Organizational Behaviour Understanding and Managing Life at Work
Organizational Behaviour: Understanding and Managing Life at Work Eleventh Edition Chapter 6 Motivation in Practice Copyright © 2020 Pearson Canada Inc. 6 -1
Learning Objectives (1 of 3) LO 6. 1 Discuss how to tie pay to performance on production jobs and the difficulties of wage incentive plans. LO 6. 2 Explain how to tie pay to performance on white-collar jobs and the difficulties of merit pay plans. Copyright © 2020 Pearson Canada Inc. 6 -2
Money as a Motivator (1 of 6) • How important is pay for you? Copyright © 2020 Pearson Canada Inc. 6 -3
Money as a Motivator (2 of 6) • Employees and managers seriously underestimate the importance of pay as a motivator. Copyright © 2020 Pearson Canada Inc. 6 -4
Money as a Motivator (3 of 6) • How effective is pay as a motivator? Copyright © 2020 Pearson Canada Inc. 6 -5
Money as a Motivator (4 of 6) • The motivation theories suggest that pay is a very important motivator. Copyright © 2020 Pearson Canada Inc. 6 -6
Money as a Motivator: Need Theories • Pay can satisfy lower-level needs as well as social, self-esteem, and self-actualization needs so it should have good potential as a motivator. • How can this potential be realized? Copyright © 2020 Pearson Canada Inc. 6 -7
Money as a Motivator: Expectancy Theory • If pay can satisfy a variety of needs, it should be highly valent, and it should be a good motivator to the extent that it is clearly tied to performance. Copyright © 2020 Pearson Canada Inc. 6 -8
Money as a Motivator (5 of 6) • Financial incentives and pay-for-performance plans have been found to increase performance and lower turnover. • Both individual and team-based financial incentives have been shown to have a positive effect on performance. Copyright © 2020 Pearson Canada Inc. 6 -9
Money as a Motivator (6 of 6) • Pay may well be the most important and effective motivator of performance. • The ability to earn money for outstanding performance is a competitive advantage for attracting, motivating, and retaining employees. • Variable pay or incentive compensation involves providing employees some portion of their pay that is based on a measure of performance. Copyright © 2020 Pearson Canada Inc. 6 - 10
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