Human Resource Management and Motivation Theories

Human Resource Management

is the organisation of employees' roles, pay, and working conditions.

Effective Human Resource Management

can enable a business to retain its employees, as it promotes high levels of motivation and job satisfaction among staff.

Motivation

the willingness of an individual to expend energy and effort in completing a task.

Maslow's Hierarchy of Needs

a motivational theory that suggests people have five fundamental needs, and their sequential attainment of each need acts as a source of motivation.

Physiological Needs

the basic requirements for human survival, such as food, water, and shelter.

Safety & Security Needs

the desires for protection from dangerous or threatening environments.

Social Needs

the desires for a sense of belonging and friendship among groups, both inside and outside the workplace.

Esteem Needs

an individual's desires to feel important, valuable, and respected.

Self-Actualisation Needs

the desires for an employee to reach their full potential through creativity and personal growth.

Maslow's Hierarchy of Needs (Ad's)

-Can help managers determine which level of the hierarchy is motivating an employee.

-Motivation can occur quickly when employees progress through the lower levels of the hierarchy.

-Employees can work in an engaging environment that allows them to reach their full potential.

Maslow's Hierarchy of Needs (Dis Ad's)

-Not all employees will be motivated by the same needs at once.

-It may be time-consuming for a manager to determine the level of each individual employee, and implement appropriate strategies for each.

-Satisfying physiological and esteem needs may result in a direct increase in business expenses.

Application of Physiological Needs in Business

using the wages they earn from work to purchase essential items, such as meals and housing.

Application of Safety & Security Needs in Business

avoiding physical harm in the workplace, while security needs include having a stable income and job security.

Application of Social Needs in Business

encouraging team-based work, celebrating employee birthdays, and organising collaborative events to commemorate important milestones.

Application of Esteem Needs in Business

acknowledging their strong performance with monetary rewards, increasing their job responsibilities, or promoting them to a higher position.

Application of Self-Actualisation Needs in Business

Employees strive to achieve personal growth and advancement through their work.

Engaging Environment

Allows employees to reach their full potential.

Lawrence & Nohria's Four Drive Theory

A motivational theory suggesting that people strive to balance four fundamental desires.

Four Universal Drives

Can be applied to business settings to understand employee motivation, relating to their desires to acquire, bond, learn, and defend.

Drive to Acquire

The desire to achieve rewards and high status.

Motivation from Drive to Acquire

Motivates employees who want to receive financial and nonfinancial rewards in recognition of their effort and performance.

Drive to Bond

The desire to participate in social interactions and feel a sense of belonging.

Motivation from Drive to Bond

Employees seek to engage in social activities with others and develop positive relationships.

Drive to Learn/Comprehend

The desire to gain knowledge, skills, and experience.

Motivation from Drive to Learn

Employees seek to improve their capabilities at work through training, mentoring, job rotation, and taking responsibility for new tasks.

Drive to Defend

The desire to protect personal security as well as the values of the business.

Motivation from Drive to Defend

A manager must ensure employees can defend themselves and the business when required.

Laurence and Nohria Four Drive Theory (Advantages)

-Provides a simple approach for motivating employees and is easy for managers to implement.

-All four drives can be attained simultaneously, and are not restricted to sequential orders

-Satisfying drives can improve employee performance and business productivity and therefore increase business profits.

Laurence and Nohria Four Drive Theory (Disadvantages)

-Managers may find it difficult to manage four drives simultaneously.

-Some drives can be overlooked and therefore, an employee's full potential may not be achieved.

-Employees may not value all drives equally and therefore, a balance between drives cannot be achieved.

Goal Setting Theory

a motivation theory that states that employees are motivated by clearly defined goals that fulfil five key principles.

Five key principles of Goal Setting Theory

Clarity: specific and easy to measure

commitment: incorporate personal interests of employees

challenge: difficult enough to encourage employees

task complexity: achievable and not overwhelming

feedback: managers should provide regular support

Process of implementing goal setting theory

1: employee discusses their personal goals with manager

2: manager set clear and achievable goal together

3: manager regularly checks employee progress and provides support

4: manager celebrates and rewards employee for reaching goal

5: manager and employee set new goal

Goal Setting Theory (Ad's)

-Goals that align employee goals with achieving business objectives are likely to improve business performance.

