FOUNDATIONS OF

INDIVIDUAL BEHAVIOR
Chapter Outline

 Perception, attribution and decision

making
 Learning

 Personality and values

 Attitudes

 Motivation
PERCEPTION, ATTRIBUTION
AND INDIVIDUAL DECISION
MAKING
 Perception
 A process by which individuals organize and interpret
their sensory impressions in order to give meaning to
their environment.
Perception is the way people organize the massive

amounts of information they receive into patterns that

give it meaning.
The world as it is perceived is the world that is

behaviorally important.
People will use their perceptions of reality, not reality
itself, to decide how to behave.
Factors Influencing Perception
 There are many factors that influence people’s
perceptions.
 The factors are either:

 in the perceiver such as attitudes and experience;

 in the situation such as social setting and time; or
 in the target such as sounds, size or background.
Factors Influencing Perception…
 Factors Influencing Perception…
 Personal characteristics that affect perception
include a person’s attitude, personality, motives,
interests, past experiences, and expectations.
 Characteristics of the target we observe can affect
what we perceive.
 The context or situation in which we see objects or
events is also important.
Person Perception: Attribution Theory

Attribution theory suggests that perceivers try to

“attribute” the observed behavior to a type of cause:
 Internal – behavior is believed to be under the
personal control of the individual
 External – the person is forced into the behavior by
outside events/causes
Attribution theory tries to explain the ways in which


we judge people differently, depending on the

meaning we attribute to a given behavior.
Person Perception: Attribution Theory…

 Attribution theory helps us to understand our

perceptions about others.
 Research has shown that our perceptions about others
are based upon the assumptions we make about them.
 The attribution theory says that when we observe
behavior we try to determine if it is internally or
externally driven.
 If it is internally driven it is under the person’s
control whereas external causes are not under the
individual’s control.
 Determinants of Attribution
 We can use three factors to help us decide if behavior
is internally or externally controlled: distinctiveness,
consensus, consistency.
 Distinctiveness – whether an individual displays
different behaviors in different situations (the
uniqueness of the act)
 Consensus – does everyone who faces a similar
situation respond in the same way as the individual did
 Consistency – does the person respond the same way
over time
Determination of Attribution
 Attribution Errors
 The following are errors and biases in the
attributions we make:
 Fundamental Attribution Error
The tendency to underestimate the influence of external
factors and overestimate that of internal factors.

 Self-Serving Bias
This bias exists when individuals attribute their own successes to
internal factors and blame external factors when they don’t
have success.
 Shortcuts Used in Judging Others
 People will utilize past experience, their attitudes and their interests to
interpret information on their own biases, often misperceiving the
situation.
 Selective Perception – a perceptual filtering process based on interests,
background, and attitude. May allow observers to draw unwarranted conclusions
from an ambiguous situation.
 Halo Effect – drawing a general favorable impression based on a single
characteristic. The opposite is true when they draw unfavorable impressions
about an individual based on a single negative characteristic, this is called the
horn effect.
 Contrast Effects – occur when we are making judgments about an individual
and comparing them to other individuals we have recently encountered.
 Stereotyping – judging someone on the basis of the perception of the group to
which they belong.
The Link Between Perception and Decision
Making

 Often decision-making occurs as a reaction to a

problem or a perceived discrepancy between the way
things are and the way we would like them to be.
 A decision is then made based on various alternatives
that have been developed from the data collected.
Perception influences:
 Awareness that a problem exists
 The interpretation and evaluation of information
 Bias of analysis and conclusions
 Decision making models
 Decision-making is done by individuals but occurs in
organizations.
 There are some models that can help us in thinking
through decision-making in organizations:
 Rational decision-making
 Bounded rationality and
 Intuitive decision making
 Rational Decision-Making Model

1. Define the problem.

2. Identify the decision criteria.
3. Allocate weights to the criteria.
4. Develop the alternatives.
5. Evaluate the alternatives.
6. Select the best alternative.
Seldom actually used: more of a goal than a practical method because this
model relies on a number of assumptions, including that the decision maker
has complete information, is able to identify all the relevant options in an
unbiased manner, and chooses the option with the highest utility.
Assumptions of the Model of rational
decision making model
 Complete knowledge of the situation
 All relevant options are known in an unbiased
manner
 The decision-maker seeks the highest utility
 This model assumes a perfect world in order to make
decisions.
 Bounded Rationality
The limited information-processing capability of human
beings makes it impossible to assimilate and understand
all the information necessary to optimize
So people seek solutions that are satisfactory and sufficient,
rather than optimal (they “satisfice”)
 Bounded rationality is constructing simplified models
that extract the essential features from problems without
capturing all their complexity
 Bounded reality, represents more of the real world

where it seeks solutions that are the best given the

information that is available.
 Decision Making in Bounded
Rationality
Simpler than rational decision making, composed of
three steps:

