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Need-Based Theories

What you’ll learn to do: Explain need-based theories of worker motivation

In this section we will look at four main theories about how human needs are satisfied: Maslow’s hierarchy of needs, Alderfer’s ERG theory, Herzberg’s two-factor theory, and McClelland’s acquired-needs theory.

Learning Outcomes

· List the levels of needs in Maslow’s hierarchy

· Explain the impact that Maslow’s levels of needs have on worker motivation

· Summarize the changes to Maslow’s hierarchy of needs in Alderfer’s ERG theory

· Explain the difference between intrinsic and extrinsic motivators in Herzberg’s two-factor theory

· Describe how employees might be motivated using McClelland’s acquired-needs theory

Maslow’s Hierarchy of Needs

Human motivation can be defined as the fulfillment of various needs. These needs can encompass a range of human desires, from basic, tangible needs of survival to complex emotional needs surrounding an individual’s psychological well-being.

Abraham Maslow, a social psychologist, was interested in a broad spectrum of human psychological needs, rather than individual psychological problems. He is best known for his hierarchy-of-needs theory. Depicted in the pyramid below, the theory organizes the different levels of human psychological and physical needs in order of importance.

The pyramid shows five levels of needs. From bottom to top, they are: physiological, safety, love/belonging, esteem and self actualization, transcendence.

Maslow’s Hierarchy of Needs

Managers can apply Maslow’s hierarchy to better understand employees’ needs and motivation, and address them in ways that lead to high productivity and job satisfaction.

Physiological Needs

At the bottom of the pyramid are the physiological, or basic human survival needs: food, shelter, water, sleep, etc. Once physical needs are satisfied, individual safety takes precedence. Safety and security needs include personal security, financial security, and health and well-being.

After they have basic nutrition, shelter, and safety, people seek to fulfill higher-level needs.

Connection: The Third Level of Need

The third level of needs—love and belonging—are the desire to share and connect with others. Neglect, shunning, or ostracism can impact a person’s ability to form and maintain emotionally significant relationships. Humans need to feel a sense of belonging and acceptance, whether from a large social group or a small network of family and friends. Without these attachments, they may be vulnerable to loneliness, social anxiety, and depression.

Higher-Level Needs

The fourth level is esteem—the normal human desire to be valued and validated by others—as well as self-esteem. People with low self-esteem may find that external validation by others—through fame, glory, accolades, etc.—only partially or temporarily fulfills their needs at this level.

Finally, at the top of the pyramid is self-actualization. At this stage, people feel that they have reached their full potential. Self-actualization may occur after reaching an important goal or overcoming a particular challenge, and it may be marked by a new sense of self-confidence or contentment. But it is rarely a permanent state. Rather, self-actualization is an ongoing need for personal growth and discovery that people have throughout their lives.

Hierarchy of Needs and Organizational Theory

Maslow’s hierarchy of needs is relevant to organizational theory because both are concerned with human motivation. Understanding what people need—and how their needs differ—is an important part of effective management. For example, some people work primarily for money (and fulfill their other needs elsewhere), but others like to go to work because they enjoy their coworkers or feel respected by others and appreciated for their good work.

In the workplace, Maslow’s hierarchy of needs suggests that if a lower need is not met, then the higher ones will be ignored. For example, if employees lack job security, they will be far more concerned about their financial well-being and paying their bills than about friendships and respect at work. However, if employees receive adequate financial compensation (and have job security), meaningful group relationships and praise for good work may be more important motivators.

Consequences of Unmet Needs

When their needs aren’t met, employees can become very frustrated. For example, if someone works hard for a promotion and doesn’t get the recognition it represents, she may lose motivation and put in less effort. Also, after a need is met, it will no longer serve as a motivator: The next level up in the needs hierarchy will become more important. Therefore, keeping employees motivated can seem like a moving target. People seldom fit neatly into pyramids or diagrams; their needs are complicated and often change over time.

Assessing Needs Accurately

Maria is a long-time employee who is punctual, does high-quality work, and is well liked by her coworkers. However, her supervisor begins to notice that she is coming in late and seems distracted. He concludes that Maria is bored with her job and wants to leave. But when he raises these issues in her semiannual performance appraisal, he learns that Maria’s husband lost his job six months ago and, unable to keep up with mortgage payments, the couple has been living in a hotel. Maria has moved down the needs pyramid and, if the supervisor wants to be an effective manager, he must adapt the motivational approaches he uses. In short, a manager’s best strategy is to recognize this complexity and try to remain attuned to what employees say they need.

Alderfer’s ERG Theory

Photo of lush, old-growth forest.

Old-Growth Forest

Clayton Paul Alderfer, an American psychologist, used Maslow’s hierarchy of needs in developing the Alderfer’s ERG theory, which refers to core needs in three areas:

· existence

· relatedness

· growth

These three areas align, respectively, with Maslow’s levels of physiological, social, and self-actualization needs.

