Work Environments.docx

WORK ENVIRONMENTS Creating a Productive Work Environment Many managers believe they can increase productivity by adding robots, introducing information systems, or modifying production procedures. Managers know, however, that productivity and the achievement of total-quality management are not only a matter of computers and production systems but of people. Proactive managers under-stand that human resources and the motivation of people through effective leadership makes the difference between mediocrity and excellence. Recent data suggest that some industrialized countries, particularly the United States, have fallen far behind other nations in one measure of productivity, output per hour. (See Figure 14-1.) One way to address productivity problems is to focus on the impact of HR practices--selection, performance appraisal, and compensation, for instance--on productivity. A corresponding approach is to value employees, at all levels, as necessary contributors to organizational success. According to U.S. Labor Secretary Robert Reich, total-quality management flourishes where (1) there is an unusual reliance on front-line workers; (2) workers are treated as assets to be developed, not costs to be cut; (3) new forms of worker-management collaboration break down adversarial barriers; and (4) technology and work are integrated in such ways that machines serve human beings, not vice versa.' This chapter addresses the conditions that Reich sets forth. Before managers can address problems of organizational productivity, they must first understand the motivational bases of performance as well as the leadership skills required to motivate employees to increase their output. In this chapter we will examine selected approaches to motivation and leadership that research and practice suggest can help managers improve employee productivity. We begin by discussing motivation, including rewards systems, perceptions of equity, various employee involvement programs, and goal setting Later we will focus on various theories of leadership, including trait leadership, situational leadership, self-leadership, and transformational leadership. (Insert Figure 14-1: Annual Index of Manufacturing Productivity, 1991) Using Rewards to Motivate Managers have numerous choices in motivating employees to be productive. Quite often, a combination of strategies works best. Employee needs and organizational objectives will often determine which motivational technique to use. Rewards: The Key to Performance Rewards are an increasingly important motivational tool for any organization. According to a poll of 179 companies conducted by Total Quality and the Service Edge Newsletter, 94 percent reported having a reward and recognition program.2 Although rewards may include a wide range of incentives--paychecks, productivity bonuses, five-year pins, certificates, special vacations--rewards are not always effectively used to enhance productivity. For example, if pay raises are given simply for “showing up” for work rather than for increasing output, they will do little to motivate employees to work harder. in the language of the behavioral scientist, rewards such as these are not “performance-contingent.” According to two noted experts in this field, Fred Luthans and Robert Kreitner, whether employees maintain high productivity depends on how they perceive the consequences of their efforts. If they believe high productivity will be rewarded, they will be more likely to work to achieve it. For this reason, organizations should place considerable emphasis on rewards that employees perceive as desirable.4 Using Pay as a Reward One rather obvious reward for performance is pay and the various forms of incentive pay systems that we discussed in Chapter 11. Since pay can be a powerful incentive, those whose job includes establishing pay systems need to understand the effect of pay on motivation. Managers who understand this relationship are in a much better position to implement effective pay-for-performance systems. Foremost, pay is something that employees value, and its value may be best understood in terms of the different needs employees have. Abraham Maslow developed the hierarchy of needs, a theory of motivation that arranges five universal needs in order of priority: (1) physiological needs for food, water, etc.; (2) safety needs for physical and psychological security; (3) belongingness needs for love and inclusion; (4) esteem needs for self-respect; and (5) self-actualization needs, or the need to reach one’s potential.5 Pay is an important reward in part because it may satisfy several of these needs. It provides employees with the means to purchase food to satisfy their physiological needs; it allows them to afford shelter to satisfy their need for safety; and it enables them to meet their esteem needs, since pay is one measure of relative worth.6 In addition, there are four other important reasons for managers to implement effective pay-for-performance systems. First, pay serves to differentiate among employees. High-performing employees usually resent systems that reward everyone equally, and they may feel that there is no reason to stay with an organization that allows the less competent to “beat the system” by receiving the same reward with less effort or ability. By serving to differentiate among employees, pay strengthens feelings of equity, a topic discussed later in the chapter. Second, using pay as a reward makes the formal performance appraisal a significant event. Where there is no link between pay and performance, employees may see appraisals as nothing more than a perfunctory requirement of the HR department. Where pay is clearly based on performance, however, it is seen as an important consequence of effective performance, thus underscoring the importance of the appraisal process. Third, pay-for-performance can be an important means of allocating scarce compensation dollars. Even in difficult financial circumstances, organizations are well advised to retain merit pay for their high-performing employees. Not only will rewarding outstanding performance help retain the superior employees, it may also encourage the poorer-performing employees to leave the organization. Fourth, pay-for-performance can be used to encourage a culture of high productivity in the organization. Transforming an apathetic culture into one where productivity is highly valued can be a very difficult task. Effective motivational strategies, including using pay as a performance reward, can help to move the organizational culture in the direction of better performance. After all, pay affects every employee in the organization, so it has considerable potential to change the entire culture, one employee at a time.7 For example, Northern Telecom changed its organizational culture from one based on the job’s sophistication to one in which employees were paid on the basis of the number of skills they possessed. (See Chapter 10 for a more complete description of skill-based pay.) Employees were thus rewarded for acquiring a greater variety of skills, the plant gained flexibility in assigning work to employees, performance improved, and supervision requirements decreased because workers were more knowledgeable about their jobs.8 Using Other Rewards There are a variety of other rewards that are very important to employees and quite useful as a means of motivating performance. Simple feedback from managers serves as a valued reward. A survey conducted for the Council of Communication Management indicated that recognition for a job well done is the top motivator of employee performance. For feedback to be most effective, however, it should be face to face and it should be immediate rather than delayed. Also It should be positive. A high amount of feedback is better than a low amount, since a low amount of feedback conveys low confidence in the subordinate and may even anger the employee. Positive