Managing Employee Motivation and Performance

INTERNATIONAL BURCH UNIVERSITY FACULTY OF ECONOMICS DEPARTMENT OF MANAGEMENT MANAGING EMPLOYEE MOTIVATION AND PERFORMANCE RESEARCH PAPER by Nedzad ISAKOVIC Project Supervisor M. A. Edin SMAJIC SARAJEVO April, 2012 Contents 1. Introduction2 1. 1. The Motivation Process2 1. 2. Wath Managers Do In Practice2 2. Motivating by Structuring Jobs to Make Them Interesting3 2. 1. Job Design3 2. 2. Job Enrichment and Job Enlargement3 2. 3. The Job Characteristics Model4 3. Conclusion5 4. References7 1. Introduction Motivation is defined as the process that initiates, guides and maintains goal-oriented behaviors.

Motivation is what causes us to act, whether it is getting a glass of water to reduce thirst, reading a book to gain knowledge or performing some specific job assignment to get pay. Why is the motivation of employees so important at the workplace? It is important for managers because it determines individual performance of the workers along with ability of the workers and work environment. The most challenging factor for manager to control of these three is motivation. Individual behavior is a complex phenomenon, and the manager needs to enter the core of the problem if he is going to solve it. 1. 1. The Motivation Process

The motivation process progresses through a series of discrete steps. Content, process, and reinforcement perspectives on motivation address different parts of this process (Griffin, 2008). Content perspective tries to find what factor or factors motivate people. The most popular content theories are Maslow’s hierarchy of needs, the ERG theory and Herzberg’s two-factor theory. Process perspectives on motivation explore how the motivation process works and how it occurs. They try to find out why people certain behavior options to fulfill their needs and how workers evaluate their satisfactions after their decisions.

Theories of process perspectives are expectancy theory, equity theory and the newer attribution theory. The reinforcement perspective tries to find out which factors force employees to continue being motivated. It tells us that employees will repeat the behavior for which they are rewarded, and they won’t repeat behavior for which they are punished. Reinforcement perspective uses positive reinforcement, avoidance, punishment and extinction as tools to keep employees motivated. These are just theories which help managers to determine what to do in practice. 1. 2.

What Managers Do In Practice The most shared thought and strategy among managers in practice is that money motivates. Because of that managers use large variety of reward systems such as merit reward systems, incentive reward systems and team reward systems to improve motivation and performance of their employees. Their assumption is correct and employees do actually perform better when they know that they will receive more money for their improved performance. But another question arises: How long will the improved performance last if money is key motivator?

The answer is that it won’t last long. The studies have shown that individuals have difficulty recalling the bonus they receive and it does not seem to have the same impact it did within the first few weeks or months of receiving it. That’s because money, in and of itself, will not continuously motivate individuals. Employees are motivated much more if money rewards are combined with recognition and with improved job design. Another problem that arises from using the money as a key factor of motivation is that it costs.

The companies need to give large amounts of money to employees as bonuses and there were several cases where bonuses are actually larger than annual salaries of some employees. This becomes a real problem if company wants to decrease the amount of bonuses employees receive. Employees become more dissatisfied and unmotivated because they are used to have large bonuses, so their performance falls quite a lot. My opinion is that the best way to motivate employees to perform better is to design jobs by making them more appealing to people. 1. Motivating by Structuring Jobs to Make Them Interesting 2. 3. Job Design

This approach of motivation is directed at improving the essential nature of the work performed by changing the design of the job. Job design is concerned with structuring jobs in order to improve organization efficiency and employee job satisfaction (Snell/Bohlander, 2007). Employees today engage in repetitive movements, which they find highly routine and monotonous. Not surprisingly, people became bored with such jobs and their performance falls with time. Fortunately, today’s organizational scientists have found several ways of designing jobs that aren’t just efficient, but are also pleasant and motivating.

Job enlargement and job enrichment are two approaches that improve motivation by changing job design. 2. 4. Job Enlargement and Job Enrichment One of the first modern approaches to redesigning jobs suggested that boredom of employees by engaging in highly repetitive jobs could be minimized by having people perform an increased number of different tasks all at the same level. This approach is known as job enlargement (Greenberg/Baron, 2008). Because of this approach employees don’t need higher skills or have higher responsibility, but perform more different actions at the same level.

