C H A P T E R

6
Applied Performance Practices

McGraw-Hill/Irwin

2005 The McGraw-Hill Companies, Inc. All rights rese

WestJet Motivates Employees

WestJet employees are highly motivated through profit sharing and stock options, empowerment, job design, and selfleadership.
Canadian Press Courtesy of WestJet

McShane/Von Glinow OB 3e

2005 The McGraw-Hill Companies, Inc. All rights rese

The Meaning of Money

Money and employee needs

Affects existence, drive to acquire, growth needs, as well as need for achievement

Money attitudes and values

Money ethic -- not evil, represents success, should be budgeted carefully

Money and social identity

Corel Corp. With permission. Corel Corp. With permission

Partly defines who we are

McShane/Von Glinow OB 3e

2005 The McGraw-Hill Companies, Inc. All rights rese

Types of Rewards in the Workplace

Membership and seniority Job status Competencies Performance-based

Corel Corp. With permission. Corel Corp. With permission

McShane/Von Glinow OB 3e

2005 The McGraw-Hill Companies, Inc. All rights rese

Membership/Seniority Based Rewards

Fixed wages, seniority increases Advantages

Guaranteed wages may attract job applicants Seniority-based rewards reduce turnover
Disadvantages

Doesnt motivate job performance Discourages poor performers from leaving May act as golden handcuffs

McShane/Von Glinow OB 3e

2005 The McGraw-Hill Companies, Inc. All rights rese

Job Status-Based Rewards

Includes job evaluation and status perks Advantages:

Job evaluation tries to maintain pay equity Motivates competition for promotions
Disadvantages:

Employees exaggerate duties, hoard resources Focuses employees on own jobs, not customers Inconsistent with flatter organizations
McShane/Von Glinow OB 3e

2005 The McGraw-Hill Companies, Inc. All rights rese

Competency-Based Rewards
Pay increases with competencies acquired and demonstrated Skill-based pay

Pay increases with skill modules learned

Advantages

More flexible work force, better quality,

consistent with employability

Disadvantages

Potentially subjective, higher training costs

McShane/Von Glinow OB 3e

2005 The McGraw-Hill Companies, Inc. All rights rese

Performance-Based Rewards
Organizational rewards Stock options Profit sharing Stock ownership Balanced Scorecard Bonuses Gainsharing Open book

Team rewards

Individual Commissions rewards Piece rate

Bonuses

McShane/Von Glinow OB 3e

2005 The McGraw-Hill Companies, Inc. All rights rese

Performance Reward Effectiveness

Positive effects
Create an ownership culture Adjusts pay with firm's prosperity

Concerns with performance pay

May undermine intrinsic motivation Sometimes used as quick fixes

McShane/Von Glinow OB 3e

2005 The McGraw-Hill Companies, Inc. All rights rese

Improving Reward Effectiveness

Link rewards to performance Ensure rewards are relevant Team rewards for interdependent jobs Ensure rewards are valued Watch out for unintended consequences
Corel Corp. With permission. Corel Corp. With permission

McShane/Von Glinow OB 3e

10

2005 The McGraw-Hill Companies, Inc. All rights rese

Job Design
Assigning tasks to a job, including the interdependency of those tasks with other jobs Constantly changing due to changing technology and psychological contracts (especially employability)

McShane/Von Glinow OB 3e

11

2005 The McGraw-Hill Companies, Inc. All rights rese

Evaluating Job Specialization

Advantages
Less time changing activities Lower training costs Job mastered quickly Better person-job matching

Disadvantages
Job boredom Discontentment pay Higher costs Lower quality Lower motivation

McShane/Von Glinow OB 3e

12

2005 The McGraw-Hill Companies, Inc. All rights rese

Job Characteristics Model

Core Job Characteristics Critical Psychological States Outcomes

Skill variety Task identity Task significance Autonomy Feedback from job

Meaningfulness

Work motivation Growth satisfaction General satisfaction Work effectiveness

Responsibility Knowledge of results Individual differences

McShane/Von Glinow OB 3e

13

2005 The McGraw-Hill Companies, Inc. All rights rese

Job Enrichment in Wine Making

Mike Just has an enriched job as wine maker at Lawsons Dry Hills Winery in New Zealand. [W]e plant vines here, we pick them, we make the wine on site and bottle it, then sell them to customers who come in, explains Just, who also enjoys jousting.

