Transcript This is the title of this presentation

Introduction to Organizational Behavior and a focus on
Motivation
Ajay Mehra
LINKS, Center for Research in Social Networks in Business
Faculty Bio
Ajay Mehra is the Carol Martin Gatton Endowed Professor in the Gatton College of Business and
Economics. He has taught courses in organizational behavior (OB) and social network analysis,
at both the graduate and undergraduate level, and he has delivered talks on OB at a variety of
organizations, including Procter and Gamble, Country Companies, Wright-Patterson Air Force
Base, the Department of Defense, and the Defense Threat Reduction Agency. He has also
served as an external consultant for a number of firms, ranging from large insurance companies
to small high-tech startups, on topics related to his research expertise. Prior to his academic
career, Ajay worked short stints as a software salesman and as a human resource consultant.
Ajay’s research work has been published in such top-tier journals as Science, Administrative
Science Quarterly (ASQ) and Academy of Management Review (AMR), and it has received
coverage in a number of newspapers, such as the European Wall Street Journal and the Los
Angeles Times. He received his Ph.D. (1998) from Penn State’s Smeal College of Business.
www.ajaymehra.net www.linkscenter.org
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Our Course Syllabus
4/28– Introduction to OB + Motivation
4/29– Managing Individual Differences
4/30– Power and Politics
5/2– Managing Interpersonal Networks
5/5— Exam 1
5/6– Decision Making
5/7— Teams
5/8— Leadership
5/9– Organizational Culture
5/15— Exam 2
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Introduction– 40 minutes
Break– 15 minutes
Case– 1hr
Break– 20 minutes
Discussion
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Epistemology
•
The veteran
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The Guru
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The humble researcher/consultant
Our theories about people matter, both when the theories are right and when they
are wrong.
Social phenomena are complexly determined– no one explanation explains
everything.
GAS: the inevitable tradeoffs in knowledge
Even small improvements can, like compound interest, lead to a very different place
down the road…
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What’s my management style?
On a scale of 1 (strongly disagree) to 5 (strongly agree)
1. I tend to be very participatory in my approach to managing.
2. I go out of my way to praise deserving employees.
3. As a manager, I give general directions and asks employees to do their best
rather than providing detailed and complete instructions on what to do.
4. As a manager, I possess excellent communication skills.
5. I don’t just tell my employees what to do, I tell them why they should do it.
6. I am very approachable at work.
7. I try to learn from my employees
8. I give my employees every opportunity to learn and grow in their roles.
* How do your employees see your management style?
* How does your boss see your management style?
* Is it consistent with how you view yourself?
Tips for success:
- Developmental versus evaluative.
- Involve people in coming up with the items.
Free tool for gathering data: http://www.surveygizmo.com/plans-pricing/
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Worksheet 1: Self-reflection Exercise and Road Map
Of the skills necessary to
be a great manager, which
do you currently possess?
Which skills do you, or
others, think need to be
worked on most?
What is your action plan
for acquiring those skills?
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Managing? That’s Easy, Right?
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Clarifies goals and objectives
Encourages participation
Plans and organizes for orderly work flow
Is a technical expert at the job on hand
Trains, coaches, supports
Provides honest and quick feedback
Relies on schedules and deadlines
Controls details (but is not overbearing)
Empowers and delegates
Recognizes and rewards good performance
Failure to Learn
• Fundamental attribution error (Lee Ross; Jones
and Harris, 1967)
– Even when people read pro/against speeches about
Castro based on a coin-toss, observers, knowing about
the coin-toss, believed that speakers believed what
they spoke about.
• Why?
– The just-world belief: attributions to disposition
suggest we have agency (Tea Party rhetoric)
– Actor salience: when it comes to ourselves, we are
more aware of situational constraints
– It hurts to think: the cognitive miser
Misreading Motives…
We tend to assume that we are better at discerning motives than
we really are:
• Social projection and the false consensus effect
– A tendency to bias estimates of how widely their views and habits are shared by others.
• Inadequate feedback from others
– Homophily effect: life as echo-chamber
– To not disagree is the essence of good etiquette
– Why be the bearer of bad tidings: message and messenger are often confused.
Before we get to Motivation: What’s a Strategy?
• Our strategy is to be number 1 or 2 in every business– Jack Welch
• Our strategy is to our people
• Don’t be evil– Google
What’s a Strategy?
• Our strategy is to be number 1 or 2 in every business– Jack Welch
• Our strategy is to our people
• Don’t be evil– Google
None of these are strategies… Strategy explains how an organization faced
with competition will achieve superior performance!
• As in war, strive to be the best?
