UNIT IV

EMPLOYEE COMPENSATION
COMPENSATION

INTRODUCTION:
Compensation is the remuneration received by an employee in returns of their contribution to
the organization. Compensation of employees for their services is important responsibility of human
resource management. Every organization must offer good wages and fringe benefits to attract and retain
talented employees with the organization. If at any time, the wages offered by a firm are not competitive as
compared to other firms, the efficient workers may leave the firm. Therefore, workers must be remunerated
adequately for their services. Compensation to workers will vary depending upon the nature of job, skills
required, risk involved, nature of working conditions, paying capacity of the employer, bargaining power
of the trade union, wages and benefits offered by the other units in the region or industry etc.,
DEFINITION:

Gary Dessler in his book Human Resource Management defines compensation in these words
“Employee compensation refers to all forms of pay going to employees and arising from their
employment.” The phrase ‘all forms of pay’ in the definition does not include non-financial benefits, but
all the direct and indirect financial compensations

According to Thomas J. Bergmann (1988) compensation consists of four distinct components:

Compensation = Wage or Salary + Employee benefits +Non-recurring financial rewards + Non-pecuniary
rewards.

OBJECTIVES OF COMPENSATION

 Recruit & Retain Competent Employees

 Consistency & Equity in Pay
 Employability in a Cost Effective
 Financial Protection to Employees
 Organizational Ability to Pay
 Comparable
 Benefit Management
 Improve Organizational Performance

IMPORTANCE OF COMPENSATION MANAGEMENT

A good compensation is a must for every business organization, as it gives an employee a reason to
stick to the company.
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 An organization gains from a structured compensation management in the following ways

 It tries to give proper refund to the employees for their contributions to the organization.
 It discovers a positive control on the efficiency of employees and motivates them to
perform better and achieve the specific standards.
 It creates a base for happiness and satisfaction of the workforce that limits the labor turnover and
confers a stable organization.
 It enhances the job evaluation process, which in return helps in setting up more realistic and
achievable standards.
 It is designed to abide with the various labor acts and thus does not result in conflicts between the
employee union and the management. This creates a peaceful relationship between the employer
and the employees.
 It excites an environment of morale, efficiency and cooperation among the workers and ensures
satisfaction to the workers.
COMPONENTS OF COMPENSATION MANAGEMENT

Basic Wages/Salaries:

Basic wages / salaries refer to the cash component of the wage structure based on which other elements of
compensation may be structured. It is normally a fixed amount which is subject to changes based on
annual increments or subject to periodical pay hikes.

Wages represent hourly rates of pay, and salary refers to the monthly rate of pay, irrespective of the
number of hours put in by the employee. Wages and salaries are subject to the annual increments. They
differ from employee to employee, and depend upon the nature of job, seniority, and merit

Dearness Allowance:

The payment of dearness allowance facilitates employees and workers to face the price increase or inflation
of prices of goods and services consumed by him. The onslaught of price increase has a major bearing on
the living conditions of the labour.

The increasing prices reduce the compensation to nothing and the money’s worth is coming down based
on the level of inflation. The payment of dearness allowance, which may be a fixed percentage on the basic
wage, enables the employees to face the increasing prices

Incentives:

Incentives are paid in addition to wages and salaries and are also called ‘payments by results’.
Incentives depend upon productivity, sales, profit, or cost reduction efforts. There are:

(a) Individual incentive schemes, and

(b) Group incentive programmes.

Individual incentives are applicable to specific employee performance. Where a given task demands group
efforts for completion, incentives are paid to the group as a whole. The amount is later divided among
group members on an equitable basis
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Bonus:

The bonus can be paid in different ways. It can be fixed percentage on the basic wage paid annually or in
proportion to the profitability. The Government also prescribes a minimum statutory bonus for all
employees and workers. There is also a bonus plan which compensates the managers and employees based
on the sales revenue or profit margin achieved. Bonus plans can also be based on piece wages but depends
upon the productivity of labour

Non-Monetary Benefits:

These benefits give psychological satisfaction to employees even when financial benefit is not available.
Such benefits are:

(a) Recognition of merit through certificate, etc.

(b) Offering challenging job responsibilities,

(c) Promoting growth prospects,

(d) Comfortable working conditions,

(e) Competent supervision, and

(f) Job sharing and flexi-time and others

Commissions:

Commission to managers and employees may be based on the sales revenue or profits of the company. It is
always a fixed percentage on the target achieved. For taxation purposes, commission is again a taxable
component of compensation.

The payment of commission as a component of commission is practiced heavily on target based sales.
Depending upon the targets achieved, companies maLy pay a commission on a monthly or periodical basis

Mixed Plans:

Companies may also pay employees and others a combination of pay as well as commissions. This plan is
called combination or mixed plan. Apart from the salaries paid, the employees may be eligible for a fixed
percentage of commission upon achievement of fixed target of sales or profits or Performance objectives.
Nowadays, most of the corporate sector is following this practice. This is also termed as variable
component of compensation.

Piece Rate Wages:

Piece rate wages are prevalent in the manufacturing wages. The labourers are paid wages for each of the
Quantity produced by them. The gross earnings of the labour would be equivalent to number of goods
produced by them. Piece rate wages improves productivity and is an
absolute measurement of productivity to wage structure. The fairness of compensation is totally based on
the productivity and not by other qualitative factors

Fringe Benefits:

Fringe benefits may be defined as wide range of benefits and services that employees receive as an integral
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part of their total compensation package. They are based on critical job factors and performance. Fringe

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benefits constitute indirect compensation as they are usually extended as a condition of employment and
not directly related to performance of concerned employee.

Profit Sharing:

Profit-sharing is regarded as a stepping stone to industrial democracy. Profit-sharing is an agreement by

which employees receive a share, fixed in advance of the profits. Profit sharing usually involves the
determination of an organization’s profit at the end of the fiscal year and the distribution of a percentage of
the profits to the workers qualified to share in the earnings.
TYPES OF COMPENSATION

1. Direct /Base Compensation:

Direct compensation refers to monetary benefits offered and provided to employees in return of the
services they provide to the organization. The monetary benefits include basic 8 salary, house rent
allowance, conveyance, leave travel allowance, medical reimbursements, special allowances, bonus,
Pf/Gratuity, etc. They are given at a regular interval at a definite time.

a) Basic Salary : Salary is the amount received by the employee in lieu of the work done by him/her
for a certain period say a day, a week, a month, etc. It is the money an employee receives from
his/her employer by rendering his/her services
b) House Rent Allowance:Organizations either provide accommodations to its employees who are
from different state or country or they provide house rent allowances to its employees. This is
done to provide them social security and motivate them to work.
c) Conveyance: Organizations provide for cab facilities to their employees. Few organizations also
provide vehicles and petrol allowances to their employees to motivate them
d) Leave Travel Allowance: These allowances are provided to retain the best talent in the
organization. The employees are given allowances to visit any place they wish with their families.
The allowances are scaled as per the position of employee in the organization.
e) Medical Reimbursement: Organizations also look after the health conditions of their employees.
The employees are provided with medi-claims for them and their family members. These medi-
claims include health-insurances and treatment bills reimbursements.
f) Bonus: Bonus is paid to the employees during festive seasons to motivate them and provide
them the social security. The bonus amount usually amounts to one month’s salary of the
employee.
g) Special Allowance: Special allowance such as overtime, mobile allowances, meals, commissions,
travel expenses, reduced interest loans; insurance, club memberships, etc are provided to

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 employees to provide them social security and motivate them which improve the organizational
productivity

2. Indirect /Supplementary Compensation:

Indirect compensation refers to non-monetary benefits offered and provided to employees in lieu of the
services provided by them to the organization. They include Leave Policy, Overtime Policy, Car policy,
Hospitalization, Insurance, Leave travel Assistance Limits,
Retirement Benefits, Holiday Homes

a) Leave Policy: It is the right of employee to get adequate number of leave while working with the
organization. The organizations provide for paid leaves such as, casual leaves, medical leaves
(sick leave), and maternity leaves, statutory pay, etc.
b) Overtime Policy: Employees should be provided with the adequate allowances and facilities
during their overtime, if they happened to do so, such as transport facilities, overtime pay, etc.
c) Hospitalization: The employees should be provided allowances to get their regular check-ups,
say at an interval of one year. Even their dependents should be eligible for the medi-claims that
provide them emotional and social security.
d) Insurance: Organizations also provide for accidental insurance and life insurance for
employees. This gives them the emotional security and they feel themselves valued in the
organization.
e) Leave Travel: The employees are provided with leaves and travel allowances to go for holiday
with their families. Some organizations arrange for a tour for the employees of the organization.
This is usually done to make the employees stress free.
f) Retirement Benefits: Organizations provide for pension plans and other benefits for their
employees which benefits them after they retire from the organization at the prescribed age.
g) Holiday Homes: Organizations provide for holiday homes and guest house for their employees at
different locations. These holiday homes are usually located in hill station and other most wanted
holiday spots. The organizations make sure that the employees do not face any kind of difficulties
during their stay in the guest house.
h) Flexible Timings: Organizations provide for flexible timings to the employees who cannot come
to work during normal shifts due to their personal problems and valid reasons.

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COMPETITIVE COMPENSATION DESIGN

Understanding how to design a compensation system that is appropriate is vital for an organisation, as it is an
effective way to promote a positive work environment and boost employee morale. When determining
compensation, the goals of an organisation are to attract people to work for it and to retain those people who have
proven their value with their hard work.

