Impact of Behavioral Wage Theories in Modern Organizations Essay

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Motivation in the Workplace

Employee motivation in the workplace is personal and individualistic. When an employee is motivated, he will demonstrate great effort, tolerance and persistence in achieving the organization’s goals. What motivates an employee may fail to motivate another employee. Motivation may not always be secured by the employer through financial compensation. Motivation is a complex issue that scholars have advanced several theories to help the management be practical in motivating employees for higher performance outcomes.

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The theories assist managers to be strategic in motivating their employees and providing incentives. What incentives should an employee provide to his employees? What are the strategies to use? An organization may have to introduce performance appraisal tools, bonuses and other rewards in the compensation policies of the organization. Growth and promotion opportunities may need to be provided.

The Reinforcement Theory

The reinforcement theory argues that an individual can be conditioned to act in a certain way. What the organization chooses to reinforce in the organization will greatly affect the individual’s actions. The individual gets to understand the consequence of his or bad actions. The theory does no focus on an individual’s feelings but on the external environment.

The best approach for managers to use when applying the reinforcement theory is to focus on positive reinforcement. When an individual does something well the manager should praise the employee. For example, if an individual comes early, he should be praised so that the punctuality can be repeated consistently. If a reward is given for good behavior the individual will even give higher performance outcomes. There can also be negative reinforcement.

If an employee commits an unacceptable act, disciplinary action can be taken to prevent the action from being repeated ever again (Villere and Hartman, 1991). The employee can be suspended from duties or given a warning letter. The other approach is extinction where an employee is no longer praised for doing certain actions.

This ends up causing him or her to stop the behavior as there is no reward or praise. The application of the reinforcement theory needs to be applied with caution though because it can cause an employee to be demoralized if only negative reinforcement is used.

The level of negative reinforcement needs to be appropriate. There should be a mix of negative and positive reinforcement. The organization should have a bonus system to reward employees with exceptional performance outcomes. Quarterly there could be the circulation of communication to employees encouraging them to nominate those people who are role models and have demonstrated teamwork.

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The winners chosen could be rewarded with monetary payments or a dinner or outing somewhere. The organization should have competitions across the organization on certain performance outcomes and winners rewarded. This will go a long way in conditioning an employee’s behavior towards higher performance.

The Expectancy Theory

In the expectancy theory, the individual performs to a certain level with the expectation of a favorable reward. For this individual rewards are highly important and influences the level of the individual performance. This was a theory advanced by Victor Vroom in the Yale School of management in the year 1964. The theory states that the individual expects to be rewarded on his performance. There are three aspects in this theory.

The Valence relates to the value of the reward while the Expectancy is where the individual expects to be rewarded and Instrumentality is the attitude the individual has that he will be compensated. (Management Study Guide Editors,1998). The three aspects lead to three kinds of relationships.

There is the effort performance relationship. The individual reasons what is the probability that his effort will be recognized in the performance appraisal come at the end of the year. The second dimension is the performance reward relationship. The individual desires to know whether his exceptional performance will lead to the organization giving him great rewards. Finally there is the reward, compensation and personal goals relationship.

How attractive or desirable is the reward to the individual and to the achievement of his personal goals and vision. Vroom viewed the employee as a person who chooses to work or not for the organization depending on the three aspects of the expectancy theory.

This theory shows that the self-interested individual desiring rewards or pay-offs that are important to him. In many modern organizations, rewards are not absolutely tied to the performance outcomes. There are many other factors that affect performance rewards such as the individual’s position, education level and his responsibilities in the organization.

This has to be addressed in several ways. In an organization aiming to apply the Expectancy theory they should provide employees with challenging and dynamic goals and work targets. However the smart objectives should be attainable or realistic, otherwise there will be a lot of frustration for the employee to the attainment of rewards. Secondly, there should be a system where the employees are rewarded for exceptional performance.

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The compensation system in the company should be fair and just in analysing the employee performance. Once the organization has set up the compensation system, the motivation level of the employees should be measured continuously using such instruments such as questionnaires and interviews.

