Motivating employees (Chapter 6).

Question 1

Define motivation.

Answer 1

Motivation is the reason why employees want to work hard and work effectively for the business.

Question 2

What are the five reasons why people work?

Answer 2

• Money.
• Security.
• Job satisfaction.
• Esteem needs (self-importance).
• Social needs (affiliation).

Question 3

Why would money be a reason why people work?

Answer 3

To pay for necessities and some luxuries.

Question 4

Why would job satisfaction be a reason why people work?

Answer 4

Enjoyment is derived from feeling that you have done a good job.

Question 5

Why would esteem needs (self-importance) be a reason why people work?

Answer 5

Feeling important, feeling that the job you do is important.

Question 6

Why would security be a reason why people work?

Answer 6

A sense of security, i.e. knowing that your job and pay are safe - you are not likely to lose your job.

Question 7

Why would social needs (affiliation) be a reason why people work?

Answer 7

Feeling part of a group or organisation, meeting people, making friends at work.

Question 8

What is the main benefit of a well motivated workforce?

Answer 8

High productivity - high output per worker - in a business usually comes from a workforce that is motivated to work effectively and from this comes increased profits.

Question 9

A well-motivated workforce gives benefits to a business, including:

Answer 9

• High output per worker - which helps to keep costs low and increase profits.
• Willingness to accept change, for example, new methods of working.
• Two-way communication with management, for example, suggestions for improving quality.
• Low labor turnover - a loyal workforce - this reduces the cost of recruiting workers who leave.
• Low rates of absenteeism - reducing the disruption caused by absence from work.
• Low rates of strike action - avoiding damage to customer relations.

Question 10

What leads to high profits?

Answer 10

well-motivated workers → high productivity (employees work more effectively) → increased output → higher profits.

Question 11

What leads to lower/ no profits?

Answer 11

unhappy workers → do not work very effectively → low output → lower/no profits.

Question 12

Abraham Maslow proposed a heirarchy of needs. From the top going down, what were these needs?

Answer 12

• Self-actualisation.
• Esteem needs.
• Social needs.
• Safety/security needs.
• Physiological needs.

Question 13

What are the two points to remember for self-actualisation?

Answer 13

• Succeeding to your full potential, feeling that you have done a good job not just for financial and personal reward.
• Being promoted and given more reponsibilty.

Question 14

What are the two points to remember for esteem needs?

Answer 14

• Having status and recognition, achievement, independence.

- Being given recognition for a job well done.

Question 15

What are the two points to remember for social needs?

Answer 15

• Friendship, a sense of belonging to a team.

- Work colleagues who support you at work.

Question 16

What are the two points to remember for safety/security needs?

Answer 16

• Job security.

- Protection against danger, protection against poverty, fair treatment.

Question 17

What are the two points to remember for physiological needs?

Answer 17

• Wages high enough to meet weekly bills.

- Food, rest, recreation, shelter.

Question 18

What did Maslow suggest about level advancement?

Answer 18

Maslow also suggested that each level in the hierarchy must be achieved before an employee can be motivated by the next level.

Question 19

What is one problem associated with Maslow’s hierarchy?

Answer 19

There are problems in that some levels do not appear to exist for certain individuals, while some rewards appear to fit into more than one level.

FOR EXAMPLE: Money allows basic needs to be purchased, but high pay can also be a good status symbol or indicator of personal worth.

Question 20

What should managers do regarding Maslow’s hierarchy?

Answer 20

Managers must identify the level of the hierarchy that a particular job provides and then look for ways of allowing the employees to benefit from the next level up the hierarchy.

Question 21

What is one of the tasks of managers?

Answer 21

One of the tasks of management is to encourage the workforce to contribute fully to the success of the business.

Question 22

Compare how people who work for themselves (entrepreneurs) and people who work for someone else work?

Answer 22

When people work for themselves, for example, entrepreneurs, they tend to work hard and effectively as they see the direct benefits of their efforts. However, once people work for someone else then they may not work as effectively.

Question 23

What did Frederick Taylor base his ideas on?

Answer 23

Taylor based his ideas on the assumption that all individuals are motivated by personal gain and therefore if they are paid more, they will work more effectively.

Question 24

What were the three criticisms of Taylor’s ideas?

