MOTIVATION, SATISFACTION AND PERFORMANCE

SATURDAY, December 19, 09

IMPORTANT POINTS

Presentations on next class Submit all compensatory assignments Check the quiz sheet and discuss if

there are any issues No marks to the student, who does not

present the proof and does not deliver

Course Outline

Sr. |Chap|Final Exam Chapter HeadingNo.|No. |Q. No.1. 1 1 An Introduction to Motivational Concept (260909)2. 2 2 Motivation in the History (101009)3. 3 3 Darwinian Theory of Evolution and Motivation

(171009)4. 4 4 Instinct and Motivation (311009)5. 5 5 The Effect of Frustration, Conflict and Stress (051109

& 071109)6. 6 6 Need Theories of Motivation (211109)7. 7 7 Reinforcement/Incentive Theories (051209)8. 8 8 Expectancy Theories of Motivation (171209)9. 9 9 Motivation, Satisfaction, and Performance (191209)10. 10 10 Motivation and Monetary Rewards (211209)11. 11 11 Motivation Through MBO and Performance Appraisal

Marks Distribution:

Number of Quizzes attended + Midterm + Final assignment

MOTIVATION AND MONETARY REWARDS

Salaries should be variable as per individual’s performance

There should be an incentive reward that is paid regularly

A ratio schedule is more effective in arousing motivation than an interval schedule

Incentives should match with needs A partial reinforcement schedule can be a more

effective motivational tool than a continuous schedule

The rewards should be instrumental, ie the results must be followed by rewards as devised.

Employee’s pay holds a motivational value if it satisfies basic needs as well as self esteem and independence needs

For lower level employees pay is motivational because it helps them cope up with basic financial requirements

For upper level employees it additionally helps to gain them social status in society

Designing a pay system for an organization is a very important and critical process

MOTIVATIONAL VALUE OF PAY

Economic being 1911, Taylor Social being 1930s, Human relationists Self actualizing man, Growth needs focus,

1960s Herzber says, money/ pay is important and

a dis-satisfier On the contrary, money not only brings

basic need-fulfilling, it also satisfies other needs such as independency, status, security etc

IMPORTANCE OF PAY INCENTIVE

If there is a valence attached to pay, then it becomes a motivator/ reinforcer and hence increase productivity

Money acquired through pay has a greater incentive value than money acquired through bonuses

Pay should be performance driven

IMPORTANCE OF PAY INCENTIVE

Dissatisfaction with pay results in lesser commitment with work

Their expectations if not met with pay result in dissatisfaction

This dissatisfaction results in low motivation, sabotage, absenteeism, turnovers

Employees stop responding to motivational initiatives such as job enlargement, enrichment, MBO etc

IMPORTANCE OF PAY INCENTIVE

Pay has a motivational power, because it buys the means of satisfying physiological needs, after the satisfaction of these needs any other need occurs

Pay can buy shelter, the job security and insurance plans serve as fulfilling the security needs for employees

Pay indirectly facilitates socialization needs It satisfies status, power and self esteem needs It does not satisfy self actualization need but may serve as a

measure of achievement

Pay is instrumental for satisfying Physiological, security, status, power, esteem and achievement needs

It is least likely to satisfy socialization and self actualization needs

IMPORTANCE OF PAY

First: NEED; Very important for the one whose basic needs are unfulfilled

It loses importance after the satisfaction of those needs, unless it satisfies higher order needs

Second: How much he receives; For high paid employees, pay becomes less important hence motivational tools other than monetary incentives, need to be devised

Third: Function of job levels; Lower level and blue collar workers give more value to pay as compared to even low paid high level workers/ managers.

The importance of pay is associated with what it can buy not what it itself is

How much the pay is important

PIECE RATE SYSTEM VS HOURLY RATE SYSTEM This system as introduced by Taylor, was

instrumental in increasing the productivity of employees

This is not very much preferred now: Output measurement is not easy Technological changes made less blue collar workers engaged

in such activities where the piece rate system is used Workers fear that increased productivity may result in increased

productivity standards, rate cuts, lay offs, loss of health and self esteem

Loss of cooperation amongst employees

[PAY PREFERENCES

HOURLY WAGE VS SALARY INDIVIDUAL AND GROUP INCENTIVES

Piece rate plans Production bonus plans Commission plans Merit rate plans Group incentive plans

COMPANY WIDE INCENTIVE PLANS Scanlon plan (profit sharing by labor cost saving) Profit sharing plan

Cash plan Deferred payment Combination

Employee Stock ownership plans Executive bonus plans Stock option plans

[PAY PREFERENCES

NON PERFORMANCE CONTINGENT PAYMENTS

GOOD LUCK