Denmark MBA

Module 1 – Team Leadership,

Motivation and
Communication Skills
Contents
Learning Topics Pages Book
Outcomes
Working in Groups and Teams 270 to 274 Management and
1 Building Effective Teams 299 Organizational
The Role of Team Leader 303 Behaviour (Laurie
1.3 + 2.1 Management and Leadership 280 to 286 J. Mullins)

2+3 Leadership and Motivation 312 to 314 Human Resource

Management
(Derek
Torrington, Laura
Hall, Stephen
Taylor
3 Meaning of Motivation 170 to 182 Armstrong’s
Handbook of
Human Resource
Management
Practice (Michael
Armstrong and
Stephen Taylor)
4 Communication 526 to 531 Marketing
(Charles W.
Lamb, Joseph
F.Hair, JR., Carl
McDaniel)
 CHAPTER 8
Working in groups and teams

Work is a group-based activity and if the organisation is to function

effectively it requires collaboration and co-operation among its
members. most activities of the organisation require at least some
degree of co-ordination through groups and teamwork. understanding
the nature, operation and impact of groups and teams is vital if the
manager is to influence the behaviour and performance of people in the
work situation.

Learning outcomes
After completing this chapter you should have enhanced your ability to:
● explain the nature and significance of work groups and teams;
● relate the nature of informal groups and importance of group values and norms;
● examine factors that influence group cohesiveness and performance;
● identify characteristics of an effective work group and virtual teams;
● explain role structure of the organisation and individual role relationships;
● evaluate individual compared with group or team performance;
● review the importance and characteristics of successful groups or teams.

Critical review and reflection

self-interest and opportunism are natural features of human behaviour and will always take preference over the
demands and best interests of the group or teamwork.
To what extent can YOU present a counter point of view? How far are YOU prepared to put the interests of a work
group or team before YOUR own interests?

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 Chapter 8 Working in groups and teams 271

The importance and significance of groups

Groups are a characteristic of all social situations. Individuals seldom work in isolation from
others. The work organisation and its sub-units are made up of groups of people. Groups are
an essential feature of any organisation and almost every member of staff will belong to one or
more groups. Although there is no single accepted definition, most people will readily under-
stand what constitutes a group. The essential feature is that its members regard themselves as
belonging to the group. A popular definition defines the group in psychological terms as:
any number of people who (1) interact with one another; (2) are psychologically aware of
one another; and (3) perceive themselves to be a group.1
Another useful way of defining a work group is a collection of people who share most, if not
all, of the following characteristics:
● a definable membership;
● group consciousness;
● a sense of shared purpose;
● interdependence;
● interaction;
● ability to act in a unitary manner.2
Members of a group must co-operate in order for work to be carried out, and managers them-
selves will work within these groups. The working of groups and the influence they exert over
their membership is an essential feature of management and organisational behaviour. People
in groups influence each other in many ways and groups develop their own hierarchies and
leaders. Group pressures can have a major influence over the behaviour of individual members
and their work performance.
Peterson and colleagues discuss the importance of morale as an indicator of group well-
being. The attention of positive psychology to promote good life (discussed in Chapter 1)
should include not only individuals but also groups within which individuals live, work, love
and play. Groups should be a primary focus of research into health and well-being.3

Groups and teams

The use of the word ‘teams’ has become increasingly fashionable in recent years. In common
usage and literature, including in this book, there is a tendency for the terms ‘groups’ and
‘teams’ to be used interchangeably and based on personal preference. It is not easy to distin-
guish clearly between a group and a team. According to ACAS:
Teams have been around for as long as anyone can remember and there can be few organi-
sations that have not used the term in one sense or another. It is common to hear of man-
agement teams, production teams, service teams or even whole organisations referred to as
teams . . . The term ‘team’ is used loosely to describe many different groupings and a variety
of labels are given to the types of teams . . . It is doubtful whether any definition of types of
teams would be universally acceptable.4
Holpp poses the question ‘Why do you want teams?’ While many people are still pay-
ing homage to teams, teamwork, empowerment and self-management, others have become
disillusioned.
If teams are just a convenient way to group under one manager a lot of people who used to
work for several downsized supervisors, don’t bother. But if teams can truly take ownership
of work areas and provide the kind of up-close knowledge that’s unavailable elsewhere, then
full speed ahead.5

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 272 Part 3 Groups, leadership and management

Cane suggests that organisations are sometimes unsure whether they have teams or simply
groups of people working together.
It is certainly true to say that any group of people who do not know they are a team cannot
be one. To become a team, a group of individuals needs to have a strong common purpose
and to work towards that purpose rather than individually. They need also to believe that
they will achieve more by co-operation than working individually.6

Teamwork as a fashionable term

Belbin points out that to the extent that teamwork was becoming a fashionable term, it began
to replace the more usual reference to groups and every activity was now being described as
‘teamwork’. He questions whether it matters whether one is talking about groups or teams
and maintains that the confusion in vocabulary should be addressed if the principles of good
teamwork are to be retained. Belbin suggests there are several factors that characterise the dif-
ference between groups and teams (see Figure 8.1). The best differentiator is size: groups can
comprise any number of people but teams are smaller with a membership between (ideally)
four and six. The quintessential feature of a small, well-balanced team is that leadership is
shared or rotates, whereas large groups typically throw up solo leaders.7
While acknowledging the work of Belbin, it appears that the term ‘group’ is often used in
a more general sense and ‘team’ in a more specific context. We continue to refer to ‘group’
or ‘team’ according to the particular focus of attention and the vocabulary of the quoted
authors. Whereas all teams are, by definition, groups, it does not necessarily follow that all
groups are teams. The Chartered Management Institute maintains that a team is more than
just a group of people who happen to work together.
It is a group of people working towards common goals and objectives and sharing responsi-
bility for the outcomes. Team building is the process of selecting and grouping team members
effectively and developing good working relationships and practices enabling the team to
steer and develop the work and reach their goals. Increasingly, a team may be composed of
people drawn from different functions, departments and disciplines whom have been brought
together for a specific project.8

Figure 8.1 Differences between a team and a group

Source: Belbin, R. M. Beyond the Team, Butterworth–Heinemann (2000). Copyright © 2000. Reproduced with permission from
Belbin, www.belbin.com.

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 Chapter 8 Working in groups and teams 273

Whatever the debate on ‘groups’ or ‘teams’, what is clear is the increasing popularity of
teamworking and the importance to organisations of effective group working or teamworking.

Critical review and reflection

it is almost impossible to distinguish clearly or in any meaningful way between work groups and teams. attempting
to do so is a vain, and pointless, quest. it is a waste of study time.
What is YOUR reaction to this assertion? How do YOU distinguish between a work group and team?

Formal and informal groups

Groups are formed as a consequence of the pattern of organisation structure and arrange-
ments for the division of work, for example the grouping together of common activities into
divisions or sections. Formal groups are created to achieve specific organisational objectives
and are concerned with the co-ordination of work activities. People are brought together on
the basis of defined roles within the structure of the organisation. The nature of the tasks to
be undertaken is a predominant feature of the formal group. Goals are identified by manage-
ment, and certain rules, relationships and norms of behaviour established.
Groups may result from the nature of technology employed and the way in which work
is carried out, for example bringing together a number of people to carry out a sequence of
operations on an assembly line. Groups may also develop when a number of people of the
same level or status within the organisation see themselves as a group, for example depart-
mental heads of an industrial organisation or chief officers of a local authority. Formal
groups tend to be relatively permanent, although there may be changes in actual member-
ship. However, temporary formal groups may also be created by management, as with, for
example, the use of project teams in a matrix organisation. (See also matrix organisation
in Chapter 11.)

Informal groups
The formal structure of the organisation, and system of role relationships, rules and proce-
dures, will be augmented by interpretation and development at the informal level. Groups will
also arise from social processes and the informal organisation (discussed in Chapter 3).
Informal groups are based more on personal relationships and agreement of group mem-
bers than on defined role relationships. They serve to satisfy psychological and social needs
not related necessarily to the tasks to be undertaken. Informal groups may devise ways of
attempting to satisfy members’ affiliation and other social motivations lacking in the work
situation. Membership can cut across the formal structure. These groups may comprise indi-
viduals from different parts of the organisation and/or from different levels of the organisa-
tion, both vertically and diagonally, as well as from the same horizontal level. An informal
group could also be the same as the formal group, or it might comprise a part only of the
formal group (see Figure 8.2).
Members of an informal group may appoint their own leader who exercises authority by
consent of the members themselves. The informal leader may be chosen as the person who
reflects the attitudes and values of the members, helps to resolve conflict, leads the group
in satisfying its goals, or liaises with management or other people outside the group. The
informal leader may change according to the particular situation facing the group. Although
not usually the case, it is possible for the informal leader to be the same person as the formal
leader appointed officially by management.

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 274 Part 3 Groups, leadership and management

Figure 8.2 Examples of informal groups within the formal structure of an organisation

Major functions of informal groups

Lysons suggests four main reasons for informal groups:
● Perpetuation of the informal group ‘culture’. Culture in this context means a set of values,
norms and beliefs that form a guide to group acceptance and group behaviour. Unless you
broadly subscribe to the group culture, you will not belong and will be an ‘outsider’ or
‘isolate’.
● Maintenance of a communication system. Groups want all the information that affects
their welfare, either negatively or positively. If groups are not apprised of policies and
motives behind actions, they will seek to tap into formal communication channels and
spread information among group members.
● Implementation of social control. Conformity to group culture is enforced by such tech-
niques as ridicule, ostracism and violence. This is illustrated, for example, by the enforce-
ment of group norms in the bank wiring room discussed in the next section.
● Provision of interest and fun in work-life. Many jobs are monotonous and fail to hold
workers’ attention. Work may also offer few prospects. Workers may try to compensate by
interpersonal relations provided by the group and in such activities as time wasting by talk-
ing, gambling, practical joking and drinking.9
As Law reminds us:
We humans are a gregarious lot. We like to gather together and establish our own social
networks, which are often the real key to creativity and innovation in organisations . . . But
many managers are unaware that seemingly pointless social networking does in fact play a
crucial part in the way people interact with each other and get work done.10

Group values and norms

The classical approach to organisation and management tended to ignore the importance of
groups and the social factors at work. The human relations approach, however (discussed
in Chapter 2), gave recognition to the work organisation as a social organisation and to the
importance of the group, and group values and norms, in influencing behaviour at work.