feedback follows the principles advocated in reinforcement theory, which states that behavior is contingent upon reinforcement. In other words, when reinforcement (rewards) follows performance, performance improves. The-process of influencing behavior through reinforcement is known as operant conditioning. There is general agreement among behaviorists that positive reinforcement is the most effective way to motivate and modify behavior. It is an especially useful approach in organizations where a wide variety of positive reinforcers are available to managers and supervisors. Several forms of positive reinforcement are discussed below. Using Awards Programs to Motivate What do organizations such as Whitestone Products, Delta Machinery, the City of Atlanta, and Diamond International Corporation all have in common?12 Each has one or more successful employee awards programs. An example of such a program is provided in Highlights in HRM 1. These programs can include many different awards, such as certificates or gifts of jewelry, crystal, or blazers. Besides these traditional awards, novel and unexpected rewards can be offered. For example, some organizations may find the following useful for encouraging higher levels of performance: Workplace visits by top executives to high-performing employees Surprise announcements of afternoons or days off Trophies, wall plaques, certificates, or pins for exceptional performance Letters to the spouse commending the employee’s performance Personal handwritten notes of thanks accompanying paychecks Invitations to lunch by managers Achievement decals for hats or cloth badges for jackets Small cash awards Telephone calls by top executives to employees at home13 It should be remembered that, if awards are to be effective, they must be given only to those employees who have performed well. In other words, they must differentiate the mediocre performer from the high performer. Furthermore, to be effective, such programs must ensure that the award is valued by the employee. Research shows awards have less effect when they are given as part of a regular meeting or sandwiched between departmental activities. Special occasions--annual dinners and award meetings--are required if awards are to be perceived as anything more than an afterthought. Figure 14-2 provides additional suggestions for ensuring an effective award system. Figure 14-2: Making Awards Count for Employees 1. Tie awards to employees' needs. Managers must get to know their employees well enough to understand their needs. 2. Make sure an award is large enough to have symbolic value. A $25 increase in the monthly paycheck may go unnoticed. A $300 bonus check is more likely to get an employee's attention. 3. Proper timing is important. Schedule the presentation of the award close to the time the award was announced. 4. Attend the awards presentation. The manager’s presence shows the importance of an awards ceremony and thus of the awards themselves. 5. Talk up the value of an award. Pointing out the benefits of the award helps to make it more meaningful. 6. Make certain the presenter is someone the employees respect 7. Use a public forum for the presentation. Schedule a special event to highlight the importance of the award. 8. Set high standards for the awards, and make them contingent upon meeting or exceeding those standards. 9. Increase the exclusiveness of an award. Awards received by fewer employees are valued more highly. 10. Do not oversell the award. Attempting to make a weekly sales bonus seem tremendously valuable only makes the award look meaningless. 11. Clearly establish the goals you want to achieve with the awards program and make sure those goals coincide with your overall objectives. Equity Theory and Motivation A basic principle in HR management is equity. Employees expect that what they give to the organization will be equivalent to what they receive from it. When things are out of balance, employees will take actions to bring them back into balance. Equity theory is the motivation theory that explains how employees respond to situations in which they feel they have received less or more than they deserve. The theory states that feelings of inequity will motivate a person to reduce inequity.15 Theory of Inequity Adams's version of equity theory is perhaps the most extensive and explicit.16 It is a general theory of social inequity. Central to the theory is the role of perception in motivation and the fact that individuals make comparisons. It states that individuals form a ratio of their inputs in a situation to their outcomes in that situation. They then compare the value of that ratio with the value of the input/outcome ratio for other individuals in a similar class of jobs. If the value of their ratio equals the value of another’s, they perceive the situation as equitable and no tension exists. However, if they perceive their input/outcome ratio as inequitable relative to others', this creates tension and motivates them to eliminate or reduce the inequity. The strength of their motivation is proportional to the magnitude of the perceived inequity. Perceived Inequity Employees may develop feelings of inequity for a variety of reasons, the most obvious of which is pay. If employees believe they give more effort, but know they are paid less than the person with whom they compare themselves, they will feel that the organization is treating them inequitably. Older, more experienced employees who believe that younger employees are receiving more than their fair share of compensation will feel that they are being treated inequitably. An employee who believes it is her turn to have the day off may resent it and perceive inequity when the day off is given to another employee. Reactions to Inequity When faced with perceptions of inequity, employees handle it in a variety Of ways. They may behave in one or more of the following ways: Sabotage the work process Reduce the amount of effort they put into their work Seek more pay to achieve equity because of their perceived larger contribution Quit their job or increase their absenteeism, thereby avoiding the situation or the person that is the source of their feelings of inequity Try to persuade their fellow employees to reduce their effort Cognitively reevaluate original estimates of inputs and outcomes Employees may also decide to compare themselves with yet another person thus reducing the perceived inequity of the earlier comparison. Some of these means of reducing inequity can be particularly damaging to an organizatiofl. & 14 Motivation and Leadership 509 One way for an employer to m.inimiz~ feeli~gs otl~~i.ty in its employees is through a fair compensati6n plan. Suc~ p~ans are' ~i~u~din detail in Chapter 10 on compensation. Managing Equity That inequity can lead to productivity problems for the organization is ample reason for managers to address perceptions of inequity and unfairness, beyond the usual compensation plans. Recognizing the need to address unfairness in a variety of managerial settings, one senior vice president of a Fortune 500 firm stated, "What's fair is whatever the workers think is fair. My job is to convince them that what's good for the company is fair for them as individuals." Common techniques managers use to ensure equity in the workplace include (1) announcing all pay raises and promotions, (2) explaining how pay raises are determined, (3) allowing workers to participate in decisions, and (4) explaining why work assignments are made. Other means of addressing inequity and unfairness include the following: Emphasizing equitable rewards for employees Recognizing that the basis for perceived inequity is comparison with others Listening carefully to employees to understand the basis of comparisons Responding to employees individually Letting employees know of the contributions of others Describing employees' current accomplishments in relation to their earlier