The Equity Theory

In the equity theory, an individual’s perception to equity and fairness is a motivating factor. The theory reveals the way employees compare themselves with others and work towards eliminating any perceived inequalities. What matters to an individual is the compensation they are receiving in comparison to others. The employee compares himself with employees within or without the organization. When an individual perceives that his pay is not equitable as compared to his colleagues, there is equity tension.

The individual may act in several areas such as quitting. He may also choose not to give as higher job output as before losing morale. In order to deal with frustration the individual may decide not to rely on recognition by others and just appreciate that he is doing a great job.

He may also start perceiving that a peer’s job is not as desirable as a defense mechanism. If the organization practices a piece rate system, the individual may begin to compromise on quality so that he can get rewards that he perceives as equitable. The individual may also choose to compare himself with a different person than whom he had chosen initially.

The theory states that the employee seeing that there is an imbalance between effort and reward or compensation. The de-motivation comes in when the employees perceive that that their inputs that is the effort, performance, skill, flexibility and tolerance are higher than the outputs which are salaries, rewards, compensation and recognition (Mindtools Editors, 1996).

The managers should work hard to ensure there is a fair balance. This may require employers to research on what employers are paying in the industry so as to give their employees competitive salaries. The organization may also have to carry out an employee satisfaction survey to find out whether the employees are happy with the work compensation in the organization. The grievances should be recorded and thoroughly analyzed.

Employees doing the same kind of work should earn the same range of salaries to avoid discontentment. The salaries may need to be harmonized to remove unfair gaps. The salary gaps between different job grades may also need to be looked into to create a healthy working environment where the employees are motivated. There should be a graduated job grade structure to create room for growth and promotion.

Need-fulfillment Theory

According to the Maslow’s theory of motivation, there is a hierarchy of needs fulfillment within individuals. At the basic level there are psychological needs of water, food, shelter and water. At the second level there are safety needs where an individual craves for job, health and financial security.

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The third level, an individual has social needs and desires love and have a sense of belongingness. At a higher level there are esteem needs which have internal and external aspects. The individual craves for confidence, freedom and achievement while externally he craves for the power, status, attention and recognition.

There is also the self-actualization need at the top where an individual craves for growth, knowledge and self-contentment. The theory proposes that an individual is motivated by the fulfillment of his particular unsatisfied needs. When an individual first

level need is satisfied, the person moves up the hierarchy and longs to fulfill the next level of needs. There are several lessons to be learnt by the management when applying the Maslow’s theory. In the area of physiological needs, the managers should give the workers appropriate levels of salary so that they can purchase their basic needs of food, shelter and clothing.

The company should also allow annual leave and lunch breaks. The company to provide adequate job security and retirement or pension benefits for employees to cater for safety needs.

Social events and teambuilding events should be organized by the company to create a social bond. In building the employees esteem the management should reward employees when they meet their targets and additional rewards for exceeding their targets. Those that are exceptional workers should be given a higher position. The managers should provide dynamic and challenging jobs to the employees so that they feel they are playing a huge role and feel self-actualized.

The company should have growth and promotion opportunities to motivate the employees. The managers have to analyze all their employees and know their unsatisfied needs so as to motivate them with the provision of those needs. A particular individual is only motivated by the most important need at that time that is being not fulfilled.

Conclusion

An organization needs to study the motivation theories in place in order to get a competitive edge in motivating their employees. There are organizations with great talent but because they do not strategically apply the motivation theories they are not able to get the best level of performance (Porter, Bigley and Richard, 2002, pg 30).

Works Cited

Management Study Guide Editors. Expectancy Theory of Motivation. 1998. Web. <>

Maurice Villere and Sandra Hartman. “Reinforcement Theory: A Practical Tool”, Leadership & Organization Development Journal. 1991. Vol. 12 Iss: 2, pp.27 – 3. Print.

Mindtools Editors. Adam’s Equity Theory. 1996. Web.

Porter, Lyman , Gregory Bigley and Richard M. Steers. Motivation and Work Behavior. 7th ed. New York: McGraw-Hill/Irwin. 2002. Print.

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IvyPanda. 2023. "Impact of Behavioral Wage Theories in Modern Organizations." December 6, 2023. https://ivypanda.com/essays/impact-of-behavioral-wage-theories-in-modern-organizations/.

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