1. Limited search for criteria and alternatives – familiar

criteria and easily found alternatives
2. Limited review of alternatives – focus alternatives,
similar to those already in effect
3. Satisficing – selecting the first alternative that is
“good enough”
Intuitive Decision Making
 A non-conscious process created out of distilled
experience
 Increases with experience
 Can be a powerful complement to rational
analysis in decision making
Common Biases and Errors in
decision making
 There are many biases and errors that occur in the decision-making
process.
 Overconfidence Bias
The overconfidence bias is when you believe too much in your own ability
to make good decisions. As managers and employees become more
knowledgeable about an issue, the less likely they are to display
overconfidence
 Anchoring Bias
A tendency to fixate on initial information and fail to adequately adjust for
subsequent information. . The anchoring bias is when you make your
decisions based on the information you received first and not on the new
information received.
 Confirmation Bias
Seeking out information that reaffirms our past choices and discounting
information that contradicts past judgments
 Common Biases and Errors
 Availability Bias
The tendency to base judgments on information that is readily available
 Escalation of Commitment
Staying with a decision even when there is clear evidence that it is wrong
 Risk Aversion
Preferring a sure thing over a risky outcome
 Hindsight Bias
The tendency to believe falsely that we could have accurately predicted the
outcome of an event after that outcome is already known and then
believing it could have been accurately predicted beforehand.
Organizational Constraints on Decision
Making
 There are many organizational constraints to good
decision-making that create deviations from the rational
model defined earlier
 Managers shape their decisions on:
 Performance evaluations
 Reward systems
 Formal regulations
 System-imposed time constraints
 Historical precedents
Learning
Learning
Definition of Learning
 Learning is “any relatively permanent change in
behavior that occurs as a result of experience.”
 This definition has several components that deserve
clarification.
 Learning involves change. Change may be good or
bad from an organizational point of view.
 The change must become ingrained. Immediate
changes may be only reflexive or a result of fatigue
thus may not represent learning.
 Some form of experience is necessary for learning.
Learning Overview: Theories of Learning

 Non-Associative
 Non-Associative (change in magnitude of response)
 Decreased/ Increased responses to a stimulus, after
another or same stimulus.
 Examples are “Habituation & Sensitization.”
 Associative
 Associative (based on the connection between events)
 Classical Conditioning
 Operant Conditioning
 Social Learning
Habituation and Sensitization
 Habituation: responses become less vigorous to a
stimulus over time
 The response to steady or repeated (harmless) stimulus
decreases over time.
 Example: You don’t hear your air conditioner after it’s
been running a while.
 Sensitization: responses become more vigorous to a
stimulus over time.
 The experience of one stimulus heightens the response to a
subsequent stimulus.
 Example: People are “jumpy” following natural disasters,
like earthquakes.
 Theories of learning
• How do we learn? Three theories have been offered to explain the
process by which we acquire patterns of behavior in associative ways.
• These are classical conditioning, operant conditioning and social
learning.
• Classical conditioning –grew out of experiments to teach dogs to
salivate in response to the ringing of a bell, conducted in the early
1900s by Russian Psychologist Ivan Pavlov.
• Learning a conditioned response involves building up an association
between a conditioned stimulus and an unconditioned stimulus.
• When the stimuli, one compelling and the other one neutral, are
paired, the neutral one becomes a conditioned stimulus and, hence,
take on the properties of the unconditioned stimulus.
 Classical Conditioning

 Classical
conditioning
 Unconditioned
stimulus (US)
 Unconditioned
response (UR)
 Conditioned
stimulus (CS)
 Conditioned
response (CR)

