace and motivating employees. How amanagerviews and communicates with employeescan influence their behavior, productivity, andjob satisfaction.2.1Theory X and Theory Y (Douglas McGregor)Douglas McGregor developed two theories—Theory XandTheory Y—to explain how managers’assumptions about employees affect their management style:•Theory Xassumes that employees dislike work, need constant supervision, and must becontrolled to get things done. Managers who follow Theory X often use strict rules and closemonitoring.•Theory Yassumes that employees are responsible, self-motivated, and capable of seekingout challenges. Managers who follow Theory Y tend to empower employees and encourageparticipation in decision-making.McGregor argued that these beliefs can becomeself-fulfilling prophecies: the way managers treatemployees often leads to the behavior they expect.2.2Chris Argyris and the Mature WorkerChris Argyris focused on what he called themature worker. In his bookPersonality andOrganization, he compared traditional management practices with the needs of mature adults.One example iswork specialization, which divides tasks into small, highly defined pieces. While thiscan improve efficiency, Argyris believed it might actuallylimit employees’ growthand prevent themfrom reaching their full potential, or self-actualization.2.3Treating Employees as Responsible AdultsLike McGregor, Argyris emphasized that managers should treat employeespositively andrespectfully. But he went further, arguing that mature workerswant more than just respect:

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