A company can use compensation to motivate employees to work at their peak performance and to ensure they are
content with their jobs and work environment. A fair and competitive compensation system can help an organisation
retain talented employees and reduce employee turnover. Employee satisfaction and productivity may increase if
employees believe the compensation they are receiving is more favourable than that of comparable jobs. Here are
the steps for designing an effective compensation plan for a company:

1. Align the compensation system with the organisation's values

An effective compensation system is one that supports the goals and values of the organisation. When designing
such a system, it is important that you consider it carefully because it ultimately reflects how an organisation
values its employees. A good compensation strategy can provide a competitive advantage, and the key to designing
it is to understand the structure, vision and direction of the organisation.

A well-designed compensation system is one tool a company can use to support the achievement of its strategic
objectives. A fair compensation plan can motivate employees. Implementing a performance-based compensation
system can offer many benefits. The effective use of incentive plans can inspire employees to perform better and
boost productivity. Supporting the organisation's strategic goals and ensuring the system fits with its structure and
strategy are two important objectives when you are designing a compensation system.

2. Analyse the job market

It is helpful to gather relevant data before you design a compensation plan to identify current market trends and
position an organisation effectively. It is important that employees perceive their compensation to be fair when
they compare it to what other employees are receiving for the same kind of work. An employer's objective is
typically to attract and retain qualified and high-performing employees. Some market variables that may affect this
are not within the control of an employer, so it is beneficial to target those elements that are within the scope.

While an organisation is free to determine the compensation levels for new hires and to advertise those salary
ranges, it is important to consider other employers who are also looking to fill positions with applicants from the
same target market group. Hence, it is a good idea to conduct a survey of the job market to find out what
compensation packages other employers are offering their employees who work in similar positions.

3. Decide on the type of compensation

If an organisation bases its compensation system on standardised components, employees are more likely to view it
as fair and equitable. Employers may compensate employees directly or indirectly. Direct compensation includes
an employee's basic pay, dearness allowance, housing allowance, bonuses, incentives, commissions, travel
reimbursements, medical reimbursements, special allowances and gratuities. Indirect compensation may include

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benefits such as life insurance, health insurance, a pension, a provident fund, a company car, overtime pay, child
care and annual leave. Non-financial compensation, such as gifts, extra paid leave, a new office or reimbursement
for purchasing health and wellness equipment, are other possible provisions.

4. Understand the job requirements

When designing a compensation system, it is necessary to consider the job descriptions and compensation packages
for similar positions in the same field. A job description specifies the contractual obligations, prerequisites, duties,
responsibilities, settings, situational factors and other components of a job. Each position lrequires a detailed
outline of the expectations andresponsibilities and an appropriate job title that ali

5. Determine pay equity

Compensation impacts employee job satisfaction, performance and motivation. Finding an equitable balance
between the amount of money that an organisation is willing to pay to its employees and the employee's
perceptions of their own worth is necessary to create a viable structure. Limiting compensation to save money may
negatively affect employee satisfaction and morale, while increasing it may improve retention and reduce
employee turnover.

6. Design the salary structure

You can create a salary structure by ranking jobs based on a competitive compensation line and pay variants. A
job ranking is a collection of different but comparable jobs. By establishing a job ranking system, it is possible to
consider similar jobs equitably and determine fair compensation packages. Furthermore, a salary structure
provides guidelines for promoting employees from one rank to the next. An organisation can determine
compensation based on its employees' qualifications, experience and efficiency by establishing pay ranges within
the job ranking. The organisational budget is another factor to consider when you are determining employee
compensation

FACTORS CONSIDERED IN DECIDING THE COMPENSATION

Employers decide on what is the right compensation after taking into account the following points. The Job
Description of the employee that specifies how much should be paid and the parts of the compensation package.
The Job Description is further made up of responsibilities, functions, duties, location of the job and the other
factors like environment etc. These elements of the job description are taken individually to arrive at the basic
compensation along with the other components like benefits, variable pay and bonus. It needs to be remembered
that the HRA or the House Rental Allowance is determined by a mix of factors that includes the location of the
employee and governmental policies along with the grade of the employee. Hence, it is common to find a
minimum level of HRA that is common to all the employees and which increases in proportion to the factors
mentioned above.

The Job Evaluation that is a system for arriving at the net worth of employees based on comparison with
appropriate compensation levels for comparable jobs across the industry as well as within the company. Factors
like Experience, Qualifications, Expertise and Need of the company determine how much the employer is willing
to pay for the employee. It is often the case that employers compare the jobs across the industry and arrive at a

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particular compensation after taking into account the specific needs of their firm and in this respect, salary
surveys and research results done by market research firms as to how much different companies in the same
industry are paying for similar roles. The components of compensation that have been discussed above are the
base requirements for any HR Manager who is in charge of fixing the compensation for potential
employees. Hence, all HR professionals and managers must take this following aspect into account when they
determine the compensation to be paid to employees

I. External Factors:

1) Demand and Supply of Labour: Wage is a price or compensation for the services rendered by
a worker. The firm requires these services, and it must pay a price that will bring forth the
supply which is controlled by the individual worker or by a group of workers acting together
through their unions. The primary result of the operation of the law of supply and demand is the
creation of the going wage rate. It is not practicable to draw demand and supply curves for each
job in an organization even though, theoretically, a separate curve exists for each job.
2) Cost of Living: Another important factor affecting the wage is the cost-of- living adjustments of
wages. This tends to vary money wage depending upon the variations in the cost-of-living index
following rise or fall in the general price level and consumer price index. It is an essential
ingredient of long-term labour contract unless provision is made to reopen the wage clause
periodically.
3) Labour Union: Organized labour is able to ensure better wages than the unorganized one.
Higher wages may have to be paid by the firm to its workers under the pressure or trade union.
13 If the trade union fails in their attempt to raise the wage and other allowances through
collective bargaining, they resort to strike and other methods hereby the supply of labour is
restricted. This exerts a kind of influence on the employer to concede at least partially the
demands of the labour unions.
4) Government: To protect the working class from the exploitations of powerful employers, the
government has enacted several laws. Laws on minimum wages, hours of work, equal pay for
equal work, payment of dearness and other allowances, payment of bonus, etc., have been
enacted and enforced to bring about a measure of fairness in compensating the working class.
Thus, the laws enacted and the labour policies framed by the government have an important
influence on wages and salaries paid by the employers. Wages and salaries can’t be fixed below
the level prescribed by the government.
5) Prevailing Wage Rates: Wages in a firm are influenced by the general wage level or the wages
paid for similar occupations in the industry, region and the economy as a whole. External
alignment of wages is essential because if wages paid by a firm are lower than those paid by
other firms, the firm will not be able to attract and retain efficient employees. For instance,
there is a wide difference between the pay packages offered by multinational and Indian
companies. It is because of this difference that the multinational corporations are able to attract
the most talented workforce.

II.

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III. Internal Factors

1) Ability to Pay
Employer’s ability to pay is an important factor affecting wages not only for the individual firm,
but also for the entire industry. This depends upon the financial position and profitability of the
firm. However, the fundamental determinants of the wage rate for the individual firm emanate
from supply and demand of labour. If the firm is marginal and cannot afford to pay competitive
rates, its employees will generally leave it for better paying jobs in other organizations. But, this
adjustment is neither immediate nor perfect because of problems of labour immobility and lack
of perfect knowledge of alternatives. If the firm is highly successful, there is little need to pay
more than the competitive rates to obtain personnel. Ability to pay is an important factor
affecting wages, not only for the individual firm but also for the entire industry.
2) Top Management Philosophy
Wage rates to be paid to the employees are also affected by the top management’s philosophy,
values and attitudes. As wage and salary payments constitute a major portion of costs and /or
apportionment of profits to the employees, top management may like to keep it to the minimum.
On the other hand, top management may like to pay higher pay to attract top talent.
3) Productivity of Workers
To achieve the best results from the workers and to motivate him to increase his efficiency,
wages have to be productivity based. There has been a trend towards gearing wage increase to
productivity increases. Productivity is the key factor in the operation of a company. High wages
and low costs are possible only when productivity increases appreciably.
4) Job Requirements
Job requirements indicating measures of job difficulty provide a basis for determining the
relative value of one job against another in an enterprise. Explicitly, job may be graded in terms
of a relative degree of skill, effort and responsibility needed and the adversity of working
conditions. The occupational wage differentials in terms of
a) Hardship,
b) Difficulty of learning the job
c) Stability of employment
d) Responsibility of learning the job and
e) Change for success or failure in the work.
This reforms a basis for job evaluation plans and thus, determines wage levels in an industry.
5) Employees Related Factors :
Several employees related factors interact to determine his remuneration. These include

1 .Performance: productivity is always rewarded with a pay increase. Rewarding performance motivates
the employees to do better in future.
2. Seniority: Unions view seniority as the most objective criteria for pay increases whereas management
prefer performance to effect pay increases.
3. Experience: Makes an employee gain valuable insights and is generally rewarded
4. Potential: organizations do pay some employees based on their potential. Young managers are paid
more because of their potential to perform even if they are short of experience

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6) Organizational Politics
Compensation surveys, job analysis, job evaluation and employee performance are all involved in
wage and salary decisions. Political considerations may enter into the equation in the following ways:
i) Determination of firms included in the compensation survey: managers could make their firm appear to
be a wage leader by including in the survey those organizations that are pay followers.

ii) Choice of compensable factors for the job evaluation plan: Again, the job value determined by this
process could be manipulated

iii) Emphasis placed on either internal or external equity and

iv) Results of employee performance appraisal may be intentionally disported by the supervisor Thus, a
sound and objective compensation system may be destroyed by organizational politic

7) Evaluation of Compensation

Today’s compensation systems have come from a long way. With the changing organizational structures
workers’ need and compensation systems have also been changing. From the bureaucratic organizations to
the participative organizations, employees have started asking for their rights and appropriate
compensations. The higher education standards and higher skills required for the jobs have made the
organizations provide competitive compensations to their employees. Compensation strategy is derived
from the business strategy. The business goals and objectives are aligned with the HR strategies. Then the
compensation committee or the concerned authority formulates the compensation strategy. It depends on
both internal and external factors as well as the life cycle of an organization

External Factor INTERNAL FACTOR

Compliance with the law
of the land Capacity to pay

Demand and supply Top Management

of labour Philosophy

Cost of living Job requirements

Governement Organisational
Politics
Prevailing Wage Employee related
Rates Factors
Labour Union and Productivity of
collective Bargaining Workers

COMPENSATION MANAGEMENT
A good compensation package is important to motivate the employees to increase the organizational productivity.
Unless compensation is provided no one will come and work for the organization. Thus, compensation helps in
running an organization effectively and accomplishing its goals. Salary is just a part of the compensation system;

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the employees have other psychological and self-actualization needs to fulfil. Thus, compensation serves the
purpose.