29
 Operant Conditioning…
• Operant Conditioning-argues that behavior is a
function of its consequences.
• People learn to behave to get something they want or to
avoid something they don’t want.
• Type of learning in which behavior is strengthened if
followed by reinforcement or diminished if followed by
punishment
• Operant behavior means voluntary or learned behavior
in contrast to reflexive or unlearned behavior.
 Operant Conditioning…
• The tendency to repeat such behavior is influenced by
the reinforcement or lack of reinforcement brought
about by the consequences of the behavior.
• Reinforcement strengthens a behavior and increases
the likelihood that it will be repeated.
 REINFORCERS (positive and negative) Increase behavior
 desirable event that increases the behavior that it follows
 powerful controller of desirable behavior.
 PUNISHMENT (positive and negative) Decreases
behavior
 aversive event that decreases the behavior that it follows
 powerful controller of unwanted behavior.
Operant Conditioning…
 Positive Reinforcement: adding (or presenting)
a stimulus, which strengthens a response and
makes it more likely to recur (e.g., praise)
 Negative Reinforcement: taking away (or

removing) a stimulus, which strengthens a

response and makes it more likely to recur
(e.g., headache removed after taking an
aspirin)
 Operant Conditioning…
 Positive Punishment:
 This works by presenting a negative consequence after
an undesired behavior is exhibited, making the
behavior less likely to happen in the future.

 Negative Punishment:
 This happens when a certain desired stimulus/item is
removed after a particular undesired behavior is
exhibited, resulting in the behavior happening less
often in the future.
Operant Conditioning…
 Social Learning…
• Social-Learning-Individuals can learn by observing
what happens to other people and just by being told
about something as well as through direct experiences.
• This view that we can learn through both observation
and direct experience is called social-learning theory.
• It could include learning without direct experience
• The influence of models is central to the social-
learning viewpoint.
PERSONALITY AND
VALUES
Personality
 Personality - the sum total of ways in which an
individual reacts to and interacts with others
 Most often described in terms of measurable traits
that a person exhibits such as shy, aggressive,
submissive, lazy, ambitious, loyal, and timid
 Psychologists define personality as the growth and
development of a person’s whole psychological system.
 We study personality in Organizational Behavior
because it impacts a number of important work
outcomes.
Measuring Personality
 Self-report surveys
 the most common and easiest way to measure
personality
 Prone to error due to the fact that the individuals are
reporting all the data about themselves.
 Observer-ratings Surveys
 Independent assessment
 May be more accurate
Personality Determinants
 Personality reflects heredity and environment
 Heredity is the most dominant factor
 Twin studies: genetics more influential than parents
 Environmental factors do have some influence
 Aging influences levels of ability
 Age does influence personality
 Basic personality is constant
Measuring Personality Traits:
Myers-Briggs Type Indicator
 Most widely used personality-assessment instrument in the
world
 Individuals are classified as:
 Extroverted or Introverted (E/I)-extroverts tend to be sociable
and assertive verses introverts tend to be quiet and shy.
 Sensing or Intuitive (S/N)-Sensors are practical and orderly
where intuits utilize unconscious processes.
 Thinking or Feeling (T/F)-Thinking focuses on using reason
and logic whereas feeling utilizes values and emotions.
 Judging or Perceiving (J/P)-Judgers want order and structure
whereas perceivers are more flexible and spontaneous.
 Classifications combined into 16 personality types (i.e. INTJ
or ESTJ)
 These categories are unrelated to job performance
Measuring Personality Traits:
The Big-Five Model
 The Big Five model of personality sets forth that there are five
basic dimensions that underlie all others and encompass most of
the significant variations in human personalities.
 The Big Five factors are:
 Extroversion-one’s comfort level with r/ps.
 Agreeableness-an individual’s propensity to defer to others.
 Conscientiousness-a measure of reliability.
 Emotional Stability-a person’s ability to withstand stress.
 Openness to Experience-one’s range of interests and fascination with
novelty.
 Strongly supported relationship to job performance (especially
Conscientiousness)
Big Five Traits and OB
 Other Personality Traits
 Core Self-Evaluation
 Core self-evaluation is the degree to which people like/dislike
themselves.
 People with positive core self-evaluation like themselves and see
themselves as capable and effective in the workplace
 Machiavellianism
 Machiavellianism describes a person who tends to be emotionally distant
and believes that the ends justify the means.
 High machs tend to be pragmatic, emotionally distant and believe
the ends justify the means
 They can be very persuasive in situations where there is direct interaction
with minimal rules and people are distracted by emotions.
 Narcissism
 A person with a grandiose view of self, requires excessive
admiration, has a sense of self-entitlement and is arrogant
 Narcissism is a trait that often hinders job effectiveness
Major Personality Attributes
Influencing OB
 Self-monitoring
 Adjusts behavior to meet external, situational factors
 High monitors are more likely to become leaders in the
workplace.
 Risk Taking
 Willingness to accept risk; This quality affects how much
time and information managers need to make a decision.
• Type A Personality
•refers to a person who tends to be aggressively involved in a chronic,
incessant struggle to achieve more and more and in less time.

