Chapter 09 – Improving Job Performance with Goals, Feedback, Rewards, and Positive Reinforcement
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CHAPTER Nine: Improving Job Performance with Goals, Feedback, Rewards, and
Positive Reinforcement
LEARNING OJBECTIVES
See Slides 9-2, 9-3
When you finish studying the material in this chapter, you should be able to:
• Define the term performance management, distinguish between learning goals
and performance outcome goals, and explain the three-step goal-setting process.
• Identify the two basic functions of feedback, and specify at least three practical
lessons from feedback research.
• Define 360-degree feedback, and summarize how to give good feedback in a
performance management program.
• Distinguish between extrinsic and intrinsic rewards, and explain the four building
blocks of intrinsic rewards and motivation.
• Summarize the reasons why extrinsic rewards often fail to motivate employees.
• Discuss how managers can generally improve extrinsic reward and pay-for-
performance plans.
• State Thorndike’s law of effect, and explain Skinner’s distinction between
respondent and operant behavior.
• Define positive reinforcement, negative reinforcement, punishment, and
extinction, and distinguish between continuous and intermittent schedules of
reinforcement.
• Demonstrate your knowledge of behavior shaping.
CHAPTER SUMMARY
Chapter 9 defines performance management and discusses the factors that impact the
success of a performance management process. Goal setting and management by
objectives are described, and practical recommendations for managing goal setting are
presented. This chapter discusses the functions of feedback, describes 360-degree
feedback and explains how to provide effective feedback. This chapter also describes
organizational reward systems, including
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the types of rewards that can influence behavior and why these rewards often fail to
motivate. Finally, Chapter 9 discusses positive reinforcement and the various
schedules of reinforcement which can be used to influence and shape employee
behavior.
Performance management is a continuous cycle of improving individual job
performance with goal setting, feedback and coaching, and rewards and positive
reinforcement. Figure 9-1 illustrates the factors that foster ongoing performance
management and improvement.
Employees with a clear line of sight understand the organization’s strategic goals and
know what actions they need to take, both individually and as team members. There
are two types of goals: a performance outcome goal (targets a specific end-result) and a
learning goal (strives to improve creativity and develop skills). Goal setting is a
cornerstone of the management by objectives (MBO) technique. The three steps in
implementing a goal-setting program are: goal setting, goal commitment, and support
and feedback. Managers should set SMART goals. That is, goals that are specific,
measurable, attainable, results oriented, and time bound. Table 9-1 presents guidelines
for writing SMART goals. Goal commitment is important because employees are more
motivated to pursue goals viewed as reasonable, obtainable, and fair. Providing
support and feedback requires providing employees with the skills and information to
get the job done.
Feedback is information about individual or collective performance shared with those in
a position to improve the situation. Feedback serves two functions: it is instructional
and it is motivational. Personality characteristics (e.g., self-esteem, self-efficacy, or self–
monitoring), needs, and goals influence one’s desire for feedback. People tend to
perceive and recall positive feedback more accurately than they do negative feedback.
Negative feedback can have a positive motivational effect but it can also damage self–
efficacy. After receiving feedback, people cognitively evaluate factors such as its
accuracy, source credibility, fairness of the system, performance-reward expectancies,
and the reasonableness of the standards to determine the relative importance to give to
the feedback. 360-degree feedback allows individuals to compare their own perceived
performance with feedback from their supervisor, subordinates, and peers. Such
programs should maintain anonymity and not be linked to pay or promotion decisions.
Rewards are a critical component of a performance improvement cycle. Figure 9-2
presents the important components of organizational reward systems. Rewards may be
extrinsic or intrinsic. Extrinsic rewards come from the environment while intrinsic
motivation is driven by positive feelings associated with doing well on a task. Extrinsic
rewards include financial/material and social rewards, while psychic rewards are
intrinsic. Three criteria for the distribution of
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rewards are results, actions and behaviors, and nonperformance considerations.
Performance results include tangible outcomes regarding quality and quantity of
performance. Performance actions and behaviors include teamwork or creativity. A
good reward system should attract talented people and motivate and satisfy them once
they have joined the organization.
Intrinsic motivation is driven by positive feelings associated with doing well on a task.
Four intrinsic rewards underlie a person’s level of intrinsic motivation: a sense of
meaningfulness, a sense of choice, a sense of competence, and a sense of progress.
Managers can enhance intrinsic motivation by increasing the amount of intrinsic
rewards employees derive from their work. Managers lead for meaningfulness by
inspiring their employees and modeling desired behaviors. Managers lead for choice by
empowering employees and delegating meaningful assignments. Managers lead for
competence by supporting and coaching their employees. Managers lead for progress
by monitoring and rewarding others.
Pay-for-performance programs link at least some portion of employees’ pay directly to
results or accomplishments. Research results show mixed outcomes from pay for
performance and many organizational reward systems fail to motivate. When
implementing a pay-for-performance plan, managers should make the pay an integral
part of the organizational strategy and base decisions on objective performance data.