The most competitive compensation will help the organization to attract and sustain the best talent. The
compensation package should be as per industry standards. Human Resource Management (HRM) has never been
as significant as it is today. Companies want to attract, retain and motivate brains to meet objectives. Today
humans are regarded as one of every company’s asset, so they need to be efficiently and effectively managed.
One of the tools companies use to attract, retain and motivate its people is Compensation Management.

OBJECTIVES OF COMPENSATION MANAGEMENT

1. To Establish a Fair and Equitable Remuneration

Effective compensation management objectives are to maintain internal and external equity in remuneration paid
to employees. Internal equity means similar pay for similar 18 work. In other words, compensation differentials
between jobs should be in proportion of differences in the worth of jobs. External equity implies pay for a job
should be equal to pay for a similar job in other organizations. Payments based on jobs requirements, employee
performance and industry levels minimize favoritism and inequities in pay.

2. To Attract Competent Personnel

A sound wage and salary administration help to attract qualified and hardworking people by ensuring an
adequate payment for all jobs. For example, IT companies are competing each other and try their level best to
attract best talents by offering better compensation packages.

3. To Retain the Present Employees

By paying competitive levels, the company can retain its personnel. It can minimize the incidence of quitting and
increase employee loyalty. For example, employee’s attrition is high in knowledge sectors (Ad-agency, KPO,
BPO etc.,) which force the companies to offer better pay to retain their employees.

4. To Improve Productivity

Sound wage and salary administration helps to improve the motivation and morale of employees which in turn
lead to higher productivity. Especially private sectors companies’ offer production linked compensation packages
to their employees which leads to higher productivity.

5. To Control Cost

Through sound compensation management, administration and labour costs can be kept in line with the ability of
the company to pay. If facilitates administration and control of pay roll. The companies can systematically plan
and control labour costs.

6. To Improve Union Management Relations

Compensation management based on jobs and prevailing pay levels are more acceptable to trade unions.

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Therefore, sound wage and salary administration simplify collective bargaining and negotiations over pay. It
reduces grievances arising out of wage inequities.

7. To Improve Public Image of the Company

Wage and salary programme also seeks to project the image of the progressive employer and to company with
legal requirements relating to wages and salaries.

8. To Improve Job Satisfaction

If employees would be happy with their jobs and would love to work for the company if they get fair rewards in
exchange of their services.

9. To Motivate Employees: Employees

All have different kinds of needs. Some of them want money so they work for the company which gives them
higher pay. Some of them value achievement more than money, they would associate themselves with firms
which offer greater chances of promotion, learning and development. A compensation plans that hits workers’
needs is more likely to motivate them to act in the desired way.

10. Peace of Mind

Offering of several types of insurances to workers relieves them from certain fears, as a result workers now work
with relaxed mind.

11. Increases Self-Confidence

Every human being wants his/her efforts to get acknowledgment. Employees gain more and more confidence in
them and in their abilities if they receive just rewards. As a result, their performance level shoots up.

FRINGE BENEFITS
Meaning:- Fringe benefits is a benefit which supplements the employee’s ordinary wages & which of
value to them & their families is so far as it materially increases their retirement benefits.
Definition
Acc. to D. Belcher “F r i n g e benefits are any wage cost not directly connected with the employees
productive effort, performance, service or sacrifice”.
Kinds of Fringe Benefits
1. Payment for time not worked:- this category includes the following:
a) Paid Holiday:- According to factories act 1948 an adult worker shall have weekly paid holidays, preferably
Sunday. When a worker is deprived of weekly holidays, he is eligible for compensatory holidays of the same
number in the same month.
b) Shift premium:- Companies operating second & third shifts, pay a premium to the workers who are
required to work during the night shift.

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c) Holiday Pay:- Generally organisation offer double the normal rate of the salary to those workers who work
during holidays.
d) Paid Vacation:- Worker in manufacturing mining & plantations who had worked for 240 days during a
calendar year are eligible for paid vacation at the rate of one day for every 20 days worked in case of adult
workers & one day for every 15 days worked in the case of child workers.

e) Employee Security:- A minimum & continuous wage or salary gives a sense of security to the employees.
The payment of wages act 1936, The Minimum Wages act 1948, the payment of Bonus act 1965, provide income
security to the employees. In addition to this, the Industrial Disputes Act 1947, provides for the payment of
compensation in case of lay off & retrenchment.
2. Safety & Health:- Employee’s safety & health should be taken care of in order to protect the employees
against accidents, unhealthy working conditions & to protect the workers productive capacity.
3. Workmen’s Compensation:- In addition to health & safety measures, provision for the payment of
compensation has also been made under Workmen’s Compensation Act, 1923. The act is intended to meet
the contingency of invalidity & death of a worker due to an employment injury or an occupational disease
specified under the act as the sole responsibility of the employer.
4. Health Benefits:- Organisations provide various medical services like hospital, clinical & dispensary
facilities to employees & their family members. As per Employees State Insurance Act 1948 provides
 Sickness benefits
 Maternity benefit
 Disablement benefit
 Dependent benefit
 Medical benefit
1. Voluntary Arrangement:- Most of the large organisations provide health service over & above the
legal requirements free of cost tot heri employees by setting up hospitals, clinics, dispensaries &
homeopathic dispensaries.
2. Welfare & Recreation Facilities:- Welfare & recreational benefits include canteens, consumer
societies, credit societies, Housing, Legal aid, Employee counselling, welfare organisation, holiday
homes, Educational Facilities , Transportation parties & picnics, miscellaneous.
3. Ole Age & Retirement Benefits:- Employers provide some benefits to the employees, after retirement
& during old age, with a view to create a feeling of security about the old age. These benefits are called
old age & retirement benefits include Provident Fund, Pension, Deposit Linked scheme, Gratuity,
Medical benefits.

INTERNAL MOBILITY PROMOTION

Meaning;- Promotion is a term which covers a change & calls for greater responsibilities & usually involves
higher pay & better terms & conditions of service and therefore, a higher status or rank.
Acc. to Scott & Clothier: “A promotion is the transfer of an employee to a job which pays more money

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or one that carries some preferred status”.

Types of Promotion
1. Vertical Promotion:- Under this type of promotion, employee is moved to the next higher level in the
organisational hierarchy with greater responsibility, authority pay & status.
2. Upgradation:- Under this type of promotion, the job is upgraded in the organisational hierarchy .
Consequently, the employee gets more salary, higher authority & responsibility.
3. Dry Promotion:- Under this promotion, the employee is moved to the nest higher level in the organisational
hierarchy with greater responsibility, authority & status without any increase in salary.
Bases of Promotion
1. Merit as a basis of Promotion:- merit is taken to denote an individual employee’s skill, knowledge,
ability, efficiency & aptitude as measure from educational, training & past employment record.
2. Seniority as a Basis of Promotion:-
Seniority refers to relative length of service in the same job & in the same organisation . & the amount of
knowledge & the level of skill acquired by an employee in an organisation.
3. Seniority –cum-Merit:-
A combination of both seniority & merit can be considered as the basis for promotion satisfying the
management for organisational effectiveness & the employees & trade unions for respecting the length of
service. A balance between seniority & merit should be struck & a new basis developed.

TRANSFER
Transfer is defined as “a lateral shit causing movement of individuals from one position to another
usually without involving any marked change in duties, responsibilities, skills, needed or compensation”.
Transfer also defined as the moving of an employee from one job to another. It may involve a promotion,
demotion or no change in job status other than moving from one job to another.
Types of Transfer

1. Production Transfer:- Transfer caused due to changes in production.

2. Replacement Transfer:- Transfer caused due to initiation or replacement of a long standing employee in the
same job
3. Rotation Transfer:-Transfer initiated to increase the versatility of employees.
4. Shift transfer:- T ransfer of an employee from one shift to another.
5. Remedial transfer:_Transfer initiated to correct the wrong placements.
6. Penal transfer:- Transfers initiated as a punishment for in disciplinary action of employees.

SEPERATION

Separation of an employee exists when the service of an employee comes to an end because of one reason or
other. Separation arises due to resignation; lay off, dismissal and retirement.

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Types of separation:

i) Resignation: when the employee himself initiates the separation then it is termed as separation. There are
some resignation which are avoidable and others which are unavoidable. It is the responsibility of the
management to look out the real reason of the resignation. In such a cases the exit interview is better to conduct
to find out the reason of resignation.

ii) Lay off: lay off is generally done to reduce the financial burden of the organization by temporary
removing the surplus employees. This is done due to inability of the employee to recruit them due to shortage of
sufficient resources. Lay off results in a great loss to the organization as they had to suffer all the expenses of
selection, placement and training.

iii) Dismissal: dismissal or discharge means separating the employee from the payroll due to unsatisfactory
performance where the employee fails to perform his duties well and he is not properly skilled to perform his job
or due to violation of organizational rules it means indiscipline, dishonesty. Whatever is the cause of dismissal
but it should be done at the last stage.

iv) Retirement: number of separation in the organization happen due to retirement. There must be clear rules
of retirement there may be compulsory retirement where an employee has to retire after attaining a particular age.
Forced retirement means when a person is found guilty in the court of law or breaks any service agreement then
has to retire forcibly irrespective of his age. Premature retirement means that the employee becomes disable to
perform the job in that case he may be given the option to take retirement before his retirement age.