Alderfer proposed that when needs in one category are not met, people will redouble their efforts to fulfill needs in a lower category. For example, if their self-esteem (an area of need in the growth category) is suffering, people will invest more effort in the relatedness category of needs.

Herzberg’s Two-Factor Theory

American psychologist Frederick Herzberg is regarded as one of the great original thinkers in management and motivational theory. He set out to determine the effect of attitude on motivation by simply asking people to describe the times when they felt really good, and really bad, about their jobs. What he found was that people who felt good gave very different responses from people who felt bad.

The results from this inquiry form the basis of Herzberg’s Motivation-Hygiene Theory, sometimes called Herzberg’s two-factor theory (1968), which hypothesized that two sets of factors govern job satisfaction and job dissatisfaction: hygiene factors, or extrinsic motivators, and motivation factors, or intrinsic motivators.

Hygiene factors, or extrinsic motivators, tend to represent more tangible, basic needs like those noted in both the existence category of ERG theory and in the lower levels of Maslow’s hierarchy of needs. Extrinsic motivators include status, job security, salary, and fringe benefits. It’s important for managers to realize that not providing the appropriate and expected extrinsic motivators will sow dissatisfaction and decrease motivation among employees.

Motivation factors, or intrinsic motivators, tend to be less tangible. They are tied more to emotional needs like those identified in the “relatedness” and “growth” categories in the ERG theory and at the higher levels of Maslow’s hierarchy of needs. Intrinsic motivators include challenging work, recognition, relationships, and growth potential. Managers need to recognize that while these needs may fall outside the traditional scope of what a workplace ought to provide, they can be critical to strong individual and team performance.

The factor that differentiates two-factor theory from the others is the role of employee expectations. According to Herzberg, intrinsic motivators and extrinsic motivators have an inverse relationship. That is, intrinsic motivators tend to increase motivation when they are present, while extrinsic motivators tend to reduce motivation when they are absent. This is due to employees’ expectations. Extrinsic motivators (e.g., salary, benefits) are expected, so they won’t increase motivation when they are in place, but they will cause dissatisfaction when they are missing. Intrinsic motivators (e.g., challenging work, growth potential), on the other hand, can be a source of additional motivation when they are available.

Chart showing the factors that contribute to job satisfaction and job dissatisfaction according to Herzberg’s two-factor theory. Job dissatisfaction is influenced by hygiene factors; job satisfaction is influenced by motivator factors.

If managers want to increase employees’ job satisfaction, they should be concerned with the nature of the work itself—opportunities for employees to gain status, assume responsibility, and achieve self-realization. If, on the other hand, management wishes to reduce dissatisfaction, then the focus should be on the job environment—policies, procedures, supervision, and working conditions. To ensure a satisfied and productive workforce, managers must pay attention to both sets of job factors.

McClelland’s Acquired-Needs Theory

Photo of a chess master contemplating his next move.

An achievement-oriented tendency is to strive for mastery.

Psychologist David McClelland’s acquired-needs theory splits the needs of employees into three categories:

· achievement

· affiliation

· power

Employees who are strongly achievement motivated are driven by the desire for mastery. They prefer working on tasks of moderate difficulty in which outcomes are the result of their effort rather than luck. They value receiving feedback on their work.

Employees who are strongly affiliation-motivated are driven by the desire to create and maintain social relationships. They enjoy belonging to a group and want to feel loved and accepted. They may not make effective managers because they may worry too much about how others will feel about them.

Employees who are strongly power-motivated are driven by the desire to influence, teach, or encourage others. They enjoy work and place a high value on discipline. However, they may take a zero-sum approach to group work—for one person to succeed, another must fail. If channeled appropriately, their motivation can positively support group goals and help others in the group feel competent.

The acquired-needs theory doesn’t claim that people can be neatly categorized as one of the three types. Rather, it asserts that all people are motivated by all of these needs to varying degrees. Also, needs do not necessarily correlate with competencies; it is possible for an employee to be strongly affiliation-motivated, for example, but still be successful in a situation that doesn’t meet her affiliation needs.

McClelland proposes that people in top management generally have a high need for power and a low need for affiliation. He also believes that although individuals with a need for achievement can make good managers, they are not generally suited to being in top management positions.

Check Your Knowledge

Answer the following questions to see how well you understand the topics covered in this section. This short quiz does not count toward your grade, and you can retake it as many times as you wish. Use this quiz to decide whether to study the section further or move on.

Choose the BEST answer.

Question 1

Clayton Alderfer’s ERG theory is a modification of Maslow’s hierarchy of needs because it states that human needs can be grouped into three instead of five categories. ________ is not one of the ERG categories.