 Proactive Personality
Identifies opportunities, shows initiative, takes action and perseveres

 Other Orientation
This orientation reflects the extent to which decisions are affected by
social influences and concerns vs. our own well-being and outcomes.
Pay me back vs. pay me forward
Values
 Values represent basic, enduring convictions that "a
specific mode of conduct or end-state of existence is
personally or socially preferable to an opposite or
converse mode of conduct or end-state of existence"
 Values represent basic convictions that make judgments
about what is the best mode of conduct or end-state of
existence.
Value Systems
 Value systems represent individual values
prioritized based on how important the particular
value is to the individual and how intense their
feelings are about that particular value.

 Prioritizing of individual values by:

 Content – importance to the individual
 Intensity – relative importance with other values
 Value Systems…
 When we rank an individual’s values in
terms of their intensity, we obtain that
person’s value system
 All of us have a hierarchy of values that

forms our value system.

 The way individuals set up their values in

order of importance is relatively stable over

time
The Importance of Values

 Values are the foundation for attitudes,

motivation, and behavior
 In addition, values are important in the

workplace because they can influence an

individual’s perception and cloud their
objectivity.
 Rokeach Value Survey
 The Rokeach Value Survey was created by
Milton Rokeach.
 It consists of two sets of values:

 terminal values
 instrumental values
Rokeach Value Survey…

 Terminal values:  Instrumental

desirable end-states values:preferable
of existence modes of behavior
 Goals that a person  Means of achieving
would like to achieve the terminal values
during his or her
lifetime
Examples of Terminal Values
 A comfortable life (a prosperous life)
 An exciting life (stimulating, active life)
 A sense of accomplishment (lasting contribution)
 A world of peace (free of war and conflict)
 A world of beauty (beauty of nature and the arts)
 Equality (brotherhood, equal opportunity for all)
 Family security (taking care of loved ones)
 Freedom (independence, free choice)
 Happiness (contentedness)
Examples of Instrumental Values
 Ambitious (hard working, aspiring)
 Broad-minded (open-minded)
 Capable (competent, efficient)
 Cheerful (lighthearted, joyful)
 Clean (neat, tidy)
 Courageous (standing up for your beliefs)
 Forgiving (willing to pardon others)
 Helpful (working for the welfare of others)
 Honest (sincere, truthful)
 Linking an Individual’s Personality
and Values to the Workplace
 The effort to match job requirements with
personality characteristics is best articulated in John
Holland’s personality–job fit theory .

 Holland proposes that satisfaction and the

propensity to leave a position depend on how well
individuals match their personalities to a job.

 The theory argues that satisfaction is highest and

turnover lowest when personality and occupation are
in agreement.
Linking an Individual’s Personality
and Values to the Workplace
 If an organization faces a dynamic and changing
environment and requires employees able to readily change
tasks and move easily between teams, it is more important
that employees’ personalities fit with the organizational
culture than with the characteristics of any specific job.

 The fit predicts job satisfaction, organizational commitment

and turnover
 When employees find organizations that match their values
they are more likely to be selected and correspondingly be
more satisfied with their work.
 The big five personality types are often helpful in matching the
individuals with organizational culture.
 In class exercise
 Form small groups to discuss the following topics, as
assigned by your instructor. Each person in the group
should first identify 3 to 5 key personal values. 
 1. Identify the extent to which values overlap in your
group.
 2. Try to uncover with your group members the source
of some of your key values (e.g., parents, peer group,
teachers, church).
 3. What kind of workplace would be most suitable for
the values that you hold most closely?
ATTITUDES
Attitudes

 Attitudes: Evaluative statements – either

favorable or unfavorable – concerning objects,
people or events
 Reflect how one feels about something