REWARDS

The achievement and benefit received by employees for their job performance in an organization are known as reward. Employees
join the organization within certain expectation of reward. Some may be expecting for better salary and wages i.e.,
economic rewards while other may be seeking for facilities like accommodation, transportation, health, safety
and other benefits as reward. Thus, economic and non-economic benefits provided by organization to employees for their job
performance regardless of their expectation is known as reward. Employees must be communicated about the
reward provision in an advance.
The basic types of rewards mentioned are extrinsic rewards, which satisfy basic needs like pay and benefits, and
intrinsic rewards, which satisfy higher needs like esteem and development through pride in one's work and sense of
accomplishment.

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Intrinsic Rewards can be defined as a particular monetary return, object or event that an employee receives in
exchange for his/her work or for having done something well.

Extrinsic Rewards that relates to the subjective feelings of liking, pleasure or satisfaction.

Intrinsic rewards are self-initiated satisfactions from the job itself like pride in work and accomplishment, while
extrinsic rewards are benefits provided externally in the form of pay and fringe benefits.

Exploring Different Forms of Reward

Effective rewards extend beyond financial compensation, encompassing a range of tangible and intangible offerings
that recognize employee dedication and excellence.
Monetary Rewards
1. Bonuses: One-time cash rewards linked to achieving specific goals or exceptional performance.
2. Salary Increases: Periodic raises that reflect employee skills, experience, and contribution.
3. Profit Sharing: Sharing a portion of company profits with employees as an incentive.
Non-Monetary Rewards
1. Flexible Work Arrangements: Providing options for remote work, flexible hours, or compressed
workweeks.
2. Professional Development: Investing in training, workshops, and courses to enhance employees’ skills.
3. Wellness Programs: Offering gym memberships, health incentives, and mental health support.
4. Work-Life Balance Initiatives: Supporting employees’ personal lives with parental leave, sabbaticals, or
paid time off.
Recognition-Based Rewards
1. Employee of the Month: Highlighting outstanding performance with public recognition.
2. Peer Recognition: Allowing colleagues to nominate and appreciate each other’s efforts.
3. Certificates and Awards: Presenting physical or digital certificates for accomplishments.
Career Advancement Rewards
1. Promotions: Recognizing exceptional performance with upward career mobility.
2. New Opportunities: Assigning challenging projects or cross-functional roles to promote growth.
Social and Team-Based Rewards
1. Team Celebrations: Recognizing team achievements with parties, outings, or team-building activities.
2. Thank-You Notes and Shoutouts: Sending personalized messages of gratitude.
Creative and Custom Rewards
1. Personalized Gifts: Tailoring rewards to individual preferences, such as books, gadgets, or experiences.
2. Customized Perks: Offering unique benefits based on employee interests.
Balancing and Tailoring Rewards
1. Individual Preferences: Understand what forms of reward resonate most with each employee.

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2. Hybrid Approaches: Combine monetary and non-monetary rewards for a comprehensive package.
3. Frequency: Establish regular intervals for rewarding employees to maintain motivation.

A well-structured reward system acknowledges employees’ multifaceted needs and preferences. By

offering a mix of monetary, non-monetary, recognition-based, and career advancement rewards,
organizations can cultivate a motivated and engaged workforce that feels appreciated and valued.

MOTIVATION

What is Motivation?
Motivation is defined as the process that initiates, guides, and maintains goal-oriented behaviors.
Motivation is what causes us to act, whether it is getting a glass of water to reduce thirst or reading a
book to gain knowledge. For example, if Ram keeps on studying then the reason might be because
Ram is motivated to become a doctor.

The formal definition of motivation is that motivation is willingness of person to make intense and
persistent efforts to achieve desired goals. There are 3 components in definition of motivation.

1. Willingness refers to state of readiness for a person to act.

2. Intense Effort refers to how hard a person tries.
3. Persistence effort refers to continuity of the effort.

If degree of willingness is high to make intense or persistent effort, motivation would be

high.

Motive, Motivators and Motivating

Motive: Motive (also known as need) is the inner state of a person that he is lacking something which
moves him to engage in goal−directed behavior. For example, if you are thirsty (inner state), you will
drink water (goal directed behavior)

Motivators: A motivator is anything which satisfy your need. For example, for a thirsty person, the
motivator would be availability of water.

Motivating: Motivating is the process of inducing others to engage in goal−directed behavior by

presenting motivators. In organizational context, managers use a variety of motivators (incentives)
as part of motivating the employees.

Motivation Process

Motivation is a goal directed behavior. Feeling of need by an individual generates a feeling that he
lacks something.

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1. Need: Arousal of need is starting step of motivation process. Need is inner state of a person that
he is lacking something. For example, if a person is thirsty then he needs water.
2. Tension: Tension is a feeling of being worried which makes it difficult for a person to relax. For
example, a thirsty person will get tense if he is not able to get water.
3. Goal-Directed behavior: In order to overcome this tension, the person engages in goal− directed
behavior through which tension is overcome. For example, if a person is thirsty then he may drink
water.
4. Need Satisfaction: Goal−directed behavior may lead to satisfaction (goal fulfillment). For
example, drinking of water by thirsty person would lead to need satisfaction. Sometimes
goal−directed behavior may not lead to need satisfaction.
5. Feedback: Feedback involves the analysis whether need satisfaction is proper or not. For
example, if a very thirsty person is given only one glass of water, then his need satisfaction may
not be proper.

Consequences of Non-Satisfaction of Need:

If a need is not satisfied even after goal−directed behavior, the person will try to modify the behavior.
He may produce following behaviors

1. Flight: One way is to leave the field. For example, employee quits the job that becomes
frustrating
2. Apathy: He will become indifferent towards the situation. For example, if a person does not
leave the frustrating job then he may not be serious anymore about the job
3. Aggression: He may become aggressive due to frustration. An employee frustrated with the job
may become aggressive towards his superior, family etc.
4. Rationalization: Rationalization involves justifying the outcome of goal−directed behavior. For
example, a person frustrated with his job might find fault in himself or his superior who has not
given them their due.

Types of Motivation

1. Positive vs. Negative: Motivating forces can be positive, as in impelling one to reach a certain goal.
They can also be negative, as in driving one away from an unwanted situation. You can be positively

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motivated about going to work because you like your colleagues and some parts of the work, and
negatively motivated because you have bills to pay.

2. Basic vs. Learned: Motivation leans on motives. Motives are often categorized into basic motives
and learned motives. Basic or primary motives are unlearned and common to both animals and
humans. We’re talking hunger, thirst, sex, avoidance of pain, and perhaps aggression and fear. The
learned or secondary motives include achievement, power, recognition, love.

3. Extrinsic motivation and Intrinsic Motivation:

Extrinsic motivation occurs when we are motivated to perform a behavior or engage in an activity to

 Studying because you want to get a good grade.

 Cleaning your room to avoid being reprimanded by your parents.
 Participating in a sport to win awards.
 Competing in a contest to win a scholarship.

earn a reward or avoid punishment. The motivation comes from outside. Examples of behaviors
that are the result of extrinsic motivation include:

Intrinsic motivation involves engaging in behavior because it is personally rewarding; essentially,

performing an activity for its own sake rather than the desire for some external reward. It comes from
inside the individual and is not done for external rewards. Examples are.
 Participating in a sport because you find the activity enjoyable.
 Solving a word puzzle because you find the challenge fun and exciting.
 Playing a game because you find it exciting.


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



MOTIVATIONAL THEORIES

The motivational theories are basically categorized into the following

1. Content Theories: Content Theories look at specific needs that motivate people. The need
can be intrinsic or extrinsic needs and hence managers should know the needs of everyone.
This set basically concentrates on what motivates an individual. These are also known as
traditional theories.

2. Process Theories: Process theories attempt to explain how the process of motivation works in an
individual. Individuals make choices based on preferences, rewards, and accomplishments and
therefore managers need to understand the process of motivation. These are also known as
contemporary theories.

Content Based Theories

These are also called Need based theories or Humanistic approach to motivation. The basis behind
these theories is that individuals have certain needs which if not met create tension in the mind of people.
The individuals will then try to satisfy the need to reduce the tension. The managers should try to
understand the needs of people and try to satisfy them. This will motivate them

For example, an employee wants to buy a car and is feeling frustrated without a car. For such an
employee, a salary raise might be the biggest motivation. On the other hand, an employee is feeling
dissatisfied because the employee is not finding the work challenging. For such an employee salary rise
might not be a good motivator, only a challenging project can motivate the employee.

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Among the above theories – All falls under Traditional Theories but if we categorize them as Content
theories which are need based theories then Theory X and Theory Y will not come under Content
Theories as they are not need based

Maslow’s Motivation Theory

Maslow has proposed that motivation of people depends on their needs and these needs may be
arranged in a hierarchy shown below.

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Need hierarchy is based on following assumptions.

1. Needs are to be fulfilled from bottom to top. Individuals must satisfy lower−level needs before
they can satisfy higher order needs. This concept of lower−level needs being satisfied first before
moving higher is called satisfaction progression. Motivating a person depends on knowing at
what level that a person is on the hierarchy.
2. A satisfied need does not motivate a person, only a next higher order needs motivates him.