Relatedness

Safety

Existence

Question 2

Herzberg hypothesized that two different sets of factors governing job satisfaction and job dissatisfaction. These are

financial needs and safety needs

hygiene factors and motivation factors

existence and relations needs

Question 3

David McClelland’s acquired-needs theory splits the needs of employees into three categories. These categories are

achievement, affiliation, and power

belonging, responsibility, and achievement

autonomy, mastery, and purpose

References

Herzberg, F. (1968). One more time: How do you motivate employees? Harvard Business Review, 46(1), 53–62.

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Introduction to Need-Based Theories from Introduction to Business by Linda Williams and Lumen Learning is available under a Creative Commons Attribution 4.0 International license. UMUC has modified this work and it is available under the original license.

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Process-Based Theories

What you’ll learn to do: Explain process-based theories of motivation

In this section we will discuss three process-based theories of motivation: equity theory, expectancy theory, and reinforcement theory.

Photo of a statue of woman holding the scales of justice.

Learning Outcomes

· Describe the role of inputs and outcomes in equity theory

· Explain the implications of equity theory for business managers

· Describe the ways managers can use expectancy theory to motivate employees

· Explain how reinforcement theory can be used as a management tool

Equity Theory

In contrast to the need-based theories we have covered so far, process-based theories view motivation as a rational process. Individuals analyze their environment, develop reactions and feelings, and respond in specific, predictable ways.

Equity theory attempts to explain relational satisfaction in terms of perceived fairness: That is, people evaluate how fair or unfair distribution of resources is within their interpersonal relationships. Regarded as one of many theories of justice, equity theory was first developed in 1963 by John Stacey Adams. Adams, a workplace and behavioral psychologist, asserted that employees seek to maintain equity between their inputs and rewards from a job, and the perceived inputs and outcomes of others.

Equity theory proposes that people value fair treatment, which motivates them to maintain a similar standard of fairness with their coworkers and the organization. Accordingly, equity structure in the workplace is based on the ratio of inputs to outcomes.

Inputs are the employee’s contributions to the workplace. They include time spent working and level of effort but can also include less tangible contributions such as loyalty, commitment, and enthusiasm.

Outputs are what the employee receives from the employer. They can also be tangible or intangible. Tangible outcomes include salary and job security. Intangible outcomes might be recognition, praise, or a sense of achievement.

A Workplace Example

For example, let’s look at Ross and Monica, who both perform similar jobs for a large magazine publishing company. If Ross received a pay raise but saw that Monica was given a larger raise for the same amount of work, Ross would evaluate this change, perceive an inequality, and be distressed. However, if Ross perceived that Monica was being given more responsibility and, therefore, relatively more work along with the salary increase, then he would see no loss in equality status and would not object to the change.

An employee will feel that he is treated fairly if he perceives the ratio of his inputs to his outcomes is equivalent to those around him.

Primary Propositions

Equity theory includes the following primary propositions:

· Individuals will try to maximize their outcomes.

· Individuals can maximize collective rewards by evolving accepted systems for equitably apportioning resources among members. As a result, groups will evolve such systems of equity and will attempt to induce members to accept and adhere to these systems. In addition, groups will generally reward members who treat others equitably and punish members who treat others inequitably.

· When individuals find themselves in inequitable relationships, they will become distressed. The more inequitable the relationship, the more distress they will feel. According to equity theory, the person who gets “too much” and the person who gets “too little” both feel distressed. The person who gets too much may feel guilt or shame. The person who gets too little may feel angry or humiliated.

· Individuals who discover they are in inequitable relationships will attempt to eliminate their distress by restoring equity.

Compensation

When an employee compares his input/outcome ratio to his fellow workers’, he will look for others with similar jobs or skill sets. For example, Ross would not compare his salary and responsibilities to those of the magazine company’s CEO. However, he might look outside the organization for comparison. For example, he might visit a job search website to check salaries for positions like his at other publishing houses.

Pay, whether hourly or salary, is a central concern for employees and is therefore the cause of equity or inequity in most, but not all, cases. In any position, employees want to feel that their contributions and work performance are being rewarded with fair pay. An employee who feels underpaid may experience feelings of hostility toward the organization and perhaps coworkers. This hostility may cause the employee to underperform and breed job dissatisfaction among others.

Subtle or intangible compensation also plays an important role in equity. Receiving recognition and being thanked for strong job performance can help employees feel valued and satisfied with their jobs, resulting in better outcomes for both the individual and the organization.

Takeaways

Equity theory has several implications for business managers:

· Employees measure the total of their inputs and outcomes. This means a working parent may accept lower monetary compensation in return for more flexible working hours.

· Different employees ascribe different personal values to inputs and outcomes. Thus, two employees of equal experience and qualification performing the same work for the same pay may have different perceptions of the fairness of the deal.

· Employees are able to adjust for purchasing power and local market conditions. Thus, a teacher from Vancouver, Washington, may accept lower compensation than his colleague in Seattle if his cost of living is different, and a teacher in a remote African village may accept a totally different pay structure.

· Although it may be acceptable for more senior staff to receive higher compensation, there are limits to the balance of the scales of equity, and employees can find excessive executive pay demotivating.

