Satisfaction, Commitment, and Motivation Is This System Fair? • Evaluate whether this method for compensation is fair: – A chain of nursing homes has supervisors write one paragraph descriptions of employee performance each year – Employees do not see the supervisor reports – The head office interprets the narrative reports and assigns points based on their brief read – These points are used to assign wage amounts • How would you change this system? Distributive Justice • According to Equity Theory, distributive justice is high when an employee’s ratio of ―outcomes‖ to ―inputs‖ matches those of some ―comparison other‖ • Thus equity theory acknowledges that motivation also depends on the rewards received by other employees Distributive Justice Concepts • Inputs – what you bring to the job; your effort; your contribution • Outcomes – the results of your work; your compensation, your recognition • Referents – the focus of your comparison; similar co-workers or your previous input/output ratio Distributive justice concepts • Equity: a person’s perceptions that they are paid comparable to individuals in other similar jobs – OS/IS:OO/IO – Example: dollars per hour worked • This is robust across species: – Monkey study at Emory University • Taught monkeys to exchange granite tokens for cucumbers • Then gave other monkeys grapes (a preferred food) for the same tokens • The ones who got the cucumbers then refused to play anymore and threw their cucumbers away Interdependence and Justice: Social Norms for Exchange • Distributive justice – Determine if actual outcomes are fair – Simple comparison process: • If Os/Is=Oo/Io, feeling of satisfaction • If Os/Is<Oo/Io, feel mistreated; work less • If Os/Is>Oo/Io, maybe feel guilty? – Complexity of comparison process • Outputs and inputs are hard to quantify sometimes • Sources of comparison (who are the o’s?) Distributive Justice Concepts: Conceptual Difficulties Simplest Case Relatively Simple Case Hours Pay Ratio Result Hours Pay Ratio Result Chris 8 $80 1:1 Fair Chris 8 $80 1:2 Underpaid; reduce hours Gene 8 $80 1:1 Fair Gene 4 $80 2:1 Overpaid; change comparitor Complicated Case # 1 Hours Pay Production Ratio Result Chris 8 $80 50 units 6 : 8 (hours) Unfair Gene 6 $80 50 units 50 : 50 (output) Fair Complicated Case # 2 Educ. Pay Ratio Result Chris 12 yrs. $12/hr 12 : 16 (money) Fair? Gene 16 yrs. $16/hr 1 : 1 (money & educ.) Fair A Picture of Internal and External Equity Comparisons General hospital Bigville Hospital Dr. Bold Director Jones external internal Dr. Young Dr. Smith Louisville Hospital internal external internal Dr. Beautiful Nurse Restless Distributive justice and compensation systems • External equity: employee perceptions that they are paid comparable to individuals in other similar jobs – Results of underpayment inequity? – Results of overpayment inequity? Distributive justice and compensation systems • Internal equity: employee perceptions that they are paid comparable to individuals in other jobs in the same organization – Results of underpayment inequity? – Results of overpayment inequity? Procedural Justice and Organizational Support • Methods for making decisions – Consistency – Information accuracy – Bias suppression • Taking employees into account – Representativeness – Communication – Correctability Interdependence and Justice: Interactive Effects High Low procedural procedural justice justice High Satisfaction without Both satisfaction and outcomes, but distributive motivation are obtained distrustful of future justice outcomes Low Satisfaction with Neither satisfaction outcomes is moderate, distributive and motivation is nor motivation is observed justice maintained Managing the Climate for Justice • Ford buyout of Volvo – Wages and benefits much higher in Sweden – Must do something to achieve equity, but neither solution is attractive • Raise American wages? • Lower Swedish wages? – What are the problems with each solution • Think operating costs • Think justice effects – Develop methods for addressing this situation that will address both procedural and distributive justice Work Design and Satisfaction • In order that people may be happy in their work, these three things are needed: 1. they must be fit for it; 2. they must not do too much of it; 3. and they must have a sense of success in it--not a doubtful sense, such as needs some testimony of other people for its confirmation, but a sure sense, or rather knowledge, that so much work has been done well, and fruitfully done, whatever the world may say or think about it. – John Ruskin Problems of Routine • I stand in one spot, about two- or three-feet area, all night. The only time a person stops is when the line stops. We do about thirty-two jobs per car, per unit. Forty-eight units an hour, eight hours a day. Thirty- two times forty-eight times eight. That’s how many times I push that button. Repetition is such that if you were to think about the job itself, you’d slowly go out of your mind. You’d let your problems build up, you’d get to a point where you’d be at the fellow next to you—his throat. – Spot welder, Working, p. 159 Work Design: Industrial Engineering • Methods studies-Taylor – Ergonomic studies – Process studies • Time & motion-Gilbreth – Motion analysis – Time analysis • Advantages? • Disadvantages? Work Design: Industrial Engineering Factors that Improve Satisfaction • Enhance satisfaction via job characteristics – Design jobs to be enjoyable • Increase autonomy, task significance, feedback, meaningfulness, and variety • Provide opportunities for positive social interactions and social support – Role ambiguity should be reduced • Well-defined work roles • Provide good socialization into role duties Thinking About Work Design and Redesign • Break into groups • Each member describes the best and worst things about a job he/she has had • Describe the way that decisions were made in the organization • Describe the characteristics of the actual tasks Improving Job Satisfaction • Job enrichment – Creating jobs that are more inherently satisfying to employees – Greatly increases satisfaction over time variety Skill Task identity Meaningfulness of work Internal motivation Quality job Task significance performance Autonomy Responsibility Satisfaction with Feedback Knowledge of results work Work Design and Satisfaction: Empirical Support 0.6 0.5 0.4 0.3 Satisfaction 0.2 Motivation 0.1 0 y y ty ck ce tit m rie ba an o en on Va ed c Id ifi ut Fe gn A Si Methods for Enhancing Job Characteristics Original job Job enlargement Job rotation Job 1 Job 1 Task Job 1 Task 1 1 Task 1 Job 2 Job 2 Task Job 2 Task Task 2 2 2 Job 3 Task Job 3 Task 3 3 Job 3 Task Each job does all the People switch from job to 3 major tasks now job every few months Examples of Job Enlargement Efforts • Bank One’s international trade banking department produced commercial letters of credit indicating that the bank would stand behind a loan taken out by a company. • Traditionally, each individual claim processor handled a single piece of each document, and then handed this off to the next person • Because each person was focused on their own specific piece of the task, they were bored and made mistakes • Turnover was astronomical • Jobs were enlarged, so that each individual had responsibility for one entire case at a time • Increased skill variety (doing numerous subtasks), task identity (a whole case is completed), task significance (could have contact with the person whose final case they were handling), autonomy (less need to check with others on the process), and feedback (saw how the job was progressing and would speak with individual client about how things were going) Examples of Job Enlargement Efforts • Many companies engage in managerial job rotation – For example, most financial division employees at Eli Lilly have held at least one non-financial position during their careers and these assignments last over a year – Toyota (which has outstanding quality) has employees rotate around factory jobs, including giving assembly workers managerial rotations, electrical engineers design rotations, and so on Thinking About Work Redesign • Return to your groups • Determine how the jobs you described could be redesigned to increase motivating potential • Do the benefits of redesign in this case exceed the costs?