– But you can win without destroying opponents (e.g., Walmart and
Target) There are many needs and many ways to serve them.
– You don’t have to be big to be profitable (consider GM in the 70s90s).
– Within most industries, no such thing as meaningfully being “the
best.” Is there a best car? A best clothing manufacturer? A best
toothpaste?
The Big Questions
Michael Porter
• Why are some companies
more profitable than others?
• Why are some industries
more consistently profitable
than others, and what does
this mean for managers
developing firm strategy?
Competitive Strategy, 1980
Competitive Advantage, 1985
• “the essence of strategy is choosing
what not to do…”
• The economist’s approach to the
answer (simplify and ruthlessly
abstract from reality: e.g., assume
that all firms are the same and in
“perfect competition”)
• The management answer:
Every situation is unique… use in-depth
case studies (but one cannot then easily
generalize…)
Porter helped marry these approaches…
The Five Forces Model
Entry barriers: a billion dollars to develop new operating system for PC
Switching costs
Does value to customers increase as more people use product: Facebook
Proprietary technology; brands; govt. policies?
• Same forces across industries
Who are the rivals? Rate of • Industry structure drives
growth influences rivalry (price,
new products). How committed profitability
are the rivals. Are rivals products
hard to distinguish
• Industry structure tends to
be sticky
• To make sense of your own
performance, you need to
understand the industry’s
fundamentals.
• What’s going on out there?
What deserves your
attention?
• Better than SWOT
Substitutes– OPEC sets price to fend off substitutes
How Msft and Intel squeeze PC manufacturers CEMEX: Big powerful buyers in US; fragmented buyers in Mexico
- undifferntiated? Importance to own performance?
Fundamental Equation
• Unit Profit Margin=PriceCost
• Industry creates value…
question is who captures
the value
• Don’t use Return on Sales
or
market share…
How Five Forces Influence Profits
• Substitutes, threat of entry, buyer power negatively influence Price
• Rivalry negatively influences price and positively influences cost
• Supplier power positively influences cost
Price-Cost=Profit
Command higher prices through differentiation (the Ford Fusion– ¼ 2010
profits due to higher cost) or low cost (e.g., Dell Inc.– outsourced
components, sold direct instead of through resellers, low inventory, took
payment first and bought components later)
The Machine Model
Taylorism (1910s-1930s)
• 1911: The Principles
of Scientific
Management
• Before Taylor: Skilled
workers;work
autonomy
• After Taylor: simplify
and optimize job so
minimally skilled
workers could
perform it.
See:http://polaris.umuc.edu/~tgrodsky/admn601/managethought.htm
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The Human Relations Movement
• Elton Mayo and
Hawthorne (1924-32)
• Human Relations
Movement:
-Emphasis on people,
their thoughts and
feelings;
-People as more than
machines;
-Tolerance versus
authoritarianism;
-Importance of rest and
socialization.
The Legacy of the HR movement
• Greatest innovation: Managerial not
technical:
- Decentralization over hierarchy
- Focus on employees “brain power”
- Bonuses and employee profit
sharing
- Gave share to all employees when
co. went public (1957)
- open (cubicle) layouts; even supply
closets were kept open
- Fire the unethical
- Killed businesses if unprofitable
- 20% growth for nearly 50 years
Motivation Theory: A Brief Historical Tour
• What is motivation?
– A hypothetical construct: “a set of energetic forces that originate both within as well as beyond an
individual’s being, to initiate work related behavior, and to determine its form, direction, intensity, and
duration.” (Pinder, 1998: 71)
• Topic of classic inquiry. In management, earliest focus was on employee selection
• 1900-1925: Birth of behaviorism; focus on observable behaviors rather than inner motivational states.
Money combined with specific, challenging tasks were the work incentives of choice.
“The time has come when psychology must discard all references to consciousness;
when it no longer delude itself into thinking that it makes mental states the object of observation.”
John Watson (1913: 158)
• 1925-1950: Focus shifted to employee attitudes and measurement through surveys: attitudes of workforce
were seen as the road to motivation. Human relations were seen as important motivator beyond money.
• 1950-1975: Theoretical approach to motivation: focus on employee needs, cognition, and job
characteristics.
• 1975-2000: Dominance of theories: Organizational justice theory; Goal setting
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Managerial Scenario
John believes that motivating people is about recognizing that different
people are motivated by different things. Some people thrive when they
are in social situations. Others seem to really enjoy teaching and
mentoring others. And yet others like to be left alone; they are, as it were,
self-motivated.