· Staff perceptions of inputs and outcomes of themselves and others may be incorrect, so perceptions need to be managed effectively.

Expectancy Theory

Expectancy theory, initially put forward by Victor Vroom at the Yale School of Management, suggests that behavior is motivated by anticipated results or consequences. Vroom proposed that a person decides to behave in a certain way based on the expected result. For example, people will work harder if they think the extra effort will be rewarded.

In essence, individuals make choices based on their expectations for the results of a given behavior. This process begins in childhood and continues throughout life. Expectancy theory has three components: expectancy, instrumentality, and valence.

Expectancy is the belief that effort will lead to the intended performance goals. It describes a person’s belief that “I can do this.” Usually, the belief is based on an individual’s past experience, self-confidence, and the perceived difficulty of the performance standard or goal. Factors associated with a person’s expectancy perception are competence, goal difficulty, and control.

Instrumentality is the belief that meeting the performance expectation will result in a desired outcome. Instrumentality reflects the person’s belief that, “If I accomplish this, I will get that.” The desired outcome may be a pay increase, promotion, recognition, or sense of accomplishment. Having clear policies in place—preferably spelled out in a contract—guarantees that the reward will be delivered if the agreed-upon performance is met. Instrumentality is low when the outcome is vague or uncertain, or if the outcome is the same for all possible levels of performance.

Valence is the unique value an individual places on a particular outcome. Valence captures the fact that “I find this particular outcome desirable because I’m me.” Factors associated with a person’s valence are needs, goals, preferences, values, sources of motivation, and the strength of their preference for a particular outcome. An outcome that one employee finds motivating and desirable—such as a bonus or pay raise—may not be motivating and desirable to another (who may, for example, prefer greater recognition or more flexible working hours).

Expectancy theory, when properly followed, can help managers understand how individuals are motivated to choose among various behavioral alternatives. To enhance the connection between performance and outcomes, managers should use systems that tie rewards closely to performance. They can also use training to help employees improve their abilities and their belief that added effort will, in fact, lead to better performance.

A Note of Caution

It’s important to understand that expectancy theory can run aground if managers interpret it too simplistically. Vroom’s theory entails more than just the assumption that people will work harder if they think their effort will be rewarded. The reward needs to be meaningful and take valence into account. Valence has a significant cultural as well as personal dimension, as illustrated here:

When Japanese motor company ASMO opened a plant in the United States, it brought in a large Japanese workforce but hired American managers to oversee operations. The managers, seeking to motivate the workers with a reward system, initiated a costly employee-of-the-month program that included free parking and other perks. The program was a huge flop, and participation was disappointingly low. Why? The program required employees to nominate their coworkers to be considered for the award. Japanese culture values modesty, teamwork, and conformity, and to be put forward or singled out for being special is considered inappropriate and even shameful. To be named Employee of the Month would be a very great embarrassment indeed—not at all the reward that management assumed. Especially as companies become more culturally diverse, the lesson is that managers need to get to know employees and their needs—their unique valences—if they want to understand what makes the workers feel motivated, happy, and valued.

Photo of a small dog doing a trick, standing on his hind legs to catch a tennis ball.

The basic premise of the theory of reinforcement is both simple and intuitive: An individual’s behavior depends on the consequences. It’s simply cause and effect: If I work hard today, I’ll make more money. If I make more money, I’m more likely to want to work hard.

Operant Conditioning

Reinforcement theory is based on the work of B. F. Skinner in the field of operant conditioning. The theory relies on four primary inputs, or aspects of operant conditioning, from the external environment: positive reinforcement, negative reinforcement, positive punishment, and negative punishment.

The Operant Conditioning chart shows the reinforcement and punishment pathways. Each one may include positive and negative stimuli.

A tree chart shows how operant conditioning would be used to stop an undesirable behavior of a child by using positive and negative stimuli, and to teach a dog to sit. It also provides examples of “escape” and “active avoidance.” The following terms are used: positive (presence of a stimulus), negative (absence of a stimulus), reinforcement (increases behavior), punishment (decreases behavior), escape (removes a stimulus), avoidance (prevents a stimulus).

Operant Conditioning

Positive is presence of a stimulus, negative is absence of a stimulus, reinforcement increases behavior, punishment decreases behavior, escape removes a stimulus, avoidance prevents a stimulus.

Types of Reinforcement

Positive reinforcement attempts to increase the frequency of a behavior through rewards. For example, if an employee identifies a new market opportunity that creates profit, she may receive a bonus.

Negative reinforcement, on the other hand, attempts to increase the frequency of a behavior by removing something the individual doesn’t like. For example, an employee demonstrates a strong work ethic and wraps up a few projects faster than expected. This employee happens to have a long commute. The manager rewards the employee’s progress by allowing her to work from home for a few days.

Reinforcement can be affected by various factors:

· satiation—the degree of need. If an employee is already wealthy a bonus may not be motivating or reinforcing.