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 Chapter 8 Working in groups and teams 299

Building effective teams

Whatever the debate about individual and group or team performance, effective teamworking
is of increasing importance in modern organisations. The Chartered Management Institute
points out that teams can play a key role in organisational success, but the development of
good working relationships is vital to team performance.
A team is more than just a group of people who happen to work together. It is a group of
people working towards common goals and objectives and sharing responsibility for the out-
comes. Team building is the process of selecting and grouping team members effectively and
developing good working relationships and practices enabling the team to steer and develop
the work and reach their goals. Increasingly, a team may be composed of people drawn from
different functions, departments and disciplines who have been brought together for a spe-
cific project.59
Yukl refers to the purpose of team building as being to increase cohesiveness, mutual co-operation,
and identification with the group. Based on research, theory and practice, Yukl identifies eight
team-building procedures:
● Emphasise common interests and values – collective identification is stronger when mem-
bers agree about objectives, values, priorities, strategies and the need for co-operation.
● Use ceremonies and rituals – to increase identification with the group and make member-
ship appear special. The use of rituals for initiation and retirement, and ceremonies for
special occasions or events.
● Use symbols to develop identification with the group – such as team name, logo, insignia,
emblem or particular colour to help create a special identity for the team.
● Encourage and facilitate social interaction – development of a cohesive group is more likely
when members get to know each other on a personal basis and find social interactions
satisfying.
● Tell people about group activities and achievements – keeping members informed about
the plans, activities and achievements and how their work contributes to the success of the
mission.
● Conduct process analysis sessions – frank and open discussions of interpersonal relation-
ships and group processes, including suggestions on how to improve effectiveness.
● Conduct alignment sessions – to increase mutual understanding among team members and
to overcome negative stereotypes and attributions.
● Increase incentives for mutual co-operation – incentives based not individually but on group
performance to encourage co-operation, such as bonus based on team performance.60

‘Away days’
Another approach to team building is the use of activity-based exercises undertaken as
part of corporate bonding, usually referred to as away days. The main objective is often
the building of team spirit and working relationships involving formal team dynamics and
assessment, although this may also be linked with a social purpose, for example to develop
interactions with colleagues, improve motivation or to thank and reward staff. The idea of
away days is subject to frequent criticism and even ridicule. Individuals may feel pressurised
into participating for fear of not appearing to support management initiative or their group
colleagues.
Baroness Kingsmill suggests that of course there is a case to be made for getting away
from day-to-day routines and pressures and spending time with colleagues: ‘Fostering rela-
tionships, encouraging creativity and innovative thinking and promoting better communi-
cation are all desirable goals. It is just that it is usually done so badly and is often a waste
of time and resource. Companies spend millions on away-days every year but rarely do

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 Chapter 8 Working in groups and teams 303

The role of team leader

Building successful teams requires effective leadership with an emphasis on trust, clear com-
munications, full participation and self-management: ‘The influence and usefulness of team
leaders comes, not from their delivery of traditional supervisory and control methods, but
from their ability to lead from the front and in training, coaching and counselling their team
members to high standards of performance.’68
In her discussion of the ‘democratic enterprise’ (organisations that can flourish economi-
cally and can also be places of excitement and stimulation, fulfilment and tranquillity),
Gratton maintains that it is the leaders of the teams across the organisation who make the
company vision a reality on a day-to-day basis. The team leaders are the creators of space in
which choice and freedom can be exercised; they delineate the obligations and accountabili-
ties contained within the business goals; they become role models for how members should
behave; and they bring the philosophy of autonomy and personal development to realisation
by the manner in which they act as mentors and coaches.69
According to Powell, if you want to see the efficacy of a leader and his or her leadership
style, then you need to look no further than the team he or she leads.
A team rarely demonstrates more passion or behaves more positively than its leader. Similarly,
cynical leaders produce, and therefore deserve, cynical teams. Innovative, creative and devel-
opmental leaders help to produce creative, innovative and developed followers. A team that is
enthusiastic, energetic and innovative will have at its heart a leader who is correspondingly so.70
With the football business as an example, Brady refers to the importance for any organisa-
tion, especially with a people business, of bringing staff with you, building a team around you
and how team ethic leads to success.
The reason it works is because of the respect we have for each other. We all know each other’s
strengths and weaknesses and we work around them. We don’t step into each other’s territo-
ries. We leave each one to each role, but we support them instead.71

Continuous improvement and innovation

The requirement for continual development and improvement is a necessary part of effective team-
work. The ACAS advisory booklet concludes that although self-regulation is necessary if the poten-
tial of teamworking is to be realised, teams will always need some degree of management direction.
The task of management is to oversee the development of teams and provide the necessary support
and training. Even when in place, teams will need constant monitoring and development. Team-
working is not a finite project but a process of continuous improvement and innovation.
The introduction of team working is a major step for an organisation to take. It is important
that management, trade unions and employees ensure they know how team working will
contribute to their business strategy and that it is likely to involve a long-term transforma-
tion . . . The early challenge and excitement of establishing teams may fade and it is easy
for organisations to accept a level of performance which is short of optimum . . . In order to
achieve high performance, teams require regular changes and challenges. These may include:
changes to team personnel; new tasks; re-examining the contribution the team makes to the
overall business aims; and ensuring that the team has regular dealings with other teams.72

Critical review and reflection

discussion about building successful teams sounds fine in the classroom. But it ignores the reality of the work envi-
ronment, for example managing groups of people in a restaurant kitchen, a production assembly line, a gay pub, an
orchestra, or professionals such as lecturers.
What do YOU think? Give YOUR own examples of the reality of teamworking in a specific environment.

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 280 Part 3 Groups, leadership and management

Organisational
Management and leadership
Teams tend to be a mirror image of their leaders. The form of management and style of lead-
ership adopted are major determinants of group cohesiveness. In general terms, cohesiveness
will be affected by such things as the manner in which the manager gives support, guidance
and encouragement to the group, provides opportunities for participation, attempts to resolve
conflicts and gives attention to both employee relations and task problems.
McKenna and Maister draw attention to the importance of the group leader establishing
a level of trust among the group by helping its members understand the behaviours that build
trust: ‘The job of the group leader is to encourage people to earn the trust of others in their
group and then show them how it can translate into greater commitment, greater creativity,
greater professional satisfaction, and better performance.’17 Farrell makes the point that man-
agers are ultimately responsible for creating a balance in the workplace and should take the
lead in setting standards of behaviour in teams.18

HR policies and procedures

Harmony and cohesiveness within the group are more likely to be achieved if HR policies and
procedures are well developed and perceived to be equitable, with fair treatment for all mem-
bers. Attention should be given to the effects that appraisal systems, discipline, promotion and
rewards and opportunities for personal development have on members of the group.

Success
Success is usually a strong motivational influence on cohesiveness and level of work perfor-
mance. Success or reward as a positive motivator can be perceived by group members in a
number of ways – for example, the satisfactory completion of a task through co-operative
action, praise from management, a feeling of high status, achievement in competition with
other groups or benefits gained, such as high wage payments from a group bonus incentive
scheme.

External threat
Cohesiveness may be enhanced by members co-operating with one another when faced with
a common external threat, such as changes in their method of work or the appointment of
a new manager. Even if the threat is subsequently removed, the group may continue to have
a greater degree of cohesiveness than before the threat arose. Conflict between groups will
also tend to increase the cohesiveness of each group and the boundaries of the group become
drawn more clearly.

Group development and maturity

The degree of cohesiveness is affected also by the manner in which groups progress through
the various stages of development and maturity before getting down to the real tasks in hand.
This process can take time and is often traumatic for the members. A popular model by Tuck-
man identifies five main successive stages of group development and relationships: forming,
storming, norming, performing and adjourning.19
● Stage 1 – forming. This concerns initial formation of the group and bringing together
individuals who identify, tentatively, the purpose of the group, its composition and terms
of reference. Consideration is given to the hierarchical structure of the group, pattern of

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 Chapter 8 Working in groups and teams 281

leadership, individual roles and responsibilities and codes of conduct. There is likely to
be considerable anxiety as members attempt to create an impression, test each other and
establish their personal identity within the group.
● Stage 2 – storming. As members of the group get to know each other better they will put
forward their views more openly and forcefully. Disagreements will be expressed and chal-
lenges offered on the nature of the task and arrangements made in the earlier stage of devel-
opment. This may lead to conflict and hostility. The storming stage is important because, if
successful, there will be discussions on reforming arrangements for the working and opera-
tion of the group, and agreement on more meaningful structures and procedures.
● Stage 3 – norming. As conflict and hostility start to be controlled, members of the group
will establish guidelines and standards and develop their own norms of acceptable behav-
iour. The norming stage is important in establishing the need for members to co-operate in
order to plan, agree standards of performance and fulfil the purpose of the group.
● Stage 4 – performing. When the group has progressed successfully through the three earlier
stages of development it will have created structure and cohesiveness to work effectively as
a team. At this stage the group can concentrate on the attainment of its purpose and per-
formance of the common task is likely to be at its most effective.
● Stage 5 – adjourning. This refers to the adjourning or disbanding of the group because
of, for example, completion of the task, members leaving the organisation or moving on
to other tasks. Some members may feel a compelling sense of loss at the end of a major
or lengthy group project and their return to independence is characterised by sadness and
anxiety. Managers may need to prepare for future group tasks and engendering team effort.
Another writer suggests that new groups go through the following five stages:
● the polite stage;
● the why are we here, what are we doing stage;
● the power stage, which dominant person will emerge;
● the constructive stage when sharing begins; and
● the unity stage – this often takes weeks, eating together, talking together.20

Critical review and reflection

modern systems of communication, such as email and the increasing use of social media, restrict personal interac-
tion and have only a negative effect on group development, cohesiveness and performance.
To what extent do YOU believe this fair comment? How has email or social media affected YOUR experience of group
membership?

Creative leadership and group development

In an examination of creative leadership and team effectiveness, Rickards and Moger propose
a modification to the Tuckman model and suggest a two-barrier model of group development.
From their empirical studies of small groups and project teams, Rickards and Moger put for-
ward two challenges to the prevailing model of team development:
1. Weak teams posed the question ‘What is happening if a team fails to develop beyond the
storm stage?’.
2. The exceptional teams posed the question ‘What happens if a team breaks out of the per-
formance norms developed?’.
The suggestion is that teams are differentiated by two barriers to performance. The weak
barrier is behavioural and defeated a minority of teams; the strong barrier was a block to

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 282 Part 3 Groups, leadership and management

creativity or innovation, and defeated the majority of those teams who passed through the
weak barrier. The two-barrier model provides a starting point for exploring the impact and
influence of a team leader on the performance of teams. Rickards and Moger identified seven
factors through which a leader might influence effective team development:
● building a platform of understanding;
● creating a shared vision;
● providing a creative climate;
● showing a commitment to idea ownership;
● resilience to setbacks;
● developing networking skills;
● learning from experience.21

Social identity theory

Within work organisations there will be a number of different but overlapping groups repre-
senting a variety of functions, departments, occupations, technologies, project teams, loca-
tions or hierarchical levels. Organisational effectiveness will be dependent upon the extent to
which these groups co-operate, but often the different groupings are part of a network of com-
plex relationships resulting in competitiveness and conflict. A feature of the importance and
significance of group membership is the concept of social identity theory. Tajfel and Turner
originally developed the idea of social identity theory as a means of understanding the psycho-
logical basis of inter-group discrimination.22 Individuals are perceived as having not just one
‘personal self’ but a number of ‘selves’ derived from different social contexts and membership
of groups.
Because of the need for a clear sense of personal identity, the groups or social categories
with which we associate are an integral part of our self-concept (social identity). A natural
process of human interaction is social categorisation, by which we classify both ourselves
and other people through reference to our own social identity. For example, membership of
high-status groups can increase a person’s perceived self-esteem. According to Guirdham,
‘self-categorisation is the process that transforms a number of individuals into a group’.23 See
Figure 8.5.
Haslam refers to the relationship between individuals and groups in an understanding of
organisational behaviour, and argues that:
in order to understand perception and interaction in organizational contexts we must do
more than just study the psychology of individuals as individuals. Instead, we need to under-
stand how social interaction is bound up with individuals’ social identities – their definition of
themselves in terms of group memberships.24

Identification with social groupings

We identify ourselves in terms of membership of certain social groupings and differentiate
ourselves from other social groupings. This leads to minimising differences between mem-
bers of our own groupings (in-groups) and maximising differences from other groupings (out-
groups). Over time the sense of shared identity with the in-group increases a feeling of what
is right and proper and highlights differences from the out-groups.25 As a result, this reinforces
both social identity with our own category and the projection of negative perceptions and
stereotypes towards out-groups.
Stereotyping can lead to shared attitudes to out-groups and to increased conflict among
work groups. The examples of group stereotyping (discussed in Chapter 6) are associated with
social identity theory. Tajfel and Turner suggest that the mere act of individuals categorising
themselves as group members leads them to exhibit in-group favouritism. Hewstone et al.

