Motivational

Motivational Theories and Alignment of Rewards Systems Stephen P. Czerniak University of Phoenix, Troy Learning Center HRM 570 Employee Motivation and Compensation Instructor: Charles A. Zajac Group ID: TRGRAD26 Assignment Due: Workshop 3 October 31, 2006

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Motivational Theories and Alignment of Rewards Systems Different perspectives on human behavior and motivation and how these translate to organizational reward systems. Compensation***and rewards are ***is a basic requirement of any employment contract. Compensation provides the resources for the employee to meet the basic needs of life: housing, clothing, food, warmth, and transportation. Zingheim and Schuster (2001) provided an incredibly memorable question in their article, Winning the talent game: Total rewards and the better workforce deal! Despite all the talk about how money isnt very important, ask people whether they would come to work tomorrow if they knew they were not getting paid. When a co-worker was told of this quote, they immediately asked, in horror, you do mean just for that day? Such a response is elicited for explainable reasons. Ramlall (2004) describes several motivational theories as shown in figure 1. The elements of Mazlows Need Hierarchy Theory and Herzbergs Motivator-Hygiene Theory are discussed here. Mazlows Need Hierarchy Theory describes the five sets of goals as physiological, security, affiliation, esteem, and self-actualization. The elements of total rewards cover the five need goals. Herzbergs Motivator-Hygiene Theory describes two categories that are both covered by the elements of total rewards.

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Need Theories of Motivation

Mazlows Need Hierarchy McClellands Need Equity Expectancy Vrooms Original Porter and Lawlers Extension Job Design Self-Actualization; Esteem; Affiliation; Security; Physiological Achievement; Power; Affiliation Inequity Motivates Action; Image of Exchange; Beliefs on Fair & Equitable Return People Behave to Produce Desired Outcomes People Make Conscious Choices Among Alternatives Valence (Preferred) Instrumentality (Linkage) Expectancy (Possibility) Reward for Task Accomplishment Job Satisfaction Linked to Equity of Rewards The Task is the Key to Employee Motivation Challenge Added through Variety, Autonomy, and Decision Authority Motivators (Achievement, Recognition, the Work Itself, Responsibility, Advancement, and Growth) Hygiene (Company Policies, Salary, Coworker Relations, and Supervisory Style) Features Need to be Built into the Work to Make it Satisfying and Motivating
(Ramlall, 2004)

Motivator-Hygiene

Job Characteristics

Figure 1 Need Theories of Motivation Milkovich (2004) identifies the components of a total rewards systems as compensation, benefits, social interaction, security, status/recognition, work variety, workload, work importance, and authority/control/autonomy (p. 267). The following table compares the elements of total rewards with the elements of Mazlows Hierarchy of Needs and Herzbergs Motivator-Hygiene Theory. TOTAL REWARDS Compensation Benefits Social interaction Security Status/recognition Work variety Workload Work importance Authority/control/autonomy Advancement Feedback Work conditions MAZLOWS NEEDS Physiological, Security Security Affiliation Security Esteem Self-actualization Security Esteem Affiliation Esteem Security Security MOTIVATOR-HYGIENE Hygiene Hygiene Hygiene Motivator Motivator Motivator Motivator Motivator Motivator Motivator Motivator Hygiene

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Development opportunity

Esteem (p. 54)

Motivator

The Motivator-Hygiene Theory tells us that hygiene items meet the basic requirements and expectations of the employees. These include company policies, salary, coworker relations, and supervisory styles. Hygiene items must be in place and produce dissatisfaction if not in place. Motivators are achievement, recognition, the work itself, responsibility, advancement, and growth. The A-B-C model describes antecedents, that occur before behavior, and consequences, that that occur after (McShane, 2005). The promise of salary or wage is an antecedent to behavior, as is the promise of wage or salary increases. This is the premise of merit pay increases. Some managers expect that threats to future compensation or employment of their employees will result in improved performance. Unfortunately, this usually results in an unexpected consequence for the manager. When a manager threatens the employment and therefore compensation of the employees, known as Cussins Theory (Halepota, 2005), the employee is driven to a condition of concern for being able to provide the physiological for themselves and their family. In creating this condition, we drive the employees exactly opposite of where we want them. Ramlall (2004) provides a synopsis of the critical factors that are expressed by the motivational theories the paper addressed. The following table quotes and paraphrases that synopsis: Needs of the Employee based on their individual, family and cultural values. .. depends on the current and desired economic, political, and social status; career aspiration; the need to balance career, family, education, community, religion, and other factors; and a general feeling of ones satisfaction with the current and desired state of being. Productive, respectful, inclusive, and friendly Enhances feeling of competency; aligned with fair and equitable rewards Teach, coach, and develop others; influence organizational goals,

Work Environment Responsibilities Supervision

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Fairness and Equity Effort Employee Development Feedback

objectives, and strategy Independent of age, gender, ethnicity, disability, sexual orientation, geographic location; aligned with level of effort and contributions Work task provides challenge and satisfaction Challenging environment; offers new learning opportunities; contributes to organizational success; opportunity for advancement; matches employees interests Timely; open; ongoing process; not limited to formal performance reviews; from employee and supervisor