accomplishments Accurately describing the outcomes for specific levels of performance Using public meetings to recognize employees1" Expectancy Theory and Motivation Expectancy theory of motivation has developed from the work of psychologists who consider humans as thinking, reasoning persons who have beliefs and anticipations concerning future life events. This theory argues that the motivational force to perform (effort) is a function of the expectancies that individuals have concerning future outcomes times the value (valence) they place on these outcomes. Victor Vroom defines an expectancy as a "momentary belief concerning ~I8 the likelihood that a particular act will be followed by a particular outcome. Thus beliefs that "hard work will lead to desired promotions" and "studying hard will result in good grades" are expectancies. Valences are the positive or negative values people place on outcomes. One application of expectancy theory is in predicting behavior in situations where choices are made. For example, it can be used to predict whether to expect large or minimal effort on a task and whether to expect an employee to quit or stay. Vroom's work has been extended by two organizational behaviorists, Lyman W. Porter and Edward Lawler. Their theoretical model is illustrated in Figure 14-3. According to their theory, the amount of effort or energy expended by 510 PART 5 Creating a Productive ~~rk Environment mr'I'I~IIEp4~r,I - A A Source: Adapted from Porter and Lawler's original model as published in LW. Porter and Edward E. Lawler, Managerial Attftudes and Performance (Homewood, Ill.: Irwin-Dorsey, 1965). Used with permission. Niotivation and Leadership 511 mance from their employees. Another is enhancing employee involvement. Increased employee involvement in organizations has become the charge of many managers and the hope of numerous self-motivated employees. Although a variety of programs have been developed to involve employees more fully in their organizations, all of these programs have one common ingredient: participation. They increase the degree to which employees participate in making critical job or organizational decisions. Increased employee participation in decision making offers a number ofadvantages, including stronger commitment to the organization's goals, better understanding of the decisions made in the organization, and improvement in the quality of the decisions themselves A more extensive list of the advantages of greater employee participation is provided in Figure 14-4. To achieve these advantages, three general ways to increase employee involvement and participation are proposed: (I) adopting suggestion systems, including employee involvement groups; (2) fostering job involvement through work teams; and (3) building individual commitment to the organization through employee improvement.19 Adopting Suggestion Systems The oldest and still most widely used employee involvem~nr ~y~t~m i~ t~e ~~gge£ tion system, which can take various forms, as shown in Highlights in HRM 2. The traditional suggestion system, to be discussed in Chapter 15, is one of the ways to ensure upward communication in organizations. However, suggestion sys tems are also an important means of motivating employees by involving them in the decision-making and reward systems of the organization, assuming that management takes its employees' suggestions seriously.20 Gainsharin~ Suggestion Systems Programs that reward employees for their suggestions are a part of organizational gainsharing systems, so called because employees share in the gains that result 512 PART 5 Creatii~g a Pr~)d~ctI\e \~ui k Envirun m"nL 1. 2. 3. 4. 5. 6. 7. 8. Fosters consensus decision making Creates a greater knowledge base from which to gain ideas or resolve organizational problems Develops a team approach to complete workplace tasks Encourages self-training for workgroup members Improves understanding and acceptance of group decisions Improves QWL by meeting employee needs for involvement, achievement, and acceptance Creates greater commitment to the organization's vision and mission Ensures employee criticism with a constructive orientation from their suggestions. Such systems can have considerable impact on organizational productivity. In its pursuit of market leadership, Herman Miller, Inc., a manufacturer of office furniture, realized $36 million in productivity gains and cost savings from its gainsharing suggestion system.21 Gainsharing plans are discussed fully in Chapter 11. Employee Involvement groups (Els) Employee Involvement Groups 4 Groups of five to ten employees doing similar or related work who meet togethe~ regularly to identify, analyze, and suggest solutions to shared problems are often referred to as employee involvement groups (Els). Also widely known as qualit~ circles (QCs), Els are used principally as a means of involving employees in the larger goals of the organization through their suggestions for improving product or service quality and cuttin~ costs.22 Generally. Els recommend their solutions to management, which decides whether or not to implement them. The employee involvement group process, illustrated in Figure 14-5, beginl with El members brainstorming job-related problems or concerns and gatheri~ data about these issues. The process continues through the generation of solu' tions and recommendations that are then communicated to management. If t~ solutions are implemented, results are measured, and the El and its members af usually recognized for the contributions they have made. Els typically meet fo~ choS~~ or more hours per month, and the meetings are chaired by a group leader from the group. The leader does not hold an authority position but instead serV~ as a discussion facilitator. Organizations must do considerable planning to ensure the effective perfor6:~ mance of employee involvement groups. Implementing the El process us ua11Y4 requires the appointment of a project manager. Though this role is sometirfl~ filled by an outside consultant, a better choice may be an insider from the ~ department who understands the organizational culture and knows which employees are good candidates for membership in the group. Successful users Els have also found it necessary to appoint an advisory committee, composed O( I,.. 513 Motivation and Leadership 2 ORGANIZATION OF A SUGGESTION PROGRAM Sou'ce: David G. Carnevale and Brett S. Sharp, The Old Suggestion Box: An Undervalued Force for Productivity Improvement, Review of Public Personnel Administration 13, no.2 (Spring 1993): 85. Copyright 1993 by the Institute of Public Affairs, University of South Carolina. All rights reserved. 514 PART5 Creating a Productive Work Environment Source: The Family and Relationship Center, 7946 Ivanhoe Ave., Suite 201, La Jolla, Calif., 92037. anagers,t oc oordinatet heE lp rocessa crossd epartments,e valuater ecommendations,m anagei mplementationo fc ontributions,a ndr ecognizee mployeesa ndE lst hath avem ades uccessfulc ontributions.I na dditiont ot hea dvisoryc ommittee,E ls upports taff( usuallyf romt heH Rd epartment)m ustp rovidet rainingt oE lm embersi np roblems olving,s tatisticalq ualityc ontrol,a ndg roupp rocesses.A lthoughE lsh aveb ecomea ni mportanto rganizationals uggestions ystem,t heya ren otw ithoutt heirp roblemsa ndt heirc ritics.F ore xample,E lsc ang os tale.S everalw aysh aveb eens uggestedt ok eepE lsf resha ndt or evivet hemw henn ecessary.F irst,m anagerss houldr ecognizet heg roupw hena r ecommendationi sm ade,r egardlesso fw hethert her ecommendationi sa dopted.T hisa pproache ncouragest heg roupt oc ontinuec omingu pw ithi dease venw hent heya ren ota lli mplementedb ym anagement.S econd,p eriodicr ecessess houldb ~p lanned.A ftera g rouph ass pentw eeksw restlingw itha p articularlya ndd ifficultp roblem,i tsm embersc anb ee xhausted.A r ecessi sn ee~e4~ v enatet heg roup.I ns omec asest hisb reakc anb eu sedf orr etraining' thf ieldt