· immediacy—the time elapsed between the desired behavior and the reinforcement. The shorter the time between the two, the more likely that the employee will correlate the reinforcement with the behavior. If an employee does something great but isn’t rewarded until two months later, he or she may not connect the behavior with the outcome. The reinforcement loses meaning and power.

· size—the magnitude of a reward or punishment can have a big effect on the degree of response. For example, where satiation is not a factor, a bigger bonus often has a bigger impact.

In managing employees, reinforcers include salary increases, bonuses, promotions, variable incomes, flexible work hours, and paid sabbaticals. Managers are responsible for identifying the behaviors to promote and those to discourage, and for carefully considering how the behaviors relate to organizational objectives. Implementing rewards and punishments that are aligned with the organization’s goals helps to create a more consistent, efficient work culture.

Incentive programs. One particularly common positive-reinforcement technique is incentive programs to encourage specific actions, behaviors, or results during a defined time period. Incentive programs can reduce turnover, boost morale and loyalty, improve wellness, increase retention, and drive daily performance. By motivating staff, businesses can increase productivity and meet goals.

Let’s look at an IT sales team, for example. Its goal is to sell a company’s new software to larger businesses, so the manager offers a 5 percent commission reward to team members who gain clients of 5,000 or more employees. This reward reinforces the behavior of closing big contracts, motivates team members to work toward the goal, and likely will increase the number of big contracts closed.

To maximize the impact of reinforcement, every feature of an incentive program must be tailored to participants’ interests. A successful incentive program contains clearly defined rules, suitable rewards, efficient communication strategies, and metrics for measuring success. By adapting each element to fit the target audience, companies are better able to engage employees and enhance the program’s efficacy.

Punishment

Positive punishment is a straightforward form of conditioning: identifying a negative behavior and providing an adverse stimulus to discourage future occurrences. A simple example would be suspending an employee for inappropriate behavior.

Negative punishment entails removing or withholding something. For example, an employee in the IT department prefers to work unconventional hours, from 10:30 a.m. to 7 p.m. However, she has been performing poorly. A negative punishment would be to revoke her right to keep the preferred schedule until her performance improves.

The purpose of punishment is to prevent future occurrences of an unacceptable or undesirable behavior. According to deterrence theory, awareness of a punishment can prevent people from engaging in a behavior: by punishing them immediately after the behavior, or by educating them about consequences upfront to discourage the behavior. Punishment tools can include demotions, salary cuts, and terminations.

In business organizations, both punishment and deterrence play vital roles in shaping workplace culture, and in avoiding conflicts and negative outcomes—both internally and externally. If employees know exactly what they are not supposed to do, and they understand the possible repercussions of violating expectations, they will generally try to avoid crossing the line. Prevention is a much cheaper and easier approach than waiting for something bad to happen. Therefore, preemptive education about rules—and the penalties for violations—is common in business.

Check Your Knowledge

Answer the following questions to see how well you understand the topics covered in this section. This short quiz does not count toward your grade, and you can retake it as many times as you wish. Use this quiz to decide whether to study the section further or move on.

Choose the BEST answer.

Question 1

Employees of a financial services company are complaining and gossiping that the pay is unfair, hurting morale and productivity.

Managers should speak to the loss of productivity but ignore the gossip. Managers should expect those who feel the strongest to leave the company.

The company managers should reprimand the critics and tell them to get back to work.

The company should survey the market value of each job and show employees the results, demonstrating that the pay is market-based.

Question 2

Vroom’s expectancy theory proposes that a rational calculation determines whether individuals are motivated to demonstrate more or less effort. Questions people ask themselves as part of this rational calculation include:

Is my compensation fair compared to others?

Is the offered incentive desirable?

Is this the norm for our company culture?

Question 3

The basic premise of the theory of reinforcement is that

an individual’s behavior depends on the consequences of that behavior

fair treatment is the key to employee motivation

behavior depends on socialization and group norms

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Putting It Together: Managing Processes from Introduction to Business by Linda Williams and Lumen Learning is available under a Creative Commons Attribution 4.0 International license. UMUC has modified this work and it is available under the original license.

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Motivational Strategies/
Job Design and Job Characteristics Theory

Job Design

Job design is an important prerequisite for motivation in the workplace. A well-designed job can encourage positive behaviors and create a strong infrastructure for employee success. Job design involves specifying the contents, responsibilities, objectives, and relationships required to satisfy expectations of the role. Following are some established approaches to help managers doing this thoughtfully and well.

Job Characteristics Theory

Proposed by Hackman and Oldham (1976), job characteristics theory identifies five core characteristics that managers should keep in mind when they are designing jobs. They proposed that these dimensions relate to and help satisfy the employee, resulting in greater job satisfaction and motivation, and less absenteeism and turnover.