Ramlalls synopsis consistently addresses the ideas that employees need challenging and satisfying work, want to work with professions like themselves, need to feel their work is valued, want to continuously improve, and want to be compensated in a fair and equitable manner.***He is correct. The Human Resources is the only asset which appreciates overtime with appropriate training and development.*** Effectiveness of Kudlers total rewards system Milkovich (2004) describes a total rewards systems (p. 267). The components of the total rewards system and Kudlers compensation system are compared in the following table. TOTAL REWARDS Compensation Benefits KUDLERS SYSTEM Job Based Compensation; Pay Ranges; Market Premium; Merit Pay; Incentive Program Health Insurance; Dental Insurance; Life Insurance; 401K; Vacation; Paid Holidays; Paid Family and Medical leave; Discount Cards; Child Care Reimbursement; Medical Reimbursement UNDEFINED UNDEFINED Employee Recognition UNDEFINED UNDEFINED UNDEFINED UNDEFINED Job Postings Performance Evaluation; Cash Drawer Policy UNDEFINED Training and Development; Tuition Reimbursement; Cooking Classes; Supervisory Training

Social interaction Security Status/recognition Work variety Workload Work importance Authority/control/autonomy Advancement Feedback Work conditions Development opportunity

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As one can see, from the table, the Kudler compensation system is missing many items from a classical total rewards system. The Kudler system focuses on the current position of the employee and the specific responsibilities being performed. There is no consideration given to varying the work assignments. Also, the Kudler system does not highlight and leverage the creation and maintenance of a positive and affirming social culture in the workplace. ***true*** Zingheim and Schuster (2001) describe a total rewards system as providing several key elements, including: compelling future making your company uniquely attractive to the people you need; individual growth providing the opportunity for workers to grow and learn over their whole career; positive workplace branding your organization so that people are excited about coming to work; and total pay attractive base pay, variable pay (cash, incentives, and stock options), benefits, recognition and celebration. Almost every item in the Kudler rewards system focuses on the present. Conflict with Kudlers Mission The Kudler Intranet portal provides the mission statement for the company. The Kudler mission statement states: Kudler Fine Foods mission is to provide our customers the finest in selected foodstuffs, wines, and related needs in an unparalleled consumer environment. Our selections, coupled with our experienced, helpful and knowledgeable staff, merge to offer each customer a delightful and pleasing shopping outing. We will provide this service because we shop the world for our products; purchase only the finest of products; are highly

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selective in acquiring our team members; and will got to extensive lengths to assure that Kudlers is the purveyor of choice for customers aspiring to purchase the finest epicurean delights (Our Mission, 2005). Pearce and Robinson (2005) state that the mission describes the companys product, market, and technological areas of emphasis in a way that reflects the values and priorities of the strategic decision makers (p. 12). They go on to say that the mission statement embodies the business philosophy of the firms strategic decision makers, implies the image the firm seeks to project, reflects the firms self-concept, and indicates the firms principal product or service areas and the primary customer needs the firm will attempt to satisfy (p. 26). The Kudler mission statement fulfills the textbook definitions from Pearce and Robinson (2005). However, only two statements are included related to the employees: 1) our experienced, helpful and knowledgeable staff, and 2) highly selective in acquiring our team members. The employees, their behavior, and their performance are the company, and this is never more true than in a retail situation.***any direct customer service business*** The Kudler mission statement addresses the quality of the products, the shopping experience, and the epicurean delights to be purchased. The opportunity to reflect positive social values are not handled in the Kudler mission statement. Ben and Jerrys Ice Cream is an excellent example of how the product, the financial, and the social responsibilities of the company. Their mission statement says: Product Mission - To make, distribute & sell the finest quality all natural ice cream & euphoric concoctions with a continued commitment to incorporating wholesome, natural ingredients and promoting business practices that respect the Earth and the Environment.

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Economic Mission - To operate the Company on a sustainable financial basis of profitable growth, increasing value for our stakeholders & expanding opportunities for development and career growth for our employees. Social Mission - To operate the company in a way that actively recognizes the central role that business plays in society by initiating innovative ways to improve the quality of life locally, nationally & internationally (Our Mission Statement, n.d.). Even though Ben and Jerrys is selling Ice Cream, which is not a healthy food, the mission statement was crafted in such a way to bring out the use of wholesome, natural ingredients. The Kudler mission statement missed the opportunity to reflect the common social value related to healthy foods. ***Ben and Jerrys mission statement is good but bothersome in that it does not discuss the most important stakeholder, i.e. the customer. The customer is the only reason for any companys existence.*** Zingheim (2001) identifies the need to provide a compelling future for the employees. Neither the Kudler internet or intranet provide specific information regarding the future of the company or its employees. A vision statement would be a marvelous way to communicate a strong image of the companys and employees future.***correct.*** ***Excellent paper. Grade: A Points:13***

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References Halepota, H. A., (2005, March) Motivational Theories and Their Application in Construction, Cost Engineering. 47, 3; p. 14 McShane, S.L., Von Glinow, M.A., (2005). Organizational behavior: emerging realities for the workplace revolution (3rd ed.). New York: McGraw-Hill. Retrieved from the University of Phoenix My rEsource page at https://ecampus.phoenix.edu/secure/resource/resource.asp Milkovich, G. & Newman, J., (2004). Compensation (8th ed.). New York: McGraw-Hill. Our Mission. (2005) Kudler Intranet. Kudler Fine Foods. Virtual Organization Portal. https://ecampus.phoenix.edu/secure/aapd/CIST/VOP/Business/Kudler/KudlerHome0 02.htm Our Mission Statement (n.d.) Ben and Jerrys Web Page at: http://www.benjerry.com/our_company/our_mission/index.cfm Pearce II, R. A., Robinson Jr., R. B., (2005) Strategic Management. Formulation, Implementation and Control. McGraw Hill Irwin. 9th Edition. Ramlall, S. (2004, September). A review of employee motivation theories and their implications for employee retention within organizations. Journal of American Academy of Business, Cambridge, 5(1/2), 52. Zingheim, P. K. & Schuster, J. R. (2001, Summer). Winning the talent game: Total rewards and the better workforce deal! Compensation & Benefits Management, 17(3), 33.

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