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 Chapter 8 Working in groups and teams 283

Figure 8.5 Processes of social and self-categorisation

Source: Guirdham, M. Interactive Behaviour at Work, third edition, Financial Times Prentice Hall (2002), p. 119. Reproduced with
permission of Pearson Education Ltd.

suggest that, even without realising it, we tend usually to favour the groupings we belong to
more than denigrate out-groups. Successful inter-group bias enhances self-esteem.26 (See also
the discussion on social exchange theory in Chapter 1 and possible effects on group member-
ship, norms and control.)

Characteristics of an effective work group

The characteristics of an effective work group are not always easy to isolate clearly. The under-
lying feature is a spirit of co-operation in which members work well together as a united team
and with harmonious and supportive relationships. This may be evidenced when members of
a group exhibit:
● belief in shared aims and objectives;
● sense of commitment to the group;
● acceptance of group values and norms;
● feeling of mutual trust and dependency;
● full participation by all members and decision-making by consensus;
● free flow of information and communications;
● open expression of feelings and disagreements;
● resolution of conflict by the members themselves;
● lower level of staff turnover, absenteeism, accidents, errors and complaints.

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 284 part 3 groups, LeadersHip and management

However, as Brooks points out, as teams operate at the higher order of group dynamics this
list is arguably more reflective of ‘effective work teams rather than work groups and this is how
it should be – these are teams not groups’.27
Musical ensembles make for an interesting study. Individual members may be brilliant
soloists and often noted for their temperament, but their performance is as much about the
total blend and working noticeably well together as about musical ability. By comparison, it is
noticeable how managers of sporting teams often deliberately introduce new players, even to
a successful team, in order to further increase competition or rivalry for places, with the hope
of achieving even greater success for the team as a whole.

Critical review and reflection

to gain a greater appreciation of effective teamwork, attention should be given in the classroom to the management
and functioning of successful musical ensembles and successful sports teams.
To what extent do YOU believe an understanding of musical ensembles or sports teams relates in a meaningful way
to the work organisation?

Potential disadvantages of strong,

cohesive groups
If the manager is to develop effective work groups, attention should be given to those factors
that influence the creation of group identity and cohesiveness. This may result in greater inter-
action between members, mutual help and social satisfaction, lower turnover and absenteeism,
and often higher production.28 However, strong and cohesive groups also present potential
disadvantages for management. Working in groups may result in members spending too much
time talking among themselves. Cohesive groups do not necessarily produce a higher level of
output. It may be remembered that in the bank wiring room experiment of the Hawthorne
studies the level of output was restricted to a standard acceptable as a norm by the group.
Once a group has become fully developed, created cohesiveness and established its own cul-
ture, it is more difficult for the manager successfully to change attitudes and behaviour of the
group. It is important that the manager attempts to influence the group during the norming
stage, when members are establishing their own guidelines and standards and their own norms
of acceptable behaviour.

Inter-group conflict
Strong, cohesive groups may develop a critical or even hostile attitude towards people outside
the group or members of other groups. Groups may also compete against each other in a
non-productive manner. This can be the case, for example, when group cohesiveness is based
on common status, qualifications, technical expertise or professional standing. As a result,
resentment and inter-group conflict may arise to the detriment of the organisation as a whole.
(Recall the discussion on social identity theory, above.) In order to help prevent, or overcome,
unconstructive inter-group conflict, the manager should attempt to stimulate a high level of
communication and interaction between groups.
Yet, inter-group rivalry may be deliberately encouraged as a means of building stronger
within-group cohesiveness. The idea is that a competitive element may help to promote unity
within a group. However, inter-group rivalry and competition need to be handled carefully

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 Chapter 8 Working in groups and teams 285

to avoid development of ‘win–lose’ situations. Emphasis should be placed on overall objec-

tives of the organisation and superordinate goals. These are goals over and above the issues
at conflict and which, if they are to be achieved, require the co-operation of the competing
groups.

Virtual teams
The combination of increasing globalisation, competition and widespread developments in
ICT has given greater emphasis to the opportunities for, and need of, virtual teams. Instead
of involving face-to-face proximity, virtual teams are a collection of people who are geo-
graphically separated but still need to work together closely. The primary interaction among
members is by some electronic information and communication process. This enables organ-
isations to function away from traditional working hours and the physical availability of
staff. Computer-based information systems and increased wireless connectivity further the
opportunities for virtual working. By their very nature, virtual teams are likely to be largely
self-managed.
According to Hall, the virtual team is a potential future compromise between fully fledged
teams and well-managed groups.
I am watching the rise of this idea with interest but am sceptical that it will actually create a
‘third way’. Real teams can only be forged in the crucible of personal interaction: videocon-
ferences and Net communications are still poor substitutes for this. Of course, once a team
has formed it can use these media, as members will know each other well, but that’s not the
important bit. It’s the forming, norming and storming that make a team.29
Virtual teams may lead to an increase in productivity through a reduction in commute time
and greater personal flexibility. Organisations are able to establish a greater worldwide pres-
ence. Virtual teams can comprise people with different types of knowledge, help to reduce
discrimination and provide wider employment opportunities. A potential difficulty is main-
taining effective communications, bearing in mind the lack of body language and non-verbal
communication (discussed in Chapter 6). Virtual teams demand good leadership and manage-
ment, including competence in ICT. Virtual working is not always to the initial liking of all
people and it is important to have a remote working strategy.
Some people seem clearly to welcome virtual working with its feeling of autonomy, free-
dom from distractions and interruptions and less time and stress on commuting. However,
despite the increase in remote working, it does not appeal to everyone. Not everyone enjoys
working on their own and they miss group membership, social structure, contact and interac-
tion. They may feel ignored by the organisation and experience an increasing feeling of isola-
tion. For some people, trust is difficult when they cannot see the other person. Without direct
personal interaction some people find it difficult to motivate themselves. A sense of discipline
and self-motivation is important for effective remote working.

Leadership and motivation

Symons considers that one advantage of virtual teamworking is the clarity and richness of
contributions when respondents are removed from the urgency of immediate interaction, and
that this can be particularly relevant in cross-cultural groups. However, as the leader can-
not influence by physical presence, and as hierarchies fade online, managing dispersed teams
requires a range of subtly different leadership skills. It is important to develop mutual trust
and a democratic approach of shared control and decision-making, and adopt the role and
style of a coach: ‘The leader has to establish and maintain “credit” with the group, as “posi-
tion power” has little or no currency in virtual working.’30

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 286 part 3 groups, LeadersHip and management

Garrett maintains that collaborating with other people in different cities or countries is not
always a successful arrangement and lists the following suggestions for helping to organise the
virtual team:
● Say hello – The most successful teams spend time during their formation period face to
face, getting to know each other.
● Build trust – This holds the team together so that you can depend on other team members
and feel comfortable opening up to them.
● Recruit with care – People who can communicate in the right way at the right time are more
likely to be successful in virtual teams.
● Do not rely on email – The written word is easily misunderstood so supplement its use with
other forms of communication.
● Encourage dissent – Without face-to-face meetings people become reluctant to speak out,
but a healthy organisation needs people to speak out and challenge leaders and each other.
● Use technology thoughtfully – Used badly, sophisticated tools can be a disaster, and people
need to be trained to use the technology, not simply have it imposed on them.
● Measure outcomes – Focus on the outcomes rather than time management, find a personal
way to appraise performance, rather than email, and hold regular chats with members.
● Do say – ‘By proactively creating virtual teams we can go where talent is, extend our reach
and work more efficiently.’
● Do not say – ‘We call them a virtual team because they’re not quite the real thing.’31

Cultural diversity
One reason for the growth in virtual teams is increasing globalisation and team members
working and living in different countries. This gives rise to potential difficulties of cultural
diversity. As Francesco and Gold point out:
The more culturally diverse the members, the more difficult it is to manage a virtual team.
Cultural diversity, which will be increasingly common, adds to the complexity of managing
virtual teams because different values, customs, and traditions require more leadership under
conditions that reduce the ability to use direct leadership.32
And, according to Murray, although virtual working presents some unexpected benefits, if
managing diversity in the workplace is a tough task for business leaders, the challenges of
keeping executives from different backgrounds working together in various parts of the world
is even more difficult. Virtual working does not eradicate the sort of cultural misunderstand-
ings that can arise in a face-to-face situation.
Cultural or behavioural differences that can manifest themselves in face-to-face working sit-
uations can be exacerbated in virtual team working, particularly when the group has mem-
bers from different backgrounds.33
Hazlehurst points out that the rise of the virtual organisation is not a universal development.
In emerging economies, the office is still a novelty and young people are clamouring to work in
them. It may seem hard to understand to westerners with generations of travel-weary commuters
in their family tree, but if you are the first person in your family to move from a village to a city, an
office job is alive with exciting possibilities, as well as being a potent symbol of personal success.34

Critical review and reflection

With continuing globalisation and advances in iCt, the days of people spending most of their time working together
in physical contact with colleagues are gone. global virtual teams are the way forward.
How far do YOU agree? What difficulties and problems do YOU foresee? Are YOU concerned about the prospect of
virtual teamworking?

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Part III Performance

From a slightly different perspective Heifetz and Laurie (1997) propose six guid-
ing principles of post-heroic leadership, and they conclude that leadership is about
learning and that the idea of having a vision and aligning people to this is bankrupt.
The idea of one leader at the top creating major changes in order to solve a one-off
challenge is no longer appropriate, as organisations now face a constant stream of
adaptive challenges, and leadership is required of many in the organisation, not just
one person at the top. They argue that employees should be allowed to identify and
solve problems themselves and learn to take responsibility. The role of the leader is
to develop collective self-confidence. As Grint (1997) puts it, ‘the apparent devolve-
ment (or desertion – depending on your perspective) of responsibility has become the
new standard in contemporary models of leadership’ (p. 13). For further discussion
on the devolution of responsibility see case 14.1 on the website.
These visions of leadership are very attractive but they do require a dramatic
change in thinking for both leaders and followers. For leaders there is the risk of
giving away power, learning to trust employees, developing new skills, developing a
different perspective of their role and overriding self-interest. For followers there is
the challenge of taking responsibility – which some may welcome, but others shun.
Yet, if sustained competitive advantage is based on human capital and collective
intelligence, it is difficult to relegate this perspective to ‘just an ideal’.
While empowering leaders have been shown to fit with the current climate we may
sometimes need heroic leaders. Kets de Vries (2003) makes the point that heroic
leadership will never die as change makes people anxious and we need heroic
leaders to calm them down, but since no one can live up to the expectations of
heroic leaders, they will eventually become a disappointment. We conclude with
the thought that there is no one best way – different leaders and different leader
behaviours are needed at different times. For an example of a mixed approach to
leadership see case 14.2 on the website about Tim Smit of the Eden Project.