Marlborough Express (N.Z.).

McShane/Von Glinow OB 3e

14

2005 The McGraw-Hill Companies, Inc. All rights rese

Job Design Strategies

Job rotation

Moving to different jobs

Job enlargement

Adding more tasks to a job

Job enrichment

Giving employees more

autonomy over their job
Marlborough Express (N.Z.).

McShane/Von Glinow OB 3e

15

2005 The McGraw-Hill Companies, Inc. All rights rese

Job Rotation vs. Job Enlargement

Job Rotation
Job 1 Operate Camera Job 2 Operate Sound Job 3 Report Story

Job Enlargement
Job 1 Operate Camera Operate Sound Report Story Job 2 Operate Camera Operate Sound Report Story Job 3 Operate Camera Operate Sound Report Story

McShane/Von Glinow OB 3e

16

2005 The McGraw-Hill Companies, Inc. All rights rese

Job Enrichment
Given more responsibility for scheduling, coordinating, and planning ones own work 1. Clustering tasks into natural groups

Stitching highly interdependent tasks into one job e.g., video journalist, assembling entire product
2. Establishing client relationships

Directly responsible for specific clients Communicate directly with those clients

McShane/Von Glinow OB 3e

17

2005 The McGraw-Hill Companies, Inc. All rights rese

Dimensions of Empowerment
Selfdetermination Employees feel they have freedom and discretion Employees believe their work is important Employees have feelings of selfefficacy Employees feel their actions influence success

Meaning

Competence

Impact

McShane/Von Glinow OB 3e

18

2005 The McGraw-Hill Companies, Inc. All rights rese

Creating Empowerment
Individual factors

Possess required competencies, able to perform

the work

Job design factors

Autonomy, task identity, task significance, job

feedback

Organizational factors

Resources, learning orientation, trust

McShane/Von Glinow OB 3e

19

2005 The McGraw-Hill Companies, Inc. All rights rese

Self-Leadership
The process of influencing oneself to establish the self-direction and self-motivation needed to perform a task Includes concepts/practices from:

Goal setting Social learning theory Sports psychology

McShane/Von Glinow OB 3e

20

2005 The McGraw-Hill Companies, Inc. All rights rese

Elements of Self-Leadership
Personal Goal Setting Constructive Thought Patterns Designing Natural Rewards SelfMonitoring SelfReinforcement

Personal goal setting

Employees set their own goals Apply effective goal setting practices

McShane/Von Glinow OB 3e

21

2005 The McGraw-Hill Companies, Inc. All rights rese

Elements of Self-Leadership
Personal Goal Setting Constructive Thought Patterns Designing Natural Rewards SelfMonitoring SelfReinforcement

Positive self-talk

Talking to ourselves about thoughts/actions Potentially increases self-efficacy

Mental imagery

Mentally practicing a task Visualizing successful task completion

McShane/Von Glinow OB 3e

22

2005 The McGraw-Hill Companies, Inc. All rights rese

Elements of Self-Leadership
Personal Goal Setting Constructive Thought Patterns Designing Natural Rewards SelfMonitoring SelfReinforcement

Finding ways to make the job itself more motivating

eg. altering the way the task is accomplished

McShane/Von Glinow OB 3e

23

2005 The McGraw-Hill Companies, Inc. All rights rese

Elements of Self-Leadership
Personal Goal Setting Constructive Thought Patterns Designing Natural Rewards SelfMonitoring SelfReinforcement

Keeping track of your progress toward the self-set goal

Looking for naturally-occurring feedback Designing artificial feedback

McShane/Von Glinow OB 3e

24

2005 The McGraw-Hill Companies, Inc. All rights rese

Elements of Self-Leadership
Personal Goal Setting Constructive Thought Patterns Designing Natural Rewards SelfMonitoring SelfReinforcement

Taking a reinforcer only after completing a self-set goal

eg. Watching a movie after writing two more

sections of a report eg. Starting a fun task after completing a task that you dont like

McShane/Von Glinow OB 3e

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2005 The McGraw-Hill Companies, Inc. All rights rese

C H A P T E R

6
Applied Performance Practices

McGraw-Hill/Irwin

2005 The McGraw-Hill Companies, Inc. All rights rese