Answer 24

• His ideas were too simplistic - employees are motivated by many things and not just money.
• A practical problem arises if you cannot easily measure an employee’s output.
• You can pay an employee more money, but if they are unfilled by their work in some way, there will be no increase in their effectiveness at work and there will be no productivity gains.

Question 25

What was Frederick Herzberg’s theories?

Answer 25

According to Herzberg, humans have two sets of needs; one is for the basic needs, which he called ‘hygiene’ factors or needs, and the second is for a human being to be able to grow psychologically which he called ‘motivational’ needs or ‘motivators.’

Question 26

What are the five motivators according to Herzberg?

Answer 26

• Achievement.
• Recognition.
• Personal growth/development.
• Advancement/ promotion.
• Work itself.

Question 27

What are the seven ‘hygiene’ or ‘maintenance’ factors?

Answer 27

• Status.
• Security.
• Work conditions.
• Company policies and administration.
• Relationship with the supervisor.
• Relationship with subordinates.
• Salary.

Question 28

According to Herzberg, the ‘hygiene’ factors must be satisfied; Why?

Answer 28

According to Herzberg, the ‘hygiene’ factors must be satisfied; if they are not satisfied, they can act as demotivators to the worker.

NOTE - They do not act as motivators, as once satisfied the effects of them quickly wear off.

Question 29

What are the methods of payment or financial reward used to provide?

Answer 29

The methods of payment or financial reward are used to provide incentives to employees to encourage them to work hard and effectively.

Question 30

What are the five most frequently used methods of financial reward?

Answer 30

• Commission.
• Profit sharing.
• Bonus.
• Salary.
• Wage.

Question 31

What is profit sharing?

Answer 31

Profit sharing is a system whereby a proportion of the company’s profits is paid out to employees.

Question 32

Why would profit sharing motivate employees?

Answer 32

This additional payment should motivate the workers to work hard as they all receive a share of the profits earned by the business.

Question 33

Where is profit sharing often used?

Answer 33

Profit sharing is often used in the service sector where it is difficult to identify an individual employee’s contributions to the increased profits, but they will all benefit from more productive work.

Question 34

What are the two possible limitations of profit sharing?

Answer 34

• If the business makes very little or no profits, them no profit share will be possible, leading to employee disappointment.
• The profit share is usually calculated on the basis of an additional percentage of a workers existing wage or salary (higher paid workers will receive a higher profit share) leading to a bad feeling among lower paid workers.

Question 35

What is commission?

Answer 35

The commission is a payment relating to the number of sales made (often paid to sales staff).

NOTE - Commission is paid in addition to the existing wage or salary.

Question 36

What encourages sales staff on a commission salary to sell as many products as possible and why is this good for a business?

Answer 36

For sales staff, the more sales they make the more money they are paid leading to an increase in sales for a business.

Question 37

What are the three possible limitations for a commission based salary?

Answer 37

• If the sales staff are very persuasive and encourage people to buy goods they don’t really want, then the business may see its sales increase only in the short term and then fall again as it gets a bad reputation.
• It can be stressful for the sales staff because, if they have a bad month, their pay will fall.
• There might be too much competition between sales staff.

Question 38

What is a wage?

Answer 38

A wage is a payment for work, usually paid weekly.

Question 39

What is time rate?

Answer 39

Time rate is the amount paid to an employee for one hour of work.

Question 40

What are the two drawbacks of wages?

Answer 40

• As the wages are paid weekly, they have to be calculated every week, which takes time and money.
• Wage clerks are often employed to perform this task.

Question 41

What are the two benefits of wages?

Answer 41

• The worker gets paid on a regular basis and does not have to wait long for some money.
• If the employee works longer than their normal hours, they can usually be paid overtime.

Question 42

When calculating the wages to be paid, they can be worked out in a number of different ways. What are the two main ways?

Answer 42

Time rate and piece rate.

Question 43

What is the benefit of time rate?

Answer 43

• This makes it easy to calculate the worker’s wages and the worker knows exactly how much they will be paid for working a certain period of time.

Question 44

What are the four possible limitations of time rate wages?

Answer 44

• The hours are often recorded on a timesheet which must be filled in and used the calculate the wages by the Accounts department (takes time).
• Good and bad workers get paid the same amount of money.
• A clocking-in system is needed to determine the number of hours worked by the employees.
• Often supervisors need to make sure the workers keep working and producing a good quality product (expensive because more supervisors are needed).

Question 45

Where is time rate used?

