How Effective Employee Motivation Plays a Primary Role in Organizational Success, Case Study Example

Introduction

Wal-Mart is the largest company in the world and is number one on the Fortune 500 list. However, the chain’s employees earn roughly 25 percent less than employees at competing grocery stores and discount stores (Informa Economics, Inc., 2003). Wal-Mart has been at the center of various court cases based on employee complaints about amount of hours worked v. amount of money earned. To examine the issue in more depth, the author visited a local Wal-Mart and asked a few employees how the chain could improve working conditions. The majority of respondents reported that effective employee motivation would greatly enhance their working environment.

The practical application of motivation is the key to a successful organization. For years the primary employee motivator in American management has been the ‘carrot-stick’ approach, where an employee was rewarded for good behavior and punished for bad behavior. This method of employee compensation and motivation has proved ineffective, and has resulted in high employee turnover rates and unsuccessful businesses. The Society for Human Resource Management reports that only one in seven employees is fully engaged in their work (Kreitner & Kinicki, 2010).  Researchers attribute these statistics to ‘under-management’, and have suggested ‘performance management’ to revamp the way American businesses are run.

A meta-analysis of 77 studies has shown a direct link between employee behaviors and performance, and organizational motivation. Employee motivation comes primarily from management. If a manager is effective and efficient in motivating employees, then those employees are likely to perform better (Lindner, 1998). Different people respond differently to rewards, so not all motivational factors are equally as effective. It is the role of the manager to understand individual employee needs in order to administer effective motivation and rewards. Managers are encouraged to enhance employee effort through methods of goal setting. A Franklin Covey survey revealed that nearly 60 percent of workers in the United States do not “clearly understand their organization’s most important goals,” and more than 80 percent of those employees “do not have clearly defined goals” (Kreitner & Kinicki, 2010, p. 245). Feedback is crucial because it creates a line of communication between employees and managers. A recent survey revealed that more than 43 percent of U.S. employees feel they do not receive adequate feedback from managers to effectively improve their job performance (Kreitner & Kinicki, 2010, p. 250). It is crucial for management to communicate employee expectancy and establish a definitive link between expectancy and reward (Kreitner & Kinicki, 2010, p. 226). This is done by the manager setting up a system of support and coaching to increase employee self-efficacy. An effective rewards system boosts employee morale and subsequently increases performance. Organizational rewards go far beyond monetary compensation and vary from organization to organization. However, some common factors of organizational reward include types of rewards (financial, social, or psychic), distribution criteria (results, behavior, other factors), and desired outcomes (attract, motivate, develop, satisfy, or retain) (Kreitner & Kinicki, 2010, p. 256). Lastly, positive reinforcement ensures continued productive behavior. It is crucial that positive reinforcement accompanies feedback and a reward system in order to achieve needed discipline and desired effect (Kreitner & Kinicki, 2010).

Background

Kreitner & Kinicki (2010) discuss the impact of positive reinforcement on job performance. The authors relate employee performance to performance management. In order to infiltrate the untapped reserve of employee performance, management must implement a system of goal setting, feedback, positive reinforcement, coaching, and rewards. They should utilize this system continuously in order to ensure performance growth and stability. Old methods of compensation and motivation, such as annual performance appraisals, have proved to be unsatisfying for all parties involved (Kreitner & Kinicki, 2010). The authors explain that in order to reach desired outcomes, a performance improvement cycle must be implemented. This cycle consists of goal setting, rewards and positive reinforcement, and feedback and coaching. However, before this cycle can be successfully implemented, situational factors such as individual employee traits and organization and team traits must be identified. These traits include abilities, skills, job knowledge, job design, and quality of supervision. Employee motivation not only benefits employees, it also has beneficial implications for managers and organizations. Based on the expectancy theory (the belief that effort leads to a specific level of performance), managerial and organizational impact can be described as follows:

• Management can determine outcomes that employees will value,
• Management can identify good performance and reward appropriate behaviors accordingly,
• Management can ensure that targeted performance levels are attainable by employees,
• Management can ensure that the outcome changes are high enough to encourage increased effort,
• Management must monitor the reward system for inequities (Kreitner & Kinicki, 2010).