There are five needs in Maslow need hierarchy – Physiological needs, safety needs, Social needs,
Self-Esteem needs, Self-Actualization needs. Let us discuss these needs one by one

1. Physiological needs: These primary needs are created in an individual by nature. Needs of air,
water, food, defecation etc. are such needs. These are the things without which we cannot live.
Unless these needs of the individual are fulfilled, he cannot even think of higher−level needs.
Example: If a child is hungry or thirsty, the teacher cannot motivate him for learning in the class.

2. Safety needs (Security needs): After fulfilling physiological needs an individual wants physical
safety and well−being (emotional security, financial security). He wants to be protected in the
environment from his enemies whether they are his fellow being or the fury of the environment in
the form of heat, cold, rain etc. Example: A child must feel that the classroom is a fair, orderly and
safe place for learning at all the times. It must be a place free from physical bullying
3. Needs of belongingness: Having the above two needs been fulfilled an individual wants a sense of
belonging to someone or a group. He wants love, affection, and friendship from his fellow beings.
To satisfy these very needs child participates in diverse types of programmes in school. To draw
the attention and love of his teachers, he fulfills the work given to him. Example: Students need to
feel emotionally and physically safe and accepted within the classroom to progress and reach their
full potential. Children who are not accepted in the groups in the class would not develop well.

4. Esteem needs: All humans have a need to feel respected; this includes the need to have
self−esteem and self−respect. Esteem presents the typical human desire to be accepted and valued
by others. People often engage in a profession or hobby to gain recognition. These activities give
the person a sense of contribution or value. Low self− esteem or an inferiority complex may result
from imbalances during this level in the hierarchy. People with low self−esteem often need respect
from others; they may feel the need to seek fame or glory.

However, fame or glory will not help the person to build their self−esteem until they accept who
they are internally. Psychological imbalances such as depression can hinder the person from
obtaining a higher level of self-esteem or self-respect.

Most people have a need for stable self-respect and self-esteem. Maslow noted two versions of
esteem needs: a "lower" version and a "higher" version. The "lower" version of esteem is the
need for respect from others. This may include a need for status, recognition, fame, prestige, and

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attention. The "higher" version manifests itself as the need for self−respect. For example, the
person may have a need for strength, competence, mastery, self−confidence, independence, and
freedom. This "higher" version takes precedence over the "lower" version because it relies on an
inner competence established through experience. Deprivation of these needs may lead to an
inferiority complex, weakness, and helplessness.

5. Needs of self-actualization: An individual comes to recognize his strengths and weaknesses fully
before coming to this last level of needs. Based on potentialities, hewants to do such an extra-
ordinary work so that he may acquire the top place in the eyes of the people. It can be achieved only
when each of the other levels have been mastered, not just understood. Example: Talented students
after a period come to know that they can achieve much more. A child can realize that he has the
potential to become the best scientist or a film actor. To achieve this target, they try their best. If a
teacher fails to recognize the abilities of these students and does not respond properly at their
achievement, these students lag their actual level of performance.

Implication at Workplace:

1. Maslow’s hierarchy of needs applied to work situations implies that managers have the
responsibility, firstly, to make sure their people’s deficiency needs are met. Only once the deficiency
needs are met, one can go for self−actualization.

2. Secondly, it implies creating a proper climate in which employees can develop their fullest potential.
Failures to do so would theoretically increase employee frustration and could result in inferior
performance, lower job satisfaction, and increased withdrawal from the organization. For example,
in this theory job insecurity and the threat of layoffs will block the person from their higher growth
needs.

Criticism of Maslow’s theory

1. Wrong Order of Needs:

a. The order in which the hierarchy is arranged has been criticized as being ethnocentric by Geert
Hofstede. Maslow's hierarchy of needs fails to illustrate and expand upon the difference
between the social and Self−esteem/self−actualization needs of those raised in individualistic
societies and those raised in collectivist societies. The needs and drives of those in
individualistic societies tend to be more self−centered focusing on improvement of the self,
with self−actualization whereas in collectivist societies, the social needs of acceptance and
community will outweigh other needs.
b. Some people may be deprived of lower order needs but still try for self−actualization.
Mahatma Gandhi is an example of the same.
c. For some people self−esteem need is more important than social needs and they may try to
assert themselves on others even at the cost of social needs.

2. The position and value of sex on the pyramid has also been a source of criticism regarding Maslow's

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hierarchy. Maslow's hierarchy places sex in the physiological needs category along with food and
breathing; it lists sex solely from an individualistic perspective. For example, sex is placed with
other physiological needs which must be satisfied before a person considers "higher" levels of
motivation. Some critics feel this placement of sex neglects the
emotional, familial, and evolutionary implications of sex within the community. The critics feel
sex should be placed in the social belonging category.

3. It is wrong to assume that only one motive is present at any point of time. Some people may be
aspiring to fulfill multiple needs at one point in time.

4. Maslow’s theory has primary application to lower−level workers in a country like India where the
basic need of workers is not satisfied fully. In countries like US where basic needs are fulfilled for all,
the people may have different order of needs and there it might be necessary, and needs be fulfilled
in this order only.

5. Needs other than those identified by Maslow also motivate people – e.g., spiritual needs.

6. People can also operate on more than one need level simultaneously or may move to a lower level of
needs if their life circumstances change. For e.g., during the recession, when many jobs were cut,
suddenly lower−order needs became dominant over higher−order needs.

Maslow’s Extended Motivation Theory

Since at least the 1970s there have been debates and discussions on whether Maslow identified all the
motivating stages that drive humans. Some have argued that there should be more levels to the
Hierarchy of Needs. Most seem to
agree that there should be three new additions
to the Hierarchy of Needs. As a result, the
extended version of Maslow Theory was
introduced which has 3 new levels as shown
below.

The three new additions to Maslow’s original

Hierarchy of Needs model are:

 Knowledge and Understanding

(Cognitive Needs)
 Need for Aesthetics
 Transcendence

1. Knowledge and Understanding

(Cognitive Needs): People have a desire to
explore and learn new things or

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understand the world.

The inability to meet the cognitive needs may make it difficult to reach Self-
Actualization. Self−Actualization is about personally growing and is a more complex form of
gaining knowledge and understanding.

2. Need for Aesthetics: This is about the desire for beauty and pleasing surroundings in our life.
Through the chaos, we seek order and balance. We want to appreciate the things we find beautiful.
For example, Tiya wants to arrange her wardrobe in a way that looks balanced and pretty.

3. Transcendence (helping others find fulfillment): Transcendence is the desire to move beyond
ourselves. In the expanded hierarchy it is placed after Self−Actualization, making it the highest
level in the hierarchy. People seeking to fulfill their Transcendent needs may be motivated by
helping others or becoming wholly driven by factors that do not personally impact them. They are
so confident in their lower−level needs being met satisfactorily that they worry about the needs of
others.

Herzberg's Two Factor Theory

Herzberg's Two Factor Theory is also known as the Motivation Hygiene Theory. It states two different
facets of motivation, the first being ‘hygiene’ factors or job context. The second factor is ‘satisfiers’ or
job content, i.e. the intrinsic qualities of the job. According to Herzberg, there are some job factors that
result in satisfaction while there are other job factors that prevent dissatisfaction. According to
Herzberg, the opposite of “Satisfaction” is “No satisfaction” and the opposite of “Dissatisfaction”
is “No Dissatisfaction”.

So the satisfiers/motivators provides satisfaction or motivation. Hygiene factors just decides

employee being dissatisfied or not dissatisfied

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1. SATISFACTION (MOTIVATION): According to Herzberg, the hygiene factors cannot be regarded

as motivators. The motivational factors yield positive satisfaction. These factors are inherent to work.
These factors motivate the employees for a superior performance. These factors are called satisfiers.
These are factors involved in performing the job. Employees find these factors intrinsically rewarding.
The motivators symbolized the psychological needs that were perceived as an additional benefit.

Motivational factors include:

 Achievement
 Recognition
 Work itself
 Responsibility
 Advancement
 Growth and Promotion

2. DISSATISFACTION (HYGIENE): Hygiene factors also known as maintenance factors are not
intrinsic part of the job but are related to conditions under which job is performed. Hygiene factors are
those factors which when adequate/reasonable in a job, pacify the employees and do not make them
dissatisfied but do not motivate them. But if these factors are absent
/ if these factors are non−existent at workplace, then they lead to dissatisfaction. These factors are
extrinsic to work. Hygiene factors are also called as dissatisfiers or maintenance factors as they are
required to avoid dissatisfaction. These factors describe the job environment/scenario. The hygiene
factors symbolized the physiological needs which the individuals wanted and expected to be fulfilled.
Hygiene factors include:
 Company policy
 Administrative policies
 Supervision
 Salary
 Interpersonal relations

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 Working conditions
 Job Security

Herzberg also says that it is not only these factors but the personality of the individual also an important
factor. Based on personality there are 2 types of individuals – motivation seekers and maintenance
seekers. The motivation seekers generally are individuals who are primarily motivated by the satisfiers.
On the other hand, maintenance seekers are more concerned about dissatisfies.

Another point mentioned by Herzberg is that today’s motivators would be tomorrow’s hygiene
because once they get any particular thing it does not motivate them any longer.

Four Situations as per Herzberg

According to the Two−Factor Theory there are four possible combinations:

1. High Hygiene + High Motivation: The ideal situation where employees are highly motivated and have
few complaints.
2. High Hygiene + Low Motivation: Employees have few complaints but are not highly motivated. The
job is viewed as a paycheck.
3. Low Hygiene + High Motivation: Employees are motivated but have a lot of complaints. A situation
where the job is exciting and challenging but salaries and work conditions are not up to par.
4. Low Hygiene + Low Motivation: This is the worst situation where employees are not motivated and
have many complaints.

