Application of Performance Management and Motivation Theories on a Workplace Scenario - Assignment Example

Management and Organisational Behaviour: Application of Performance Management and Motivation Theories on a Workplace Scenario This paper focuses on my personal experience of performance management, the description of its experience, its analysis, evaluation and application. It further gives an understanding of what is meant by the concepts of performance management, and how is it used within my organization in my home country Oman. It extends and constructs my understanding of what is meant by organizational justice, and how it can be explained and justified. The paper provides an overview of the process of decision making and how this process can affect employees’ performance. It discusses the reward management from the perspective of organization in practice and endeavours to establish how reward systems work within organizations and the impact of these systems on employees’ performance. It focuses on the motivational level of employees and the impact of motivation or lack of motivation on employees’ performance using two motivational theories. The importance of receiving feedback and the problems with not getting feedback for employees are also discussed. In the end the paper gives some recommendations to improve the performance management system through enhancement of employees’ motivation within my Oman based organization. Task 1: Scenario (576 words) Three years ago I was working as a Supervisor with the Directorate General of Administrative Development of Royal Court Affairs (RCA) in Sultanate of Oman. The whole thing seemed to be going well until one day when I was made to feel deprived. That day my manager called me for a meeting to discuss RCA employees’ performance. During the meeting he announced that names of the employees for the yearly bonuses have been decided. He informed me that some employees’ names were excluded from the bonuses considering their performance. Unfortunately, my name was not included in the list. The information was quite upsetting, annoying for me and felt extremely deprived and demotivated. I had worked very hard that year and considered myself to be one the best employees throughout. I had achieved all my tasks with wonderful outcomes, my colleagues and supervisors had been rating me quite high throughout the year. After the meeting I tried to talk to the manager about my concern for my performance appraisal but he refused to listen to me. He only pointed out that I need to improve my performance in order to get a bonus next year. I did not want to wait until next year to receive a bonus, as I felt I had deserved it this year for the work I accomplished. I also attempted to get myself transferred to some other departments within RCA but the manager refused to transfer me without even giving any reason for his refusal. The study of performance and reward management has been complex and challenging. It has been changing and developing throughout history. The importance of understanding these different concepts, along with how they have evolved over time is crucial when studying of performance and reward management. Studying performance and reward management while looking at organizations in general perspective is very important to understand and evaluate how well the employees perform their jobs. Performance management can be defined as the process through which employees and managers ensure that employees’ activities and outputs are fitting with the organizations goal. In human resource management the term performance management has been used for the process whereby employees’ performance is reviewed and managed (Bourne, Franco & Wilkes 2003). Measuring performance is a complex activity which needs a lot of talent and skilfulness. Joe et al. (2004, p. 239) assert ‘often, managers feel they do not know how to evaluate performance effectively, and employees feel they are excluded from the process and that their contributions are not recognized.’ Lee (1996, pp. 44-49) has also pointed out the problem of managers’ inefficiency to evaluate employees’ performance which ultimately lowers the motivation levels of the employees. This was what happened to me the inefficiency of managers at RCA deprived me of a well deserved bonus and lowered my level of motivation considerably. From my personal experience of performance working with RCA there are some other issues that need to be addressed. Gosselin, Werner & Halle (1997 p.315) discuss performance appraisal as ‘a social and communication process where the rater is considered the key actor.’ However, the performance appraisal systems that are used as the basis for HRM action, there is a further need to meet certain legal requirements and these can be broadly classified as individual rating scales and comparison methods. Therefore, in general, the employees’ acceptance of performance appraisal is very high, but sometimes the fairness and overall satisfaction with the performance management system is negative. Task 2.1 Impact of Events on Attitudes and Perceptions (793 words) Organizational justice is one of the most important issues that any organization should focus on. Organizational practices and outcomes are related to the three types of organizational justice i.e. distributive justice, procedural justice and interactional justice. Cohen-Charash & Spector (2001 p. 304) argue that work performance is strongly related to procedural justice, but hardly to distributive and interactional justice. However, from my personal experience, performance and the organizational justice, and job satisfaction are considered to be fundamental components of interactional justice because interactional justice is resolute by the interpersonal behaviour of management and these systems allow employees to show what is expected of them. Therefore management at RCA needs to develop strategy in order to address employees’ concern that hinders the achievement of organizational goals. This way RCA can improve the satisfaction level of its employees. The process of decision making is also vital to the progress of any organization. It requires a decision maker to recognize the situation in which the decision is to be taken. However, managers need to ensure employees involvement and participate in the process of negotiation as it is their routine duty. Elbanna (2006, p. 2) claims that there are two types of decision: programmed decisions and non-programmed decisions. Therefore, managers need to make decisions about both problems and opportunities. Elbanna (2006, p. 16) argues that managers have the power to influence the success of strategic decisions through the process in which they make their decision. But in my case, the process of decision making was not given importance. Employees were not involved in the process which had a negative impact on my next year’s performance as I felt I had been successful and deserved a bonus or at least a compliment or some positive reinforcement that would have allowed me to walk away valuing my position, and feeling good about my job. The situation not only had a negative impact on my attitude but also changed my perception about the decision makers. Insufficient reward management strategies also lead to decline in motivation and brings about negative change in employees’ attitudes and perceptions. Managers are often criticized for not coaching the employees directly in order to achieve their goals. O’Neill claims that employees want their pay and benefits, and if their due reward is given to they can achieve the organizational goals (1995 p.103). Kerr (1975 p. 769), however, argues that most of the organizations seek information concerning what activities should be rewarded and then these organizations offer rewards or at least pretend to do so. Reward system at RCA is not established with a clear goal. It keeps on changing from time to time without any clear reason. For example, if an employee gets a bonus this year, the management will not give him another bonus next year even if his/her performance is extraordinarily good. Top management at RCA need to device a reward system that has the ability to keep all the employees happy and satisfied. Wright & Staw (1999) claim that for most part in past the field of organization behaviour has ceased investigating whether happier workers are also more productive (1999 p. 2). Another extremely significant factor in performance management is motivation. Mitchell believes ‘Motivation is the psychological activity that causes arousal, direction, and persistence of voluntary actions that are goal directed’ (1982, p. 80). Employees’ motivation has been identified as among one of the most important factors for good productivity and organizational superior performance. Therefore, motivation is very important for all organizations, as it is the best way to retain employees, especially the skilled staff, and also to attract the new employees. The management is required to choose the best way to motivate employees, such as a cash reward, a vacation trip, job design, and promotions. However, in my personal experience, performance is not discussed with management in our organization, and they don’t try to motivate the employees in the best possible ways. The process of giving and receiving feedback is another vital area which has far reaching impact on employees’ performance, attitudes and perceptions. Cannon & Witherspoon (2005) claim that most manager hate giving critical feedback, and most employees detest receiving it. (p. 120). However, the feedback can be used for other areas of organizational development such as training needs analysis, management improvement, team satisfaction and coaching program. In some situations managers can use their emotions to give feedback; this is very difficult for managers as it sometimes puts them into an awkward situation. Managers who are trained in giving appropriate feedback incorporating positive reinforcement often succeed more than managers who lack specific training. The flaws prevalent in the feedback process at RCA have caused dissatisfaction and attitude change among the employees. Their perception about their organization has also undergone negative change. Task 2.2 Two Relevant Motivational Theories and impact of events in scenario upon the motivation of staff (776 words) Motivational Theory One: J Stacy Adam’s Equity Theory The equity theory was presented by J. Stacy Adam’s (1965, pp. 267-99) and was re-evaluated by a number of other researchers (e.g. Kilbourne & O’Leary-Kelly 1994, Goodman & Friedman 1971, Vecchio, 1981, Greenberg & Cohn 1982, Mowday, 1996, Mero 1999, Griffeth & Gaertner, 2001). The theory concerns with employees’ motivation as a group in which employees compare their rewards with other employees of their own or other organizations. Employees show interest in