 Attitude can be defined as providing a state

of ‘readiness’ or tendency to respond in a
particular way.
 Three Main Components
of Attitudes
 Attitudes are made up of three components.
 The cognitive component is composed of the belief
in the way things are.
 The affective component is the more critical part of
the attitude as it calls upon the emotions or feelings.
 The behavioral component describes the intention
to behave in a certain way toward someone or
something.
 These three components work together to aid in
our understanding of the complexity of an attitude.
Three Main Components
of Attitudes…
 Does Behavior Always
Follow from Attitudes?
 Early research on attitudes assumed they were
causally related to behavior— that is, the
attitudes people hold determine what they do.
 However, in the late 1960s, a research
challenged this assumed effect of attitudes on
behavior.
 One researcher—Leon Festinger—argued that
attitudes follow behavior. Did you ever
notice how people change what they say
so it doesn’t contradict what they do?
Attitudes Follow Behavior:
Cognitive Dissonance
 Festinger proposed that cases of attitude following
behavior illustrate the effects of cognitive dissonance.
 Cognitive dissonance: any inconsistency between two
or more attitudes, or between behavior and attitudes
 Individuals seek to minimize dissonance
 Desire to reduce dissonance is determined by moderating
factors such as:
 The importance of the elements creating the dissonance
 The degree of influence the individual believes he or she
has control over the elements
 The rewards that may be involved in dissonance
Behavior Follows Attitudes:
Moderating Variables
 The most powerful moderators of the attitude-behavior
relationships are:
 Importance of the attitude-Important attitudes
reflect our fundamental values, self-interest, or
identification with individuals or groups we value.
 Correspondence of the attitude to the behavior-
Specific attitudes tend to predict specific behaviors,
whereas general attitudes tend to best predict general
behaviors.
 Accessibility of the attitude-Attitudes that our
memories can easily access are more likely to predict our
behavior.
Behavior Follows Attitudes:
Moderating Variables…
 The existence of social pressures on behavior-
Discrepancies between attitudes and behavior tend to
occur when social pressures to behave in certain ways
hold exceptional power, as in most organizations.
 Direct personal experience of the attitude-the
attitude–behavior relationship is likely to be much
stronger if an attitude refers to something with which we
have direct personal experience.
 These variables will impact the ability to estimate how a
certain attitude will predict behavior.
 Knowing attitudes helps predict behavior
Major Job Attitudes
 Job attitudes are evaluations of one’s job that
express one’s feelings toward, beliefs about, and
attachment to one’s job.
 Most of the research in OB has looked at three
attitudes: job satisfaction, job involvement,
and organizational commitment. A few other
attitudes are:
 Psychological empowerment

 Perceived organizational support

 Employee engagement
 Assignment:
 Read about the above mentioned job attitudes.
 MOTIVATION
CONCEPTS
&
APPLICATIONS
 What Is Motivation?
• Motivation: The processes that accounts for an
individual’s intensity, direction, and persistence of
effort toward attaining an organizational goal
– Intensity – the amount of effort put forth to meet the goal
– Direction – efforts are channeled toward organizational goals
– Persistence – how long the effort is maintained
 Early Theories of Motivation
• Maslow’s Hierarchy of Needs Theory
• McGregor’s Theory X and Theory Y
• Herzberg’s Two-Factor (Motivation-Hygiene) Theory
• McClellan’s Theory of Needs (Three Needs Theory)
Maslow’s Hierarchy
of Needs Theory
 This theory states that with every individual there
is a hierarchy of five needs.
 As each need is met or satisfied the next need
becomes dominant.
 Maslow’s theory posits that individuals are stuck
in their existing need level until it is satisfied and
then they can move on to the next level.
 The organization of these need levels may vary
across cultures.
Maslow’s Hierarchy
of Needs Theory
 Douglas McGregor’s X & Y
 Douglas McGregor developed the theory called Theory
X, Theory Y.
 He believed that there are two distinct views of human
beings that managers hold.
 The Theory X view is basically negative and holds that
workers have little ambition, dislike work and avoid
responsibility.
 The Theory Y sets forth that workers tend to be self-
directed, enjoy work and accept responsibility.
 Managers will modify their behavior toward employees
based on what view they hold about them.
 Douglas McGregor’s X & Y