LEADERSHIP AND MOTIVATION

All leadership models are based on the assumption that one person can motivate
another to act, and we have looked at different explanations of how leaders may do
this – based on their traits, their employment of the one best leadership style or their
use of a style which matches (in some ways) the needs of their followers, and is
responsive (in some ways) to the context. We have also explained how the leader
may be reconceptualised as heroic (transformational leader) and as empowering or
post-heroic.
Some interconnections can be made between these theories and motivation
theories. It is not our purpose here to recount any motivation theories in detail (for
this see texts such as Buchanan and Huczynski 1997; Mullins 1999; Fulop and
Linstead 1999; or Hollyforde and Whiddett 2002). Below we identify some of the
key concepts addressed in motivation theories and suggest which leadership per-
spectives tap into these concepts:

• Expectancy has an impact on motivation. We have already mentioned

McGregor’s (1960) model and his argument that if you treat people as respons-
ible and self-motivated then they will act in a responsible and motivated manner.
In addition Vroom’s (1964) expectancy theory of motivation recognises that in

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Chapter 14 Leadership and motivation

the process of motivation the extent to which the individual feels they can real-
istically achieve the target will have an influence on whether they are motivated
even to try. In respect of transformational leadership it is argued that followers
can be inspired to achieve beyond the normal, partly because the leader has high
expectations of the followers and in addition the leader expresses the belief that
the followers are capable of achieving these great things. From a different per-
spective the post-heroic leader concept is based on trusting organisation members
to play their part, trusting them with information and expecting them to use this
wisely for the good of the organisation.
• Social needs are important. Maslow (1943), Mayo (1953) and McClelland
(1971), among others, highlight the need for affiliation as a motivational fac-
tor. Some leadership models specifically respond to this, for example Blake and
Mouton (1964) (‘one best style’ theory), Hersey and Blanchard (1988) and Fielder
(1967) (contingency theory) all use ‘concern for people’ in some form as one of the
key aspects of their leadership models. The concept of post-heroic leadership con-
cerns involving those who may previously have been excluded, and concerns the
impact of their leadership on individuals. In addition this perspective concentrates
on the importance of learning and acting collectively.
• Importance of the work itself. Maslow (1943), Herzberg (1968), and Hackman
and Oldham (1976), for example, all underline the way in which individuals are
motivated to seek and may achieve satisfaction through their jobs. Herzberg, for
example, identifies how opportunities for achievement, recognition, responsibil-
ity, autonomy, challenging tasks and opportunities for development may all be
motivational. In some ways, Hersey and Blanchard’s (1988) model addresses
these needs in their ‘delegation’ style. In the post-heroic model many people in the
organisation need to be involved in meeting adaptive challenges, in working out
solutions and in contributing to vision building and many need to take on the
responsibility of leadership. This is very different from the transformational lead-
ership model in which the leader at the top of the organisation is seen to have all
the responsibility.
• Recognising different people are motivated by different things. Expectancy the-
ory, previously mentioned, also identifies that different individuals value different
things and hence have different motivational needs. In the process of motivation,
only those things that the individual values will spur them to act. Contingency
models of leadership take this on board to some extent. From a different perspect-
ive the transformational leader develops an interpretation of the world, or nar-
rative, that plays to the followers’ needs. However, while post-heroic leadership
identifies that different people may play a different part, there is an assumption
that all will be prepared to be involved, to share information and to develop them-
selves in line with the needs of the organisation.
• Social influences on motivation. Recent work in the area of motivation suggests
that motivations are socially or culturally determined, and to a limited extent the
transformational leader ties into this as they reinterpret the world for their
followers.

In spite of the links between leadership and motivation theories, there are many
aspects of motivation that the leadership theories ignore. For example, some people
have less internal energy and drive than others and less need for growth. Also,

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Part III Performance

individuals with high levels of energy and drive may satisfy these outside the work
environment. While we may try to motivate people externally the greatest power
for motivation comes from within and is therefore under the control of the indi-
vidual rather than another. The best we can say is that leaders can enhance fol-
lowers’ motivation by the way they treat them, and at worst leaders may neutralise
the motivational energy in their followers. There will always be some factors on
which leaders have no impact whatsoever.

SUMMARY PROPOSITIONS

14.1 Leadership is a process where one person influences a group of others to achieve
group or organisational goals – leadership is thus about motivation.

14.2 The trait model of leadership, although often discredited, continues to play a part in
our understanding of leadership.

14.3 Behavioural models are more helpful than earlier models as they concentrate on
what leaders do rather than on what they are.

14.4 Some behavioural models offer a ‘one best way’ of leadership, but more sophistic-
ated models take account of contingency factors such as maturity of followers and
the nature of the task.

14.5 Models of transformational leadership treat the leader as a hero who can (single-
handedly) turn the organisation around and deliver it from a crisis.

14.6 Empowering and post-heroic leadership models conceptualise the leader as teacher
and facilitator, who involves many in the leadership task.

14.7 While there are many ways in which leadership theories tap into concepts of moti-
vation, at best leaders may enhance the motivation of their followers and at worst
they may neutralise it.

GENERAL DISCUSSION TOPICS

1 Do we need leaders at all? Discuss what alternatives there might be.

2 Consider the four types of charismatic leader identified by Steyrer (1998): hero, father
figure, missionary and saviour. Discuss the ways in which the types of leader are similar or
different.

FURTHER READING
IDS (2003) IDS Studies: Leadership Development, No. 753. London: Incomes Data Services
A useful book outlining the work of five case study organisations, in terms of their conception
of leadership, what prompted their leadership development programmes and an outline of the
programmes themselves. The case organisations are the Dixons group, the Inland Revenue,
Novartis Pharmaceuticals, Portsmouth City Council and Skipton Building Society.

314
170 Part 3 Factors Affecting Employee Behaviour

motivation by the work itself. It is not created by

The meaning of motivation external incentives. Deci and Ryan (1985) suggested
that intrinsic motivation is based on the need to
The term ‘motivation’ derives from the Latin word be competent and self-determining (that is, to have
for movement (movere). A motive is a reason for a choice). Michael Sandel (2012: 122) remarked
doing something. Motivation is the strength and that: ‘When people are engaged in an activity they
direction of behaviour and the factors that influence consider intrinsically worthwhile, offering money
people to behave in certain ways. People are moti- may weaken their motivation by “crowding out”
vated when they expect that a course of action is their intrinsic interest or commitment’.
likely to lead to the attainment of a goal and a valued Intrinsic motivation can be enhanced by job
reward – one that satisfies their needs and wants. design. Katz (1964) suggested that jobs should in
The term ‘motivation’ can refer variously to the goals themselves provide sufficient variety, complexity,
that individuals have, the ways in which individuals challenge and skill to engage the abilities of the
chose their goals and the ways in which others try to worker. Hackman and Oldham (1974) in their job
change their behaviour. Locke and Latham (2004: characteristics model identified the five core charac-
388) observed that: ‘The concept of motivation refers teristics of jobs that result in intrinsic motivation,
to internal factors that impel action and to external namely: skill variety, task identity, task significance,
factors that can act as inducements to action.’ autonomy and feedback. Pink (2009) stated that
As described by Arnold et al (1991) the three there are three steps that managers can take to
components of motivation are: improve motivation:
1 Direction – what a person is trying to do. 1 Autonomy – encourage people to set their
2 Effort – how hard a person is trying. own schedule and focus on getting work
3 Persistence – how long a person keeps on done not how it is done.
trying. 2 Mastery – help people to identify the steps they
Well-motivated people engage in positive discre- can take to improve and ask them to identify
tionary behaviour – they decide to make an effort. how they will know they are making progress.
Such people may be self-motivated, and as long as 3 Purpose – when giving instructions explain
this means they are going in the right direction to the why as well as the how.
attain what they are there to achieve, then this is the Intrinsic motivation is associated with the concept
best form of motivation. But additional motivation of engagement, as explained in Chapter 15.
provided by the work itself, the quality of leadership,
and various forms of recognition and reward, builds
on self-motivation and helps people to make the best Extrinsic motivation
use of their abilities and to perform well.
There are two types of motivation and a number Extrinsic motivation occurs when things are done
of theories explaining how it works, as discussed to or for people in order to motivate them. These
below. include rewards such as incentives, increased pay,
praise or promotion; and punishments such as
disciplinary action, withholding pay, or criticism.
Extrinsic motivators can have an immediate and
Types of motivation powerful effect, but it will not necessarily last long.
The intrinsic motivators, which are concerned with
Intrinsic motivation the ‘quality of working life’ (a phrase and movement
that emerged from this concept), are likely to have
Intrinsic motivation takes place when individuals a deeper and longer-term effect because they are
feel that their work is important, interesting and chal- inherent in individuals and the work – and are not
lenging and that it provides them with a reasonable imposed from outside in such forms as incentive pay.
degree of autonomy (freedom to act), opportunities Motivation theory as described below explains
to achieve and advance, and scope to use and develop the ways in which intrinsic and extrinsic motivation
their skills and abilities. It can be described as take place.
 Chapter 13 Motivation 171

be seriously affected by the informal relationship

Motivation theory existing between workers.

As mentioned by Steers et al (2004: 379) the earliest

approaches to understanding human motivation Content theory
date from the time of the Greek philosophers and
focus on the concept of hedonism as a principle The aim of the content or needs theories produced
driving force in behaviour. Individuals were seen as by Maslow, Alderfer, McClelland, Herzberg, and
directing their efforts to seeking pleasure and avoid- Deci and Ryan was to identify the factors associated
ing pain. This principle was later refined and further with motivation. The theory focuses on the content
developed in the works of philosophers such as of motivation in the shape of needs. Its basis is the
John Locke and Jeremy Bentham in the 17th and belief that an unsatisfied need creates tension and a
18th centuries. Motivation theory has moved on state of disequilibrium. To restore the balance a goal
from then. It started in the earlier part of the 20th is identified that will satisfy the need, and a behaviour
century with the contributions of the exponents pathway is selected that will lead to the achievement
of scientific management (instrumentality theory). of the goal and the satisfaction of the need. Behaviour
In the middle years of that century the behavioural is therefore motivated by unsatisfied needs. A content
scientists entered the field and began to develop the theory model is shown in Figure 13.1. Content the-
‘content’ or ‘needs’ theory of motivation. The main ory, as the term implies, indicates the components
process theories such as expectancy theory emerged of motivation but it does not explain how motiva-
in the in the 1960s and 70s, although the first for- tion affects performance – a necessary requirement
mulation of the process theory of reinforcement took if the concept is to provide guidance on HR policy
place in 1911. The three main areas of motivation and practice. This was the role of expectancy theory,
theory – instrumentality, content and process – are as will be discussed later.
examined below.
Maslow’s hierarchy of needs
The most famous classification of needs is the one
Instrumentality theory formulated by Maslow (1954). He suggested that
Instrumentality theory states in effect that rewards there are five major need categories that apply to
and punishments are the best instruments with people in general, starting from the fundamental
which to shape behaviour. It assumes that people physiological needs and leading through a hierarchy
will be motivated to work if rewards and penalties of safety, social and esteem needs to the need for
are tied directly to their performance; thus the self-fulfilment, the highest need of all. When a lower
awards are contingent upon effective performance. need is satisfied the next highest becomes dominant
Instrumentality theory has its roots in the scientific and the individual’s attention is turned to satisfying
management methods of Taylor (1911: 121) who this higher need. The need for self-fulfilment, however,
wrote: ‘It is impossible, through any long period of can never be satisfied. ‘Man is a wanting animal’;
time, to get workmen to work much harder than only an unsatisfied need can motivate behaviour
the average men around them unless they are assured and the dominant need is the prime motivator of
a large and a permanent increase in their pay.’ behaviour. Psychological development takes place
This theory provides a rationale for financial as people move up the hierarchy of needs, but this is
incentives such as performance-related pay, albeit not necessarily a straightforward progression. The
a dubious one. Motivation using this approach lower needs still exist, even if temporarily dormant
has been and still is widely adopted. It may be suc- as motivators, and individuals constantly return to
cessful in some circumstances, eg piece work, but – previously satisfied needs.
for reasons explained in Chapter 27 – merit or Maslow’s needs hierarchy has an intuitive appeal
performance pay is flawed. and has been very popular. But it has not been verified
Instrumentality theory relies exclusively on a by empirical research such as that conducted by
system of external controls and does not recognize Wahba and Bridwell (1979), and it has been criticized
a number of other human needs. It also fails to ap- for its apparent rigidity – different people may have
preciate the fact that the formal control system can different priorities and the underpinning assumption
172 Part 3 Factors Affecting Employee Behaviour