Changing job in this way is an increase in the horizontal job loading. Several studies showed that job enlargement is very useful way to increase employee job satisfaction and employee boredom at the workplace. A more effective approach, job enrichment, gives employees not only more jobs to do, but more tasks to perform at a higher level of skill and responsibility (Greenberg/Baron, 2008). The main idea of job enrichment is making jobs more interesting to people so that they will be more highly motivated to perform them.

Job enrichment gives employees the opportunity to take greater control over how to do their jobs. Because people performing enriched jobs work at higher levels than others, this approach increases a job’s vertical job loading. Even the job enrichment is successful it has some problems in implementation. First one is difficulty of implementation because it is expensive to redesign existing facilities. Second problem is lack of employee acceptance because not all employees are ready to accept the changes in their job accomplishment and higher obligations for the work they perform. 2. 5. The Job Characteristics Model

In previous text I stated that employers should enrich the jobs, but I failed to specify precise what elements of a job need to be enriched for it to be effective. Job characteristics model answers this question. It assumes that jobs can be designed so as to help people get enjoyment out of their jobs and care about the work they do (Greenberg/Baron, 2008). It tells us how jobs can be redesigned to help employees feel that they are doing meaningful and valuable work. The model specifies that enriching certain elements of jobs influences employee’s psychological states in a manner that increases their work effectiveness.

It identifies five core job dimensions that help create three critical psychological states, leading to several beneficial personal and work outcomes. The five critical job dimensions are skill variety, task identity, task significance, autonomy, and feedback. Skill variety shows us how many different tasks the employee performs using several of his skills and talents. Task identity shows us how much is employee involved in one piece of work, from beginning to end. Task significance shows us how much impact employee’s work has on others.

Autonomy shows us how much freedom employees have in planning and performing jobs as they wish. Feedback shows us how much the job allows employees to know is their performance efficient enough. The model tells that these various job dimensions have important effects on many critical psychological states. Combination of these job dimensions have effect on experienced meaningfulness of the job performed, which is then experienced as highly important, valuable and worthwhile. Job dimensions also determine how much employees are personally responsible and accountable for their work.

When they are free to decide what to do and how to do it they feel more responsible for their work. Finally, these job dimensions impact employee’s knowledge of the results of their work. When a job is designed to provide employees with information about the effects of their actions, they better understand how effective they are – and such knowledge improves their effectiveness. These critical psychological states affect personal and work outcomes such as: feelings of motivation, the quality of work performed, satisfaction with work, absenteeism and turnover.

The higher these psychological states are, the more positive the personal and work benefits and outcomes will be. The job characteristics model is highly applicable and it has high and positive results. The employees that respond best to this model are the ones which have high need for personal growth and development. The model has been focus of many empirical tests, most of which are supportive of many aspects of the model. One study conducted among a group of South African clerical workers found particularly strong support for the job characteristic model (Greenberg/Baron, 2008). . Conclusion In my opinion altering employee motivation by changing job design is much more productive and better than improving motivation by incentive reward systems. It is true that inducing motivation by changing job design has several problems, such as difficulty of implementation and lack of employee acceptance, but these problems are easier to overcome than problems that occur when companies use money to motivate their employees. Incentive reward systems have problems beside the incredibly high costs to organization.

These systems may lead to lower job satisfaction as the employees work until they reach their limit and then they become unhappy. They can also create competition within the organization and destroy cooperation among employees. Employees cannot be treated just as machines and the money they receive for their work just isn’t enough to satisfy them. They need recognition for their work and they need to see that the work they do is meaningful and worthwhile, and this is the thing that job design allows them to have. They feel respected and fulfilled and, at the end, motivated to perform the best they know. . References Ricky W. Griffin (2008). Management (9th Edition ed. ). Houghton Mifflin Company. Jerald Greenberg ; Robert A. Baron (2008). Behavior in Organizations (9th Edition ed. ). Pearson Prentice Hall. Luis R. Gomez-Mejia ; David B. Balkin ; Robert L. Cardy (2007). Managing Human Resources (5th Edition ed. ). Pearson Prentice Hall . Scott Snell ; George Bohlander (2007). Human Resorce Management. Thomson. http://psychology. about. com/od/mindex/g/motivation-definition. htm , http://www. entrepreneur. com/article/202352