Chapter 6 Applied Performance Practices

Topic 6-1 Financial Reward Practices Gainsharing plan - a team-based reward that
calculates bonuses from the work unit’s cost
Four Specific Objectives of Financial Rewards savings and productivity improvement
1. MEMBERSHIP- AND SENIORITY-BASED - tend to improve team dynamics, knowledge
REWARDS sharing, and pay satisfaction
- Sometimes called “pay for pulse.
- Represent the largest part of most paychecks Types of Organizational Rewards
- Potentially reduce turnover and attract job
applicants (particularly those who desire 1. Employee stock ownership plans (ESOPs) - a
predictable income). reward system that encourages employees to
buy company stock
Golden handcuffs - they discourage employees
from quitting because of deferred bonuses or Stock options – a reward system that gives
generous benefits that are not available employees the right to purchase company stock
elsewhere at a future date at a predetermined price
Profit-sharing plan - a reward system that pays
2. JOB STATUS–BASED REWARDS bonuses to employees on the basis of the previous
- Try to improve feelings of fairness by year’s level of corporate profits
distributing more pay to people in higher-
valued jobs. Topic 6-2 Improving Reward Effectiveness

Job evaluation - systematically rating the worth of Important strategies for improving reward
jobs within an organization by measuring the effectiveness.
required skill, effort, responsibility, and working 1. LINK REWARDS TO PERFORMANCE -
conditions employees with better performance should be
rewarded more than those with poorer
3. COMPETENCY-BASED REWARDS performance.
- Motivate employees to learn new skills. 2. ENSURE THAT REWARDS ARE RELEVANT – The
- This tends to support a more flexible more employees see a “line of sight” between
workforce, increase employee creativity, and their daily actions and the reward, the more
allow employees to be more adaptive to they are motivated to improve performance.
embracing new practices in a dynamic 3. USE TEAM REWARDS FOR INTERDEPENDENT
environment. JOBS - Team rewards are better than individual
rewards when employees work in highly
Skill-based pay plans are a more specific variation interdependent jobs, because it is difficult to
of competency-based rewards in which people measure individual performance in these
receive higher pay determined by their mastery of situations.
measurable skills. 4. ENSURE THAT REWARDS ARE VALUED -
rewards work best when they are valued.
4. PERFORMANCE-BASED REWARDS 5. WATCH OUT FOR UNINTENDED
a) Individual Rewards - employees receive CONSEQUENCES - can often be averted by
individual bonuses or other rewards for carefully thinking through what the rewards
accomplishing a specific task or exceeding actually motivate people to do
annual performance goals.
b) Team Rewards
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Intrinsic motivation - occurs when the source of 3. Task significance the degree to which a job
motivation is controlled by the individual and has a substantial impact on the organization
experienced from the activity itself. and/or larger society
Topic 6-3 Job Design Practices 4. Autonomy the degree to which a job gives
employees the freedom, independence,
Job design—the process of assigning tasks to a job, and discretion to schedule their work and
including the interdependency of those tasks with determine the procedures used in
other jobs. completing it
5. Job feedback is the degree to which
Job is a set of tasks performed by one person. employees can tell how well they are doing
from direct sensory information from the
Job specialization - the result of a division of labor, job itself.
in which work is subdivided into separate jobs
assigned to different people THREE CRITICAL PSYCHOLOGICAL STATES
1. Job’s experienced meaningfulness - the belief
Cycle time is the time required to complete the that one’s work is worthwhile or important.
task before starting over with another item or 2. Experienced responsibility—a sense of being
client personally accountable for the work outcomes
3. Knowledge of results—an awareness of the
Scientific management - the practice of work outcomes based on information from the
systematically partitioning work into its smallest job itself.
elements and standardizing tasks to achieve
maximum efficiency INDIVIDUAL DIFFERENCES
Growth need strength refers to an individual’s
Topic 6-4 Job Design and Work Motivation need for personal growth and development, such
as work that offers challenges, cognitive
Motivator-hygiene theory stimulation, learning, and independent thought
- introduced by Frederick Herzberg and action.
- Herzberg’s theory stating that employees are
primarily motivated by growth and esteem SOCIAL AND INFORMATION PROCESSING JOB
needs (called motivators), not by lower level CHARACTERISTICS
needs (called hygienes).
Two clusters of job features:
Job characteristics model - a job design model that 1. Social characteristic
relates the motivational properties of jobs to a. Extent to which the job requires employees
specific personal and organizational consequences to interact with other people (coworkers,
of those properties clients, government representatives, etc.)

FIVE CORE JOB CHARACTERISTICS Task interdependence - the extent to which team
1. Skill variety the extent to which employees members must share materials, information, or
must use different skills and talents to expertise in order to perform their jobs
perform tasks within their jobs
2. Task identity the degree to which a job b. Feedback from others
requires completion of a whole or an
identifiable piece of work 2. Information Processing Demands
a. Task variability - how predictable the job
duties are from one day to the next
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b. Task analyzability, refers to how much the • Competence. Empowered people are confident
job can be performed using known about their ability to perform the work well and
procedures and rules have a capacity to grow with new challenges.
• Impact. Empowered employees view
themselves as active participants in the
organization; that is, their decisions and actions
have an influence on the company’s success.
Job Design Practices That Motivate

Three main strategies can increase the Topic 6-6 Self-Leadership Practices
motivational potential of jobs
1. JOB ROTATION - moving employees from one SELF-LEADERSHIP - specific cognitive and
job to another for the purpose of improving behavioral strategies to achieve personal goals and
the motivational and physiological conditions standards through self-direction and self-
of the work. motivation.
2. Job enlargement - the practice of adding more SELF-LEADERSHIP STRATEGIES
tasks to an existing job. 1. Personal Goal Setting - requires a high degree
- This might involve combining two or more of self-awareness, because people need to
complete jobs into one or just adding one or understand their current behavior and
two more tasks to an existing job. performance before establishing meaningful
- improves work efficiency and flexibility
goals for personal development.
3. Job enrichment - the practice of giving
2. Constructive Thought Strategies - Before
employees more responsibility for scheduling,
coordinating, and planning their own work beginning a task and while performing it,
a. Natural grouping approach- combining highly employees engage in two constructive
interdependent tasks into one job (positive) thought strategies about that work
b. Establishing client relationships – involves and its accomplishment: positive self-talk and
putting employees in direct contact with their mental imagery
clients rather than using another job group or a. self-talk - the process of talking to ourselves
the supervisor as the liaison between the about our own thoughts or actions
employee and the customer. b. mental imagery - the process of mentally
practicing a task and visualizing its
Topic 6-5 Empowerment Practices successful completion
3. Designing Natural Rewards - can alter tasks
Empowerment a psychological concept in which and work relationships to make the work more
people experience more self-determination, motivating. To alter the way a task is
meaning, competence, and impact regarding their accomplished
role in the organization 4. Self-monitoring is the process of keeping track
at regular intervals of one’s progress toward a
FOUR DIMENSIONS OF: goal by using naturally occurring feedback. Self-
 Self-determination. Empowered employees monitoring significantly improves employee
feel that they have freedom, independence, performance
and discretion over their work activities. 5. Self-reinforcement occurs whenever an
• Meaning. Employees who feel empowered care employee has control over a reinforcer but
about their work and believe that what they do
is important.
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doesn’t “take” the reinforcer until completing a