-The process of managers setting goals with employees can improve levels of trust and the relationship between employees and management.

-When employee goals align with business objectives, they can contribute to a business's financial aims, such as increasing sales and net profit.

Goal Setting Theory (Dis Ad's)

-It may be difficult for a manager to always align an employee's personal goals with business objectives.

-Employees may become stressed and demotivated if they have too many goals at once

-Failure to meet a goal may result in an employee losing confidence and feeling less motivated to contribute to business objectives.

motivation strategies

Performance Related Pay, Career Advancement, Investment in Training, Support, Sanction

Performance-related pay

a financial reward that employees receive for reaching or exceeding a set business goal.

Performance-related pay examples

A manager can reward performance by providing several types of remuneration, such as: a pay rise, a bonus, or a commission on sales.

Career advancement

the upwards progression of an employee's job position. This can be achieved through promoting employees or giving them more challenging tasks.

Investment in Training

allocating resources to improve employee skills and knowledge.

Support strategies

a manager assisting employees to improve their performance.

Sanction strategies

a manager punishing employees to get them to perform as needed.

Motivated employees

improve the performance of the business and contribute to the achievement of business objectives.

On-the-job Training

Involves employees improving their knowledge and skills within the workplace.

Advantages of On-the-job Training

-Employees can perform their role while training, minimising losses to productivity.

-Employees can quickly become familiar with work equipment, reducing the time taken to complete their training.

-Training employees internally is often less expensive than performing training externally, as there are no travel costs.

Disadvantages of On-the-job Training

-The business may lack the amount of experienced staff required to train employees.

-Employees completing the training may become distracted by the workplace.

-Experienced employees are taken away from completing other duties to train employees, which negatively impacts the business, particularly during busy periods.

Examples of On-the-job Training

Job Shadowing, mentored, onsite demonstration by external provider.

Off-the-job Training

Involves employees improving their knowledge and skills in a location external to the business.

Advantages of Off-the-job Training

- Receiving training from professionals can enable employees to gain new perspectives on how to perform their roles to a higher standard.

-Employees are likely to perform training in a distraction-free environment, enhancing the quality of training received.

-It does not take more experienced employees away from their jobs to train other employees, enabling them to remain productive in their own tasks.

-Errors made by employees during training do not occur on site, decreasing expenses associated with waste.

Disadvantages of off the job training

-The business's workflow may be disrupted if employees are away for training, lowering productivity.

-Employees may try to find a job elsewhere with the external qualifications they gain, causing this investment in training to be redundant.

-Paying external organisations to train employees may be expensive.

-Accommodation and travel costs can make training expensive, especially when a group of employees are being trained.

Examples of Off-the-job Training

Attending conferences/workshops/attaining specific qualifications via online/TAFE or university.

Performance management

help determine how well employees are completing their work and areas that require improvement

Management by objectives

involves both managers and employees collaboratively setting individual employee goals that contribute to the achievement of broader business objectives

management by objectives (advantages)

•Aligning employee objectives with the business's overall objectives means that employees are always working towards business goals, leading to improvements in business performance.

•Collaboration between managers and employees when setting objectives can foster positive workplace relationships.

•Employees may gain a sense of achievement if they reach their individual goals, improving motivation.

management by objectives (disadvantages)

•Employees may take harmful shortcuts in their work in order to achieve their objectives, which can negatively impact progress towards overall business objectives.

•Failure to achieve personal objectives may be demoralizing.

•Employees may become demotivated if they do not receive compensation or recognition after achieving objectives.

performance appraisals

involve a manager assessing the performance of an employee against a range of criteria, providing feedback, and establishing plans for future improvements.

Performance appraisals (advantages)

•Communication between managers and employees during one-on-one reviews can improve workplace relationships.

•The results from the performance appraisal process can outline areas where employees are struggling, and training can be implemented to resolve issues.