ripsc ana llowa g roupt ov isito therp artso ft heo rganization,l earningp roblemsa red ealtw itht herea ndg ainingn ewi nsighti ntoo ldp roblemst heg roupf acesi ni tso wna rea. Motivation and Leadership 515 CHAPTER 14 Organizations have often modified the traditional El process to fit their ~WLn particular organizational needs. For example, some organizations have found that voluntary Els have not always proven successful. They have found that the El process is most successful when natural work groups are used rather than bringing together employees from different work groups. Other organizations have found that Els run out of ideas, and management must feed them ideas to keep the process going. Still other objections to Els come from their basic design. Some critics argue that Els do not fundamentally change the organization in which they are established. As a form of suggestion system, they may work well, but they do not alter organizational culture. Therefore, these critics argue, employees who participate may realize the benefits of participation, but most employees, who are not included in Els, are unaffected by their efforts. Furthermore, employers may not achieve all of the benefits attributed to Els. In one study, employees participating in Els had no more positive attitudes over time 23 than those involved in a control group. Fostering Job Involvement Job involvement, another means of designing work for employee involvement, is the degree of identification employees have with their jobs and the degree of importance they place on their jobs. Among the approaches used to increase job involvement are job redesign and the use of work teams. Job Redesign Two-factor theory II ~I I lIlt flIt II l\ II 1(111 II It) ~, lit I lt~I Ii ft~t it~tl l)\ II\~l Ii Work team ll~ I I It It I ('I t~l tt III) I ii liii ili,tii i~tI it lii, l~ i (I I t~t I I I it t1iiliij~ 11cr Iii 111.1 flCc rc\ l&j\t~~ The aim of job redesign is to enrich a job so that the employee is more motivated to do the work. This approach usually builds increased autonomy and feedback into the job, adds tasks to the job, and increases the number of skills required to complete the work. One of the earliest theories associated with such job redesign was Herzberg's two-factor theory, which identified two sets of factors in organizations: extrinsic factors like pay and working conditions, which Herzberg called hygiene factors, and intrinsic factors like job challenge and responsibility, which he called morivators.24 Herzberg's motivators have a parallel in Maslow's self-actualization needs, and it is these factors that bring about the kind of improvement in performance that management seeks. Despite lingering questions about tIi~ vdIidity uf tuc two-factor thcory, it i~ ~tilI the stimulus (or consider2~Ie con-cern with job design, discussed fully in Chapter 4~25 Work Teams Another approach to increasing employee job involvement-the work team-focuses on the work group as the primary unit of involvement. It creates group goals, and it compensates employees, at least in part, on the basis of group accomplishment of these goals. The approach also seeks to make all members of the work group share responsibility for the group's performance. Furthermore, decisions are decentralized to the level of the work team.26 For example, a work team at a Procter & Gamble manufacturing plant may be partly responsible for deciding how many units to produce, making decisions about assignment of tasks, setting prices if working as a product team, making its own quality-control checks, 516 PART 5 Creating a Productive Work Environment and also setting inventory levels. In contrast with gainsharing and Els, work teams involve changes in job design and organizational design, thereby affecting more employees and making a longer-lasting impact on the organizational culture and the employees. Work teams are based on sociotechnical systems theory that advocates jointly combining the social and technical components of the work environment. Employee training and skill enhancement emphasize both technical knowledge (e.g., task performance) and social skills (e.g., interpersonal relations, communication). The group, rather than the individual, becomes the focus for performing the job. Inherent in work teams is the notion that the group is the logical work unit to apply resources to resolve organizational problems and concerns. Work teams are championed to improve organizational productivity while simultaneously enhancing the quality of work life for employees.27 A description of the use of work teams in provided in Highlights in HRM 3. At General Foods, as well as Procter & Gamble, Steelcase Inc., Federal Express, and others, the benefits of work teams have included more integration of individual skills, better performance in terms of quantity and quality, reduced turnover and absenteeism, and a growing sense of confidence and accomplishment among team members.28 Despite successes in the use of work teams, there are difficulties, including substantial start-up costs. In some cases, whole plants must be built from scratch or significantly redesigned for the efficient use of the work-team approach. Furihcrtnorc, the technology of the nrg~nization may make the use of work teams very difficult or even impossible. For successful implementation of this approach~ the work should be of the kind that no one individual can do alone or do as well as a team. For example, teams are appropriate in process production facilities such as chemical plants, and they are appropriate to some activities in service areas such as airlines or customer service operations. In adopting the work-team concept, organizations must address several is sues that could present obstacles to effective team function, including expectations, compensation, continuity, career movement, and power. For example, new team members must be retrained to work outside their primary functional areas, and compensation systems must be constructed to reward individuals for teart' accomplishments. Because of the integration of the team members, continuity in membership is critical. Thus employees may be asked to make a three- to five-year commitment before joining a team, or team members may be chosen frort' older, less mobile employees. Since team membership demands ~0~~~generaI skills and since it moves an employee out of the historical career path, new ca' reer paths to general management must be created from team experience. FinallV'~ as the team members become capable of carrying out functions such as 5~~~tegiC planning that were previously restricted to higher levels of management~ ~afl' agers must be prepared to utilize their newfound expertise. Another difficulty with work teams is that they alter the tradittofl81 manager~employee relationship. Managers often find it hard to adapt to the ro of leader rather than supervisor and sotnet~m~s; ~ threatened by the gro~ power of the team and the reduced power of~tn~nagement. Furthermore, employees may also have difficulty adapting to a role that includes tradttlofl supervisory responsibilities. A difficulty with work teams is that they must be ~ corporated into the organization's strategic planning process. Since work tea~:3. 