IB Chapter 10

Question 1

Objectives of employee rewars

Answer 1

• Flexibility - the workforce can better respond to the organization’s needs
• recruitment and retention of employees
• cost-effectiveness of the reward
• productivity of the workforce

Question 2

financial motivators

Answer 2

• piece rates: pays worker for each unit of output they produce
• time rates: paid in relation to the length of time they work
• salary: flexible, open to change, no incentives
• fringe benefits: company cars, etc.

Question 3

incentives schemes

Answer 3

bonuses
performance-related pay (PRP): conflict btw. employee and manager about reward, does not promote teamwork
profit sharing
share ownership: company shares are given to employee (not really ownership though)

Question 4

Theories of Motivatuion

Answer 4

TW Taylor
Elton Mayo
Abraham Maslow
Fredrick Herzberg
Douglas McGregor: Theory X and Y
William Ouchi: Theory Z
Reinforcement Theory

Question 5

TW Taylor Theory of Scientific Management

Answer 5

Pig-iron Steel work

• improve efficiency
• all workers should be supervised and controlled, and those who do not work efficiently should be punished
• workers should be rewarded financially for being efficient

Theory into practice:

• mass production assembly lines
• dominated manufacturing in the 20th century
• introducing either a piece rate system of payment or a financial incentive system

Problem:
- ignores the difference btw. the workers

Question 6

Elton Mayo Theory of Human Relations

Answer 6

• importance of teamwork team spirit –> motivated employees

Theory into practice:

• communication is essential
• workers should make decisions

Problem:

• his experiments were far from realistic
• workers will not always share the goals of managers
• trade unions could see that there is a discrepancy btw. managers aims and the workers benefit from it

Question 7

Business case

Answer 7

A business case captures the reasoning for initiating a project or task.

Question 8

Abraham Maslow Theory of the hierarchy of needs

Answer 8

1. Physiological needs
2. Safety needs
3. Love and belonging needs (being part of a group, receiving affection and friendship)
4. Esteem needs (respect from others)
5. Self-actualisation (training, challenges and opportunities to develop each individual’s skills

Theory into practice

• identify the individual needs of the workforce
• first the physiological needs have to be satisfied by payment
• boosting workers’ esteem is crucial

Problems:

• workers could find needs in other areas than work
• not everybody has same needs (matching is nearly impossible)

Question 9

Frederick Herzberg Two-factor theory

Answer 9

1. Motivators:

• a sense of achievement
• recognition of effort
• interesting work
• responsibility
• opportunities for promotion
• opportunities for self-improvement

–> human need to grow psychologically (they are only motivational but do not create dissatisfaction when absent)

2. Hygiene factors (can cause illness), so basically dissatisfaction

• company policy
• relationships with supervisors and colleagues
• pay and status
• security

–> can not motivate an employee but can avoid dissatisfaction when fulfilled

Theory into practice:

• to motivate a workforce all hygiene factors have to be met
• advocates job enrichment by a variety of tasks

Problem:

• can not be applied to workers in every business
• low-skilled jobs can not easily be enriched

Question 10

Douglas McGregor Theory X and Y

Answer 10

Theory X
- consistent with Taylor’s theory and assumes that employees dislike work and only function in a controlled environment
Theory Y
- consistent of the ideas of the human relations movement
- work is important to peoples lives
- people work towards goals they are committed
- people want personal rewards
- people seek out responsibility
- organisations generally do not make full use of their human resources

Question 11

William Ouchi Theory Z

Answer 11

• a belief that some middle ground between American and Japanese firm are the best

Question 12

Reinforcement theory

Answer 12

a theory of motivation based on the premise that rewarded behaviour is likely to be repeated, whereas punished behaviour is less likely to recure

Question 13

Equity theory

Answer 13

a theory based on the premise that people are motivated to obtain and preserve equitable treatment for themselves
equity is the distribution of rewards in direct proportion to each employee’s contribution to the organisation

Question 14

expectancy theory

Answer 14

motivation depends on how much we want something and on how likely we think we are to get it

Question 15

Goal setting theory

Answer 15

a theory of motivation suggesting that employees are motivated to achieve goals that they and their managers establish united.,

Question 16

MBO

Answer 16

management by objective: managers and employees work together in setting goals

Question 17

job enlargement

Answer 17

expanding a worker’s assignments to include additional but similar tasks

Question 18

flexitime

Answer 18

employees set their own work hours within employer-determined limits

Question 19

empowerment

Answer 19

gives employees greater control by providing them with decision-making powers