•Increased communication between employees and managers can provide employees with clear direction on how to improve their performance.

Performance appraisals (disadvantages)

•Employees may lose motivation if they receive multiple poor performance appraisals.

•This process can be time consuming as managers individually review each employee's performance.

•Training courses provided to address employee weaknesses can increase business expenses.

self-evaluation

involves an employee assessing their individual performance against a set of criteria.

self-evaluation (advantages)

•The employer can gain insight into an employee's understanding of their own strengths and weaknesses and assign work accordingly.

•Employees may be empowered to improve performance, as they are directly involved in their own performance management.

•Self-evaluation can save managers time, as employees evaluate their own performance.

self-evaluation (disadvantages)

•If an employee is biased or dishonest in assessing their performance, a manager will not gain reliable information.

•Employees may underestimate or exaggerate their own skills, therefore the evaluation may not be reliable and accurate.

•Criteria for the self-evaluation process need to be developed, and this can be time consuming for managers.

Employee observation

involves a range of employees from different levels of authority assessing another employee's performance against a set of criteria.

Employee observation (advantages)

•Where an employee is unaware they are being observed, this allows for an accurate analysis of an employee's performance.

•Employees that are observing others may identify the strengths of other employees and then mimic this behaviour.

•Employees may be responsive to feedback provided by peers as they value their opinion.

Employee observation (disadvantages)

•Results may be misleading if employees are aware they are being evaluated, as they may only work harder in the presence of an observer.

•Making other staff assess an employee's performance can disrupt their normal workflow and business productivity.

•The development of criteria for observers to use can be time consuming.

Termination

the process whereby a business ends its employment contract with an employee

Retirement

involves an individual deciding to leave the workforce permanently as they no longer wish to work.

Redundancy

involves an employee no longer working for a business because there is insufficient work or their job no longer exists.

Resignation

involves an employee voluntarily terminating their own employment, usually to take another job position elsewhere.

Dismissal

involves the involuntary termination of an employee who fails to meet required work standards or displays unacceptable or unlawful behaviour.

Entitlement considerations

are legal obligations an employer owes to its employees following the termination of their employment contract.

Examples include: annual leave, long service leave, redundancy pay, notice of termination, justifiable reasons for termination.

Transition considerations

are social and ethical practices that a manager can consider implementing when terminating employment.

Examples include: resume writing training, interview training, networking, flexible working hours to allow interviews elsewhere, counselling regarding job insecurity, adjusting working hours of soon to be retired, financial/lifestyle planning for retirees.

Human resource managers

individuals who coordinate the relationship between employees and management within a business.

They:

Recruit, hire, train, terminate employees.

-Negotiate with employees and reps (unions)

-Mediate disputes

-Ensure minimum legal requirements for pay and conditions are met

employees

individuals who are hired by a business to complete work tasks and support the achievement of its objectives.

They:- Follow and understand workplace safety procedures.

-Obey terms of their contract

-Avoid misusing confidential info

-Report illegal or unethical behaviour.

Employer associations

advisory bodies that assist employers in understanding and upholding their legal business obligations.

They:- Share information with employers about new laws, policies, regulations.

-Provide advice regarding the above.

-Represent employers during negotiations.

-Provide management advice.

Unions

organisations composed of individuals who represent and speak on behalf of employees in a particular industry to protect and improve their wages and working conditions.

They:- Represent employees and negotiate new wages and conditions on behalf of their members.

-Seek better wages and work conditions on behalf of employees

-Protect job security and integrity of employee contracts

Fair work commission

Australia's independent workplace relations tribunal that has a range of responsibilities outlined by the Fair Work Act.

They:- Set national minimum working standards

-Establish awards

-Approve enterprise agreements

-Mediate AND arbitrate

-Respond to serious workplace issues (unfair dismissal, bullying)

awards

are legal documents that outline the minimum wages and conditions of work for employees across an entire industry.

The minimum working standards in the award are set by the Fair Work Commission (FWC), a government body that also develops industry awards.

Awards advantages

•Transparency between employees is maintained - as they all receive the same wages and conditions.

