Employee Motivation and Organizational Performance

Employee Motivation and Organizational Performance

An organization consists of a large or small group of individuals which is working under the direction of a management and a system for the accomplishment of certain common objectives. The individuals forming the group are the employees of the organization who contribute their efforts towards the achievement of the organizational objectives.  Employees are very vital and an integral part of the organization. They are important for the organization for its functioning. The employees are to display positive attitude towards work so that the organization can function well.

The organization is considered to be performing if it is achieving its objectives. The objectives for the determination of the organizational performance are normally directed towards achieving improved profits, productivity, sales, innovativeness, market share, and shareholder wealth. The organizational performance is normally considered successful if it accomplishes its goals (effectiveness) using a minimum of resources (efficiency).

The performing organization ensures that its objectives are consistently being met in an effective and efficient manner. Management of such an organization focuses on the effective and enhanced performance of the organizational resources (materials, plant and equipment, and financial capital), processes and systems, and employees (human resource) towards meeting the strategic objectives and the priorities of the organization. Hence, the performance of the organization is decided by the processes which are implemented for improving both the effectiveness of the organization as well as the well-being of the employees through planned interventions.

Essentially, performance is a function of ability, the perception of the task required, and the efforts put in. Performance accomplishment, in turn, is related to the rewards and the satisfaction. In the present day environment, an organization is highly dependent on the work motivation level of its employees for its performance. It is now universally recognized that the employees’ motivation play a dominant role in the performance of the organization. When there is a low level of employees’ motivation, then it leads to low employees’ morale, lack of employees’ commitment and low productivity of the employees which gets reflected in the organizational performance.

Employees are one of the vital organs of the organization. For leading the organization to success, they are to function in a manner so that the other vital organs of the organization also functions well and when all the organs of the organization functions well, it leads to the improvement in the organizational performance.

Employees constitute the most important organizational asset which is having the highest significance to the organization. Their performance has a major impact on the performance of the organization. When the employees act diligently, intelligently, and in appositive manner, then they give outstanding performance, and because of this, the performance of the organization improves and becomes superior. In fact, there is a close relationship between the employees’ performance and the organizational performance with the performance of the employees critically influencing the performance of the organization measured by the parameters of (i) productivity, (ii) profit, (iii) employee turnover, (iv) employee accidents, (v) quality of work life, (vi) product quality, and (vii) customer satisfaction. Hence, the organizational management is to ensure that the work efforts of the employees are directed towards the organizational objectives so that the organization can perform well for improving its performance parameters. To achieve this, management has to make effective strategies for improving the motivational levels of the employees for the sake of the organizational performance.

There are several factors which influences the employees’ performance. The major factors include (i) employee motivation, (ii) teamwork, (iii) training and development, (iii) performance appraisals, (iv) employee satisfaction, (v) compensation, (vi) job security, (vii) incentives and rewards, (viii) work environment, and (ix) organizational structure. Though all these factors are important, employee motivation is the one which has a very high influence on the performance.

Employees’ motivation is driven by the internal rather than external elements of the organization. It means that the employees are to be involved in a continuous striving effort for improvement. Employees’ motivation is a psychological process which results from the interaction of the employees with the work environment and is characterized by the willingness of the employees to increase their work effort in order to achieve a specific need or desire they hold. Motivation mainly consists of three components namely (i) direction which means what is expected from the employees, (ii) effort which means how much endeavour the employees put in into their work for achievement of the results, and (iii) persistence which means how long the employees keep on trying for achieving the result.

Motivated employees are essential for the organization which desires to improve its performance. In this context, motivation means the willingness of the employees to make efforts and take action towards organizational objectives. The challenge for the organizational management is to see that not only the employees are motivated but the employees’ motivation is also sustained.

Motivation helps in the goal directed behaviour of the employees. There are several definitions for the employees’ motivation which have evolved over the time. The common thing in these definitions of the motivation is that the motivation provides the employees the stimuli, push, and drive among others which propel them to act in a specific and particular way. It creates a desire in the employees to achieve beyond expectations. It provides the employees an inner force which drives their level of effort, determination and energy in the face of the obstacles and the impediments to accomplish the objectives.

Motivation increases the trust of the employees in the organization. The employees feel appreciated and work with enhanced enthusiasm which leads to their better productivity and loyalty. It is often said that a motivated employee is a productive employee. Hence, special attention is required from the organizational management to see that the employees of the organization remains continuously motivated. The management which achieves success in this ensures a good performance of the organization.

Employees’ motivation is not a simple concept. It relates to various drives, desires, needs, wishes and other forces. For the sake of the organizational performance, the management is to provide an environment in the organization which motivates the employees. Motivation in the employees induces the required drives and desires towards their performance.

Employees are normally guided by four basic drives for their motivation. These are the drives (i) drive to acquire, (ii) drive to bond, (iii) drive to comprehend, and (iv) drive to defend. These four drives lead to high levels of engagement, satisfaction, commitment and a reduced intention to quit, in the employees which ultimately lead to better their performance and hence the organizational performance. Management is to see that the requirements for each these four drives are best met by a distinctive organizational lever of motivation.

The drive to acquire is met when the management discriminates between good, average and poor performers by tying to reward clearly and transparently the performance of the good employees and providing them opportunities for advancement. The drive to bond is fulfilled when a culture promotes teamwork, collaboration, openness and friendship. Management encourages care about the employees, and the employees encourage care for each other to bring the behaviour of the belongingness in the employees. The drive to comprehend is supported when the job design involves creating and specifying jobs which are meaningful, interesting and challenging. Employees are also challenged to think more creatively and broadly about how they can contribute to make a difference to the organization, customers, and investors. The drive to defend is met when there is increased transparency, fairness and equity over all the processes. To emphasize these characteristics, performance management and resource allocation processes are used. These processes make evaluation and decision taking processes transparent, fair and clear.