517 Motivation and Leader~hip 3 PEAK PERFORMANCE THROUGH TEAMWORK AT GENERAL FOODS nlgnllghts General Foods has adopted work teams as a strategic approach to maximizing productivity and promoting high performance among its employees. The groups are called TMinterfunctional work teams." Achieving peak performance is based on (1~ a strong commitment to high levels of performance, (2) collaboration and support among group members, and (3) a strong sense of ownership and responsibility for the results of the team effort. Team members are expected to go beyond the functional contribution they normally make as accountants, marketing specialists, etc. For example, the financial member of the Minute Rice team is expected to contribute to advertising, strategic planning, package design, product quality, and financial structure of the product. General Foods has sought to emphasize five elements in achieving peak performance: 1. Goals. Team members must collaborate to set clear goals, which are to be based on the mission of the strategic business unit. ~ Roles. Individuals bring diverse roles to the group, but interdependence is essential; team members must develop a common vision of the expected accomplishments of the team. 3. Leadership. The team leader must retain a multif unctional outlook, establish a positive working climate for team members, and obtain resources for the team. 4. Team relations. Team members must openly communicate their expectations of each other; interpersonal team processes must be frequently addressed. 5. Rewards. Rewards are provided for team members as a group, and the team is encouraged to celebrate its accomplishments during the life of the project. do alter the organization structurally, they must be taken into account when organizatIonal ~L[d~cgic5 an~ t,,ctic~ are ~eing e~rahlished. HR mana~ers can play an active role in the strategic planning for work-team implementation by incorporating work-team changes into managerial career ladders, introducing relevant organizational development tactics, and planning for necessary managerial and team-member training. Finally, empirical studies of work teams suggest that teams are greater contributors to organizational performance when they operate under open and unrestricted access to information, when team membership represents diverse job functions, and when a team has a sufficient number of members to accomplish its effectiveness.~ Team members achieve their greatest value when participation is valued and viewed as important to success. 518 PART5 Creating a Productive ~brk Environ inent All types of organizations have successfully empowered their employees. Examples come from organizations as diverse as Cigna Health Care, DuPont, PPG Industries, Wal-Mart, General Dynamics, the State of Illinois, Colgate-Palmolive, AT&T, Magma Copper Company, and Mesa Community College. Empowered employees have made improvements in product and service quality, reduced costs, and modified or, in some cases, designed products. At Chrysler Corporation, one employee working for Chrysler Financial designed a self-calculating branch cash system that saved the corporation $525,000 annually. The employee's creation was designed at home on her personal computer. Scandinavian Airline Systems (SAS) places customer service and reservation employees at the top of their organization chart-above managers. This arrangement grants power to those individuals responsible for performing critical job functions. Employees are encouraged to be creative, sensitive, and attentive to customer service needs and to accept responsibility for their own actions. Herman Miller, Inc., a manufacturer of office furniture, expects its employees to participate with managers in discussions involving product quality and service. Herman Miller prides itself on a corporate culture regarded as highly egalitarian. Avon Products empowered its minority managers to improve sales and service in inner-city markets. Grounded in the belief that minority managers better understand the culture of inner-city residents, Avon turned an unprofitable market into a highly productive sales area. Johnsonville Foods, a small, family-owned sausage manufacturer, allows employees to hire and fire one another, to select and purchase needed equipment, and, generall~ to act as their own bosses. The State of Kentucky allowed public school teachers to have more control over public school administration. This change represented a dramatic shift in power from school boards to governing councils formed by teachers, who now have the authority to direct policy in education, including curriculum issues. Source: Se',eraI examples were selected from Stephen P. Robbins, Organizational Behavior: Concepts, Controversies and Applications, 6e, copyright 1993~ pp. 6a1-8z. Aaaptea DY permissiwi ur Pi~ti~"-Hell, r:nglewood cliffG, New Jerq.~v. ncouragingE mployee~ i~ipow~r~;rnefltT hef inalm eanso fi ncrea8in~~ p'loVeei nvotvementi nt heo rganizatiofli st hroughe mployeee mpowerment,a m ethodo fi nvolvinge mployeesi nt heirw or~t hrougha p rocesso fi nclusion.( SeeH ighlightsi nH RM4 .)L ikej obi nvoIve~m ent,e mpowermente ncouragese mployeest ob ecomei nnovatorsa ndm ~nage~o ft heiro wnw ork,a ndi ti nvolvest hemi nt heirj obsi nw ayst hatg ivet hernt t'ore Motivation and Leadc~ship 519 control. Ann Howard from Development Dimensions International defines empowerment as "pushing down decision-making responsibility to those close to internal and external customers." To support high involvement, organizations must share information, knowledge, power to act, and rewards throughout the workforce.3C While defining empowerment can become the first step to achieving it, in order for empowerment to grow and thrive, organizations must encourage these conditions: Participation Innovation Access to information Accountability Employees must be encouraged to take control of their work tasks. Employees, in turn, must care about improving their work process and interpersonal work relationships. The environment must be receptive to people with innovative ideas and encourage people to explore new paths and to take reasonable risks at reasonable costs. An empowered environment is created when curiosity is as highly regarded as is technical expertise. Employees must have access to a wide range of information. Involved individuals make decisions about what kind of information they need for performing their jobs. Empowerment does not involve being able to do whatever you want. Empowered employees should be held accountable for their behavior toward others, producing agreed -upon results, achieving credibility, and operating with a positive approach.3t Additionally, employee empowerment succeeds when the culture of the organization is open and receptive to change. An organization's culture is largely created through the philosophies of senior managers and their leadership traits and behaviors-the subject we will discuss next. Effective leadership in an empowered organization is highlighted by managers who are honest, caring, and receptive to new ideas and who exhibit dignity and respect for employees as partners in organizational success. Goal Setting in Employee Involvement The setting of work goals can have a significant impact on the motivation and performance of employees. Why is goal setting so motivational? The answer lies in the effect goal setting has on individual behavior. Goal setting has four motivational influences: (I) goals direct our attention to what is relevant and important; 520 PART 5 Creating a Productive Work Environment (2) goals regulate effort (e.g., they motivate us to act); (3) goals increase our persistence in expending effort over extended periods of time; and (4) goals encourage us to develop strategies and action plans.32 Furthermore, setting goals is an employee involvement technique and is therefore compatible with employee involvement groups, work teams, and empowerment. Goal-setting theory is generally associated with Edward Locke, who has demonstrated the effect of goal setting on individual performance. His major proposition, which has been supported experimental~, is that those employees who set or accept harder goals perform at levels higher than those who set or accept easier goals. Goal setting provides the foundation for management by objectives (MBO), a technique for managing the goal-setting process in organizations. (MBO is discussed in Chapter 9.) Edward Locke and Gary Latham have demonstrated that the most reliable effect of goal setting is to raise productivity or improve work quality. But there are a variety of other benefits from goal