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McClelland’s Need Theory
• The Need for Achievement
– Desire to accomplish
something difficult, rapidly,
and independently
• The Need for Affiliation
– Desire to spend time in
social relationships and
activities
• The Need for Power
– Desire to influence, coach,
teach, or encourage others
to achieve
Managerial Implication:
Consider each in the selection and
placement process. Slot the right
people in the right place.
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Managerial Scenario
John works at an auto dealership as a sales manager. He has decided to
adopt a no nonsense approach to motivating his team. Having been a
salesperson, he believes that what matters is salary/commission; good
relations with one’s supervisor; and good working conditions. The rest is
fluff.
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Herzberg’s Motivator-Hygiene Model
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Hygiene Factors
job characteristics associated with job
dissatisfaction
– Salary
– Supervisory relations
– Working conditions
•
Motivators
job characteristics associated with job
satisfaction
– Achievement
– Recognition
– Responsibility
Managerial Implication:
Recognize that the factors
related to dissatisfaction
are not simply the
opposite of those related
to satisfaction.
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Managerial Scenario
You notice that two of the managers at work seem to employ very
different approaches towards motivating others:
Jane: Likes to explain to people that if they work hard they have a very
good chance of success in terms of meeting their production goals; that
this success would mean that they will get the bonuses they are all hoping
for.
John: Likes to assume that he is working with grown-ups who didn’t need
to be spoon feed information about why they need to work towards
meeting production goals. He believes people are smart enough to realize
that meeting goals will mean better end-of-year bonuses.
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Expectancy:
“What are my
chances of
reaching my goal
if I work hard?”
Outcome 1
Performance
Goal
High Effort
Outcome 2
Outcome 3
Decision
To Exert
Effort
Low Effort
Instrumentality:
“What are my
chances of getting
various outcomes if I
achieve my goal?
Expectancy: “What
are my chances of
reaching my goal if I
slack off?”
Valence: “How
much do I value
these outcomes
?”
Outcome 1
Performance
Goal
Outcome 2
Outcome 3
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Managerial Scenario
• You increase the pay for everyone in your group by 2%, hoping this will
create a sense of equity and fair play. But instead of thanks you hear
grumbling and complaint… why?
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Equity Theory
A. An Equitable Situation
Other
Self
$2
= $2 per hour
1 hour
$4
= $2 per hour
2 hours
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Equity Theory
B. Negative Inequity
Self
$2
= $2 per hour
1 hour
Other
$3
1 hour
= $3 per hour
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Equity Theory
C. Positive Inequity
Self
$3
= $3 per hour
1 hour
Other
$2
= $2 per hour
1 hours
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Managerial Scenario
Have been asked to make cuts. Best solution: get rid of deadwood. Give
generous retirement packages.
- Just do it? Or explain in detail why and how of decision?
- Focus on objectively better retirement packages versus bring up
decision for discussion?
- Run potential of scaring employees with bad news about future
prospects, or shield them and let them work?
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Two Paths to Performance
Utility maximizers:
rational calculations of
self-interest; focus on
outcomes
People care about process, not just outcomes
Engagement: Involve people by asking for input
(communicate respect; sharpen understanding)
Explanation: Not just what, but why
(understanding builds commitment; enhances learning)
Expectation clarity: State clearly rules of game.
(what are new targets? Who’s responsible for what?)
Source: (Kim and
Mauborgne, 1997)
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Why don’t managers focus on procedural fairness?
• Managers think that they are fairer than they are perceived to be (“when
managing change, I make extra efforts to treat people with dignity and
respect”
• Managers think that employees only care about outcomes (e.g., size of
severance pay): but even employees who remain care about process.
• Legal departments: disclosure of information could invite lawsuits:
underway: allow doctors to apologize to patients?
• Fear and discomfort: avoidance over confrontation; internal guilt and
drama.
• Paternalistic attitude: shield the kids.
• Practical Implication? Inform and train managers; make process
fairness a top priority at top.
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Goal-Setting Theory
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Managerial Scenario
Your boss believes that motivating others is simple: Just set the right kinds
of goals. The problem is identifying which kinds of goals are best.
- Hard/easy
- General goals (do your best) or specific goals (I want a 3% improvement
in sales figures next month)
- Goals that stretch people beyond what they are capable of doing– even
if they fail, at least they will have tried…
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Locke’s Model of Goal Setting
Directing
one’s attention
Regulating
one’s effort
Goals
motivate the
individual
by...
Task
performance
Increasing
one’s persistence
Encouraging
development of goalattainment strategies
or action plans
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Managerial Implications: SMART Goals
Specific
Measurable
Attainable
Results oriented
Time bound
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Sears Auto
In early 90s: Specific,
challenging measurable goal:
$147/hr
“Goal setting process for service
advisers created an
environment where mistakes
did occur”
Sears’ Chairman Edward
Brennan
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The Ford Pinto: 1971-1980
• Lee Iacocca: build me a car
“under 2000 pounds and
under $2000.”