The major factors which influence the employees’ motivation are (i) salaries and compensation, (ii) incentives and rewards, (iii) work-life balance, (iv) promotional opportunities for growth, (v) praise and recognition, (vi) organization’s culture, (vii) employees’ empowerment and assigning of the responsibilities, (viii) impartiality and transparency in employees’ related decisions and employees’ related organizational policies, and (ix) effective and transparent communication . A number of studies on the employees’ motivation has brought out that the increase in salaries and compensation alone is not enough for motivation of the employees and there are other motivational factors which contribute for the improved performance of the employees. The conceptual relationship between employees’ relationship and organizational performance is shown in Fig 1.

Fig 1 Conceptual relationship between employees’ relationship and organizational performance

To understand how the different organizational cultures can be used as an organizational lever which facilitates employees’ motivation, there is a need to identify the prevailing types of organizational cultures. The framework of the organizational cultures specifies that the cultures can be seen in terms of two sets of competing values namely (i) the dilemma over flexible and control values, and (ii) the dilemma over employees (internal) and organizational (external) focus. Four types of cultures emerge from these two sets of competing values. These are two flexible cultures (team culture and innovation culture) which emphasize an internal or external focus, and two control cultures (hierarchy culture and market culture) which also emphasize an internal or external focus. Flexible cultures encourage employees’ empowerment and creativity, while the control cultures aid implementation of the new ideas. The team culture places a great deal of emphasis on human affiliation in a flexible structure, internal focus on cohesion and morale, and employees’ development to create team spirit. The innovation culture places a great deal of emphasis on change through a flexible structure, external focus that requires a readiness to grow through risk-taking, innovation, planning and adaptability, resource acquisition and cutting-edge output. The hierarchy culture or bureaucratic culture places a great deal of emphasis on structure characterized by bureaucratic mechanisms which provide clear roles and procedures which are formally defined by rules and regulations. It is internally oriented, and stresses the role of information management, communication and routines to support an orderly work environment with sufficient coordination and distribution of information to provide employees with a psychological sense of continuity and security through conformity, predictability and stability. The fourth culture known as the market culture or competitive culture places a great deal of emphasis on control mechanisms in an externally focus structure. This culture values competition, competence, and achievement. Clear objectives, goal setting, productivity and efficiency are rewarded. Each type of these four cultures is viewed as an organizational lever to fulfill the drives which motivates the employees.

Employees can also get motivated themselves by seeking work where their individual goals, needs and wants are achieved. Both the intrinsic factors and the extrinsic factors influence the employees’ motivation.  Intrinsic motivation is the motivation which comes from inside of the employee. The motivation is generated through satisfaction and pleasure that the employee gets in completing or working on a task. Factors which influence intrinsic motivation include responsibility, freedom to act, scope to use and develop skills and abilities, interesting work, and opportunities for advancement. These motivating factors, which are concerned with the quality of life, tend to have a long term effect since they are inherent in individual and not imposed from outside. On the other hand, the extrinsic motivation is something which is done to or for employees to motivate them. It arises from factors outside the employees, such as pay, position and punishments (criticism). These are rewards which provide the employees the satisfaction and pleasure which the task itself might not provide. The extrinsically motivated employees can work on a task even when they have little interest in it. This type of motivation usually has an immediate and powerful effect, however it does not tend to last for a long time.

Employees’ motivation leads to healthy and safe practices at the work place. Employees concentrate more on the job, put their best efforts on the job, and do not waste their time in the non productive activities. They are more committed to their jobs. They enjoy their job and get a feeling of happiness and satisfaction while working on the job. This results into higher attention of the employees towards their work which in turn leads to improvement not only in the volume of their output but also towards the quality of the work as well as the output quality.

Motivation of the employees brings along with it (i) flexibility of work, (ii) the challenging and interesting traits of the work, and (iii) a good and co-operative relationship with the supervisors and the colleagues. The employees get increasing clarity with respect to the goals, priorities, and objectives at work place. They are inspired to give their best efforts and meet the set goals and once they achieve the set goals it further motivate them to perform even better. This produces a spiraling effect for the improvement in their performance.

Motivated employees perform work better than those employees who lack motivation. They are more innovative as they are always looking for better ways to complete a task. They are self-directed and goal-oriented. They can produce high-quality work with more or maximized efficiency and productivity which also leads to the improvement in the performance of the organization.

Motivated employees are crucial for the success of the organization. The organization can reach some level of success without highly motivated employees but it rarely achieves its full potential. Employees being human need to be rewarded and encouraged for their efforts. Motivation and reward has a strong link. It is therefore necessary for the organization to find out what motivates its employees so that it can suitably plan a reward system and gain better results. The right combination of material and immaterial rewards can boost up the work motivation of the employees and enhanced their commitment to the organization.

Organizational management is required to consider the employees’ motivation as one of the organizational policies to increase effectively the performance of the employees at the workplace. It is an accepted fact that the motivation causes changes in the employees’ behaviour which makes them work intelligently, harder and smarter. Management is to positively reinforce those employee behaviours which lead to positive outcomes and negatively reinforce those employee behaviours which lead to negative outcomes. This improves their quality of work as well as improves their productivity and performance which in turn improves the performance of the organization.

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