F i g u r e 13.1 The process of motivation according to content theory

Establish
goal

Identify Take
need action

Attain
goal

that everyone has the same needs is invalid. It is McClelland’s achievement

difficult to accept that needs progress steadily up
the hierarchy and Maslow himself expressed doubts motivation
about the validity of a strictly ordered hierarchy. An alternative way of classifying needs was devel-
But he did emphasize that the higher-order needs oped by McClelland (1961), who based it mainly
are more significant. on studies of managers. He identified three needs
of which the need for achievement was the most
important:
ERG theory (Alderfer)
Alderfer (1972) produced a more convincing and 1 The need for achievement, defined as the
simpler theory, which postulated three primary need for competitive success measured
categories of needs: against a personal standard of excellence.
2 The need for affiliation, defined as the need
1 Existence needs such as hunger and thirst –
for warm, friendly, compassionate
pay, fringe benefits and working conditions
relationships with others.
are other types of existence needs.
3 The need for power, defined as the need to
2 Relatedness needs, which acknowledge that
control or influence others.
people are not self-contained units but must
engage in transactions with their human
environment – acceptance, understanding, Herzberg’s two-factor model
confirmation and influence are elements of The two-factor model of motivation developed by
the relatedness process. Herzberg (1957, 1966) was based on an investigation
3 Growth needs, which involve people in into the sources of job satisfaction and dissatisfaction
finding the opportunities to be what they are of accountants and engineers who were asked what
most fully and to become what they can. made them feel exceptionally good or exceptionally
This is the most significant need. bad about their jobs. According to Herzberg, this
 Chapter 13 Motivation 173

research established that there were two factors that meant that he had considerable influence on the job
affected feelings of satisfaction or dissatisfaction. enrichment movement, which sought to design jobs
Motivating factors or ‘satisfiers’ relate to the job in a way that would maximize the opportunities
content and consist of the need for achievement, the to obtain intrinsic satisfaction from work and
interest of the work, responsibility and opportunities thus improve the quality of working life. Herzberg
for advancement. These needs are the intrinsic famously remarked that if you want people to do
motivators. He summed this up in the phrase ‘moti- a good job then give them a good job to do (quoted
vation by the work itself’. by Dowling, 1971).
Hygiene factors relate to the job context, includ-
ing such things as pay and working conditions. Self-determination theory
‘Hygiene’ is used in the medical use of the term,
As formulated by Deci and Ryan (2000) this theory
meaning preventative and environmental. In them-
states that individuals are motivated by the need
selves hygiene factors neither satisfy nor motivate
to achieve three fundamental goals: striving for
and they serve primarily to prevent job dissatis-
competence, autonomy and relatedness.
faction, while having little effect on positive job
attitudes. Pay is not a satisfier but if it is inadequate
or inequitable it can cause dissatisfaction. However, Comment on content theories
its provision does not provide lasting satisfaction. Shields (2007: 74) observed that content theories
Herzberg’s two-factor theory in effect identifies share some common shortcomings. His criticisms
needs but it has been attacked by, for example, were that they incorrectly assume:
Opsahl and Dunnette (1966). The research method ●● the existence of a universally applicable set
has been criticized because no attempt was made to of human needs;
measure the relationship between satisfaction and
●● that according to Maslow (1954), needs
performance. It has been claimed that the two-factor
conform to a simple ordered hierarchy of
nature of the theory is an inevitable result of the
need importance, when in reality, needs seem
questioning method used by the interviewers. It has
to operate in a more flexible, less ordered
also been suggested that wide and unwarranted in-
and predictable way;
ferences have been drawn from small and specialized
samples and that there is no evidence to suggest that ●● that the link between needs and behaviours
the satisfiers do improve productivity. The under- is direct and automatic, rather than mediated
pinning assumption that everyone has the same needs by human consciousness, values and choice.
is invalid. Denise Rousseau (2006: 263) in her pres- In addition, he pointed out that content theories
idential address to the US Academy of Management ‘underestimate the motivational potency of extrinsic
summed up these views as follows: ‘Herzberg’s long rewards, including financial rewards’.
discredited two-factor theory is typically included
in the motivation section of management textbooks,
despite the fact that it was discredited as an artefact
Process theory
of method bias over thirty years ago.’ In process theory, the emphasis is on the psycho-
In spite of these objections, the Herzberg two- logical or mental processes and forces that affect
factor theory continues to thrive; partly because motivation, as well as on basic needs. It is also
it is easy to understand and seems to be based on known as cognitive theory because it refers to
real-life rather than academic abstractions, and people’s perceptions of their working environment
partly because it convincingly emphasizes the and the ways in which they interpret and under-
positive value of the intrinsic motivating factors stand it. The main process theories are concerned
and highlights the need to consider both financial with reinforcement, expectancy, goals, equity, and
and non-financial factors when developing reward cognitive evaluation.
systems. It is also in accord with a fundamental
belief in the dignity of labour and the Protestant Reinforcement theory
ethic – that work is good in itself. Herzberg’s This is the oldest and least complex of the process
strength as a proselytizer rather than a researcher theories. It is based on ‘the law of effect’ as formulated
174 Part 3 Factors Affecting Employee Behaviour

by Thorndike (1911), which states that over time frequently presented with new situations – a change
people learn about the relationships between their in job, payment system, or working conditions
actions and the consequences of them and this imposed by management – where past experience
understanding guides their future behaviour. In is an inadequate guide to the implications of the
other words, if they believe that something has change. In these circumstances, motivation may be
worked previously then they will do it again. It was reduced.
later developed by Hull (1943, 1951). Motivation is only likely when a clearly perceived
Skinner (1953) and others later built on these and usable relationship exists between performance
principles with the notion of ‘operant conditioning’, and outcome, and the outcome is seen as a means
which was influenced by the work of Pavlov and his of satisfying needs. This explains why extrinsic
salivating dogs. As Shields (2007: 76) put it: ‘Positive financial motivation – for example, an incentive or
reinforcement of desired behaviour elicits more of bonus scheme – works only if the link (line of sight)
the same; punishment of undesired behaviour between effort and reward is clear and the value of
(negative reinforcement) elicits less of the same.’ the reward is worth the effort. It also explains why
Reinforcement models continue to thrive today as intrinsic motivation arising from the work itself
explanatory vehicles for understanding work moti- can be more powerful than extrinsic motivation.
vation and job performance, and as a justification Intrinsic motivation outcomes are more under the
of performance pay. control of individuals, who can place greater reliance
But reinforcement theory can be criticized for on their past experiences to indicate the extent to
taking an unduly mechanistic view of human nature. which positive and advantageous results are likely
It implies that people can be motivated by treating to be obtained by their behaviour.
them as machines – by pulling levers. In assuming This theory was developed by Porter and Lawler
that the present choices of individuals are based on (1968) into a model shown in Figure 13.2, which
an understanding of the outcomes of their past follows Vroom’s ideas by suggesting that there are
choices, reinforcement theory ignores the existing two factors determining the effort that people put
context in which choices are made. In addition, into their jobs: first, the value of the rewards to indi-
motivational theories based on the principle of rein- viduals in so far as they satisfy their needs for security,
forcement pay insufficient attention to the influence social esteem, autonomy and self-actualization;
of expectations – no indication is given of how to second, the probability that rewards depend on
distinguish in advance which outcomes would effort, as perceived by individuals – in other words,
strengthen responses and which would weaken their expectations about the relationships between
them. Above all, they are limited because they imply, effort and reward. Thus, the greater the value of a
in Allport’s (1954) vivid phrase, a hedonism of the set of awards and the higher the probability that
past. receiving each of these rewards depends upon effort,
the greater the effort that will be put forth in a given
situation.
Expectancy theory But, as Porter and Lawler emphasized, mere effort
Expectancy theory states that motivation will be is not enough. It has to be effective effort if it is to
high when people know what they have to do in produce the desired performance. The two variables
order to get a reward, expect that they will be able additional to effort that affect task achievement are:
to get the reward and expect that the reward will be 1) ability – individual characteristics such as intel-
worthwhile. ligence, knowledge, skills; 2) role perceptions –
The concept of expectancy was originally con- what the individual wants to do or thinks they are
tained in the valency-instrumentality-expectancy required to do. These are good from the viewpoint
(VIE) theory that was formulated by Vroom (1964). of the organization if they correspond with what
Valency stands for value; instrumentality is the it thinks the individual ought to be doing. They are
belief that if we do one thing it will lead to another; poor if the views of the individual and the organiza-
and expectancy is the probability that action or tion do not coincide.
effort will lead to an outcome. Alongside goal theory (see below), expectancy
The strength of expectations may be based on past theory has become the most influential motivation
experiences (reinforcement), but individuals are theory, particularly as it affects performance and
 Chapter 13 Motivation 175

F i g u r e 13.2 Motivation model (Porter and Lawler, 1968)

Value of rewards Abilities

Effort Performance

Probability that
Role
reward depend
expectations
upon effort

reward management. But reservations have been ●● may be able to evaluate the extrinsic rewards
expressed about it. House et al (1974) remarked they expect but may find it difficult to
that: ‘Evidence for the validity of the theory is evaluate the possibility of achieving intrinsic
very mixed.’ They also established that there were rewards;
a number of variables affecting expectations that ●● may find it difficult to distinguish the benefits
make it difficult to predict how they function. of one possible outcome from another.
These are:
They concluded that: ‘Expectancy theory can account
●● Leadership behaviour – the function of the for some of the variations in work effort but far less
leader in clarifying expectations, guiding, than normally attributed to it’ (ibid 386).
supporting and rewarding subordinates. Shields (2007: 80) commented that a problem
●● Individual characteristics – the subjects’ with expectancy theory is that it assumes that
perception of their ability to perform the ‘behaviour is rational and premeditated when we
required task. know that much workplace behaviour is impulsive
●● Nature of the task – whether accomplishing and emotional’.
the task provides the necessary However, in spite of these objections, the simple
reinforcements and rewards. message of expectancy theory – that people will be
motivated if they expect that their behaviour will
●● The practices of the organization – its produce a worthwhile reward – is compelling. And
reward and control systems and how it it provides a useful tool to assess the effectiveness of
functions. motivating devices such as performance-related pay.
Research conducted by Behling and Starke (1973)
established that individuals: Goal theory
Goal theory as developed by Latham and Locke
●● make crucial personal decisions without
(1979) following their research states that motivation
clearly understanding the consequences;
and performance are higher when individuals are
●● do not in practice consistently evaluate their set specific goals, when goals are demanding but
order of preference for alternative actions; accepted, and when there is feedback on performance.
●● have to assign two values when making a Goals must be clearly defined. Participation in goal
decision – its desirability and its achievability setting is important as a means of getting agreement
– but they tend to be influenced mainly by to the setting of demanding goals. Feedback is vital
desirability – they let their tastes influence in maintaining motivation, particularly towards the
their beliefs; achievement of even higher goals.
176 Part 3 Factors Affecting Employee Behaviour