• Inherent dislike for work • View work as being natural

and will attempt to avoid as rest or play
it • Will exercise self-direction
• Must be coerced, and self-control if
controlled or threatened committed to objectives
with punishment
 Herzberg’s
Two-Factor Theory
 This theory sets forth that satisfaction and dissatisfaction
are not the opposites, but two separate ideas.
 There are a set of factors that when present will help to
avoid dissatisfaction in workers. This group is called the
hygiene factors.
 There is another set of factors that when present will help
to cause satisfaction in workers. This group is called
motivators.
 These sets are distinct and the presence of hygiene factors
does not cause satisfaction, it just helps avoid
dissatisfaction.
Herzberg’s
Two-Factor Theory
Not Dissatisfied Satisfied

•• Quality
Qualityof
of •• Promotional
Promotional

Motivation
supervision opportunities

MotivationFactors
supervision opportunities
•• Pay
Pay
•• Opportunities
Opportunitiesfor
for
•• Company
Companypolicies
policies personalgrowth
personal growth
•• Physical
Physicalworking
working
conditions •• Recognition
Recognition
conditions

Factors
•• Relationships
Relationships •• Responsibility
Responsibility
•• Job
Jobsecurity
security •• Achievement
Achievement

Dissatisfied Not Satisfied

 McClelland's
Theory of Needs
• McClellan bases his theory on the idea that people are
motivated in the workplace by three main needs.
• Need for Achievement (nAch)
The drive to excel
• Need for Power (nPow)
The need to make others behave in a way they would not
have behaved otherwise
• Need for Affiliation (nAff)
The desire for friendly and close interpersonal
relationships
 McClelland's High Achievers
• High achievers prefer jobs with:
– Personal responsibility
– Feedback
– Intermediate degree of risk
– High achievers tend to be motivated in jobs that are
more individualistic in nature and provide regular
and effective feedback.
• High achievers are not necessarily good managers
• High nPow and low nAff is related to managerial
success
Contemporary Theories of
Motivation
• Self-Determination Theory
• Goal-Setting Theory
– Management by Objectives
• Self-Efficacy Theory
• Equity Theory
• Expectancy Theory
 Self-Determination Theory
• Self-determination theory: People prefer to have
control over their actions so when they feel they are
forced to do something they previously enjoyed
motivation will decrease
– Cognitive evaluation theory: Proposes that the introduction
of extrinsic rewards for work (pay) that was previously
intrinsically rewarding tends to decrease overall motivation

 Verbal rewards increase intrinsic motivation, while tangible

rewards undermine it
 Goal-Setting Theory
• Goals increase performance when the goals are
– Specific
– Difficult, but accepted by employees
– Accompanied by feedback (especially self-generated
feedback)
• Contingencies in goal-setting theory
– Goal Commitment – public goals better
– Task Characteristics – simple & familiar better
– National Culture – Western culture suits best
 Management by Objectives (MBO)

• MBO: Converts overall organizational

objectives into specific objectives for work
units and individuals
• Common ingredients:
– Goal specificity
– Explicit time period
– Performance feedback
– Participation in decision making
 Self-Efficacy or
Social Learning Theory
• Self-efficacy: Individual’s belief that he or she is capable of
performing a task
 Self-efficacy increased by:
 Enactive mastery – gain experience

 Vicarious modeling – see someone else do the task

 Verbal persuasion – someone convinces you that you

have the skills
 Arousal – get energized
 Equity Theory
• Equity theory: Employees weigh what they put into
a job situation (input) against what they get from it
(outcome)
• They compare their input-outcome ratio with the
input-outcome ratio of relevant others

My Output Your Output

My Input Your Input
 Equity Theory and Reactions to
Inequitable Pay
Employee reactions in comparison to equitably-paid employees

Paid by:
Employees are:
Piece Time
Will produce fewer,
Over-Rewarded but higher-quality Will produce more
units
Produce large Produce less output
Under-Rewarded number of low or output of poorer
quality units quality
Equity Theory: Forms of Justice
Expectancy Theory
 Argues that the strength of a tendency to act in a certain
way is dependent on the strength of the expectation that
they will receive a given outcome and that the outcome
is desired.
Three key relationships:
1. Effort-performance: perceived probability that exerting
effort leads to successful performance
2. Performance-reward: the belief that successful
performance leads to desired reward
3. Rewards-personal goals: the attractiveness of
organizational outcome (reward) to the individual
Expectancy Theory
 JCM: Designing Motivational
Jobs
 According to the JCM, any job can be described in terms of five core
job dimensions:
• Skill variety. The degree to which the job requires a variety of different
activities
• Task identity. The degree to which the job requires completion of a
whole and identifiable piece of work.
• Task significance. The degree to which the job has a substantial impact
on the lives or work of other people.
• Autonomy. The degree to which the job provides substantial freedom,
independence, and discretion to the individual
 Feedback. The degree to which the individual carrying out the job