Organizational implications are as follows:

• The organization should reward employees when they perform according to desired standards,
• The organization should discuss pay decisions openly with employees,
• The organization should design challenging positions,
• The organization should reward managers for their efforts in creating, maintaining, and monitoring performance expectancies, instrumentalities, and outcomes which result in employees attaining goals and making an increased effort to do so,
• The organization should monitor employee motivation by conducting interviews with managers and employees, or by conducting anonymous surveys,
• The organization should familiarize itself with unique employee differences in order to implement a system of flexibility into the motivational system (Kreitner & Kinicki, 2010).

Positive employee motivation involves effective goal setting procedures. Goal setting is beneficial because it directs attention, regulates effort, and increases employee persistence (Kreitner & Kinicki, 2010). Additionally, several motivational approaches exist. In the area of job design, motivation attempts to improve the employee’s effective and personal reactions to job satisfaction. Overall job satisfaction ensures decreased employee absenteeism and employee turnover. Is enhances job performance. Job design relies on four key motivational techniques: job enlargement, job enrichment, job rotation, and job characteristics model (Kreitner & Kinicki, 2010).

• Job Enlargement – this approach aims to make an employee’s job more interesting by adding variety to a specific job. It involves combining specialized tasks of different levels of difficulty into a specific position. This approach is best used in conjunction with other motivational approaches because it does not have a lasting positive effect standing by itself.
• Job Rotation – this involves moving employees from one job to another. This creates an environment where all employees are well trained by learning a variety of job-related skills. This method proves to stimulate employee interest, while providing employees with a broader understanding of an organization’s functionality. An advantage of this approach is increased worker flexibility because employees are cross-trained to do a variety of specialized tasks.
• Job Enrichment – this approach promotes job creation where an employee can feel a sense achievement and recognition. The effects doing something that is stimulating to an employee will result in that employee taking greater responsibility for their position. The employee will also work harder toward future advancement in the organization.
• Job Characteristics Model – this approach ensure that employees are internally and intrinsically motivated. Intrinsic motivation refers to an employee’s desire to do their job because they feel an internal sense positive correlation with the work, knowing they can do it well (Kreitner & Kinicki, 2010).

Maroney (2004), states that not all employees respond to the same motivation. Like Kreitner & Kinicki (2010), Maroney argues that management should invest time to understand the individual needs of the people that make up the organization. He lists five steps for effective employee motivation, which would ensure the success of any organization. The first step is to guarantee employee motivation through building job satisfaction. Secondly, employees will feel motivated if they feel genuine appreciation for their role in the company. Third, motivation happens through recognition. Fourth, motivation happens through inspiration from leadership. Lastly, motivation happens through compensation (Maroney, 2004).

Lindner (1998) studied the importance of employee motivation at Ohio State University and found that interesting work, supported with good compensation, are two key factors that boost employee morale. He argues that employee needs and motivation form the basis for a successful business. Employees typically have five levels of needs: social, ego, self-actualization, physiological and safety. A proactive manager will identify those needs in his or her employees and nurture them to motivate employees to do good work. He further found that motivation leads to employee efforts, and those efforts lead to increased performance, which then leads to rewards (Lindner, 1998).

AccellTeam.com (2010), reports that employee motivation differs from executive motivation. Because there exists a different value system between employees and executives, each attach different values to financial incentives. In order to further explain this system, it is important to understand the complex executive elements. They include salary, short-term incentives, long-term incentives, employee benefits, and prerequisites (Accel-Team, 2010).