However, the universality of goal theory has feedback, when used to convey to people a sense
been questioned. For example, Pintrich (2000) noted of appreciation for work well done, will tend to be
that people have different goals in different circum- experienced informationally and will maintain or
stances and that it is hard to justify the assumption enhance intrinsic motivation. But when they are used
that goals are always accessible and conscious. And to motivate people, they will be experienced con-
Harackiewicz et al (2002) warned that goals are trollingly and will undermine intrinsic motivation.’
only effective when they are consistent with and Deci et al (1999) followed up this research by
match the general context in which they are pursued. carrying out a meta-analysis of 128 experiments on
But support for goal theory was provided by rewards and intrinsic motivation to establish the
Bandura and Cervone (1983) who emphasized the extent to which intrinsic motivation was under-
importance of self-efficacy (a belief in one’s ability mined by rewards. The results of the study indicated
to accomplish goals). that for high-interest tasks, rewards had significant
negative effects on what the researchers called ‘free-
Equity theory choice measures’, which included the time spent on
the task after the reward was removed.
Equity theory, as defined by Adams (1965), is con- But as noted by Gerhart and Rynes (2003: 52):
cerned with the perceptions people have about ‘The vast majority of research on this theory has
how they are being treated as compared with others. been performed in school rather than work settings,
He proposed that employees assess the fairness or often with elementary school-aged children.’ But
otherwise of their rewards (outcomes) in relation to that did not stop other commentators assuming
their effort or qualifications (inputs) and that they that the results were equally significant for working
do this by comparing their own input/output ratio adults. It is interesting to note that research in in-
against that of other individuals. If the input/output dustry conducted by Deci and Ryan (1985), while it
ratio is perceived to be unfavourable, they will feel found that financial incentives did decrease intrinsic
that there is reward inequity. motivation in high-control organizational cultures,
Equity theory explains only one aspect of the pro­ also established that in organizations with the
cesses of motivation and job satisfaction, although opposite high-involvement culture, intrinsic and ex-
it may be significant in terms of morale and, possibly, trinsic motivation were both increased by monetary
of performance. incentives. Context is all important. Moreover, a
meta-analysis of 145 studies conducted by Cameron
Social learning theory et al (2001) led to the conclusion that rewards do
Social learning theory as developed by Bandura not inevitably have negative effects on intrinsic
(1977) combines aspects of both reinforcement and motivation.
expectancy theory. It recognizes the significance of
the basic behavioural concept of reinforcement Purposeful work behaviour
as a determinant of future behaviour but also A more recent integrated motivation theory formu-
emphasizes the importance of internal psychological lated by Barrick and Mount (2013) focused on the
factors, especially expectancies about the value of impact on motivation of individual factors, such as
goals and the individual’s ability to reach them. personality and ability, and situational factors, such
The term ‘reciprocal determinism’ is used to denote as job characteristics. The motivation to engage in
the concept that while the situation will affect purposeful work behaviour depends on both these
individual behaviour individuals will simultaneously factors.
influence the situation.
Comment on process theories
Cognitive evaluation theory Process theories are not based on suspect assump-
Cognitive evaluation theory contends that the use tions about the universality of needs, as are content
of extrinsic rewards may destroy the intrinsic moti- theories. Process theories emphasize the importance
vation that flows from inherent job interest. It was of individual decision-making on work behaviour.
formulated by Deci and Ryan (1985). Referring As pointed out by Shields (2007: 85) They ‘ac-
to their research, they stated that: ‘Rewards, like knowledge the importance of social and job context
 Chapter 13 Motivation 177

as co-determinants of motivational strength while

those other than reinforcement theory also high-
Motivation and job
light the importance of self-efficacy, task or goal
clarity and motivational learning’.
satisfaction
Job satisfaction can be defined as the attitudes and
feelings people have about their work. Positive and
Summary of motivation theories favourable attitudes towards the job indicate job
A summary of motivation theories is set out in satisfaction. Negative and unfavourable attitudes
Table 13.1. towards the job indicate job dissatisfaction. It can
be distinguished from morale, which is a group
rather than individual variable, related to the degree
to which group members feel attracted to their
Conclusions on motivation theory group and want to remain a member of it.
All the theories referred to above make some contri-
bution to an understanding of the processes that
affect motivation. But instrumentality theory provides The factors that affect job
only a simplistic explanation of how motivation
works. Needs and content theories are more sophis- satisfaction
ticated but have their limitations. As Gerhart and Levels of job satisfaction or dissatisfaction are in-
Rynes (2003: 53) commented: fluenced by:
Although the ideas developed by Maslow,
●● The intrinsic motivating factors. These relate
Herzberg and Deci have had considerable appeal
to many people, the prevailing view in the
to job content, especially the five dimensions
academic literature is that the specific predictions of jobs identified by Hackman and Oldham
of these theories is not supported by empirical (1974): skill variety, task identity, task
evidence. On the other hand it would be a mistake significance, autonomy and feedback (the job
to underestimate the influence that these theories characteristics model).
have had on research and practice. Pfeffer, Kohn ●● The quality of supervision. The Hawthorne
and others continue to base their argument studies (Roethlisberger and Dixon, 1939)
regarding the ineffectiveness of money as a resulted in the claim that supervision is the
motivator on such theories. most important determinant of worker
But, bearing in mind the reservations set out earlier, attitudes. Elton Mayo (1933) believed that
needs theory still offers an indication of the factors a man’s desire to be continuously associated
that motivate people and content theory provides in work with his fellows is a strong, if not
useful explanations of how motivation takes place. the strongest human characteristic.
And while instrumentality and reinforcement theo- ●● Success or failure. Success obviously
ries may be simplistic they still explain some aspects creates satisfaction, especially if it enables
of how rewards affect motivation and performance individuals to prove to themselves that they
and they continue to exert influence on the beliefs are using their abilities to the full. And it is
of some people about the power of incentives to equally obvious that the reverse is true of
motivate people. Herzberg’s research may be flawed failure.
but he still contributed to the recognition of the
importance of job design.
Motivation theory can explain what makes peo-
ple tick at work but it is also necessary to consider
Job satisfaction and performance
two other aspects of the impact of motivation – its It is a commonly held and not unreasonable belief
relationship with job satisfaction and the effect of that an increase in job satisfaction results in im-
money on motivation. Strategies for motivation proved performance. The whole human relations
based on the lessons learnt from motivation theory movement led by Mayo (1933) and supported by
are considered at the end of this chapter. the Roethlisberger and Dixon (1939) research was
178 Part 3 Factors Affecting Employee Behaviour

Ta b l e 13.1  Summary of motivation theories

Category Theory Summary of theory Implications

Instrumentality Taylorism If we do one thing it leads to Basis of crude attempts to

Taylor (1911) another. People will be motivate people by incentives.
motivated to work if rewards Often used as the implied
and punishments are directly rationale for performance-related
related to their performance. pay although this is seldom an
effective motivator.

Content or Hierarchy of A hierarchy of needs exists: Focuses attention on the various

needs needs physiological, safety, social, needs that motivate people and
Maslow (1954) esteem, self-fulfilment. Needs the notion that a satisfied need is
at a higher level only emerge no longer a motivator. The concept
when a lower need is satisfied. of a hierarchy has no practical
significance.

ERG A non-hierarchical theory A simpler and more convincing

Alderfer (1972) identifying three basic needs: categorization of needs.
existence, relatedness and
growth.

Achievement Identified three needs for Emphasized the importance to

motivation managers: achievement, managers of achievement as a
McClelland affiliation and power. Of these, motivating factor.
(1961) achievement is the most
important.

Two-factor model Two groups of factors affect job The research methodology has
Herzberg (1957, satisfaction: 1) those intrinsic been strongly criticized (it does
1966) to the work itself; 2) those not support the existence of two
extrinsic to the job such as pay factors) and the underpinning
and working conditions. The assumption that everyone has
factors that affect positive the same needs is invalid. But it
feelings (the motivating factors) has influenced approaches to job
are quite different from those design (job enrichment) and it
that affect negative feelings supports the proposition that
(the hygiene factors). reward systems should provide
for both financial and non-financial
rewards.

Self- Individuals are motivated to Provides an alternative and

determination achieve three fundamental simpler classification of needs.
Deci and Ryan goals: striving for competence,
(2000) autonomy, and relatedness.
 Chapter 13 Motivation 179

tAB L E 13.1 Continued

Category Theory Summary of theory Implications

Process Reinforcement As experience is gained in Provide feedback that positively

Thorndike (1911) satisfying needs, people reinforces effective behaviour.
Skinner (1953) perceive that certain actions
help to achieve goals while
others are unsuccessful. The
successful actions are repeated
when a similar need arises.

Expectancy Effort (motivation) depends on The key theory informing

Vroom (1964) the likelihood that rewards will approaches to rewards, ie that
Porter and follow effort and that the they must be a link between effort
Lawler (1968) reward is worthwhile. and reward (line of sight), the
reward should be achievable and
it should be worthwhile.

Goal Motivation will improve if Influences performance

Lathom and people have demanding but management and learning and
Locke (1979) agreed goals and receive development practices.
feedback

Equity People are better motivated Need to have equitable reward

Adams (1966) if treated equitably, ie treated and employment practices.
fairly in comparison with
another group of people
(a reference group) or a
relevant other person.

Social learning Recognizes the significance of The emphasis is on expectancies,

Bandura (1977) reinforcement as a determinant individual goals and values and
of future behaviour but also the influence of both person and
emphasizes the importance of situational factors as well as
expectancies about the value reinforcement.
of goals and the individual’s
ability to reach them.

Cognitive The use of extrinsic rewards Emphasizes the importance of

evaluation may destroy the intrinsic non-financial rewards. The
Deci and Ryan motivation that flows from conclusions reached from Deci
(1985) inherent job interest. and Ryan’s research have been
questioned.
180 Part 3 Factors Affecting Employee Behaviour

based on the belief that productivity could be in- the work itself. However, it must be re-emphasized
creased by making workers more satisfied, primarily that different people have different needs and
through pleasant and supportive supervision and by wants. Some will be much more motivated by
meeting their social needs. But research by Katz money than others. What cannot be assumed is that
et al (1950) and Katz et al (1951) found that the money motivates everyone in the same way and to
levels of satisfaction with pay, job status or fellow the same extent. Thus it is naive to think that the
workers in high productivity units were no different introduction of a performance-related pay scheme
to those in low productivity units. will miraculously transform everyone overnight
Meta-analysis by Brayfield and Crocket (1955) of into well-motivated, high-performing individuals.
a number of studies concluded that there was little Nevertheless, money is a powerful force because
evidence of any simple or appreciable relationship it is linked directly or indirectly to the satisfaction of
between satisfaction and performance. A later review many needs. Money may in itself have no intrinsic
of research by Vroom (1964) found that the median meaning, but it acquires significant motivating
correlation between job satisfaction and job per- power because it comes to symbolize so many intan-
formance for all these studies was only 0.14, which gible goals. It acts as a symbol in different ways for
is not high enough to suggest any marked relation- different people, and for the same person at different
ship between them. Spector (1997) came to the times.
same conclusion. Indeed, it can be argued that it is But do financial incentives motivate people? The
not increases in satisfaction that produce improved answer is yes, for those people who are strongly
performance but improved performance that in- motivated by money and whose expectations are
creases satisfaction. This was confirmed by data on that they will receive a worthwhile financial reward.
the link between job satisfaction and performance But less confident employees may not respond to
for 177 store managers, analysed by Christen et al incentives that they do not expect to achieve. It can
(2006). It was established that store managers’ per- also be argued that extrinsic rewards may erode
formance increased their job satisfaction but that intrinsic interest – people who work just for money
job satisfaction had no impact on job performance. could find their tasks less pleasurable and may not,
therefore, do them so well. What we do know is
that a multiplicity of factors is involved in perform-
ance improvements and many of those factors are
Motivation and money interdependent.
Money can therefore provide positive motivation
Money, in the form of pay or some other sort of in the right circumstances not only because people
remuneration, is regarded by many people as the need and want money but also because it serves as
most obvious extrinsic reward. Money seems to a highly tangible means of recognition. But badly
provide the carrot that most people want. designed and managed pay systems can demotivate.
Doubts were cast on the effectiveness of money Another researcher in this area was Jaques (1961),
by Herzberg (1968), which although unsupported who emphasized the need for such systems to be
by his research have some degree of face validity. perceived as being fair and equitable. In other words,
He claimed that while the lack of money can cause the reward should be clearly related to effort or level
dissatisfaction, its provision does not result in lasting of responsibility and people should not receive less
satisfaction. There is something in this, especially money than they deserve compared with their fellow
for people on fixed salaries or rates of pay who do workers. Jaques called this the ‘felt-fair’ principle.
not benefit directly from an incentive scheme. They
may feel good when they get an increase; apart
from the extra money, it is a highly tangible form
of recognition and an effective means of helping Motivation strategies
people to feel that they are valued. But this feeling
of euphoria can rapidly die away. Other causes of Motivation strategies aim to create a working envir­
dissatisfaction from Herzberg’s list of hygiene factors, onment and to develop policies and practices that
such as working conditions or the quality of man- will provide for higher levels of performance from
agement, can loom larger in some people’s minds employees. The factors affecting them and the HR
when they fail to get the satisfaction they need from contribution are summarized in Table 13.2.
 Chapter 13 Motivation 181

Ta b l e 13.2 Factors affecting motivation strategies and the HR contribution

Factors affecting motivation The HR contribution
strategies

The complexity of the process of motivation Avoid the trap of developing or supporting strategies
means that simplistic approaches based on that offer prescriptions for motivation based on a
instrumentality or needs theory are unlikely simplistic view of the process or fail to recognize
to be successful. individual differences.