obtains direct and clear information about the effectiveness of his or

her performance.
The Job Characteristics Model
JCM: Designing Motivational
Jobs…
 JCM-designed jobs give internal rewards
 Individual’s growth needs are moderating factors
 Motivating jobs must be
 Autonomous
 Provide feedback
 Have at least one of the three meaningfulness factors
How Can Jobs Be Redesigned?
 Job Rotation
The periodic shifting of an employee from one task to
another
 Job Enrichment
Increasing the degree to which the worker controls the
planning, execution and evaluation of the work
Guidelines for Enriching
a Job Using JCM

 Enrichment reduces turnover and absenteeism while increasing

satisfaction
Alternative Work Arrangements

 Flextime
Some discretion over when worker starts and leaves
 Job Sharing
Two or more individuals split a traditional job
 Telecommuting
Work remotely at least two days per week
The Social and Physical Context of
Work
 There is both a social and a physical context to work
 Social characteristics that improve job performance
 Interdependence
 Social support
 Interactions with people outside the workplace
 Work context also affects performance
 Temperature
 Noise level
 Safety
Employee Involvement
 Employee involvement: A participative process that
uses the input of employees to increase their
commitment to the organization’s success
 Two types:
 Participative management
 Representative participation
Participative Management
 Participative management: Subordinates share a
significant degree of decision-making power with
superiors
 Required conditions:
 Issues must be relevant
 Employees must be competent and knowledgeable
 All parties must act in good faith
 This program has shown to have a limited impact on
productivity, motivation, and job satisfaction
Representative Participation
 Representative participation: Workers are
represented by a small group of employees who
participate in decisions affecting personnel
 Works councils
 Board membership
 Redistribute power within an organization
 Does not appear to be very motivational
Rewarding Employees
 Money is not the primary driver for job satisfaction.
However, it does motivate individuals and companies
often underestimate its impact in keeping top talent.
 Major strategic rewards decisions:
 What to pay employees
 How to pay individual employees
 What benefits to offer
 How to construct employee
recognition programs
What to Pay
 Need to establish a pay structure
 Balance between:
 Internal equity – the worth of the job to the
organization
 External equity – the external competitiveness of an
organization’s pay relative to pay elsewhere in its
industry
 A strategic decision with trade-offs
How to Pay:
Variable-Pay Programs
 Bases a portion of the pay on a given measure of
performance
 Piece-Rate Pay – workers are paid a fixed sum for each
unit of production completed
 Merit-Based Pay – pay is based on individual
performance appraisal ratings
 Bonuses – rewards employees for recent performance
 Skill-Based Pay – pay is based on skills acquired instead
of job title or rank – doesn’t address the level of
performance
More Variable Pay Programs
 Profit-Sharing Plans – organization-wide programs that
distribute compensation based on an established formula
designed around profitability
 Gainsharing is a group incentive where a department or unit
will earn additional income if it improves group productivity
from the previous period.
 Employee Stock Ownership Plans (ESOPs) – plans in
which employees acquire stock, often at below-market prices
 While
 Whileititappears
appearsthat
thatpay
paydoes
doesincrease
increaseproductivity,
productivity,ititseems
seemsthat
thatnot
not
everyoneresponds
everyone respondspositively
positivelyto
tovariable-pay
variable-payplans
plans
What Benefit to Offer: Flexible
Benefits
 Flexible benefits allow employees choices between different
benefits.
 Each employee creates a benefit package tailored to his/her
own needs and situation
 Modular plans – predesigned packages to meet the needs
of a specific group
 Core-plus plans – a set of core benefits that most need and
then some additional options to choose from
 Flexible spending plans – full choice from menu of
options
How to Recognize Them: Employee
Recognition Programs
 In addition to pay there are intrinsic rewards
 Can be as simple as a spontaneous comment
 Can be formalized in a program
 Recognition is the most powerful workplace
motivator – and the least expensive