setting, including the clarification of objectives, the stimulation of competition, relief from boredom, employee satisfaction with performance, pride in achievement, and increased willingness to accept future challenges. In compar~ng goal setting with other motivational techniques, Locke and Latham conclude that "any given technique will be effective to the degree that it generates or is associated with the setting of specific, challenging goals and/or the degree to which it enhances commitment to those goals."33 Motivation through Effective Leadership It is appropriate to discuss motivation and leadership together since leadership is a key variable in achieving employee motivation. And motivation, in turn, is related to leadership styles. It is the combination of leadership and motivation that produces a productive work environment. Leadership has been defined in numerous ways, but it is usually seen as the influence exerted by one individual on a group of persons to accomplish some goal.34 In organizations, leadership is usually associated with the influence that a manager exerts in the accomplishment of goals associated with the productivity of the organization. Thus effective leadership in managers may be viewed as a means of motivating employees to improve their performance. Since a major concern of managers is to improve employee performance, it is not surprising that the study of leadership has been of such interest to them.35 P Identification of Effective Leadership Traits ~aIte of Ieader8 In the first half of this century, more than 100 studies attempted to identify traI~s pf ~eaders. These studie~ undertook to verify the belief that certain charact~i~ Ic~ possessed by leaders are not pos~essed by nonleaders. Such research has held great interest for HR professionals, since identification of specific leadershiP traits could facilitate the selection and training functions of HRM. ~anagers could be selected who possessed certain leadership traits, or managers lacking such traits might be able to develop them. Motivation and Leadership 521 Early research studied such traits as intelligence, initiative1 persI.st¶nce1 self-confidence, and desire for control. In his 1948 revi~w of the~~~4ie~ Rp1~ Stogdill found a consistent pattern of support for only five traits: (1) ~ntefligence, (2) scholarship, (3) dependability, (4) social participation, and (5) socioeco 'p nomic status. Therefore, he concluded, "A person does not become a leader by virtue of the possession of some combination of traits. "36 Despite the failure of early studies to identify a consistent set of traits that effective leaders possess, the research has continued. However, behavioral scientists today use a greater variety of measurement procedures and focus more directly on organizational managers rather than on other types of leaders, such as military leaders. Furthermore, today's research looks at traits of leaders in terms of the process of leading. Cadbury Schweppes, a long-time user of assessment centers, has developed a trait profile of the competent manager for its operations. The traits include vision, drive, sociability, persuasive skills, delegation skills, teamwork skills, analytical ability, organizing skills, and personal factors such as integrity and ambition. Interestingly, social science research has provided results that are somewhat consistent with Cadbury's experience. In fact, social scientists have identified four traits - emotional stability, action orientation, interpersonal skills, and cognitive skills as consistently associated with organizational leaders. These research findings, as well as Cadbury's experience, provide considerable opportunity for HR professionals. For example, this information may be used as a starting point in any organization for developing an organization-specific leader profile that can be used as a basis for selection, training, and employee appraisal. Finally, the single trait charisma is increasingly discussed as a characteristic of effective leaders.37 Charismatic leaders are heralded as business heroes-reviving failing companies, starting new enterprises, or instilling a spirit of renewal into stagnant organizations. Charismatic leaders are typically able to inspire extraordinary performance in followers as well as to build trust and faith in themselves as leaders. They often achieve success by incorporating their followers' dreams and aspirations in their own vision of success. As noted by two authors, charismatic leaders "develop creative, critical thinking in their followers, provide opportunities for them to develop, welcome positive and negative feedback, recognize the contributions of others, share information with followers, and have moral standards that emphasize collective interest."38 McClelland's Managerial Motivation One modern approach to explaining the traits of leaders has focused on the motivations that managers must possess to be successful. This research has used the Thematic Apperception Test (TAT), a projective test, to reveal the strength of three motivations, or needs, in particular: needs for achievement, power, and affiliation.~ The need for achievement is prominent among successful executives. These individuals generally perceive themselves to be hard-working persons who need solid accomplishments in order to feel satisfied. Executive positions typically give them the challenge they need. Some of the characteristics of those with high achievement motivation are preference for moderate risk, persistence, as- 522 PART 5 Creating a Productive Work Environment sumpt ion of personal responsibility for performance, need for performance feedback, and innovativeness.40 Studies have shown that achievement-motivated people prefer tasks of moderate levels of difficulty. Thus a supervisor must structure jobs and assign them to people who see their odds of acceptable performance as neither too low nor too high. Needs for power and affiliation also characterize those who are successful managers. The need for power is important to managers since they must exercise control and influence over their subordinates, peers, and superiors. McClelland has been careful to describe the need for power among leaders as a need that must be constrained. That is, the need for power must be such that it is satisfied through accomplishments associated with reaching organizational goals. Thus, power is important for leaders as a means of achievement rather than as an end in itself. The need for affiliation must also be constrained. A moderate need for affiliation will enable managers to socialize sufficiently to accomplish their tasks, and it will orient them toward the needs of their subordinates, thereby facilitating the motivation of employees. Identification of Leadership Behavior Despite some recent success with the trait approach to leadership studies, early dissatisfaction with it had led instead to the analysis of the behavior of managers. Rather than focusing on the traits of successful managers, this approach emphasized the behavior that facilitates effective interaction of work-group members. Employee-Centered and Production-Centered Leadership In the late 1940s, the Survey Research Center of the ~niversity of Michigan em-barked on a program to determine how leader behavior affected work-group performance and employee satisfaction. One of the major findings of these early studies was that production-centered supervisors, those concerned primarily with production, are less effective in terms of measurable productivity than employee-centered supervisors, those who give their attention to the people who do the work. Even in these early studies, it was found that employee~centered supervisors were production-centered as well, exhibiting concern for high performance goals and enthusiasm for achieving them. The third type of leadership under investigation by the Michigan researchers was participative leadership. In early studies at