Chapter 6

Applied Performance Practices

http://highered.mcgraw-hill.com/sites/0070979898/student_view0/chapter6/key_terms.html

Canadian OB 7e: McShane/Steen

2009 The McGraw-Hill Companies, Inc. All rights reserved

Applied Performance Practices at Nucor

Courtesy Nucor

Nucor has survived and thrived in the turbulent steel industry through the benefits of performance-based rewards, job design, and empowerment.

Financial Reward Practices

Financial rewards -- fundamental part of employment relationship Pay has multiple meanings

symbol of success reinforcer and motivator reflection of performance can reduce anxiety

Men value money more than women Cultural values influence the meaning and value of money

Corel Corp. With permission.

Types of Rewards in the Workplace

Membership and seniority

Job status Competencies Performance-based

Corel Corp. With permission.

Membership/Seniority Based Rewards

Fixed wages, seniority increases Advantages

Guaranteed wages may attract job applicants Seniority-based rewards reduce turnover

Disadvantages
Doesnt motivate job performance Discourages poor performers from leaving

May act as golden handcuffs (tie people to the job)

Job Status-Based Rewards

Includes job evaluation and status perks Advantages:

Job evaluation tries to maintain pay equity Motivates competition for promotions

Disadvantages:
Employees exaggerate duties, hoard resources Reinforces status, hierarchy

Inconsistent with workplace flexibility

Competency-Based Rewards

Pay increases with competencies acquired and demonstrated Skill-based pay

Pay increases with skill modules learned

Advantages
More flexible work force, better quality,

consistent with employability

Disadvantages
Potentially subjective, higher training costs

Performance Pay at Spruceland Millworks

Spruceland Millworks, an Alberta-based remanufacturer of mouldings, decking, and other niche lumber products, is a highperformance workplace that rewards individual, team, organization-level performance.

Performance-Based Rewards
Organizational rewards
Profit sharing Share ownership Share options Balanced scorecard

Team Bonuses rewards Gainsharing

Individual Commissions rewards Piece rate

Bonuses

Evaluating Organizational Rewards

Positive effects
Creates an ownership culture
Adjusts pay with firm's prosperity Scorecards align rewards with several specific organizational

outcomes

Concerns with performance pay

Weak connection between individual effort and rewards Reward amounts affected by external forces

Improving Reward Effectiveness

Link rewards to performance Ensure rewards are relevant Team rewards for interdependent jobs Ensure rewards are valued Watch out for unintended consequences

Corel Corp. With permission.

Job Design

Assigning tasks to a job, including the interdependency of those tasks with other jobs Organization's goal -- to create jobs that allow work to be performed efficiently yet employees are motivated and engaged

Job Specialization

Dividing work into separate jobs that include a subset of the tasks required to complete the product or service Scientific management
Frederick Winslow Taylor advocates job specialization Taylor also emphasized person-job matching,

training, goal setting, work incentives

Evaluating Job Specialization

Advantages

Disadvantages

Less time changing activities Lower training costs Job mastered quickly Better person-job matching

Job boredom Discontentment pay Higher costs Lower quality Lower motivation

Job Characteristics Model

Core Job Characteristics Critical Psychological States Outcomes

Skill variety Task identity Task significance Autonomy Feedback from job

Meaningfulness

Work motivation

Growth satisfaction
Responsibility Knowledge of results General satisfaction Work effectiveness

Individual differences

Job Rotation

Moving from one job to another Benefits

Minimizes repetitive strain

Job A Job B

injury Multiskills the workforce Potentially reduces job boredom

Job D

Job C

Job Enlargement

Adding tasks to an existing job Example: video journalist

Traditional news team

Employee 1 Operates camera Employee 2 Operates sound Employee 3 Reports story

Video journalist Operates camera Operates sound Reports story

Job Enrichment
Given more responsibility for scheduling, coordinating, and planning ones own work 1. Clustering tasks into natural groups
Stitching highly interdependent tasks into one job e.g., video journalist, assembling entire product

2. Establishing client relationships

Directly responsible for specific clients Communicate directly with those clients

Kambuku Empowerment
Pretoria Portland Cement introduced Kambuku, a companywide initiative that made the South African company more performance-oriented through employee empowerment.

Courtesy Pretoria Portland Cement

Dimensions of Empowerment
Selfdetermination Employees feel they have freedom and discretion Employees believe their work is important

Meaning

Competence

Employees have feelings of selfefficacy Employees feel their actions influence success

Impact

Supporting Empowerment

Individual factors
Possess required

competencies, able to perform the work

Job design factors

Autonomy, task identity,

task significance, job feedback

Organizational factors
Resources, learning

orientation, trust

Courtesy Pretoria Portland Cement

Self-Leadership

The process of influencing oneself to establish the self-direction and selfmotivation needed to perform a task Includes concepts/practices from:
Goal setting Social learning theory Sports psychology

Elements of Self-Leadership
Personal Goal Setting
Constructive Thought Patterns Designing Natural Rewards SelfMonitoring SelfReinforcement

Personal goal setting

Employees set their own goals
Apply effective goal setting practices

Elements of Self-Leadership
Personal Goal Setting Constructive Thought Patterns Designing Natural Rewards SelfMonitoring SelfReinforcement

Positive self-talk
Talking to ourselves about thoughts/actions Potentially increases self-efficacy

Mental imagery
Mentally practicing a task Visualizing successful task completion

Elements of Self-Leadership
Personal Goal Setting Constructive Thought Patterns Designing Natural Rewards SelfMonitoring SelfReinforcement

Finding ways to make the job itself more motivating

eg. altering the way the task is accomplished

Elements of Self-Leadership
Personal Goal Setting Constructive Thought Patterns Designing Natural Rewards

SelfMonitoring

SelfReinforcement

Keeping track of your progress toward the selfset goal

Looking for naturally-occurring feedback Designing artificial feedback

Elements of Self-Leadership
Personal Goal Setting Constructive Thought Patterns Designing Natural Rewards SelfMonitoring SelfReinforcement

Taking a reinforcer only after completing a self-set goal

eg. Watching a movie after writing two more sections

of a report eg. Starting a fun task after completing a task that you dont like

Chapter 6

Applied Performance Practices

Canadian OB 7e: McShane/Steen

31

2009 The McGraw-Hill Companies, Inc. All rights reserved