Answer 45

Time rate is used where it is difficult to measure the output of the worker (bus driver or hotel receptionist for example).

Question 46

What is piece rate?

Answer 46

Piece rate is an amount paid for each unit of output (the more they make, the more they get paid).

Question 47

What is the advantage of piece rate?

Answer 47

The advantage of this system is that it encourages workers to work faster and produce more goods.

Question 48

What are three possible limitations of piece rate?

Answer 48

• Workers are often paid a guaranteed minimum amount of money in the case that the machinery breaks down.
• Workers who are careful in their work will not earn as much as those who rush, which may not be seen as fair.
• Workers may concentrate on making a large number of products and ignore quality, producing goods that may not sell very well because they are of poor quality. NOTE - a quality control system is needed and this is expensive.

Question 49

What is a salary?

Answer 49

A salary is a payment for work, usually paid monthly straight into a bank account.

NOTE - It is usual for office staff or management to be paid salaries.

Question 50

What are the two possible limitations of salaries?

Answer 50

• Workers may prefer to be paid weekly.

- No payment for extra time worked - workers may be reluctant to worklonger.

Question 51

What are the benefits of salary payments?

Answer 51

• The payment has to be calculated only once a month instead of at least four times a month.
• The employer has the money in their bank account for longer than if they were paying their workers’ wages, as salaries are paid only once a month.
• A salary is divided into 12 monthly amounts meaning it is easy to calculate salary costs for the business.

Question 52

What is a bonus?

Answer 52

A bonus is an additional amount of payment above basic pay as a rewards for good work.

Question 53

Why does being paid a bonus have a positive motivating effect?

Answer 53

Workers often consider themselves to be recognised and special if they are paid a bonus.

Question 54

What are two possible limitations of bonuses?

Answer 54

• Bonuses can become expected every year and if they are not paid then employee disappointment can be difficult to manage.
• If only one or a small number of workers are paid bonuses, then bad feelings can be caused as other workers resent this and question why they did not receive one.

Question 55

Give five examples of fringe benefits or perks.

Answer 55

• Company vehicle.
• Discounts on the business’s products.
• Health care is paid for.
• Children’s education fees paid.
• Free accommodation.
• Share options.
• Generous expense accounts (for food and clothing).
• Pension paid for by the business.
• Free trips abroad/holidays.

Question 56

Define job satisfaction?

Answer 56

Job satisfaction is the enjoyment derived from feeling that you have done a good job.

Question 57

What are five examples of ways in which a business can increase the job satisfaction?

Answer 57

• Job rotation.
• Job enrichment.
• Autonomous work groups or team working.
• Training.
• Opportunities for promotion.

Question 58

Define job rotation.

Answer 58

Job rotation involves workers swapping around and doing each specific task for only a limited time and then changing around again.

Question 59

What does job rotation increase?

Answer 59

This increases the variety in the work itself and also makes it easier for the managers to move workers around the factory if people are ill and their jobs need covering.

Question 60

What is job enrichment?

Answer 60

Job enrichment involves looking at jobs and adding tasks that require more skill and/or responsibility.

NOTE - Additional training may be necessary.

Question 61

What is a promotion?

Answer 61

Promotion is the advancement of an employee in an organization, for example, to a higher job/ managerial level.

Question 62

How will employees feel after being offered a promotion?

Answer 62

Employees offered promotions will feel recognized, have a higher status, and will be given more challenging work to perform.

Question 63

What is training?

Answer 63

Training is the process of improving a worker’s skills.

Question 64

How will workers feel if they have been selected by management for training?

Answer 64

Workers can also feel as if they have been selected by management for training courses and this can give them a feeling that their good work has been recognized.

Question 65

Improving a worker’s level of skills through training can have beneficial effects of motivation levels. What are the two benefits?

Answer 65

• First, workers can feel a great sense of achievement if they successfully gain and apply new work-based skills.
• Second, they could now be given more challenging and rewarding work to perform.

Question 66

Define the term teamworking.

Answer 66

Teamworking involves using groups of workers and allocating specific tasks and responsibilities to them.

NOTE - Teamworking involves a group of workers being given responsibility for a particular process, product or development.

Question 67

The workers of a team can become more involved in the decision-making and take responsibility for this process. What does this give?

Answer 67

This gives a feeling of control over the jobs/tasks and the employees feel more committed, therefore increasing job satisfaction.