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are no longer adequate.

      Maslow’s hierarchy of needs can be instructive to a manager in that it points to the individual differences among employees and the need to recognize each individual’s position on the hierarchy.

      Motivating an employee who is well paid, well-liked, and highly satisfied with his or her job will be quite different from motivating an employee who does not make enough money to meet his or her basic needs, or an employee who is dealing with security issues in his or her personal life.

      Theories X and Y

      Strongly influenced by Maslow and his needs hierarchy, Douglas McGregor applied this hierarchy to the organizational structure. In the l960s, he came up with two opposing theories, which he called Theory X and Theory Y.

      Theory X management stresses that human beings are essentially lazy and do not want to work. They need to receive direction and are motivated through the fear of punishment. In addition, Theory X proposes that the average employee tries to avoid responsibility and wants job security above all else.

      Theory Y management states that people will use both self-control and self-direction. This theory suggests that the average employee learns not only to accept but also to seek responsibility.

      Theory X organizations have a hierarchical structure and control employee behavior. Employees are treated as if they —

      • are lazy and anxious to evade work whenever possible,

      • need control and direction in order to perform well,

      • have relatively little ambition, and

      • avoid responsibility whenever possible.

      Theory Y organizations function in an almost completely opposite manner. These organizations are characterized by integration. According to McGregor, integration involves “the creation of conditions such that the members of the organization can achieve their goals best by directing their efforts toward the success of the enterprise.” Employees are treated as if they —

      • enjoy physical and mental effort,

      • direct themselves to meet objectives,

      • relate achievement with certain rewards, and

      • use a high degree of imagination, ingenuity, and creativity.

      Many of the dotcom companies that became prevalent in the 1990s, though they began to fail financially, were successful in providing employment atmospheres that are strongly indicative of a Theory Y environment.

      A seasoned businesswoman with more than 25 years of experience in a traditional business environment had this to say about her shift to a dotcom: “I can’t believe how happy I have been in this particular position, and what a great creative environment it is. I actually enjoy getting up and coming to work every day.”

      Another former corporate employee says, “One of the exciting things about working in a dotcom are the intelligent, enthusiastic, energetic people that it attracts. The whole space buzzes with energy. Unfortunately, that hasn’t always been the case in my personal experiences with some of the larger corporations I’ve been with.”

      Interestingly, what many dotcom employees point to as motivating in their new positions is their sense of contribution and the feeling that they are truly making a difference. Compare this to a comment from an employee for a publicly held corporation: “I had a manager who was very hands-off — so much so that if I went on vacation I’m sure he did not know I was gone. He never asked me how I was doing or if I needed any support from them unless it was review time. I finally transferred out of the department. I don’t like a hovering manager, but I need to be recognized more than once a year.”

      Theory Z

      Theory Z was advanced by William Ouchi and is often referred to as Japanese management style. The secret to success, according to Ouchi, is not technology but a special way of managing people. This management style involves a strong company philosophy, a distinct corporate culture, long-range staff development, and consensus decision making. The result is lower turnover, increased job commitment, and much higher productivity.

      A major aspect of Theory Z is trust. Organizations spend a lot of time developing the interpersonal skills needed to make effective group decisions. When a group makes decisions, group members are asked to place their fate in the hands of others. Each person has responsibility for some individual objectives set by the group. Team performance is critical to the accomplishment of objectives.

      Ouchi has said:

       “Perhaps the single most notable characteristic among those who have succeeded at going from A to Z has been an almost palpable character of integrity. By integrity I do not mean preaching morality to others; I mean an integrated response to problems, an integrated and consistent response to customers and employees, to superiors and subordinates, to problems in finance and in manufacturing. A person of integrity treats secretaries and executives with equal respect and approaches subordinates with the same understanding and values that characterize his or her family relationships. A person with integrity can be counted upon to behave consistently, even as organizational conditions change. Such a person can be trusted and can provide that key human capital from which others can draw in the process of change.”

      Applying the theories

      Theories and classification systems are a good starting point for employers and managers looking for ways to improve employee performance, morale, and productivity. For real results, however, you need more than theory. You need a step-by-step, day-by-day, practical approach to motivating your employees so they will help your company run smoothly and profitably. How to motivate your employees without adding to the already high costs of your operations is the challenge that today’s manager faces.

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      Facts and Fallacies about Motivation

      Are you motivated? How do you really know? Motivation can be a tough term to define — even when we relate the term to our own behavior. Imagine, then, how difficult it can be to spot, and reinforce, motivation in others.

      But spot it we must if we wish to maintain a fully operational workforce. Employee turnover has risen to startling levels in the past two decades. According to a survey conducted by the Bureau of National Affairs, turnover increased from 1.1 percent per month in both 1997 and 1998 to 1.2 percent in 1999. Worse, turnover increased at an even greater pace for smaller companies (those with fewer than 250 employees) from .09 percent in 1998 to 1.2 percent in 1999.

      There is no doubt that managers and business owners are critically aware of the need to motivate their staff members. Recruitment and retention are high on the list of corporate initiatives at most organizations as they struggle to maintain a fully functioning workforce. What it takes to keep employees on the job, however, is not necessarily clear to those attempting the task. In fact, a poll conducted of senior executives at Drake Beam Morin (DBM), a leading workplace consulting firm, revealed the following misconceptions about the impact of various practices on employee retention — misconceptions, says dbm, that organizations need to overcome.

      1) “Show me the money.” While there is no question that compensation is a very powerful lure to entice employees to accept new opportunities, money is not necessarily the answer to the retention issue. dbm’s experience in working with people in career transition has found that career development and challenging work opportunities are often greater incentives than money to stay or start with an employer.

      2) “Recruitment is a separate issue.” Not so. An effective retention strategy begins at the earliest stages of the selection and recruitment process, according to dbm. Selecting the right people — those whose skill sets and attitudes fit the organization’s needs and values

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