People are more likely to be motivated if Encourage the development of performance

they work in an environment in which they management processes that provide opportunities
are valued for what they are and what they to agree expectations and to recognize
do. accomplishments.
This means paying attention to the basic
need for recognition.

Extrinsic motivators such as incentive pay Develop total reward systems that provide
can have an immediate and powerful effect, opportunities for both financial and non-financial
but it will not necessarily last long. The rewards to recognize achievements. Bear in mind,
intrinsic motivators, which are concerned however, that financial rewards systems are not
with the ‘quality of working life’ (a phrase necessarily appropriate and the lessons of
and movement that emerged from this expectancy, goal and equity theory need to be taken
concept), are likely to have a deeper and into account in designing and operating them.
longer-term effect because they are inherent Pay particular attention to recognition as a means of
in individuals and the work they do and not motivation.
imposed from outside in such forms as Develop intrinsic motivation by paying attention to
performance-related pay. job design, ensuring that managers are aware of its
importance and their role in designing intrinsically
motivating jobs.

Some people will be much more motivated Avoid the introduction of a performance-related
by money than others. It cannot be assumed pay scheme in the belief that it will miraculously
that money motivates everyone in the same transform everyone overnight into well-motivated,
way and to the same extent. high-performing individuals.

The need for work that provides people with Advise on processes for the design of jobs that take
the means to achieve their goals, a account of the factors affecting the motivation to
reasonable degree of autonomy, and scope work, providing for job enrichment in the shape of
for the use of skills and competences. variety, decision-making responsibility and as much
control as possible in carrying out the work.

The need for the opportunity to grow by Provide facilities and opportunities for learning
developing abilities and careers. through such means as personal development
planning processes as well as more formal training.
Develop career planning processes.
182 Part 3 Factors Affecting Employee Behaviour

TAB L E 13.2 Continued

Factors affecting motivation The HR contribution

strategies

The cultural environment of the organization Advise on the development of a culture that
in the shape of its values and norms will supports processes of valuing and rewarding
influence the impact of any attempts to employees.
motivate people by direct or indirect means.

Motivation will be enhanced by leadership, Devise competency frameworks that focus on

which sets the direction, encourages and leadership qualities and the behaviours expected of
stimulates achievement and provides managers and team leaders.
support to employees in their efforts to Ensure that leadership potential is identified through
reach goals and improve their performance performance management and assessment centres.
generally. Conduct leadership development programmes.

Achievement motivation is important for Pay attention to job design to ensure that people are
managers and those who aspire to greater given the scope to achieve.
responsibility. Develop talent management processes to provide
people with opportunities to achieve and
performance management processes to provide
them with feedback on how well they are achieving
and what they must do to achieve more.

Key learning points: Motivation

The process of motivation most significant theories are those concerned with
expectancy, goal setting, equity and cognitive
Motivation is goal-directed behaviour. People are evaluation, which are classified as process or
motivated when they expect that a course of action cognitive theories.
is likely to lead to the attainment of a goal and a valued
reward – one that satisfies their needs and wants.
Motivation strategies
Types of motivation Motivation strategies aim to create a working
environment and to develop policies and practices
The two basic types are intrinsic and extrinsic motivation.
that will provide for higher levels of performance from
employees. They include the design of intrinsically
Motivation theories motivating jobs and leadership development
There are a number of motivation theories that, in programmes and the development of total reward
the main, are complementary to one another. The systems and performance management processes.
 Using these overall goals, marketers combine the elements of the promotional mix into
promotion a coordinated plan. This promotional plan defines the promotional strategy, which then
Communication by marketers that becomes an integral part of the overall marketing strategy for reaching the target market.
informs, persuades, and reminds
potential buyers of a product in The main function of a marketer’s promotional strategy is to convince target
order to influence an opinion or customers that the goods and services offered provide a competitive advantage over the
elicit a response. competition. A competitive advantage is the set of unique features of a company and
promotional strategy its products that are perceived by the target market as significant and superior to the
A plan for the optimal use of the competition. Such features can include high product quality, rapid delivery, low prices,
elements of promotion: advertising, excellent service, or a feature not offered by the competition. For example, fast-food
public relations, personal selling,
and sales promotion. restaurant Subway promises fresh sandwiches that are better for you than a hamburger
or pizza. Subway effectively communicates its competitive advantage through advertis-
competitive advantage ing featuring longtime “spokes-eater” Jared Fogle, who lost weight by eating at Subway
One or more unique aspects of
an organization that cause target every day.1 Thus, promotion is a vital part of the marketing mix, informing consumers
consumers to patronize that firm of a product’s benefits and thereby positioning the product in the marketplace.
rather than competitors.

communication
The process by which we
exchange or share meanings 2
through a common set of symbols.
MARKETING COMMUNICATION
Promotional strategy is closely related to the process of communication. As humans, we
assign meaning to feelings, ideas, facts, attitudes, and emotions. Communication is the
process by which we exchange or share meanings through a common set of symbols. When
a company develops a new product, changes an old one, or simply tries to increase sales

Obama for President: The Ultimate IMC Campaign

Start with a young, relatively unknown black man with a online distribution. They used text messaging and e-mail
Muslim-sounding name. His first opponent was the best- effectively by using the list sparingly through most of the
known woman in America married to one of the most campaign and then sending a flurry of e-mails during
successful politicians in history. His second competitor the last few weeks of the campaign urging supporters to
was a well-known and respected war hero with 40 years make calls and visits, host parties, and volunteer. Obama
as a senator. But President Barack Obama had a better had more than double John McCain’s online traffic. The
marketing strategy than either one of them: Change. campaign even created their own social network of 2
Obama’s presidential campaign, launched in million users, MyBarackObama.com, and leveraged other
February 2007, began with the message of “change” social networks such as Facebook and MySpace and as
and did not deviate from it. Ever. The message resonated well as specialized networks such as Eon and BlackPlanet.
with American voters and would-be voters. He kept the Search engine optimization was used to dispel negative
message simple and consistent through endless repeti- information and Internet rumors. The campaign demon-
tion. Obama also effectively defined the message so strated not only knowledge of basic marketing principles,
that all of the other candidates were also forced to talk but also an understanding of ground-level tactics on every-
about change. This follows classic marketing positioning thing from segmentation and database management to
principles. analytics, social networking, and online communities.
But Team Obama went further. They used behav- And consider the results. First there was the obvious
ioral targeting to segment their voter audience so that landslide victory—even in states that Democrats have not
each message was tailored specifically to the individual captured in years. Second, the campaign set fundraising
voter. Traditional media were used in untraditional records of more than half a billion dollars, specifically from
ways—specifically by purchasing viewing time on big everyday voters who donated less than an average of
events, such as the Summer Olympics, and by airing a $100. Third, they have a database of more than 13 mil-
30-minute infomercial on seven networks just days before lion engaged voters and 5 million supporters on social net-
the election. Team Obama raised the use of digital works. With all of this momentum, the real question is how
media to a completely new level and created content for Obama will use his marketing skills to run the country.2
of an existing good or service, it must communicate its selling message

CHAPTER 16
to potential customers. Marketers communicate information about the
firm and its products to the target market and various publics through its
promotion programs. When Sara Lee Corp. decided to reinvigorate its
legacy brand, Kiwi shoe polish, it began with communication: It asked
people about their shoe care needs. After interviewing 3,500 people
across eight countries, it found out that people cared more about fresh,

Promotional Planning for Competitive Advantage

comfortable shoes than whether those shoes were polished. Sara Lee’s
new CEO welcomes innovation. She found out which innovations
would be welcome by communicating with Kiwi’s consumers, marketers,
and retailers; then she pushed the employees to “think outside the box—
or inside the shoe.” And it paid off. Kiwi’s new products—including thin
insoles with built-in fresheners and single-use polishes—pushed Kiwi’s
sales up by 4.4 percent (for the first time in a long time). Now Sara Lee is
using that same innovation-driven-by-communication model and holding
focus groups with its employees and customers to find out which new
products will revive Sara Lee’s other brands (www.kiwicare.com).3
Communication can be divided into two major categories:
interpersonal communication and mass communication. Interpersonal
communication is direct, face-to-face communication between two
or more people. When communicating face-to-face, people see The Obama presidential campaign demonstrated

© AP PHOTO/CHRIS CARLSON
the other person’s reaction and can respond almost immediately. not only knowledge of basic marketing principles,
A salesperson speaking directly with a client is an example of an but also an understanding of ground-level tactics on
interpersonal marketing communication. Mass communication involves everything from segmentation and database man-
agement to analytics, social networking, and online
communicating a concept or message to large audiences. A great deal of
communities.
marketing communication is directed to consumers as a whole, usually
through a mass medium such as television, newspapers, or the Internet.
When a company advertises, it generally does not personally know the
people with whom it is trying to communicate. Furthermore, the company is unable to
respond immediately to consumers’ reactions to its message. Instead, the marketing manager
must wait to see whether people are reacting positively or negatively to the mass-communi-
cated promotion. Any clutter from competitors’ messages or other distractions in the environ-
ment can reduce the effectiveness of the mass-communication effort.

The Communication Process

Marketers are both senders, and receivers of messages. As senders, marketers attempt to
inform, persuade, and remind the target market to adopt courses of action compatible
with the need to promote the purchase of goods and services. As receivers, marketers
attune themselves to the target market in order to develop the appropriate messages,
adapt existing messages, and spot new communication opportunities. In this way, mar-
keting communication is a two-way, rather than one-way, process. The two-way nature
of the communication process is shown in Exhibit 16.2.

The Sender and Encoding The sender is the originator of the message in the com-
munication process. In an interpersonal conversation, the sender may be a parent, a
friend, or a salesperson. For an advertisement or press release, the sender is the com-
interpersonal communication
pany or organization itself. For example, the Swedish brand Absolut Vodka launched Direct, face-to-face communication
a marketing campaign using the theme “In an Absolut World.” At the outset, the between two or more people.
objective of the campaign was to increase Absolut’s market share in the crowded and
mass communication
increasingly competitive U.S. vodka market. To appeal to this market, Absolut had to The communication of a concept or
differentiate its message from the “rational benefits” (such as best taste or smooth feel) message to large audiences.
being claimed by so many of the upstarts in the vodka category. Absolut changed its
sender
near-legendary super-premium brand strategy—a print campaign pairing the iconic The originator of the message in the
shape of its bottle with equally iconic art figures—to a campaign that would appeal communication process.
to the “emotional benefits” of the brand.4 Thus, Absolute launched a new campaign