•Saves time - Employee wages and conditions are determined by the FWC.

•Cost-effective - allowing a business to minimise its labour costs whilst remaining compliant with the law.

Awards disadvantages

•Limited flexibility for different business models.

•Employees may be unsatisfied by only receiving the minimum wages and conditions.

•Businesses lack the opportunity to develop a relationship with their employees

Agreements

are legal documents that outline the wages and conditions of employees and are applicable to a particular business or group of businesses.

Collective bargaining is the process where employees, often represented by a union, negotiate with employers, who may be represented by an employer association.

Agreements advantages

•Positive relationships between employees and employers may develop in the negotiation process.

•Businesses have greater flexibility when setting wages and conditions.

•Business may attract highly skilled and talented employees if it is paying wages that are above the industry average.

agreements disadvantages

•More costly than awards.

•Inequality in wages and conditions may increase across industries.

•It can be a time-consuming process for employees and employers to negotiate

Awards & agreements similarities

Similarities:

•Both awards and agreements must comply with the National Employment Standards (NES).

•Contractual disputes for both are handled by the Fair Work Commission (FWC).

Differences:

Awards:

•Employees may not always be represented by a union during negotiations.

•For a specific INDUSTRY.

•Developed by the Fair Work Commission (FWC).

•

Agreements:

•Leaves employees better off than the relevant award.

•Developed through voluntary negotiation between employers and employees.

•For a specific BUSINESS.

•Reviewed and approved by the FWC.

dispute resolution process

a series of steps that disputing parties follow in order to resolve a disagreement and reach a resolution.

Dispute resolution process: Mediation

impartial third party facilitating discussions between disputing parties to help each side of the conflict reach a resolution themselves.

Mediation advantages

•When parties reach decisions together, it promotes positive working relationships for the future.

•The likelihood of a communication breakdown between disputing parties is reduced with a mediator facilitating negotiations.

•Both disputing parties have control over the final decision, meaning they are more likely to be satisfied at the end of the resolution process.

•It is less expensive than more formal dispute resolution processes as it usually occurs in an informal setting.

Mediation disadvantages

•It may not be effective for resolving all business disputes as a final decision may not always be reached.

•Mediation does not always result in a legally binding decision meaning parties could go back on their agreement in the future.

•There may be an unbalanced power dynamic between employees and managers, meaning employees could be coerced into accepting a resolution that they do not agree with.

•Time.

dispute resolution process: arbitration

an independent third party hearing arguments from both disputing parties and making a legally binding decision to resolve the conflict.

It is the most formal and official stage of any dispute resolution process as it occurs in a court-like setting

Arbitration advantages

•It guarantees that a final decision is made by a third party, enabling a business to move forward from a dispute.

•The final decision is legally binding, which prevents the occurrence of the same dispute between the two parties.

•Employees are not coerced into agreeing to a resolution as the likelihood of a power imbalance between disputing parties is reduced.

Arbitration disadvantages

•This process may harm future workplace relations if one of the disputing parties involved is unhappy with the final decision.

•The process of hearing both sides of the dispute in an external, courtlike setting is time-consuming for both parties.

•most expensive dispute resolution process due to the costs incurred from conducting hearings.

Similarities (Mediation/Arbritration)

•Both methods require an independent body or individual to be involved in resolving the dispute.

•Both methods are more formal than resolving disputes within a workplace without a third party.

Differences (mediation/arbitration)

Role of the third party: The mediator acts as an impartial referee and does not suggest resolutions, where as the arbitrator listens to both sides of the conflict and makes a legally binding decision.

Role of the parties: In Mediation the parties have control over the final decision, in Arbitration the parties have no control over the final decision.

Who makes the decision: Mediation: the parties. Arbitration: the 3rd party (Arbitrator)

Binding: In Mediation the decision is not binding, in Arbitration the decision is binding; that is the concept where the decision must be followed and is enforceable in a court of law.

Formality: Mediation is less formal than Arbitration.

Protected industrial action

action taken by either party to a dispute that has been approved by the Fair Work Commission

unprotected industrial action

action that has not been approved by the Fair Work Commission