According to a 2010 study on employee motivation, employees agree that effective employee motivation builds staff loyalty and overall job satisfaction. More than 70 percent of the survey participants agreed that employee motivation increases performance and efficiency in an organization (Warren, 2010). However, although the majority of survey participants agree that employee motivation increases job performance, only 30 percent agreed that monetary rewards did not play a significant role in employee motivation. In fact, more respondents value job security over monetary rewards. Sixty eight percent of survey participants agreed that job security is a crucial motivational tool (Warren, 2010). Nearly 90 percent of all respondents agree that managerial feedback promotes increased employee confidence levels, which improves employee motivation. Survey results show that employee motivation leads to increased employee performance, and increased employee performance leads to a successful and effective organization.

Cornelius and Associates (2010) describe five factors or steps to ensure positive and effective employee motivation. FLAME (feedback, lots of skills, autonomy, mine, and effect on others) unleashes employee potential that will be beneficial to any organization.

• Feedback: an efficient feedback system promotes communication between employees and managers
• Lots of Skills: To further increase employee job performance, management should create jobs that utilize employee skills. Doing so will give employees a sense of increased and valued productivity.
• Autonomy: A system should be in place to give employees individual power to practice some autonomy in their specific jobs. Employees feel empowered when they have a say in what happens in their day-to-day jobs.
• Mine: A system of ownership should be put in place for employees to take pride in their work.
• Effects on Others: Management should make employees aware of the impact that their specific job has on the rest of the organization. This will motivate employees to perform better (Cornelius and Associates, 2010).

Effective employee motivation creates an energizing and competitive work atmosphere. Employees are more apt to perform better in an environment where they feel challenged, valued, appreciated. Practicing FLAME creates such an environment (Cornelius and Associates, 2010).

Discussion

The literature review explained that employee motivation is an individualized concept that must be treated as such my management. A good manager will identify unique employee needs and focus on them in establishing an effective motivational strategy. Not all employees are motivated by the same incentives. In order to ensure a successful organization, management must seek specific goals that will increase employee performance and productivity. One aspect of individualized and individual-specific motivation is goal-setting. Goal setting leads to increased performance, if employees are committed to them (Brown, 2005). Goals typically include desired future outcomes and circumstances. So, if an employee has set an attainable goal, chances are that the employee will be dedicated to reaching desirable goal outcomes. However, it is important to remember that employees must believe that they are capable of doing what is expected of them. So, in the goal-setting process, it is important to be honest about individual employee abilities. Setting up specific goals based on specific skills or abilities, enhances the employee’s chances of attaining the goal. Doing so creates a sense of accomplishment that will motivate the employee to further increase performance (Brown, 2005). In addition to goal setting, management could add incentive to goal achievement. For instance, higher commissions for sales people, or extended vacations for administrative workers are added incentives for an employee to pursue goal attainment.

Conclusion

Performance management will improve individual job performance. Continuous goal setting, feedback, and coaching, in accordance with rewards and positive reinforcement will result in heightened employee job satisfaction. Learning goals encourage learning, innovation, and skill development. Performance outcome goals encourage target specified end results. The collected research will also show that extrinsic rewards often fail to motivate employees because it places an over-emphasis on money, offers little in regards to employee appreciation, and present benefits as entitlements. It also tends to reward the wrong behavior, and uses a generic reward system for all employees. These rewards have a temporary impact and are the primary cause for high employee turnover rates. It is therefore beneficial to organizations to implement a system of positive and negative reinforcement, rather than one of punishment and extinction. Positive and negative reinforcement are management strategies that strengthen behavior. Punishment and extinction weaken employee behavior and causes harm to the entire organization. It is crucial that management approach these strategies from an objective standpoint, and take not of what is actually effective, not what may be effective. Doing so will largely contribute to positive employee behavior shaping. When closer approximations of target behaviors are reinforced, the target behavior is likely to become habitual (Kreitner & Kinicki, 2010, p. 268). Habitual positive employee performance has a positive impact on the individual’s state of mind and therefore, on the organization as a whole.

Works Cited

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