the university, subordinates who had participative leaders exhibited higher work-related satisfaction and performance.41 Consideration I ti ~~CS ~ ~ \\ '~t) Consideration and Structure At the ~ame time the Michigan studies were underway, researchers at Ohio State University were studying two major dimensions of supervisory behavior~con sideration and initiating structure. Consideration, like employee orientation in the Michigan research, includes leader behaviors that encourage mutual trust, respect, and warmth between leaders and their work-group members. ~~itiating Motiva~ion and Leadership 523 I structure, like production orientation in the Michigan studies, includes leader behaviors such as organizing activities, defining the role of work-group members, and assigning tasks to get the work done. Considerable research has examined the effect of the task and relationship orientations of leaders. Results of questionnaire-based as well as case-based research have demonstrated that at least a moderate degree of both orientations is desirable in a leader. It is therefore important in developing more satisfied and productive employees that managers focus on training that encourages both behavioral dimensions of leadership. The Leadership Grid. Perhaps the most prominent behavioral-styles model of leadership is the Managerial Grid (renamed the Leadership Grid in 1991). This model has been very popular as a basis for training managers and supervisors.42 The grid, shown in Figure 14-6, expresses the relationship between concern for people and concern for production. By referring to the grid and identifying their own behavior in the two areas of concern, managers and supervisors are better able to understand the approach they use with their subordinates. Developers of the grid, Robert Blake and Jane Srygley Mouton, emphasize that the 9,9 style of leadership (Team Management) is the best, regardless of the situation. The grid itself, however, only provides the conceptual framework. It must be implemented through participation in seminars if it is to be effective. In the seminars, managers and supervisors learn to identify personal and organizational changes that are necessary and to become more effective in their interpersonal relationships and their work groups. Situation-Based Theories of Leadership Despite some support for the revised leadership-trait approach and the leadership-behavior approach, the research has proved inconsistent and inadequate. While leaders may possess certain traits such as achievement motivation and may be more successful if they have both a production-centered and an employee-centered orientation, there was a growing realization that successful leaders behaved differently according to the demands of the situation. From this realization, several situation-based theories of leadership have emerged. Path-Goal Theory Path-goal theory views the leader's role as being to motivate the employee by increasing the employee's payoffs for achieving work-related goals. The payoffs include a variety of rewards that we discussed earlier in the chapter. The leader acts to increase an employee's payoffs or rewards by clarifying work-related goals, reducing roadblocks to the goals, and increasing the degree of personal satisfaction that the subordinate feels about accomplishing the goals.43 Path-goal theory is based on the expectancy theory of motivation, discussed earlier in the chapter. According to the theory, an employee decides how much effort to invest in a task on the basis of the likelihood that the effort will accomplish the task and the likelihood that accomplishment will lead to some 524 PARTS Creating a Productive Work Environment High 9 1.9 Country Club Management 8 Thoughtful attention to the needs of people for satisfv'ing relationships leads to a comfortable, friendly 7 organization atmosphere and work tempo. 6 9.9 Team Management Work accomplishment is from committed peopIG; interdependence through a "common stake" in organization purpose leads to relationships of trust and respect w LL z = w z 5 4 Middle-of-the-Road Management 5.5 Adequate organization performance is possible through balancing the necessity to get out the work with maintaining morale of people at a satisfactory level. 3 Impoverlabed Management Exertion of minimum effort to get required work done is 2 appropriate to sustain organization membership. 1.1 1 Low ,.~Authodty-Compliance Efficiency in operations results from arranging conditions of work in such a way that human elements interfere to a minimum degree. 9,1 Low 1 2 3 4 5 6 1 8 9 CONCERN FOR PRODUCTION High Source: Robert A. Blake and Anne Adams McCanse, Leadership Dilemmas~rid Solutions (Houston: Gulf Publishing Company, 1991), 29. (First published as the Managerial Grid Figure by Robert R. Blake and Jane S. Mouton). Reproduced with permission. desired reward. Thus bank tellers are likely to put effort into pleasing customers if they believe that customers can be pleased and if they believe they are likely to be rewarded for pleasing customers. In this example, the path-goal theory of leadership views the supervisor's role as ensuring that customers are not annoyed by other aspects of their banking experience, that tellers clearly under' stand that customer satisfaction is desired, and that the teller who pleases customers is rewarded. At 4 525 ~PTER 14 Motivation and Leadership Research supporting path-goal theory has found that more directive leaders can increase employee satisfaction when employees are faced with unstructured and ambiguous tasks such as those found in customer service positions. In addition, supportive behavior from a leader increases the clarity of job requirements in unstructured tasks. Finally, the path-goal theory of leadership has been instrumental in drawing attention to the variations in leader behavior that different situations require. Situational Leadership Theory Situational ~ed~rship theory 'I ~h~i pr p der be~.i\ I I 1 foIlo~~i< k~~l 1t'~i~ and ~ ~i~~ii Paul Hersey and Kenneth Blanchard developed another situation-based approach to leadership that they called simply situational leadership theory.44 Like path-goal theory, situational leadership theory assumes that leaders vary their behaviors depending on what the situation demands. However, in Hersey and Blanchard's theory, the leader behavior is broadly defined in terms of relationship behavior and task behavior, and the situation is defined in terms of follower readiness. ~Follower readiness" refers to both the skill level and the self-confidence possessed by the subordinate; both affect the behavior of the leader. For example, as employee readiness increases, the leader's task behavior decreases. (See Figure 14-7.) In other words, employees with greater self-confidence and better skills require less supervision from their manager. The contribution the situational leadership theory makes to management is that it recognizes the complexity of the manager's situation. Emerging Theories of Leadership I Leadership is such a complex phenomenon that no single approach has offered managers a full understanding of what is required to lead employees to higher levels of productivity. Studies such as those associated with McClelland's managerial motivation theory or leader-behavior theory or the situational theories provide managers with some practical advice. Unfortunately, as these theories Uccomc morc complex in order to ~(\~r~SS the phenomenon of leadership thoroughly, they become more difficult to test. Growing out of somewhat limited success with these theories are newer views of leadership. Sel~leadership Theory ~I~~ader8hip A theory Ieadtr~l1~1, ~us~ng that ~ ~ ~lf.