Job enrichment according to Herzberg's two factor theory

Job enrichment attempts to give employees greater responsibility by increasing the range and complexity
of tasks, as employees are called upon to complete and for job enrichment necessary authority should also
be granted. Herzberg argued that job enrichment (through motivators) should be a central element
in any policy of motivation. Herzberg suggests that work be enriched (or 'vertically loaded') for true
motivation to spark up. This is different from horizontal job loading, which reduces the personal
contribution rather than giving opportunities for growth. Some examples of horizontal loading are:

 Challenging the employee by increasing the amount of production expected.

 Adding another meaningless task to the existing one.
 Rotating the assignments of several jobs that need to be enriched.
 Removing the most difficult parts of the assignment.

Criticism of Herzberg’s theory

1. Herzberg drew conclusions from a limited experiment covering engineers and accountants. Engineers,
accountants, and other professionals like them may like responsibility and challenging jobs. But the
general body of workers are motivated by pay and other benefits (Hygiene factors)
2. The two−factor theory is an over−simplification of the true relationship between motivation and

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dissatisfaction. Several studies showed that one factor can cause job satisfaction for one person and job
dissatisfaction for another.
3. Herzberg’s inference regarding differences between satisfiers and hygiene factors cannot be
completely accepted. People generally attribute the causes of satisfaction to their achievements. But
more likely they attribute their dissatisfaction to obstacles presented by the company’s policies or
superiors than to their deficiencies.

McGregor’s Theory X and Theory Y

Douglas McGregor developed the theory that there are two basic management behavior types, Theory X
managers and Theory Y managers, each of which has a quite different set of assumptions about others.

Theory X managers

Theory X managers are authoritarian and controlling, using threat and punishment to coerce people into
working hard. The carrot and stick approach to motivation is followed. People are shown carrot
(rewards) to get the work done and if they are not able to meet the targets then they are punished. They tend not to
produce elevated levels of performance from their teams.

Theory X Assumptions:

1. People have an inherent dislike of work and will try to avoid it at all costs.
2. People need to be coerced, controlled, and threatened to work hard.
3. People are not ambitious and dislike responsibility, preferring to be directed.
4. Above all else, people want security.

Theory Y managers

Theory Y managers are democratic, consultative and empowering, helping people to develop and
encouraging them to take the initiative. These enlightened managers tend to achieve the best results from
their teams.

Theory “Y" managers gravitate towards relating to the worker on a more personal level, as opposed to a
more conductive and teaching based relationship. As a result, Theory Y followers may have a better
relationship with their higher ups, as well as potentially having a healthier atmosphere in the workplace.

Theory Y Assumptions:

1. People naturally put as much effort into their work as they do into play or rest
2. People will exercise self−direction and self−control if they are committed to a goal
3. People will be committed to an organization if they are satisfied in their job
4. People relish and seek responsibility
5. People are good at creative problem−solving

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6. People’s talents and skills are normally underused

Interpretation/Difference between Theory X and Theory Y

1. Level of Needs: Theory of X assumes Maslow’s lower−level needs dominate in employees. Whereas
Theory of Y, assumes Maslow’s higher−level needs dominate in employees

2. Type of Leadership: Theory X focusses on autocratic leadership whereas theory Y focusses on

democratic leadership. Although an authoritarian style of leadership is occasionally necessary in
crisis situations, but the positive and participative Theory Y style is generally accepted as more
effective for motivating people. People will contribute more to their job and organization if they are
treated as emotionally mature, responsible, and valued employees and are given challenging work.

3. Situations: Theory X is more applicable to handle unskilled and uneducated low−level employees
whereas theory Y is more applicable for skilled and educated employees

4. Locus of Control: Theory X people lacks self−motivation and has external locus of control; they
require close supervision to get maximum output from them. In theory Y, people are self−directed,
creative and prefer self−control

5. Centralization or Decentralization: Theory X emphasizes scalar chain system and centralization of

authority in the organization while Theory Y emphasizes decentralization of authority and greater
participation in decision making

Management Implications of Theory X and Theory Y

 Quite a few organizations use Theory X today. Theory X encourages use of tight control and
supervision. It is useful in organizations where repetitive tasks are to be done in tight schedule. It
implies that employees are reluctant to organizational changes. Thus, it does not encourage
innovation.

 If Theory Y is embraced, the organization can accurately perform several elements to attach the
motivational dynamism of its employees: Theory Y gives employees freedom and encourages
self−control and participation in decision making. Employees are able to take higher responsibility.
If accurately applied, such an atmosphere would end result in a boundless level of motivation as
employees work to gratify their higher−level personal needs through their work.

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Expectancy theory

The expectancy model of motivation was propounded by Victor H. Vroom. This theory is classified as
process theory because the theory attempts to identify the relationship between the variables which affect
individual behaviour. Vroom’s expectancy model established that motivation of an individual depends upon
the strength of his expectation that a certain act will lead to a desirable outcome and the degree to which that
outcome is preferred by that individual. Major contribution of this theory in the concept of motivation can
be described in terms of identification of various forces that motivate an individual to perform on the job.
There are three variables which are explained by the expectancy model: Valence, Expectancy and
Instrumentality. This model postulates that motivation is multiplier of all of these three variables. Therefore,
in order to motivate an individual, all of these three variables must have positive value. If any one of these
three variables becomes zero, motivation will also be zero.

The three variables are explained as follows:

a) Valence: It refers to attraction of the outcome to an individual. Valence is the strength of an individual’s
preference for a particular outcome or reward. Valence is a subjective phenomenon and therefore it
varies from person to person. Value of valence ranges between -1 to +1. If an individual prefer to
achieve some outcome, valence in that case will be positive. If an individual does not prefer to achieve
certain outcome, in that case valence will be negative and valence will be zero if an individual expresses
indifferent attitude towards achieving the outcome. Therefore, it can be said that in order to motivate an
individual for certain outcome, valence of the reward associated with the outcome must be positive for
that individual.

b) Expectancy: Expectancy is also called effort-performance probability. It refers to the extent an

individual believes that certain level of efforts made by him will lead to the achievement of desired level
of outcome or completion of the task. Expectancy is the probability that a particular amount of effort
will lead to desired level of performance (first level outcome). Since it is a probability, its value will
vary from 0 to 1. If an individual believes that probability of achieving the desired level of performance
is zero i.e if an individual feels that he will not be able to achieve certain level of performance no matter
how hard he works, he will not even try to put efforts. On the other hand, if a person believes that
probability of achieving the desired level of performance is positive, he will try harder to achieve the
desired outcome.
For example, a sales agent who has been assigned a task of selling 100 units of cell phones in a month
will put more efforts to achieve desired level of performance if he believes that he will be able to sell
100 cell phones in a month. But, if he believes that it is impossible to sell 100 mobile phones in a month

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irrespective of the level of efforts he put in the desired direction, he will not try to complete the task.

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c) Instrumentality: It is also called performance-reward probability. Instrumentality is the expectation of

an individual that his performance will lead to desired reward associated with the performance. It is
probability that first level outcome (performance) will lead to the second level outcome (reward). The
instrumentality also varies from 0 to 1. Instrumentality will be positive, if an individual believes that
after achieving desired level of performance, he will get rewards associated with it. Whereas,
instrumentality will be zero if a person believes that desired level of performance will not lead to
desired rewards.

As per the Vroom’s expectancy model:

Motivation=Valence*Expectancy*Instrumentality

This relationship explains that motivation level of an individual will be higher if all of these three elements
are higher and motivation level will be decreased if any of these elements will be lower. This model can
help the management to determine the behaviour of employees and take necessary steps to modify the
same.

Vroom’s expectancy model is described in the following figure:

Instrumentalit

Second
First level
level

Expectanc Outcome
Outcome

Outcome

Motivational
Force
Outcome

Outcome

Outcome

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Critical analysis of Vroom’s Expectancy Model:

Vroom’s expectancy model was appreciated on the following grounds:

a) This model is very useful in understanding organisational behaviour. The model explains how
individual’s behaviour is influenced by his goals.
b) This is a cognitive theory which assumes that human beings are rational. They can anticipate their goal
achievement and amount of efforts required to achieve the goals.
c) This theory says that motivation is not just about the satisfied and unsatisfied needs of individuals.
Efforts made by an individual can result in achievement of desirable rewards which in turn will improve
the motivation.
Despite of the above mentioned advantages, the model was criticised because:
a) This theory is very complex and hence difficult to practice.
b) The theory assumes the human being to be rational who makes all decisions consciously. But, in reality
so many decisions are taken without conscious thoughts.
c) Managers don’t have enough time implement such a complex model on the job.

