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OB - Summary Note - Ch07

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OB - Summary Note - Ch07

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huynhhuongthuy2508
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Chapter 7: Motivation - applications

Job Characteristics Model

Look at the appendix for the model.

Motivating Potential Score (MPS) – index that estimates the job’s motivating potential. It is calculated as:

MPS = ((skill variety + task identity + task significance)/3) x autonomy x feedback Motivating jobs needs to high at least on one
of the three dimensions that create meaningfulness and on both autonomy and feedback. However, it is better to add the above
characteristics to improve motivation, rather than using this complex model.

Job Redesign

 Job rotation (employee is performing different tasks at different times, tasks shift, employee moves from one job to another which
requires the same skills level). Reduce boredom, increase motivation, increase flexibility as employees have more skills. But it
increases training costs, creates disruptions, reduce productivity.
 Job enlargement (employee is performing more different and various tasks, his work is becoming more diverse and it horizontally
widened) The application of job enlargement is not always successful, as employees may dislike the job even more.
 Job enrichment (vertical widening of one’s job, adding activities from different expertise fields, e.g. controlling, leading, planning,
implementing, one has more responsibilities and independence). Reduces absenteeism, turnover costs, increase satisfaction, but
doesn’t work very well in productivity.

Alternative work arrangements

Flextime – flexible time work

Job sharing – two or more workers share a 40-hour week job

Telecommuting – working from home

Ability and opportunity

Performance may be calculated as = (ability x motivation x opportunity to perform). Opportunity to perform means absence of barriers
that may limit the performance of an employee

Employee involvement programs

Participative management – joint decision making between employees are their supervisors

Representative participation – representation of employees who participate in organizational decision making instead of all workers
participating in decision making, in form of works councils and board representatives.

Quality circles – volunteer group composed of workers who meet to talk about workplace improvement, and make presentations to
management with their ideas, especially relating to quality of output in order to improve the performance of the organization, and
motivate and enrich the work of employees.

Rewards as motivators

What to pay? Pay structure -> process of establishing pay level to balance internal and external equity. Pay more: better qualified,
motivated and longer loyalty, but leads to very high cost.

How to pay? More and more organizations use variable-pay programs – refers to compensation that is received in addition to the base
pay. The amount received may be linked directly to individual, team, division and/or organization performance, and is determined
(typically) by a variety of measures important to the organization.

 Piece-rate pay – employees is paid stable price for each unit of completed production. Limitation: not feasible and realistic for
many jobs.
 Merit-based pay – pay plan that is performance-related. It provides bonuses for workers who perform their jobs better, according to
measurable criteria. Limitation: only valid upon the performance evaluation on which it is based; dependant on the pay raise pool,
resisted by (trade) unions.
 Bonuses – pay plan rewarding employees for latest performance (not past)
 Skill-based pay - employees are paid on the basis of the number of job skills they have or have acquired or number of jobs they
can perform. Limitation: the organization may pay the employees for acquiring skills which are not immediately needed.
 Profit-sharing plan - various incentive plans introduced by businesses that provide direct (cash) or indirect (stock) payments to
employees that depend on company's profitability in addition to employees' regular salary and bonuses
 Gainsharing - program that returns cost savings to the employees, usually as a lump-sum bonus. It is a productivity measure, as
opposed to profit-sharing which is a profitability measure
 Employee stock ownership plan – plan in which employees can buy company’s stock for below-market prices as benefits.

What benefits to offer? Flexible benefits enable employers to select the benefits that suit them. There are also 3 main types of benefits
plan: modular plans, core-plus plans and flexible spending plans.

How to construct employee recognition programs? – Intrinsic rewards


Financial motivators (pay plans, wage) are effective in short-term, while intrinsic rewards are crucial motivator in long-term. Intrinsic
rewards can be just informal thank you as well as the whole formally developed program. Intrinsic rewards plans are inexpensive but are
vulnerable to politics of management.

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