Employees should actively participate in the development, implementation and revision
of the plan and teamwork should be rewarded whenever possible. Supervisors and
middle managers must support the plan and be amenable to two-way communication
from employees. Finally, any cash bonuses should be distributed in sizable lump sums
in order to maximize their motivational impact.
Feedback and extrinsic reward programs are often ineffective because they are
administered haphazardly. A behavior modification technique called positive
reinforcement helps managers achieve desired effects by systematically providing
feedback and extrinsic rewards. Thorndike formulated the “law of effect” which says
behavior with favorable consequences tends to be repeated, while behavior with
unfavorable consequences tends to disappear. Skinner drew an important distinction
between two types of behavior: respondent and operant. Unlearned reflexes or
stimulus-response (S-R) connections are called respondent behavior. Operant behavior
is learned when one “operates on” the environment to produce desired consequences.
Contingent consequences control behavior in four ways: positive reinforcement,
negative reinforcement, punishment, and extinction. Positive reinforcement is the
process of strengthening a behavior by contingently presenting something desirable.
Negative reinforcement also strengthens behavior, but by contingently withdrawing
something displeasing. Punishment is the process of weakening
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behavior through either the contingent presentation of something displeasing or the
contingent withdrawal of something desirable. Extinction is the weakening of a behavior
by ignoring it or making sure it is not reinforced.
There are two broad categories of reinforcement schedules: continuous and
intermittent. A continuous reinforcement schedule reinforces every instance of the
target behavior. Intermittent reinforcement schedules reinforce some but not all
instances of the target behavior. Intermittent schedules have four subcategories. In a
fixed ratio schedule, reinforcement occurs after a fixed number of responses is emitted.
A variable ratio scale reinforces after a varying or random number of responses is
emitted. A fixed interval schedule reinforces the first response after a specific period of
time has elapsed. Finally, variable interval schedules reinforce the first response after
varying or random time periods have elapsed. Ratio schedules are contingent on the
number of responses emitted, while interval schedules are tied to the passage of time.
The schedule of reinforcement can more powerfully influence behavior than the
magnitude of reinforcement. Variable ratio and variable interval schedules produce the
strongest behavior that is most resistant to extinction.
Behavior shaping is defined as the process of reinforcing closer and closer
approximations to a target behavior. The key to successful behavior shaping lies in
reducing a complex target behavior to easily learned steps. After the steps are
established, then it is important to faithfully reinforce any improvement. Table 9-3
presents practical tips for shaping job behavior.
LECTURE OUTLINE
I. Performance Management Overview
i) Performance management: an organization wide system for improving
performance by setting, monitoring, and evaluating goals; providing feedback
and coaching; and rewarding employees on a continuous basis. See
Slide 9-4
ii) Figure 9-1: Improving Individual Job Performance: A Continuous
Process illustrates the factors that foster ongoing performance management
and improvement. See Slide 9-5
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II. Goal Setting
i) Goal Setting Overview
(1) Many workers in the United States don’t clearly understand their
employer’s most important goals and many don’t have their own clearly
defined goals.
(2) Line of sight: employees know the organization’s strategic goals and how
they need to contribute. See Slide 9-6
ii) Two Types of Goals See Slide 9-7
(1) Performance outcome goal: targets a specific end result.
(2) Learning goal: encourages learning, creativity, and skill development.
(3) The Real World/Real People: Starwood’s CEO Frits van Paasschen
Runs on Goals profiles the impact of goals for one executive.
(4) Managers typically overemphasize performance outcome goals and
ignore learning goals.
(5) Performance outcome goals are more frustrating than motivating for
employees who lack the necessary skills.
iii) Management by Objectives
(1) Goal setting has been promoted through a management technique called
management by objectives.
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(2) Management by objectives (MBO): management system incorporating
participation into decision making, goal setting, and feedback. See
Slide 9-8
(3) Meta-analyses indicate that MBO programs foster productivity gains and
employee job satisfaction.
(4) There can be ethical problems stemming from extreme pressure for
results in MBO programs.
iv) Managing the Goal-Setting Process See Slides 9-9, 9-10, 9-11, 9-14,
9-15
(1) Step 1: Set Goals
(a) Goals should be “SMART”: specific, measurable, attainable, results
oriented, and time bound.
(b) Table 9-1: Guidelines for Writing SMART Goals describes the
aspects of SMART in more detail. See Slide 9-12
(c) For complex tasks, managers should train employees in problem-
solving techniques and encourage them to develop a performance
action plan.
(d) Individual differences should be considered when establishing goals,
including the person’s goal orientation.
(i) Learning goal orientation: view their skills sets as something that
can be developed.
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(ii) Performance-prove goal orientation: focus on performance and
try to demonstrate their ability by looking better than others.
