In the Jungle

This is Part 4 of my series on Employee Motivation

Equity Theory

This is a more recent theory. Equity theory is the root of the concepts we know call organizational justice. This theory is not as broad as the other two, but is still pretty informative. In general terms, equity theory posits that humans seek to maintain a balance between inputs and outputs.

• Inputs are anything employees contribute to the job, be it time, effort, education, dedication, passion, etc.
• Outputs refer to anything employees get out of a job. These can be things like compensation, benefits, awards, recognition, sense of belonging, etc.

Employees seek equilibrium between their inputs and outputs. Much of the research on this model of employee motivation revolves around the issue of inequity. If employees feel their inputs are greater than their outputs, they will attempt to increase their outputs. Failing that, they will try to reduce their inputs. Reduction in employee inputs seldom works out in a way employers enjoy.

This theory also focuses our attention on two aspects of organizational justice; distributive and procedural.

• Distributive justice refers to the distribution of organizational valuables. More often than not, this aspect of justice deals with how much compensation one employee receives relative to others. For instance, if one employee learns that another employee gets substantially more money for the same work, the first employee will feel that they are underpaid. They might have been perfectly fine with their compensation, until they learned that they received different (less) compensation than someone else.
  • This comparison occurs not just among peers, but also across levels of the organization. Supervisor tends to expect more compensation that those they manage.
  • Interestingly enough, this comparison is driven by the similarity between the employees being compared. Line workers seldom base equity perceptions on how much money the CEO is making. They are much more likely to compare themselves to other line workers, or to a lesser extent, their supervisors.
  • By the same token, CEOs tend to compare themselves to their line workers, or other executives in their organization when developing distributive justice perceptions. Their point of reference tends to be other CEOs. This is one possible explanation for the escalation in executive pay people keep writing about.
• Procedural justice refers to how decisions are made and how people are treated. When people talk about “office politics,” they are probably noticing that some people are treated differently than others. This happens all the time, and it is not always a bad thing; this preferential treatment is the cornerstone of Leader-Member Exchange (LMX) theory (another topic for another day). Here are the important bits for this theory:
  • Reduce systematic procedural inequity. People should be treated the same whenever possible. If an inequity must occur, then explain it to all parties involved.
  • Perhaps the most important lesson we can draw from this theory is to allow your employees sufficient amount of voice. People should have a say in the rules that impact them. Many times people will accept distributive and some procedural inequities, as long as they have been given a voice. Of course, it is not the act of speaking out that matters, so much as the sense that someone is listening to their concerns; that their input matters.

This is Part 3 of my series on Employee Motivation

Operant Conditioning

This is probably the most intuitive of all approaches, though I would be surprised if many people know what operant conditioning is. It is an early model of human learning that posits humans are motivated by the consequences of their behaviors. In other words, this approach is all about rewards and punishments.

This approach has quite a lot going for it, not the least of which is the fact that it works well.  The other important feature of this model is that it is largely intuitive. In fact, it is so intuitive that we sometimes get it wrong. Here are a few of the ways we can get this wrong.

• Rewards must have value to the person being rewarded. In modern humans, cash is king… but as many point out, it is not everything. Indeed, cash is not everything, but it is usually the best option. Cash has near universal appeal and even if the amount is not large, you don’t have to worry about how it will be interpreted (well, excluding issues of magnitude).
  • Time off is also a very valuable reward, don’t be stingy with it if you can help it.
  • I can’t think of any circumstances where a logo-slathered bauble is motivating to anyone. Avoid this like the swine-flu.
  • If you are using non-cash awards like points to exchange for goods and services (in psychology this is called a token economy), make sure that it is not seen as a cop out. Cheap items, exorbitant point costs, low item selection and obvious attempts to mask the cash value of prizes all have a way of reducing the effectiveness of these programs.
• Rewards must immediately follow the behavior you want reinforced.
  • Increased delay between behavior and reward decreases the effectiveness of the reward. This is why many rewards and recognition efforts are not particularly effective at changing human behavior.
  • Certificates aren’t effective for exactly this reason. They are certainly nice to have; they are inexpensive and can carry quite a bit of meaning. However, they take time to print. A more effective alternative is to have nice thank you cards on hand and write a personal comment in them immediately after someone does something you wish to reinforce.
  • Story time: When I was fresh out of undergrad, I worked for a new car dealer. I was a sales person (not a terribly good one, but that is a story for another time). One of the most incredibly motivating tricks of the trade were what we called spiffs- these were cash-in-hand bonuses (I have no idea why they were called spiffs). The idea was simple; the sales manager would point to a car that simply had to go and offered us 200 to 1000 dollars to sell it that day. This was on top of our commission pay. As soon as the car drove off the lot, the manager would pull us off to the side and lay a few crisp $100 bills. You better believe we did everything we could to sell those cars.
• Be clear about what you are reinforcing.
  • It is very easy to reward the wrong thing. For instance, do not expect to see increases in teamwork when all compensation and recognition is tied to individual performance. Further, do not expect to see creativity when you only reward accuracy. If you reward long term success with short term metrics, guess what you are going to get?
• Not every instance of a behavior must be rewarded.
  • This reward schedule is the worst kind of reinforcement. It works, but the behaviors revert back to normal very soon after reinforcement stops.
  • The best reinforcement schedule (timing) rewards behavior after a random number of the behavior has occurred.
• Punishment seldom works to change human behavior.
  • Punishment probably has probably only consistently works on dogs. Children and adults find ways around punishment.  Cats are immune (any that lived with me, anyway).
  • I know many of us have stories about how our parents brought us up. I am no exception to this rule. However, research repeatedly shows that punishment is not an effective method to change human behavior. It can immediately curb some behavior, but the behavior change lasts only as long as your vigilance. If punishment must be used, then it is best if it is immediately followed by reinforcement of desired behavior.

Update: I just read a very relevant post on the proper design of incentive programs. Check it out.