each other during work and social gatherings. They ‘observe each other, judge one another, and make comparisons’ the employees ‘also want their reward system to be fair’ and ‘tend to judge fairness by comparing the outcomes they receive with their relevant inputs and also by comparing this ratio with the ratio of other people’ (Newstrom & Davis 2002, p. 123). The theory posits that employees tend to analyze the fairness their input-output in order to compare it with the input-output of their co-workers and even the workers doing similar jobs in other companies. Inputs in the theory are the elements like effort, experience, education, and competence; while outcomes are represented by the elements like salary levels, raises, and recognition. Many studies (e.g. Walster & Scott 1978, Greenburg 1989, pp. 174-84) show that this perception of inequity and injustice can result into a variety of behavioural attitudes. Robbins (2003) believes that this sense of inequity can result into a variety of choices and the employees may: 1. Change their inputs (for example, don’t exert as much effort) 2. Change their outcomes (for example, individuals paid on a piece-rate basis can increase their pay by producing a higher quantity of units of lower quality) 3. Distort perceptions of self (for example, “I used to think I worked at a moderate pace but now I realize that I work a lot harder than everyone else.”) 4. Distort perceptions of others (for example, “Mike’s job isn’t as desirable as I previously thought it was.”) 5. Choose a different referent (for example, “I may not make as much as my brother-in-law, but I’m doing a lot better than my Dad did when he was my age.”) 6. Leave the field (for example, quit the job). (pp. 170-73) The theory appears to be ideal for organizations like RCA since employees at RCA usually think about all these choices due to a feeling of inequity and injustice. To avoid the negative impact of the actions taken by the employees due to these choices available to them, RCA needs to establish a strategy which may ensure distributive justice (the perceived fairness of the amount and allocation of rewards among individuals. It should also ensure procedural justice (‘the perceived fairness of the process used to determine the distribution of rewards’) in order to keep the employees motivated and content (Robbins 2003, 172). Motivational Theory Two: Victor H. Vroom’s Expectancy Theory Expectancy theory was developed by Victor H. Vroom (1973, 1988 & 2000) which was later refined by many other researchers (e.g. Field, Read & Louviere 1990). This theory is based on three factors namely valence, expectancy, and instrumentality. The degree of desire for a reward by an employee is called valence, the estimate of probability one has regarding his/her effort and the resultant successful performance is called expectancy, while the estimate that an employee’s performance will result in receiving a reward is termed as instrumentality. Newstrom & Davis (2002, p. 118) have developed the following formula for attainment of employees’ motivation: Valence × Expectancy × Instrumentality = Motivation The theory posits that an employee’s good performance depends upon his expectancy of a good performance appraisal which will then lead to organizational rewards such as promotions, increments, bonuses. The theory explains the reasons why certain employees are not motivated enough to do their jobs in a proper manner. Robbins (2003) explains the theory through three vital relationships that are important to understand the motivation level of employees in an organization: 1. Effort-performance relationship. The probability perceived by the individual that exerting a given amount of effort will lead to performance. 2. Performane-reward relationship. The degree to which the individual believes that performing at a particular level will lead to the attainment of a desired outcome. 3. Reward-personal goals relationship. The degree to which organizational rewards satisfy an individual’s personal goals or needs and the attractiveness of those potential rewards for the individual. (p. 173) The expectancy theory is directly relevant to the scenario prevalent at RCA where the employees lack motivation due to weak and uncertain reward policies. The organizational reward system also lack availability of specific personal goals for the employees that can lead to certain rewards. Group Dynamics and Teamwork (1316 words) Task 3: Recommendations: (2 pages) Managing Attitudes and Perceptions Rationale Feedback Mechanism A feedback mechanism is vital for the growth of RCA since due to lack of any feedback mechanism the employees usually don’t understand why they certain incentives have been given to them and others or why they have been deprived. The employees at RCA should be included in any job related development so that a direct feedback containing their opinion can be gathered. Feedback mechanism on group level can also be established by organizing discussions, informal meetings and seminars where employees are allowed to speak out their problems. Complaint or suggestion boxes can also be placed at different areas in order to give an opportunity to the employees to comment about their work related problems, their personal problems that may affect their performance and their concerns about their wages, promotions, bonuses and working hours. Reward Systems Every organization depends upon the individuals it has employed, particularly its managers. Motivating and rewarding these individuals for their good performance is vital to the job satisfaction of the employees and ultimately to the growth of the organization. Thus PCA can implement the following recommendations (as posited by Pearce and Robinson 1997) in order to establish and run its reward systems in a result oriented manner: 1. Rewards should be linked to the strategic plan: linking rewards mechanism with the accomplishment of key objectives can keep the employees focussed on the most productive and beneficial tasks. 