1. Equity theory of Motivation

Equity theory proposed by J. Stacey Adam is the most popular and developed version of equity. It is based
on the simple assumption that all individuals expect to be treated fairly. According to this theory, equity is
the perception of employees that we are treated equally as compared to others and inequity is the perception
of employees that we are treated unfairly as compared to others. Employees assess what they get from the
job (salary) against the inputs (experience, education) they put into the job. They compare their outcome-
input ratio with outcome-input ratio of other relevant individuals. If individuals perceive their ratio to be
equal to the ratio of others i.e. if they feel that they are getting salary equal to others, state of equity exists.
But, if an individual perceives his ratio to be unequal i.e. if they feel that they are overpaid or underpaid,
state of inequity prevails. See the following equations to understand such comparisons:

(i) 𝐼𝑛𝑑𝑖𝑣𝑖𝑑𝑢𝑎𝑙 ′ 𝑠 𝑜𝑢𝑡𝑐𝑜𝑚𝑒/𝐼𝑛𝑝𝑢𝑡 = 𝑜𝑡ℎ𝑒𝑟 ′ 𝑠 𝑜𝑢𝑡𝑐𝑜𝑚𝑒/𝐼𝑛𝑝𝑢 ; State of equity

(ii) 𝐼𝑛𝑑𝑖𝑣𝑖𝑑𝑢𝑎𝑙 ′ 𝑠 𝑜𝑢𝑡𝑐𝑜𝑚𝑒 /𝐼𝑛𝑝𝑢𝑡 > 𝑜𝑡ℎ𝑒𝑟 ′ 𝑠 𝑜𝑢𝑡𝑐𝑜𝑚𝑒/ 𝐼𝑛𝑝𝑢 ; State of inequity due to overpaid

(iii) 𝐼𝑛𝑑𝑖𝑣𝑖𝑑𝑢𝑎𝑙 ′ 𝑠 𝑜𝑢𝑡𝑐𝑜𝑚𝑒 𝐼𝑛𝑝𝑢𝑡 < 𝑜𝑡ℎ𝑒𝑟 ′ 𝑠 𝑜𝑢𝑡𝑐𝑜𝑚𝑒 𝐼𝑛𝑝𝑢 ; State of inequity due to underpaid

Porter and Lawler’s Performance-Satisfaction Model of Motivation

Porter and Lawler gave an inclusive theory of motivation. The theory explained that an individual’s
motivation, performance and satisfaction are separate variables but are related to each other in different
ways. Porter and Lawler’s model of motivation matches with Vroom’s expectancy model to large extent.
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The model is explained in the following figure:

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Value Ability Perceived

of and equitable
rewards

Intrinsi
c

Performance Satisfaction
Efforts
Accomplishment

Extrinsic
rewards

Perceived Role
Effort Perception
Reward
Probability

The figure given above clearly shows that this multivariate model of motivation explains the relationship
between effort, performance and satisfaction. It is important to point out here that effort leads to performance
but this relationship is not direct. The relationship between effort and performance is influenced by
individual’s abilities, traits and his perception about the role he is performing. Further, the desired level of
performance results in the intrinsic and extrinsic rewards associated with the performance. But perceived
equitable rewards determine the level of satisfaction of an individual. This model is based on the following
assumptions:

a) The model assumes employees to be rational who take conscious decisions about their behaviour
in the organisations.
b) All employees have different needs, desires and goals.
c) Individual behaviour is determined by combination of situational factors, environment and
employees’ traits and perception about the role.

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The variables explained by this model are discussed as follows:

1) Effort: Effort refers to the energy which an individual put to perform his job.
2) Value of reward: This is what was explained by Vroom’s expectancy model as Valence. It
refers to the degree of attractiveness of reward associated with the performance.
3) Perceived Effort Reward probability: This refers to the probability that certain level of
effort will lead to desired level of performance and further probability that the performance
will lead to certain kinds of rewards. If the probability is positive only then individuals will
decide to put certain level of efforts.
4) Performance: Performance is the outcome of efforts made by an individual. The level of
performance is influenced by abilities, traits and individual’s perception about his role.
Abilities of an individual include knowledge, skills and intellect to perform the job.
5) Rewards: Performance leads to two types of rewards: intrinsic rewards and extrinsic
rewards. Intrinsic reward is inner feeling of achievement and accomplishment associated
with the performance. Extrinsic rewards are given by the organisation in the form of
incentives, recognition, promotion etc.
6) Satisfaction: Satisfaction will result from both intrinsic as well as extrinsic rewards. But the
level of satisfaction will be determined by perception of an individual that he is getting the
rewards which he actually values or needs.

CAREER DEVELOPMENT

Career development is a function of human resource management which aims at providing

opportunities for people to develop their careers. This will help them to achieve their career
aspirations at the same time enable to talent development in the organisations. Career planning and
succession planning are two major parts of career development.

Career is viewed as a sequence of position occupied by a person during the course of his lifetime.
Career may also be viewed as amalgam of changes in value, attitude and motivation that occur, as a
person grows older. The implicit assumption is that an individual can make a different in his career
over time and can adjust in ways that would help him to enhance and optimize the potential for his
own career development. Career development is important because it would help the individual to
explore, choose and strive to derive satisfaction with one’s career object.
Through career development, a person evaluates his or her own abilities and interests, considers
alternative career opportunities, establishes career goals, and plans practical developmental activities.
Career development seeks to achieve the following objectives:
a) It attracts and retains the right persons in the organisation

b) It maps out careers of employees suitable to their ability, and their

willingness to be trained and developed for higher positions

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c) It ensures better use of human resources through more satisfied and

productive employees

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CAREER PLANNING

Meaning
Career planning is the self-evaluation & planning done by a person to have a strong career path. Career
planning process in the continuous reiterative process of understanding oneself, setting career goals,
revising skills and searching for the right career options.
Importance of Career Planning
1. To attract competent person & to retain them in the organisation.
2. To provide suitable promotional opportunity.
3. To enable the employees to develop & take them ready to meet the future
challenges.
4. To increase the utilization of managerial reserves within an organisation.
5. To attract employment placement.
6. To reduce employee dissatisfaction & turnover.
7. To improve motivation & morale.
STEPS IN THE CAREER PLANNING PROCESS

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Career planning process is an important aspect for an individual’s career development. Some of the
basic steps in a career planning process are:
1. Self-Assessment: The first step in the career planning process is self-assessment to be done by the
individual to understand his or her skills, areas of interest etc.
2. Research on Careers: The second step in the career planning process is to understand the career
options, companies available, growth options in career etc.

3. Set Career Objectives: The next step in the career planning is to set short-term as well as long-term
career goals for oneself, and to have a clear career path.

4. Learn & Improve Skills: The fourth step in the career planning process is to keep acquiring new
skills and knowledge to be in line with career objectives and with industry requirements.
5. Preparation of CV: The next step in the career planning is to be fully prepared in terms of CV, cover
letter, recommendations etc.
6. Job Search: The sixth step in the career planning process is to short-list the companies where an
individual is seeking a job & start applying.
7. Revise Career Goals: The last step in the career planning process is to continuously evaluate the
career goals and again do a self-assessment to build a strong career path.

SUCCESSION PLANNINNG
Meaning
 Succession Planning is the process of identifying and tracking high-potential employees who will
be able to fill top management positions when they become vacant.
 Succession planning is an ongoing process that identifies necessary competencies, then works to
assess, develop, and retain a talent pool of employees, in order to ensure a continuity of
leadership for all critical positions. Succession planning is a specific strategy, which spells out
the particular steps to be followed to achieve the mission, goals, and initiatives identified in
workforce planning. It is a plan that managers can follow, implement, and customize to meet the
needs of their organisation, division, and/or department.
 Succession planning establishes a process to recruit employees, develop their skills, and prepare
them for advancement, all while retaining them to ensure a return on the organization's training
investment. Succession planning involves understanding the organization's long-term goals and
objectives, identifying employee development needs, and determining trends.

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DIFFERENCE BETWEEN CAREER PLANNING & SUCCESSION PLANNING

BASIS FOR CAREER PLANNING SUCCESSION PLANNING

COMPARISON
Meaning Career Planning is the process Succession Planning is a
through which an individual selects process who tends to spot and
the goals of his work life and finds develop the employees that can
ways to reach the goals. occupy the key positions in the
organization, when they
become vacant.
Subset of Career Management Succession Management
What is it? Individual Planning Organizational Strategy

Position One employee holds different One position is held by

positions, in his/her work life. different employees, over a
period of time.
Ensures Success in one's career. Continuity in leadership for all
key positions.

PROCESS OF CAREER DEVELOPMENT

There are two components of career planning and development. They are

1) CAREER DEVELOPMENT PROGRAMME

2) Assisting employees in assessing their own internal career needs.

3) Developing and publicising available career opportunities in the organisation.

4) Aligning employee needs and abilities with career opportunities.

a) Internal Career Assessment: Since a person's career is extremely important element of life,
each person is to make his or her decision in this regard. However, the HR manager may
assist an employee's decision-making process by providing as much information as possible
to the employee showing what type of work would suit him or her most, considering his or
her other interest, skill, aptitude, and performance in the work that he or she is already doing.
For rendering such help some big organisations provide formal assessment centre/workshops
where small groups of employees are subjected to psychological testing,

b) Career Opportunities: Knowing that employees have definite career needs, there naturally
follows the obligation of specifically charting career paths through the organisation and
informing the employees. For identifying the career paths the technique of job analysis may
help in discovering multiple lines of advancement to several jobs in different areas.

c) Employee's Needs and Opportunities: When employees have assessed their needs and have

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become aware of organisational career opportunities the remaining problem is one of

alignment. For aligning or matching the career needs of employees to opportunities offered
by the organisation, special training and development techniques such as special
assignment, planned position rotation, and supervisory coaching, are used. The HR
department of some organisations have also some system of recording and tracking moves
through the organisation, and maintain an organisation chart that highlights age, seniority
and promotion status.

B) Career Planning Process and Activities

The process of career planning involves a number of activities or steps to be undertaken as
mentioned below:
a) Preparation of HR inventory of the organisation,
b) Building career paths or ladders for various categories of employees,

c) Locating or identifying employees with

necessary potential for career planning,
d) Formulation and implementation of suitable plans for training and development of persons
for different steps of the career ladder or paths, and

e) Maintaining age balance while taking employees up the career path and review of career
development plan in action, etc.
a) Organisation’s HR Inventory: Such an inventory is an essential prerequisite for any
successful career planning within the organisation. This inventory should be so prepared as to
provide the following information:

 Organisational set up and its different levels.

 The existing number of persons employed in the organisation. For this, manning tables
are prepared showing the nature of positions at different levels of the organisation and
the number of persons manning those jobs. Sometimes the age of persons holding
the jobs are also mentioned in the table to show when they are likely to retire and when
the vacancy thus caused may be required to be filled.