Core Job Characteristics

These are the core job characteristics, and the reasons why each one is an important motivator:

· Skill variety. Doing the same thing day in, day out gets tedious. The solution is to design jobs with enough variety to stimulate ongoing interest, growth, and satisfaction.

· Task identity. Being part of a team is motivating, but so, too, is having some ownership of a set of tasks or part of the process. Having a clear understanding of what one is responsible for, with some degree of control over it, is an important motivator.

· Task significance. Feeling relevant to organizational success provides important motivation for getting a task or job done. Knowing that one’s contributions are important contributes to a sense of satisfaction and accomplishment.

· Autonomy. No one likes to be micromanaged, and having some freedom to be the expert is critical to job satisfaction. Companies usually hire people for their specialized knowledge. Giving specialists autonomy to make the right decisions is a win-win.

· Feedback. Finally, everyone needs objective feedback on how they are doing and how they can do better. Providing well-constructed feedback with tangible outcomes is a key component of job design.

In the following Ted Talk, career analyst Dan Pink examines the puzzle of motivation, starting with a fact that social scientists know but most managers don’t: Traditional external rewards aren’t always as effective as we think; those that speak to a person’s internal motivation are often more potent and lasting.

https://youtu.be/rrkrvAUbU9Y

Psychological States

The following psychological states help employees feel motivated and satisfied with their work:

· Experienced meaningfulness. This is a positive psychological state that will be achieved if the first three job dimensions—skill variety, task identity, and task significance—are in place. All three dimensions help employees feel that what they do is meaningful.

· Experienced responsibility. Dimension four, autonomy, contributes to a sense of accountability, which for most people is intrinsically motivating.

· Knowledge of results. Dimension five, feedback, provides a sense of progress, growth, and personal assessment. Understanding one’s accomplishments is a healthy state of mind for motivation and satisfaction.

Work Outcomes

The combination of core job characteristics and psychological states influences the following work outcomes:

· Job satisfaction. When employees feel that their jobs are meaningful, their positive psychological state contributes to a sense of satisfaction.

· Motivation. Employees who experience responsibility in their job, a sense of ownership over their work, and knowledge of the results tend to be more highly motivated.

· Absenteeism. When employees are motivated and satisfied, absenteeism and job turnover decrease.

Overall, the manager’s goal is to design the job so that the core characteristics complement the worker’s psychological states of the worker and lead to positive outcomes

Job Design Techniques

As a motivational force in the organization, managers must consider how to design jobs that lead to empowered, motivated, and satisfied employees. There are established methods to accomplish this objective:

· Job rotation. As noted previously, it’s not particularly motivating to do the same thing every day. Rotating jobs and expanding employees’ skill sets accomplishes two objectives: increasing employee satisfaction and broadening employees’ skills.

· Job enlargement (horizontal). Giving employees the autonomy to step back and assess the quality of their work, improve the efficiency of their processes, and address mistakes contributes to satisfaction in the workplace.

· Intrinsic and extrinsic rewards. Allowing employees autonomy helps generate intrinsic rewards (self-satisfaction) and motivation. Extrinsic rewards (such as time off, a bonus, or a commission) are also motivating.

· Job enrichment (vertical). It’s important for managers to delegate some of their planning to seasoned employees as they grow into their roles. By turning over control of work-task planning to employees themselves, managers help workers feel a strong sense of engagement, career progress, and ownership of their work outcomes.

Goal-Setting Theory

Goal Setting

Research shows that people perform better when they are committed to achieving particular goals. Factors that help ensure commitment to goals include

· importance of the expected outcomes

· self-efficacy, or the belief that the goal can be achieved

· promises or engagements to others, which can strengthen commitment

In a business setting, managers cannot constantly drive employees’ motivation or monitor their work from moment to moment. Instead, they rely on goal setting to help employees regulate their own performance and stay on track. Goal setting affects outcomes in the following important ways:

· Choice. Goals narrow attention and direct efforts to goal-relevant activities, and away from goal-irrelevant actions.

· Effort. Goals can lead to more effort; for example, raising a worker’s production from four widgets per hour to six.

· Persistence. People are more likely to work through setbacks if they are pursuing a goal.

· Cognition. Goals can lead individuals to develop and change their behavior.

Edwin Locke and his colleagues examined the behavioral effects of goal setting, and they found that 90 percent of laboratory and field studies involving specific and challenging goals led to higher performance, whereas those with easy or no goals showed minimal improvement. While some managers believe it is sufficient to urge employees to “do their best,” these researchers learned that people who are instructed to do their best generally do not. The reason is that if you want to elicit a specific behavior, you need to give a clear picture of what is expected. “Do your best” is too vague. A goal is important because it establishes a specified direction and performance measure.

https://leocontent.umuc.edu/content/dam/learning-resources/course-content/bmgt/bmgt110/toward_peak_performance.jpg

Toward Peak Performance

Athletes set goals during the training process. Through choice, effort, persistence, and cognition, they can prepare to compete.