2. A variety of incentives should be introduced which should be extended to every employee working at RCA: Some portion of each employee’s compensation should be linked to his/her performance in order to keep each employee motivated all the time. 3. Rewards and incentives have to be connected to an individual employee’s job and the outcomes the employee can personally effect: this will provide an opportunity to the employees to control what needs to be done in order to achieve the outcomes that can earn them incentives 4. Performance must be rewarded and value must be linked to success, rather than to position in the hierarchy: RCA can increase the motivational outcomes by structuring incentives and compensations to reward the key skills or expertise necessary for a strategy to be successful, rather than rewarding people according to their position in the organization. 5. Reward systems should be scrupulously fair and correct: reward systems based on justice and fairness at RCA will give a sense of equity and the employees will feel more contented and fulfilled. 6. Reward should be according to the proportion of success: The existing reward system at RCA is quite unscrupulous and has no definite structure. If the employees know that a bigger success will reward them greatly they will strive their best to improve their performance. Attitude Change and Attitude Surveys Robbins (2003) defines attitudes as ‘evaluative statements—either favourable or unfavourable—concerning objectives, people, or events. They reflect how one feels about something.’ (p. 71). Attitudes like job involvement and commitment to goals have positive impact while the attitudes resulted out of low levels of motivation have a negative impact on an organization (Blau 1986). RCA’s indifference to attitudinal surveys has created a wide gap between the workers and the management. An attitude survey according to Robbins (2003, p. 76) is eliciting responses from employees through questionnaires about how they feel about their jobs, and the organization. These surveys at RCA will play a vital role in formulation or policies regarding reward systems, performance enhancement, job satisfaction, productivity enhancement, and administrative control. Mentoring and Communications Mechanism No mentoring or communications mechanism is available at RCA. Mentoring tends to positively convey strengths and weaknesses of an individual and communicates micro and macro level goals to the employees. It can also address grievances, complaints and misunderstandings of individual employees and groups. A communication mechanism will ensure rapport between the supervisors and workers and will increase understanding to ultimately heighten job satisfaction. Enhancement of Managerial Skills Unskilled managerial practices are causing multifarious risks at RCA. Employees are aware of the weakness and imperfections of their managers and this phenomenon has lowered the levels of their job satisfaction. It has also enhanced a sense of depravity and insecurity. RCA stakeholders must device a managerial training programme to enhance managerial skills among its managers. This will reverse the negative impacts created by the flawed management practices of the past. Actions to improve motivation Rationale Employee Recognition Programme. Employee recognition programmes at RCA can help motivate the under motivated employees. This programme may consist of personal attention, expressing interest, approval and appreciation for an employee who has done a good job. Accomplishment of various workers must be recognized through public displays on notice boards, award of certificates, and monitory awards. Employees who do exceptionally good jobs must be invited to the annual meetings and their efforts should be recognized by the top management hierarchy. Employees should also be given opportunity to have their say in policy making processes. Motivational theories should be applied in true spirit. Equity and expectancy theories must be applied as suggest above in order to keep the employees motivated. Distributive and procedural justice will enhance the motivation level of the employees at RCA and equity based reward and promotion systems will enhance the level of satisfaction and improve the quality of performance of the employees. Employee Involvement Programmes Application of theories like participative management, empowerment, employee ownership and employee participation are cumulatively called employee investment programmes. All these programmes ensure employee involvement and increase employees’ job satisfaction levels and increases their commitment to the organization. Employees at RCA, through this programme, will become more productive, committed and satisfied with their jobs. Understanding Individual Differences Understanding of individual differences can provide information to the managers