527
 EXHIBIT 16.2
Communication Process Noise

• Other advertisements
• News articles
• Other store displays

Encoding Decoding the

Sender Message Receiver
the message
channel
message

• Marketing • Advertisement • Media • Receiver • Customers

manager • Sales • Salesperson interpretation • Viewers/
• Advertising presentation • Retail store of message listeners
manager • Store display • Local news show • News media
• Advertising • Coupon • Clients
agency • Press release
encoding Feedback
The conversion of a sender’s ideas channel
and thoughts into a message,
usually in the form of words or
signs. • Market research
• Sales results
channel • Change in market share
A medium of communication—such
as a voice, radio, or newspaper—
for transmitting a message.
using the phrase “Absolut World” to promote the message that their vodka was the
noise brand to choose if the customer was intelligent, savvy, and wanted to challenge the
Anything that interferes with,
distorts, or slows down the status quo by taking on bold and optimistic new world views. The new ads assert that
transmission of information. Absolut vodka is in a class by itself—indeed, in a world of its own, an “Absolut World.”
The ad campaign also invites Absolut’s consumers to visualize a world that appeals to
them—even a world that may be idealized or “fantastic.”5
Encoding is the conversion of the sender’s ideas and
thoughts into a message, usually in the form of words or
signs. A basic principle of encoding is that what matters is
not what the source says but what the receiver hears. One
way of conveying a message that the receiver will hear prop-
erly is to use concrete words and pictures. For example,
Absolut’s marketers encoded the message by a creating a
series of life-size outdoor ads, wrapped buildings, and other
media that imagined an “Absolut World” where factories
Promotion and Communication Strategies

emit harmless bubbles instead of smoke, ATMs dispense

“free” money, politicians’ noses grow if they lie, and people
in bars wear buttons labeling their dating status and mindset.6

Message Transmission Transmission of a message requires a

channel—a voice, radio, newspaper, computer, or other com-
munication medium. A facial expression or gesture can also
serve as a channel.
© UNDER PERMISSION BY V&S VIN & SPRIT AB

Reception occurs when the message is detected by the

receiver and enters his or her frame of reference. In a two-way
conversation such as a sales pitch given by a sales representa-
tive to a potential client, reception is normally high. In con-
trast, the desired receivers may or may not detect the message
when it is mass communicated because most media are clut-
tered by noise—anything that interferes with, distorts, or slows
down the transmission of information. In some media over-
crowded with advertisers, such as newspapers and television,
PART 5

528
the noise level is high and the reception level is low. For example, competing network

CHAPTER 16
advertisements, other entertainment option advertisements, or other programming on
the network itself might hamper reception of the “Absolut World” advertising campaign
message. Transmission can also be hindered by situational factors: physical surroundings
such as light, sound, location, and weather; the presence of other people; or the tempo-
rary moods consumers might bring to the situation. Mass communication may not even
reach all the right consumers. Some members of the target audience were likely watch-

Promotional Planning for Competitive Advantage

ing television when Absolut’s commercials were shown, but others probably were not.

The Receiver and Decoding Marketers communicate their message through a channel
to customers, or receivers, who will decode the message. Decoding is the interpretation
of the language and symbols sent by the source through a channel. Common under-
standing between two communicators, or a common frame of reference, is required for
effective communication. Therefore, marketing managers must ensure a proper match
between the message to be conveyed and the target market’s attitudes and ideas.
Even though a message has been received, it will not necessarily be properly
decoded—or even seen, viewed, or heard—because of selective exposure, distortion,
and retention. (Refer to Chapter 6.) Even when people receive a message, they tend
to manipulate, alter, and modify it to reflect their own biases, needs, knowledge, and
culture. Differences in age, social class, education, culture, and ethnicity can lead to
miscommunication, for example. Further, because people don’t always listen or read
carefully, they can easily misinterpret what is said or written. In fact, researchers have
found that consumers misunderstand a large proportion of both printed and televised
communications. Bright colors and bold graphics have been shown to increase consumers’
comprehension of marketing communication. Even these techniques are not foolproof,
however. A classic example of miscommunication occurred when Lever Brothers mailed
out samples of its then new dishwashing liquid, Sunlight, which contains real lemon
juice. The package clearly stated that Sunlight was a household cleaning product.
Nevertheless, many people saw the word sunlight, the large picture of lemons, and the
phrase “with real lemon juice” and thought the product was lemon juice.
Marketers targeting consumers in foreign countries must also worry about the transla-
tion and possible miscommunication of their promotional messages by other cultures.
An important issue for global marketers is whether to standardize or customize the
message for each global market in which they sell. While Absolut’s marketers used the
“World” message globally, they tailored the ads to reflect how people in various regions
might envision an “Absolut World.” For example, a bus shelter on Second Avenue in
New York City was wrapped to look like a subway entrance—a dream of many New York
commuters.7 In Germany, consumers were given a firsthand experience of the “Absolut
World.” For one week, a fleet of Porsche taxis chauffeured passengers quickly—and for
free—around Hamburg, Munich, and Berlin. By the end of that week, the taxis had gen-
erated over 15 million media contacts through TV, print, and online news coverage.8

Feedback In interpersonal communication, the receiver’s response to a message is

direct feedback to the source. Feedback may be verbal, as in saying “I agree,” or non-
verbal, as in nodding, smiling, frowning, or gesturing.
Because mass communicators like Absolut’s are often cut off from direct feedback,
they must rely on market research or analysis of viewer responses from indirect feed-
back. Absolut might use such measurements as the percentage of television viewers
who recognized, recalled, or stated they were exposed to Absolut’s messages. Indirect receiver
feedback enables mass communicators to decide whether to continue, modify, or drop The person who decodes a message.
a message. Web sites also facilitate feedback. For example, Absolut could capture con-
decoding
sumer feedback in e-mails, discussion boards, blogs, and other tools from their Web site. Interpretation of the language and
symbols sent by the source through a
channel.
The Impact of Web 2.0 on Marketing Communication
feedback
The Internet and related technologies are having a profound impact on marketing The receiver’s response to a message.
communication. When companies initially developed Web sites the primary formats

529
 were either online brochures, where essentially the corporate brochure or catalog
corporate blogs was put online, or e-commerce sites, where the companies could facilitate online
Blogs that are sponsored by a sales of products. The next generation of the Internet, Web 2.0, facilitated consumer
company or one of its brands and
maintained by one or more of the empowerment. For the first time, consumers were able to directly speak to other
company’s employees. consumers, the company, and Web communities.
Web 2.0 tools include blogs (online journals), podcasting (online radio shows),
noncorporate blogs
Independent blogs that are not vodcasts (online videos and newscasts), and social networks such as MySpace and
associated with the marketing Facebook. In the beginning, these tools were primarily used by individuals to express
efforts of any particular company themselves. For example, a lawyer may develop a blog to talk about politics because
or brand.
that is a hobby. Or a college freshman may develop a profile on Facebook to stay in
touch with high school friends. But soon, businesses began to see that these tools can be
used to engage with consumers as well. The rise of blogging, for example, has created a
completely new way for marketers to manage their image, connect with consumers, and
generate interest in and desire for their companies’ products.
Despite what could be considered a national obsession with blogs, measuring
blogging activity remains challenging. According to Technorati, the first blog search
engine, there were more than 28 million blogs online in 2006. But by early 2008,
there were so many blogs there was not a consistent number. While research com-
panies agree that there are millions of blogs, comScore Media Metrix says that as
of August 2008, there were 189 million blogs (counting Facebook) and Universal
McCann reports there were 184 million blogs.9 As part of their annual State of the
Blogosphere, Technorati says the real trend is with the Active blogosphere that tends to
influence the mainstream media. Brands also permeate the Blogosphere. Four of five
bloggers post brand or product reviews, so even if a company does not have a formal
social media strategy, chances are the brand is still out in the blogosphere thanks to the
millions of bloggers. As such, companies are now reaching out to the most influential
bloggers. Indeed, more than one-third of those with a blog have been approached to be
a brand advocate.
The question then is whether blogging is a passing fad, representing at best an unre-
liable means of communicating, or an emerging trend. If it is a fad, why are marketers
so interested in blogging as a promotional tool? The answer in part is that blogging
alters the marketing communication process for the promotional elements that rely on
mass communication—advertising, public relations, and sales promotion—by moving
them away from impersonal, indirect communication toward a personalized, direct
communication model.
Blogs can be divided into broad categories: corporate blogs and professional blogs
versus noncorporate blogs (such as personal blogs). Corporate blogs are sponsored
by a company or one of its brands and maintained by one or more of the company’s
employees. Corporate blogs disseminate marketing-controlled information. (Recall from
Chapter 6 that marketing-controlled information is a source of product information that
Promotion and Communication Strategies

originates with marketers promoting the product.) Because blogs are designed to change
daily, corporate blogs are dynamic and highly flexible, giving marketers the opportunity
to adapt their messages more frequently than with any other communication channel.
Initially, blogs were maintained by only the most technology-savvy companies. But
today companies as diverse as Coca-Cola, Starwood Hotels, Honda, Nokia, Benetton,
Ducati, Guinness, and HSBC have all launched corporate blogs. Undoubtedly, many
more will appear in the near future.
In contrast, noncorporate blogs are independent and not associated with the
marketing efforts of any particular company or brand. As such, noncorporate blogs
function much like nonmarketing-controlled information: They provide a source of
information and opinion perceived to be independent and more authentic than a
corporate blog.10 Michael Marx loves Barq’s root beer. He wears Barq’s T-shirts, brings
the beverage to parties, and calls it his “beer.” He established a blog dedicated to Barq’s,
www.thebarqsman.com, where he posted news about the brand, Barq’s commercials
he likes, and musings on why Barq’s is superior to other root beers. Thebarqsman.com
is not affiliated with Coca-Cola, the owner of the Barq’s brand, which had no idea
of the blog’s existence until a New York Times reporter writing a story on brand blogs
PART 5

530
mentioned it. Even though thebarqsman.com is dedicated to a single brand, Marx’s

CHAPTER 16
blog is an example of a noncorporate blog.11
Both corporate and noncorporate blogs have had an impact on the communica-
tion model depicted in Exhibit 16.2. That model shows the feedback channel as
primarily impersonal and numbers-driven. In the traditional communication process,
marketers can see the results of consumer behavior (e.g., a drop in sales), but are
only able to explain them using their judgment. Even the information generated

Promotional Planning for Competitive Advantage

by market research is not as natural as that gleaned from bloggers. Corporate blogs
allow marketers to personalize the feedback channel by opening the door for direct
conversation with consumers. However, because there is no control over noncor-
porate blogs, there is a chance that comments and postings will be negative. Thus,
many companies have a crisis communication strategy to deal with negative informa-
tion in the blogosphere.
When marketers launch a corporate blog, they create an unfiltered feedback
channel. For example, Enrico Minoli, CEO of Ducati, the Italian motorcycle brand,
launched a blog at blog.ducati.com. He vowed to write “openly about what’s going on
at Ducati.” Within three days, his postings had generated 99 responses, from motorcycle
enthusiasts from Greece to Daytona Beach, who all seemed most pleased that the CEO
himself was a motorbike enthusiast. They began peppering him with questions about
when new models would hit production and chatted with each other about their own
bikes and biking experiences. Minoli’s blog put a face on the impersonal nature of a
large corporation.12
Noncorporate blogs have also personalized the feedback channel. But while
corporate blogs create a direct, personalized feedback channel for masses of
consumers, noncorporate blogs represent an indirect, personalized feedback
channel. Because noncorporate blogs are independent, they are often perceived as
more authentic. Blogging experts offer marketers some solid advice for giving their
blogs the honest quality many bloggers associate with noncorporate blogs: open the
feedback channel. Todd Copilevitz, a consultant specializing in digital marketing,
says, “Blogs are not an environment where you just hold forth opinion and don’t
accept feedback. You have to have your wits about you to understand it’s not the
same old PR machine.”13

REVIEW LEARNING OUTCOME

Describe the communication process

2

Sender Feedback channel Receiver

Message to Message that

be conveyed was understood

Encode Decode
message message

NOISE NOISE NOISE NOISE

Transmit Receive
message message
Message channel

531
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Armstrong’s Handbook of Human Resource Management

Practice (Michael Armstrong and Stephen Taylor)
MICHAEL ARMSTRONG 13TH EDITION
iii

AND STEPHEN TAYLOR

ARMSTRONG’S
HANDBOOK OF
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Management and Organizational Behaviour (Laurie J.

Mullins)
 Management &
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Eleventh Edition

Laurie J. Mullins
WITH GILL CHRISTY

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HUMAN RESOURCE
Derek Torrington
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