You’ll recall from the discussion of SMART objectives that setting effective goals and identifying the best ways to achieve them are important aspects of the controlling function of managers. It turns out that setting SMART goals is also a powerful way to motivate employees, especially when employees are able to participate in setting their goals. Specific, Measurable, Achievable, Realistic, and Time-constrained goals give both managers and employees clear direction and a way to measure performance.

Goals and Feedback

Managers need to track performance so employees can see how effective they have been in attaining their goals. Without proper feedback channels, employees find it impossible to adapt or adjust their behavior. Goal setting and feedback go hand-in-hand. Without feedback, goal setting is unlikely to work.

Providing feedback on short-term objectives helps sustain an employee’s motivation and commitment. When giving feedback, managers should

· create a positive context

· use constructive and positive language

· focus on behaviors and strategies

· tailor feedback to the needs of the individual worker

· make feedback a two-way communication

image of a soccer goal

Goals and Performance

Goal setting is closely tied to performance. Those who set realistic but challenging goals are likely to perform better than those who do not.

Goal setting may have little effect if the employee can’t evaluate his own performance in relation to the goal. By giving accurate, constructive feedback, managers can help employees evaluate whether they need to work harder or change their approach.

Although goal-setting theory is useful in business, it does have limitations. Using production targets to drive motivation may encourage workers to meet those targets by any means necessary—resulting in poor quality or, worse, unethical behavior. You’ll recall that this was the case in the recent Wells Fargo scandal, where employees created millions of fake bank accounts in order to hit sales targets. Another problem with goal setting is that a manager’s goals may not be aligned with the organization’s, and conflict may ensue, or the employees may feel uncertain about which goals ought to be prioritized—the manager’s or organization’s? Either way, performance can suffer. In addition, for complex or creative tasks, it is possible for goal setting to actually hamper achievement, because the individual can become preoccupied with meeting goals and distracted from completing tasks. This is especially true if reviews and pay increases are strongly tied to goal achievement.

Videos: Motivation in Today’s Workplace

References

Hackman, J. R., & Oldham, G. R. (1976). Motivation through the design of work: Test of a theory. Organizational Behavior and Human Performance, 16(2), 250-279. doi:10.1016/0030-5073(76)90016-7

The following videos contain examples of motivational theory at work in today’s companies. As you watch, see if you recognize any of the theories you’ve studied. Are they need based or process based? What are the results of the motivational strategies these companies use?

https://youtu.be/QO6AWhDy_Ac

https://youtu.be/W18DXW8gYZA

https://youtu.be/4hNu98BQFvI

Licenses and Attributions
Introduction to Strategies for Motivating Employees from Introduction to Business by Linda Williams and Lumen Learning is available under a Creative Commons Attribution 4.0 International license. UMUC has modified this work and it is available under the original license.

Marketing Function: Why It Matters

Why learn about the marketing function?

A pair of men’s shoes, a folded blue men’s shirt, a tablet.

How did your day start? If you are like most people, you woke up to an alarm that rang on a smartphone, you climbed out of bed, and you stumbled over to your favorite morning beverage of coffee, soda, or tea. You may have checked the weather using your phone or TV. You showered, brushed your teeth, and got dressed. If you were headed to work or school, you may have gotten in your car for the drive. Maybe you grabbed breakfast at a drive-through. Between these activities there were probably a hundred other small things you did as part of your routine—like giving your dog a treat, applying makeup, making a lunch, and packing a bag or briefcase. All of these activities have one thing in common: They are all directly related to a company’s marketing efforts.

Look at the brand of cell phone you chose. Which brand of coffee or soda did you drink? What shampoo did you use? What make and model of car did you drive? Which fast-food restaurant did you visit? Where do you work or go to school? And more to the point, why do you use the things you use? Buy what you buy? Eat where you eat?

The answer is marketing.

Companies expend a vast quantity of resources to get their products into your hands, homes, and stomachs. They identify a market for their products, goods, and services and then market to the consumers like you who make up that market. By focusing on the consumer, meeting their demands, and keeping them happy, companies expand their market presence and, as a result, increase their sales and profits.

In this section you will explore the role customers play in marketing efforts and learn how companies segment markets to better target prospective customers. You’ll also get an introduction to the marketing mix—the components a company can choose from to achieve sales goals. In the words of Stanley Marcus, founder of the department store Neiman Marcus, businesses use marketing to ensure that they “sell products that don’t come back, to people who do.”

Licenses and Attributions

Why It Matters: Marketing Function from Introduction to Business by Linda Williams and Lumen Learning is available under a Creative Commons Attribution 4.0 International license. UMUC has modified this work and it is available under the original license.

CC LICENSED CONTENT, ORIGINAL

· Marketing Function: Why It Matters. Authored by: Linda Williams and Lumen Learning. License: CC BY: Attribution

· First Product Shot. Authored by: Tormod Ulsberg. Located at: https://www.flickr.com/photos/tormodspictures/11923473083/. License: CC BY-NC-ND: Attribution-NonCommercial-NoDerivatives

Why It Matters: Marketing Function

Why learn about the marketing function?