• Real cost? 53 deaths, many
injuries, $6 million lawsuit,
and costly hit to reputation,
1.5 million pintos recalled in
1978.
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Perverse Goals and The Deepwater Horizon Disaster
The focus on controlling costs
was so acute at BP, to the point
that it became a distraction.
They just go after it with a
ferocity that is mind-numbing
and terrifying. No one's ever
asked to cut corners or take a
risk, but it often ends up like
that.“
Oberon Houston, BP rig manager,
testifying to the presidential
commission
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Enron executives were meeting
their goals… but were they the
right goals (revenue vs.
profits)?
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Unanticipated (but lethal) Side Effects of Goal Setting
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Narrow focus that neglects non-goal areas
Rise in unethical behaviors
Distorted risk preferences
Corrosion of culture
Reduced intrinsic motivation
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But Goals can Run Wild
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Are the goals too specific?
Are the goals too challenging?
Who gets to set the goals?
Is the time horizon appropriate?
How might goals influence risk taking?
Might goals influence unethical and potentially even illegal behavior?
Can goals be tailored to individuals and still be fair?
How will goals influence team/organizational culture?
Given ultimate goals, ask yourself: are performance or learning goals
most appropriate?
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CSIKSZENTMIHALYI: (Chicks-Send-Me-High)
• A major constraint on people enjoying
what they are doing is always being
conscious of a fear of how they
appear to others and what these
others might think.
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FLOW: How it feels
• How does it feel to be in "the flow"?
Flashes of intense feeling against the dull background of life
• Completely involved, focused, concentrating - with this either due to innate
curiosity or as the result of training
• Sense of ecstasy - of being outside everyday reality
• Great inner clarity - knowing what needs to be done and how well it is going
• Knowing the activity is doable - that the skills are adequate, and neither anxious
or bored
• Sense of serenity - no worries about self, feeling of growing beyond the
boundaries of ego - afterwards feeling of transcending ego in ways not thought
possible
• Timelesness - thoroughly focused on present, don't notice time passing
• Intrinsic motivation - whatever produces "flow" becomes its own reward
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Finding Flow
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Finding Flow at Work
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Clear set of goals
Clear rules
Immediate feedback
Overcoming a challenge that is just about manageable; acts as magnet
for learning new skills
Managerial Implications:
- Make work like play.
- Deal with all the demands that crowd into the mind:
Make lists, flowcharts: which tasks to delegate, which to tackle
and in which order: “prioritize, organize, and streamline the
routines that now fritter away our attention”
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Maslow’s Need Hierarchy Theory
Managerial Implication:
The manager needs to
continually identify and fulfill
emerging or unmet needs;
new needs arise as old ones
are fulfilled.
Example: Wipro, a high-tech Indian
company, created a matchmaking
service on its company’s intranet to
help single employees date and
marry.
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Take-Away
• Motivation is a hypothetical construct; it is complex and has many
potential causes.
• Managerial levers for managing motivation:
– Intrinsic differences among people
– The power of goal setting
– Being explicit about the linkages between expectancy,
instrumentality, and valence
– The power of flow
– Motivation may drive performance; but performance can also
influence motivation
Caveat: Leaders play a special role in managing motivation; but they are
not the only actors who influence motivation.
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Theories of Motivation
• Content Theories
• Process Theories
– Identify the process by
which internal factors and
cognitions influence
motivation
– Identify internal factors
influencing motivation
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Maslow’s Need Hierarchy
McClelland’s Need Theory
Herzberg’s MotivatorHygiene
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Adam’s Equity
Vroom’s Expectancy
Goal Setting Theory
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Case 1
• A tale of two teams
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A Tale of Two Teams
Both teams face: Recent layoffs; tough competition; meaningful products
Team GC
- Matt and all team members ask tough
questions
- Reminds people of specific deadlines
- Explains why the task is worthwhile (adds
15 million dollars over three years to
company’s bottomline; they will get
bonuses, stock, and gratitude of company)
- Demanding, but provides immediate
feedback
- Matt is admired for fighting top
management on their behalf
Team HPLC
- Elaine doesn’t want to use potential
sales/profits to motivate; better to let
professionals work for the love of work.
- Team feels like they are working on a
losing product, but Elaine wants them to
work on it anyway given tough political
environment
- Elaine: I trust you; just do your best
- Team members don’t know if the work they
are doing will pay off
- Julio: in above his head?
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END CLASS HERE
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