Contemporary Theories of Motivation

1. Contemporary Theories of Motivation Gonzalo Campuzano Enrique Flores

2. OUTLINE • Introduction • Early Theories of Motivation (Overview) • Goal Setting Theory • MBO Programs • Equity Theory • Expectancy Theory • Integrating Contemporary Theories of Motivation • References • Questions & Answers

3. 55% of U.S. employees have no enthusiasm for their job. As cited in D. Jones, “Firms spend Billions to Fire Up Workers – With Little Luck”, USA Today, May 10, 2001

4. INTRODUCTION • Motivation is the result of the interaction of the individual and the situation. • Individuals differ in their basic motivational drive. • i.e. Texbook Vs. Novel • The level of motivation varies both between individuals and within individuals at different times. • Motivation: “The process that account for an individual’s intensity, direction, and persistence of effort toward attaining a goal.” [1]

5. EARLY THEORIES OF MOTIVATION • 1950’s: • Hierarchy of needs theory • Theories X and Y • The two-factor theory. • They represent a foundation from which contemporary theories have grown. • Practicing managers still regularly use this theories and their terminology in explaining employee motivation. • Contemporary way of thinking

6. GOAL-SETTING THEORY • Goals tell an employee what needs to be done and how much effort will need to be expended. • In order to increase performance: • Set specific goals. • Difficult goals, when accepted, result in higher performance than does easy goals. • Provide feedback. • An individual is committed to the goal when he believes he can achieve the goal, and wants to achieve it.

7. MBO PROGRAMS:Putting Goal-Setting T. Into Practice • Converting overall organizational objectives into specific objectives for organizational units and individual members. • Four ingredients common to MBO programs: • Goal specification. • Participation in decision making. • An explicit time period. • Performance feedback. • Failures may come from: • Unrealistic expectations regarding results. • Lack of commitment by top management. • Cultural incompatibilities. • Fujitsu

8. EQUITY THEORY • Employees make comparison of their job inputsand outcomes relative to those of others: • When employees perceive inequity, the can: • Change their inputs. • Change their outcomes. • Distort perceptions of self. • Distort perception of others. • Choose a different referent • Leave the field

9. EQUITY THEORY • Given payment by time: • Overrewarded employees will produce more than will equitably paid employees. • Underrewarded employees will produce less or poorer quality of output. • Given payment by quantity of production: • Overrewarded employees will produce fewer, but higher-quality, units than will equitably paid employees. • Underrewarded employees will produce a large number of low-quality units in comparison with equitably paid employees.

10. EQUITY THEORY:Conclusions • Motivation is influenced significantly by others’ rewards as well as by one’s own rewards. • Inequities created by overpayment do not seem to have a very significant impact on behaviour. • Most research has focused on pay, but employees seem to look for equity in the distribution of other rewards. • Historically, equity theory focused on distributive justice. But increasingly equity is thought of from the standpoint of organizational justice. • Managers should consider openly sharing information on how allocation decisions are made, following consistent and unbiased procedures.

11. EXPECTANCY THEORY • The strength of a tendency to act in a certain way depends on the strength of an expectation that the act will be followed by a given outcome and on the attractiveness of that the outcome to the individual. • The theory focuses on three relationships: • 1. Effort-performance. • 2. Performance-reward. • 3. Rewards-personal goals.

12. EXPECTANCY THEORY • Giving maximum effort not always means being recognized. • Good performance appraisal not always leads to organizational rewards. • Rewards are not always found attractive by employees: • Managers limited in the rewards they can distribute. • Managers incorrectly assume that all employees want the same.

13. EXPECTANCY THEORY:Conclusions • The key is the understanding of an individual’s goal and the linkage between the three relationships. • There is no universal principle for explaining everyone’s motivations.

14. INTEGRATING CONTEMPORARY THEORIES OF MOTIVATION • Many theories are complementary. • Its basic foundation is the expectancy model.

16. REFERENCES Robbins and Judge, “Organizational Behavior”, 12th Edition, Pearson Prentice Hall, 2007. D. Jones, “Firms spend Billions to Fire Up Workers – With Little Luck”, USA Today, May 10, 2001 [1] T.R. Mitchell, “Matching Motivational Strategies with Organizational Contexts”, Research in Organizational Behavior, vol. 19, pp 60-62 P.C. Early, P. Wojnaroski, and W. Prest, “Task Planning and Energy Expended: Explorations of How Goals Influence Performance”, Journal of Applied Psychology, Feb 1987. J. Greenberg and S. Ornstein, “High Status Job Title as Compensation for Underpayment: A Test of Equity Theory”, Journal of Applied Psychology, May 1983.

17. Questions & Answers