that can be utilized to understand homogeneity of the employees and their individual needs. Understanding of individual needs and employee diversity can help managers device more focused policies aiming at enhancement of performance, betterment of attitudes, improvement of perceptions and attainment of broader goals of the organization. Employees’ Proper Placement Employees must be placed keeping in view their education, training and skills. Even the best efforts of employees will bear no good results if they are placed on an inappropriate job. RCA should follow proper recruitment and selection techniques in order to appoint a proper worker for each specific job. Actions to improve Group and Team Dynamics Rationale Group thinking Mechanism and Group Empowerment Group dynamics is the process by which people interact face to face in small groups (Newstrom & Davis 2002, p. 285). Formal and informal groups play important in the growth of an organization. Informal groups produce informal leaders who can have influence on the members of these groups. Formal groups, on the other hand, are established formally by the organization. These include committees, task forces, boards, and other groups that are assigned the task of decision making. Creating consensus is important in group thinking. RCA needs to improve participation and dynamics of the formal groups. It also needs to identify leaders of the informal groups in order to benefit from their role as informal leaders. Empowerment of the groups at RCA is not at place since the top management tends to make decision on its own. Empowering small formal groups can improve policy making mechanism at RCA. Teamwork and Effective Teams Teamwork enhances the capabilities of individual workers and the organization. Teams must be formed carefully and must be given assigned with clear and measureable goals. RCA needs to provide more supportive environment to its teams by demonstrating faith in the capabilities of the members of its teams. It also needs to define the roles of each member of the team in a clear way. Members of formal teams and groups at RCA are usually not provided with clear goals. Groups should be made carefully and their goals should be set and explained comprehensively by the RCA management. Task 4: Reflection (442 words) Reflection in relation to conclusions drawn from the scenario After a thorough discussion of the scenario it can be concluded that The Directorate General of Administrative Development in Royal Court Affairs (RCA) needs to implement changes in their best practices, and in performance measurement and management. Secondly the RCA needs to improve the processes of the performance management appraisals. Thirdly the Royal court Affairs needs to be aware of giving, and receiving employee feedback, while explaining how the employees can improve their performance through a more effective feedback and more encouraging and motivating workplace environment. The Royal Court Affairs needs to be aware of the motivational levels of its employees and how it is influencing the individual performance of its employees. Motivation is not just about bonuses and pay increases. Motivation can come through a variety of factors as discussed by Equity and expectancy theories. The Royal Court Affairs needs to use fairness and equity within the organization to achieve the organizational goals. RCA should take steps to enhance employees’ satisfaction though employees’ encouragement, reward mechanism, team empowerment, feedback mechanics, and job security measures. The RCA needs to use reinforcement for positive performance by going beyond the cash rewards. The RCA should state clear goals for motivation and reward management. RCA can improve employees’ performance by shifting its focus from the issues of profits and productivity to employees satisfaction and happiness. To conclude, I would say that I have learnt a lot out of application of motivational theories and performance management on my own workplace scenario. I have enhanced my knowledge of how this a specific scenario can be described, analyzed, evaluated and applied. It has given me an understanding of what is meant by the concepts of performance management, equity theory and expectancy theory and how these theories can be used within my organization in Oman. It has given me an understanding of what is meant by organizational justice and how it can be explained and justified. By providing an overview of the process of decision making and how that influences the employees’ performance my knowledge of organizational behaviour has been furthered and I feel confident about the application of these principles practically in my organization once I go back home. This paper discussed the reward management from an organization in practice, along with how reward systems work with the organization, and further its effect on the employees’ performance. This paper has shown the significance of motivation level, and how motivation can affect the employees’ performance, while stressing the importance of receiving feedback and the problem with not getting feedback. The recommendations given in the end of this paper have a pragmatic appeal and can be applied conveniently at RCA. List of References Adams, JS 1965, ‘Inequity in social exchange’, in L. Berkowitz (ed.), Advances in Experimental social Psychology, vol. 2, New York, Academic Press. 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