Photo of products: a pair of men's shoes, a folded blue men's shirt, an iPad.

How did your day start today? If you are like most people, you woke up to an alarm that rang on a Smartphone, and you climbed of bed and stumbled over to your favorite morning beverage, be it coffee, soda, or tea. You may have turned on your TV to check the weather while you got ready for your shower. You washed your hair, brushed your teeth, and got dressed. If you headed out to work or school, you probably got in your car or someone else’s car for the drive. If you were rushed, maybe you went through the drive-thru of a fast-food restaurant and grabbed breakfast on your way to your final destination. In between these activities there were probably a hundred other small things that happened as part of your routine. Things like giving the dog a treat, applying makeup, making your lunch, packing up your book bag or briefcase. All of these activities have a one thing in common: they are all directly related to a company’s marketing efforts.

How is that possible? What type of phone do you have: iPhone, Android, Windows? Which brand of coffee or sofa did you drink? What shampoo did you use? What make and model of car did you ride in or drive? Which fast-food restaurant did you visit? Where do you work or go to school? More important: Why do you use the things you use? Buy the things you buy? Eat where you eat? MARKETING.

Company’s expend a vast quantity of their resources to get their products into your hands, homes, or stomachs. How? They identify the market for their products, goods, and services and then market to the consumers (you) who make up that market. By focusing on the consumer, meeting their demands, and keeping them happy, companies expand their market presence and, as a result, increase their sales and profits.

In this section you will explore the role that customers play in today’s marketing efforts and learn how companies segment the market to better target prospective customers. You’ll also get an introduction to the mix of marketing components a company can use to achieve its sales goals. In the words of Stanley Marcus, founder of the department store Neiman Marcus, businesses use marketing as a way to ensure that they “sell products that don’t come back, to people who do.”

The Role of Customers in Marketing

What you’ll learn to do: Explain the role of customers in marketing

All marketing focuses on creating, delivering, and communicating value to the customer. In this section you’ll learn why customers play such an important role in a business’s marketing activities.

Panoramic color photo of busy Hong Kong intersection (similar to Times Square in New York) showing brightly lit digital ads and hundreds of people on the streets and sidewalks.

Hong Kong

Learning Outcomes

· Define the term marketing

· Explain the marketing concept

· Identify and describe an organization’s value proposition

· Demonstrate the importance of managing the customer relationship

· Discuss the factors that influence customer decisions

· Analyze the consumer buying process

What Is Marketing?

Marketing is the range of activities related to creating, communicating, delivering, and exchanging offerings that have value for others. In business, the marketing function brings value to customers the business seeks to identify, satisfy, and retain. This chapter emphasizes the role of marketing in business to sell products. However, many of the concepts will apply to other entities, like nonprofits; and for other purposes, like issues advocacy and campaigns to influence perceptions and behavior.

The Art of the Exchange

In marketing, the act of obtaining something by offering something else of value in return is called the exchange process. It has four components:

1. customer (buyer)—a person or organization with a want or need, and the willingness to give money or another personal resource to satisfy it

2. product—a good, service, experience, or idea designed to satisfy the customer’s want or need

3. provider (seller)—the company or organization offering this need-satisfying thing, which may be a product, service, experience or idea

4. transaction—the terms of trading this value-for-value (most often, money for product), which both the customer and provider agree to

Individuals on both sides of the exchange try to maximize rewards and minimize transaction costs to gain the most profitable outcomes. Ideally, everyone achieves a satisfactory level of reward.

Marketing creates a bundle of goods and services that the company offers, for a price, to its customers. The bundle consists of a tangible good, an intangible service or benefit, and the price of the offering.

When you compare one car with another, for example, you can evaluate the three dimensions separately. However, you can’t buy one manufacturer’s car, another manufacturer’s service, and a third manufacturer’s price—you must purchase them as a group. They make up a company’s offer or bundle.

Marketing is also responsible for the environment in which this value exchange occurs. The marketing role is to

· identify customers, their needs, and how much value they place on satisfying their needs

· inform product design to meet customer needs and provide value proportional to cost

· communicate with customers about products, explaining who is offering them and why they are desirable

· listen to customers, communicate feedback to the provider about how well they are satisfying customer needs, and suggest opportunities for improvement

· shape the location and terms of a transaction, as well as the customer experience after a product is delivered

Creating Value for Customers

The purpose of all business is to “create and keep a customer (Levitt, 1977).” Marketing is instrumental in helping achieve this purpose. It is much more than just advertising, selling, and collecting money. Marketing generates value by creating connections between people and products, customers and companies.

How does this happen? The essential role of marketing is to identify, satisfy, and retain customers.

Before you can create anything of value, you must first identify a want or need that you can address, as well as prospective customers with the want or need.