Chapter Seven

Motivating and Managing People and Groups in

Business Organizations© 2007 The McGraw-Hill Companies, Inc., All Rights

Reserved.McGraw-Hill/IrwinIntroduction to Business

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Learning Objectives

1. Understand the nature and sources of work motivation and appreciate that motivation is under the voluntary control of an employee.

2. Describe five different theories of work motivation and identify how they work together to determine work motivation.

3. Identify the characteristics of groups and teams and distinguish between important types of groups and teams.

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Learning Objectives

4. Explain the factors that create high-performing groups and teams.

5. Identify the sources of organizational conflict and understand how bargaining and negotiation are used to resolve conflictsbetween people and groups.

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Motivation in Business Organizations

• Work motivation - the psychological force within people that

arouses their interest, directs their attention, and causes them to persist to achieve their work goals

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Voluntary Employee Behavior

Figure 7.1

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Maslow’s Needs Hierarchy Theory

• Maslow’s Needs Hierarchy Theory - a theory that specifies why and how people

try to satisfy their needs through their behavior at work

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Maslow’s Hierarchy of Needs

Figure 7.2

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Maslow’s Needs Hierarchy Theory

• Self-actualization - the desire for personal self-fulfillment, that

is, a person’s desire to become the best he or she is capable of becoming

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Expectancy Theory

• Expectancy Theory - a theory that argues that the motivation of

employees depends upon whether or not they believe that performing at a high level will lead to the rewards they desire

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Factors Affecting the Effort-to-Performance Linkage

• Employees’ past experiences provide them with information about how likely they are to succeed at a particular task

• Employees need to believe that nothing in the work situation outside their control will prevent their hard work from successful performance

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Factors Affecting the Effort-to-Performance Linkage

• Self-efficacy - the belief a person holds about his ability to

succeed at a certain task or in a particular situation

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Linkages in Expectancy Theory

Figure 7.3

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Question?

Which motivation theory argues that employees will be motivated to achieve a goal only if they believe they will be rewarded equitably relative to their co-workers?

A. Expectancy theoryB. Goal-setting theoryC. Equity theoryD. Job enrichment theory

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Factors Affecting Performance-to-Outcome Linkage

• Different employees value different outcomes differently

• Employees must believe that nothing in the work setting outside their control will prevent them from obtaining the valued outcomes they seek

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Factors Affecting Performance-to-Outcome Linkage

• Even if employees have strong effort-to-performance and performance-to-outcome expectancies, this does not guarantee they will be motivated to behave the way the company desires

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Goal-Setting Theory

• Goal-Setting Theory - a theory that suggests that if goals are to

motivate employees, they should be specific, challenging, measurable, results oriented, and have a specified timeframe for completion

See an example of a company’s financial goals

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Goal-Setting Theory

• Work goal - something specific an employee is trying to accomplish when doing a job

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Five Characteristics of Motivating Goals

Figure 7.4

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Why Goal Setting Increases Motivation

1. A goal directs and focuses an employee’s efforts toward achieving that goal

2. A goal motivates an employee to be persistent

3. Helps develop personal goal-attainment strategies that make employees more effective over time

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A Hierarchy of Company Goals

Figure 7.5

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Management by Objectives

• Management by Objectives - a work-performance review system that

involves setting specific and challenging goals and then reviewing employees’ progress towards achieving those goals

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Motivation through Goal Setting and Management by Objectives

Figure 7.6

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Stretch Goals and Job Learning

• Stretch goals - highly ambitious goals put in place to

motivate employees to perform at higher levels

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Equity Theory

• Equity Theory - a theory that argues that employees will be

motivated to achieve a goal only if they believe they will be rewarded equitably relative to their co-workers

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Equity Theory in Action

Figure 7.7

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Job Enrichment Theory

• Job Enrichment Theory - a theory that employees will be more

motivated if they have more control over the way they do their jobs

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Question?

What is motivating employees by expanding the range of tasks they do?

A. Job rotationB. Job enlargementC. EmpowermentD. Job replacement

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Job Enrichment Theory

• Job enlargement - motivating employees by expanding the

range of tasks they do

• Empowerment - expanding employees’ tasks and

responsibilities to allow them more freedom and autonomy over the way work is performed

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Job Enrichment Theory

• Self-managed teams - groups of employees who are given the

responsibility to supervise their own activities and to monitor the quality of the goods and services they provide

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What is a Group or Team?

• Group - a collection of people who follow similar

work rules and norms and work towards a common, specific, and measurable goal

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What is a Group or Team?

• Team - a group of people who are jointly

responsible for creating, managing, and changing work rules and norms to find better ways to achieve current and future goals

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Patterns of Interaction between Employees, Groups, and Teams

Figure 7.8

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Types of Groups and Teams

• Functional team - people grouped together by virtue of their

expertise, typically, by departments

• Cross-functional team - a group of people from a company’s

various functions who pool their talents to increase the organization’s efficiency and effectiveness

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Types of Groups and Teams

• Top management team - a group consisting of the top managers of a

company’s major functions or business units

• Virtual teams - teams whose members are connected by

e-mail, the Internet, instant messaging, wireless laptops, and video conferencing

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Why Do Employees Perform at a Higher Level When They Work in Groups?

1. When people work in teams, their shared identity and need for achievement can make them want to work harder

2. Groups and teams frequently monitor the performance of their members

3. Teams often facilitate the division of labor and specialization

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Conflict, Bargaining, and Negotiation

• Organizational conflict

- the discord that ensues when stakeholders thwart each other’s attempts to achieve their goals and objectives

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Types of Conflict

• Interpersonal - conflict between two or more people in a

company• Intragroup

- conflict that arises within a group, team, or department

• Intergroup - occurs between groups, teams, or

departments

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Sources of Conflict

• Incompatible goals• Complex task interdependencies• Incompatible reward systems• Scarce resources

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Sources of Organizational Conflict

Figure 7.9

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Resolving Conflict through Negotiation and Bargaining

• Negotiation and Bargaining - a technique managers use to increase the

chances that conflicting parties will reach a compromise

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Resolving Conflict through Negotiation and Bargaining

• Emphasize common goals• Focus on the problem, not the people• Create opportunities for joint gain• Focus on what is fair

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Video: The Container Store

• Garrett Boone, Co-Founder and CEO explains that the company’s operating philosophy of The Container Store can be captured in the following maxim: “1 great person = 3 good people.”

• What examples from The Container Store support Maslow’s motivational need for self-actualization?