 Types of existing employees, their status, duties, qualifications, age, aptitude, ability
to shoulder added responsibility and their acceptability to their colleagues.

 Whether the existing manpower is short or in surplus to requirements. If there is a

shortage, how many more persons are required, and for what positions.

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Number of persons required in the near future, say in the next one to five years, to meet
the needs arising from expansion or diversification of work or natural wastage of
manpower. The latter includes death, permanent disability, superannuation and
retirement, discharge, dismissal, voluntary resignation, or abandonment of the jobs.

Collection of all the above information may amount to manpower planning, and involve
preparation of manpower budget showing present and immediate future needs.

b) Employee's Potential for Career Planning: After determining the career path, the next
logical step is to find out the suitable employees who may have the necessary ability and
potential for climbing up the ladder and are willing to be promoted and to take up higher
responsibilities. For this the management control technique of Performance Appraisal and
Merit Rating is utilised. Periodical evaluation and merit rating of employees is also
necessary for proper planning of manpower and career of employees in the organisation. This
can be possible only by knowing how much and what types of human resources are available,
and the potential of employees whose career is to be planned.

c) Formulation and Implementation of Training and Development Plans and

Programmes: For making the career planning a success it is essential that the training and
development programmes should be so planned and designed that they meet the needs of
both the management and employees. The participants of these programmes should be the
employees who are willing to be trained and developed further to make their career in the
organisation. Methods of training and nature of skill and knowledge to be imparted may be
different for different types of employees. The emphasis may be on improving technical skills
of skilled workers and on acquiring and improving leadership qualities, human and
conceptual skills for senior supervisors, executives and managers.
d) Age Balance and Career Paths: One widespread difficulty in career planning may arise
from the need to accommodate people in the same level of supervisory and managerial
hierarchy, some of whom are young direct recruits and others are promotees who are almost
always considerably older. The latter, because of their limited education or formal
profession qualification, cannot expect to be move up high: the former as they are better
educated and trained have aspirations for rapid vertical mobility. Promotion and direct
recruitment at every level must, therefore, be so planned as to ensure a fair share to either
group. Intense jealousies, rivalries or groupism may develop if this aspect of personnel
administration is neglected. Very quick promotions which create promotion blocks should

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also be avoided if the employees are not to feel stagnated or demotivated at early stages o f
their careers, and think of leaving the organisation for better prospects. Such a situation can
be avoided if promotions are properly spaced.

e) Review of Career Development Plans in Action: Career planning is a continuous activity.

In fact it is a process. For effective career planning, a periodical review process should be
followed so that the employee may know in which direction the organisation is moving, what
changes are likely to take place and what resources and skills he or she needs to adapt to the
changing organisational requirements. Even for the organisation, annual evaluation is
desirable to know an employee's performance, limitations, goals and aspirations, and to
know whether the career plan in action is serving the corporate objective i.e. effective
utilisation of human resources by matching employee abilities to the demands of the job and
his or her needs to the rewards of the job. Some of the questions that could be asked while
evaluating the career plan might be:

 Was the classification of the existing employees correct?

 Are the job descriptions proper?

 Is there any employee unsuited to his or her job?

 Are the future manpower projections still valid?

 Is the team pulling on well as a whole?

 Are the training and development programmes adequately devised to enable the
employee to climb up the career ladder and fit into higher positions?

Answers to all these and other questions can be found either by holding brainstorming
sessions or by undertaking a survey of career planning activities and their impact on the
working of the organisation.

f) Career Counselling: Career planning may also involve counselling individuals on their
possible career paths, and what they must do to achieve promotions. The need for such
counselling arises when employees plan their own careers, and develop or train themselves
for career progression in the organisation. This does not mean revealing the number of
determined steps in a long range plan of the organisation.

Even if it were possible, it would be inappropriate to raise expectations which might not be
fulfilled or induce complacency about the future. In counselling, the wisest approach is to

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provide a scenario of the opportunities that might become available. The main aim should be
to help the individual concerned to develop oneself by giving him or her some idea of the
direction in which he or she ought to be heading. Some other objectives of career counselling
are as follows

 Providing a normal mature person with guidelines to help him or her understand
oneself more clearly and develop his or her thinking and outlook.

 Achieving and enjoying greater personal satisfaction, pleasure and happiness.

STAGES OF CAREER DEVELPOMENT

1. Exploration:
 The exploratory stage is the period of transition from college to work, thatis, the
period immediately prior to employment.
 It is usually the period of one’s early 20 s and ends by mid-20 s. It is a stageof self-
exploration and making preliminary choices.
2. Establishment:

 This career stage begins when one starts seeking for work. It includesgetting one’s
first job.
 Hence, during this stage, one is likely to commit mistakes; one has also the
opportunities to learn from such mistakes and may also assume greater
responsibilities.

3. Mid-Career:

 During this stage, the performance may increase or decrease or may remain constant.
 While some employees may reach their goals at the early stage and may achieve
greater heights, some may be able just to maintain their performance.
 While the former may be called ‘climbers’, the later ones are not very ambitious
though competent otherwise.
4. Late Career:

 This stage is usually a pleasant one because during this stage, the employee neither
tries to learn new things nor tries to improve his/her performance over that of
previous years.

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 He/she takes advantage of and depends on his/her reputation and enjoys playing the
role of an elderly statesperson.
5. Decline:
Since it is the final stage of one’s career, it ends in the retirement of the employee after
putting up decades of service full of continuous achievementsand success stories. As
such, it is viewed as a hard stage.

DEVELOPMENT OF MENTOR-PROTÉGÉ RELATIONSHIP

DEFINITION:
The relationship between an experienced employer and a junior employee in which the
experienced person helps the junior person with effective socialization by sharinginformation
gained through experience with the organization.

Requirements for effective mentor-protégé relationship:

1. The status & characteristics of the mentor:

Mentors should be seniors in status, experience, age, skills, knowledge.

2. Protégé: Junior employees should have the zeal to learn from their senioremployees
regarding their career, social and psychological aspect.
3. The relationship: It is based on mutual dependence & mutual trust.
4. The activities:
 Developing the potentials of the protégé. Improving protégés performance
 Interlinking formal learning & practices Guide, support, providing feedback
5. Developing higher skills:
It should encourage their juniors towards high task performance by reducing weakness
& strength of the protégés.
6. Response of the protégé:
Protégés should learn carefully regarding career opportunities, personal goals.
Phases of Mentor-Protégé Relationship:

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According to Kram, there are four phases of mentor-protégé r,elationship namely,

initiation, cultivation, separation and redefinition.
1. Initiation:
A period of six months to a year during which time the relationship gets startedand
begins to have importance for both.
2. Cultivation:
A period of two to five years during which time career and psychological functionsprovided
expand to a maximum.

3. Separation:
A period of six months to two years after a significant change in the structural role
relationship and/or in the emotional experience of the relationship.
4. Redefinition:
An indefinite period after the separation phase, during which time the relationship is ended
or taken on significantly different characteristics, making it more peer like relationship.

MENTORING

Mentoring is a relationship between two people with the goal of professional and
personal development. The "mentor" is usually an experienced individual who shares
knowledge, experience, and advice with a less experienced person, or "mentee."

TYPES OF MENTORING

1. One-on-One Mentoring
 In one-on-one mentoring programs, participants are matched via a formal
program or they self-select who they want to be paired with over the
courseof a certain time period.

 This type of mentoring is more focused on relationship-building andindividual

skill-building.

2. Situational Mentoring

If you want your mentees to learn a specific skill or trade, you may want to
pairthem with a mentor to coach them as they learn
3. Developmental and Career Mentoring
This type of mentoring is long term and typically entails managers and directors

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whomentor their employees as they progress in their careers over the course of a
few years.

4. Reverse Mentoring
 When new hires possess skills and knowledge, they can also
mentortheir bosses and co-workers.

 This type of mentoring encourages knowledge sharing across your

organization.

5. Group-Based Mentoring
 It is possible to pair more than one mentee to a mentor,
especiallyfor situational mentoring scenarios.

 With group-based mentoring, group members can help keep one another ontrack
and are also able to meet with their mentors one-on-one when needed.
6. Peer-Based Mentoring
 Sometimes with group-based mentoring, a mentor may not even be needed atall.
 To build and maintain effective mentorship programs at your organization,consider
implementing one or more of the types of programs listed above.

Benefits of being a Mentee

 Gain practical advice, encouragement and support

 Learn from the experiences of others
 Increase your social and academic confidence
 Become more empowered to make decisions
 Develop your communication, study and personal skills
 Develop strategies for dealing with both personal and academic issues
 Identify goals and establish a sense of direction
 Gain valuable insight into the next stage of your university career
 Make new friends across year groups
Benefits of being a Mentor

 Improve communication and personal skills

 Develop leadership and management qualities
 Reinforce your own study skills and knowledge of your subject(s)
 Increase your confidence and motivation
 Engage in a volunteering opportunity, valued by employers

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 Enhance your CV
 Increase your circle of friends
 Gain recognition for your skills and experience
 Benefit from a sense of fulfilment and personal growth

Mentor Barriers

1. Competing demands
2. Time restraints
3. Power differential
4. Competency of conflicting roles
5. Lack of understanding of mentor role
6. Personality
7. Boundaries
Mentee Barriers

1) Concern about underachieving

2) Unrealistic expectations of mentors
3) Power differential
4) Availability/scheduling
5) Personality
Institutional Barriers

1) Training
2) Lack of acknowledgement / recognition
3) Lack of incentive for participants
4) Time
5) Lack of formal training
6) Poor planning
7) Self-identified vs. assigned mentors

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