(Iii Self-leadership theory focuses on encouraging subordinates to exercise leadership for themselves.45 The successful manager leads by example (i.e., by modeling self-leadership), by giving rewards for self-leadership among subordinates, and by assisting with employee goal setting, a topic discussed earlier. In these ways, the leader teaches employees to act as their own leaders. Thus the successful leader does not appear to lead by influencing, directing, coercing, or punishing subordinates. Instead, the successful leader is one who encourages others to be self-directed and who offers rewards to subordinates who establish a pattern of self-direct ion.46 Changes in the workforce appear to support the potential of self-leadership theory. As we noted in Chapter 2, there are growing numbers of better-educated and more independent employees in the workforce, and they should be capable 52~ PART5 Creating a Productive Work Environment LEADER BEHAVIORS High 3 a z L z a Lew FOLLOWER READINESS Able and Able but Unable but Unable and willing or or unwilling or confident insecure Source: Copyrighted by Center for Leadership Studies. All rights reserved. Used by permission. 1 a TASK BEIIAVWR (Directive) High Follower-directed Leader-directed 14 Motivation and Leadership 137 of self-leadership. Furthermore, there are a growing number of service organizations, such as community mental health agencies, whose employees perform their tasks largely outside the view of their supervisors. In addition, more-sophisticated information systems permit decentralization of decision making. Where employees act on their own, encouraging self-leadership seems to be the most effective means of ensuring that their behavior is consistent with the organization's mission and goals. Even in the more structured and traditional organizational setting, self-leadership may have merit in that it allows employees autonomy and responsibility for their own performance and satisfaction. Because the workforce is so diverse, managers should recognize that some employees may be better suited to self-leadership than others. Transformational Leadership or matlonal ~dershIp ~I \ iil{ flI t( J( ( I' Ii With the success of such leaders as John Sculley at Apple Computers, Jack Welch at General Electric, and Leslie Wexner at The Limited, public attention has been drawn to the transformational leader. Transformational leadership refers to a leader's success in changing an organization by building enthusiasm and commitment to the leader's vision of the organizational mission. The role of the transformational leader may be described in the following way: "The transformational leader motivates followers to do more than originally expected. Such transformation can be achieved by (a) raising an awareness of the importance and value of designated outcomes, (b) getting followers to transcend their own self-interests, or (c) altering or expanding followers' needs on Maslow's hierarchy of needs.'~7 Transformational leaders do not abandon traditional leader behaviors such as providing appropriate rewards or controlling the actions of subordinates in t1 528 PART 5 Creating a Productive Work Environment order to accomplish goals. Rather, they go beyond these traditional leader behaviors, sensing what is important and communicating that vision in the form of an organizational mission. They also stimulate the development of individuals by assigning projects and coaching employees in a way that recognizes the individual's capabilities. Finally, transformational leaders provide intellectual stimula -tion by encouraging followers to think in new ways.48 Behavioral science research concerning transformational leadership is encouraging. First, it appears that transformational leaders may be found in a variety of organizational levels, not just at the top. Second, transformational leadership produces positive responses from followers, and it appears to make a difference in their performance. Third, and perhaps its greatest contribution, transformational leadership helps to improve the culture of an organization. Transformational leaders develop a vision for a more successful, higher-performing organization. They then develop commitment for that vision by implementing strategies for institutionalizing the vision among employees as well as in external constituencies of the organization.49 More organizations are looking at their HRM activities as a key means to improve organizational productivity. Among those activities is the use of appropriate and novel rewards. Rewards serve to recognize past accomplishments while reinforcing positive employee behaviors. Pay is a particularly important reward that is used as a performance-contingent means of enhancing performance. Perceptions of equity concern a person 5 evaluation of whether he or she receives adequate rewards to compensate for contributive inputs. Central to equity theory is that people perform these evaluations by comparing the inputs they bring to the work environment and the rewards they receive from it against a comparison individual. When comparisons of perceived inputs and outputs are not in balance, inequity exists and the person is likely to show unfavorable behavior such as absenteeism and/or low productivity. Expectancy theory of motivation is based on our beliefs regarding the effort we put into doing a task combined with the value we place on the outcome of that task. For example, if I study extensively for an exam, I expect to earn a grade of A. And, if I value an A, my motivation to study is high. Managers can use this theory of motivation with employees by learning what employees value. Once employee values are known, then managers should increase employee expectancies that high effort will lead to success and the achievement of things valued. Employee involvement groups are groups of employees working in a similar area or performing a similar function who meet regularly to discuss improvement of work performance. By analyzing problems and offering suggestions they seek to improve efficiency, cut costs, and/or address product or service issues. IVI I I I Motivation and Leadership 121 ~L ci~ionsthi.anct~~ ~¶'~~~POwer their employees by including them in tasks and det\'etr jobs. Employees become empowered when they are asked to think innovative ways and to assume more accountability and control over their work functions. The study of leadership traits has identified literally hundreds of character istics thought to contribute to leader effectiveness. While it is probably impossi~te to identify all the traits associated with successful leaders, cognitive skills, interpersonal skills, drive, vision, analytical ability, communication skills, con-cern, and charisma are frequently associated with today's successful leaders. Behavioral theories of leadership focus on specific leader behaviors that facilitate work-group performance. The Ohio State and Michigan studies identified two components of leader behavior-consideration and initiating structure-as behaviors that direct good managers. The situational theories emphasize that a manager's behavior (e.g., style of leadership) is contingent upon the environment facing the manager and the types and maturity of employees supervised. Two emerging theories of leadership are self-leadership and transformat iona I leadership. Self-leadership emphasizes that subordinates exercise leadership for themselves. Self-leadership is enhanced when managers become mentors to their subordinates and reward subordinates when the desired behavior is shown. Transformational leadership is based on a set of abilities that allows the leader to recognize a need for change, to champion a vision for change, and to execute the change effectively. Transformational leaders are frequently characterized as charismatic leaders. KEV TERMS . consideration reinforcement theory employee empowerment self-leadership theory employee involvement situational leadership theory employee involvement groups (Els) structure equity theory traits of leaders expectancy theory transformational leadership hierarchy of needs two-factor theory needs for achievement, po'NGr, and work team affiliation path-goal theory