(iii)Performance-avoid goal orientation: focus on performance to
avoid negative outcomes.
(2) Step 2: Promote Goal Commitment
(a) Obtaining goal commitment is important because employees are more
motivated to pursue goals they view as reasonable, obtainable, and
fair.
(b) Goal commitment can be enhanced by following these guidelines:
(i) Explain why the organization is committed to a comprehensive
goal-setting program.
(ii) Create clear lines of sight by clarifying the corporate goals and
linking the individual’s goals to them.
(iii)Let employees participate in setting their own goals, preferably
“stretch” goals, and creating their own action plans.
(iv)Foster personal growth by having employees build goal ladders.
1. Goal ladder: a chain of progressively more difficult and
challenging goals that fosters personal growth.
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2. Focusing on completed goals in a goal ladder promotes a
feeling of satisfaction, while focusing on remaining goals in the
ladder tends to motivate a higher level of achievement.
(3) Step 3: Provide Support and Feedback
(a) Managers must provide employees with the necessary skills and
information to reach their goals.
(b) Managers should pay attention to employees’ effort → performance
expectations, perceived self-efficacy, and reward preferences and
adjust accordingly.
(c) Managers should be supportive and helpful.
(d) Employees should be provided with timely, task-specific feedback
(knowledge of results) on how they are doing.
(e) Managers should provide monetary and nonmonetary incentives and
reward both significant progress and goal accomplishment.
III. Feedback
i) Feedback Overview
(1) Feedback: information about individual or collective performance shared
with those in a position to improve the situation. See Slide 9-16
(2) Feedback is the exchange of information about the status and quality of
work products.
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ii) Two Functions of Feedback See Slide 9-17
(1) Feedback serves two functions for those who receive it: one is
instructional and the other motivational.
(a) Instructional: feedback that clarifies roles or teaches new behaviors.
(b) Motivational: feedback that serves as a reward or promises a reward.
(2) The Real World/Real People: Feedback Is a Way of Life for Ford’s
CEO Alan Mulally profiles one executive’s use of feedback.
(3) The motivational function of feedback can be significantly enhanced by
pairing specific, challenging goals with specific feedback about results.
iii) Are the Feedback Recipients Ready, Willing, and Able?
(1) The Recipient’s Characteristics
(a) Personality characteristics such as self-esteem and self-efficacy can
help or hinder one’s readiness for feedback.
(b) Needs and goals also influence one’s openness to feedback.
(c) High self-monitors are also more open to feedback because it helps
them adapt their behavior to the situation.
(2) The Recipient’s Perception of Feedback
(a) People tend to receive and recall positive feedback more accurately
than they do negative feedback.
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(b) Negative feedback can have a positive motivational effect but it can
also damage self-efficacy.
(3) The Recipient’s Cognitive Evaluation of Feedback
(a) Upon receiving feedback people cognitively evaluate factors such as
its accuracy, the credibility of the source, the fairness of the system,
their performance reward-expectancies, and the reasonableness of the
standards.
(b) Any feedback that fails to clear one or more of these cognitive hurdles
will be rejected or downplayed.
(c) Feedback must foster high effort → performance expectations and
performance → reward linkages if it is to motivate desired behavior.
iv) Practical Lessons from Feedback Research See Slide 9-19
(1) Research provides the following practical implications for managers about
feedback:
(a) The acceptance of feedback should not be treated as a given.
(b) Managers can enhance their credibility as sources of feedback by
developing their expertise and creating a climate of trust.
(c) Negative feedback is typically misperceived or rejected.
(d) Although very frequent feedback may erode one’s sense of personal
control and initiative, feedback is too infrequent in most work
organizations.
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(e) While average and below-average performers need extrinsic rewards
for performance, high performers respond to feedback that enhances
their feelings of competence and personal control.
(2) Table 9-2: Six Common Trouble Signs for Organizational Feedback
Systems profiles signs of an ineffective feedback system. See Slide
9-20
v) 360-Degree Feedback See Slide 9-21
(1) 360-degree feedback: comparison of anonymous feedback from one’s
superior, subordinates, and peers with self-perceptions.
(2) The idea behind 360-degree feedback is to let individuals know how their
behavior affects others, with the goal of motivating change.
(3) Top-management support and an organizational climate of openness can
help 360-degree feedback programs succeed.
(4) 360-degree feedback should be anonymous and used for development,
rather than pay and promotion decisions.
vi) How to Give Feedback for Coaching Purposes and Organizational
Effectiveness See Slide 9-22
(1) When giving feedback as part of a comprehensive performance
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management program, managers should:
(a) Focus on performance, not personalities.
(b) Give specific feedback linked to learning goals and performance
outcome goals.
(c) Channel feedback toward key result areas for the organization.
(d) Give feedback as soon as possible.
(e) Give feedback to coach improvement, not just for final results.
(f) Base feedback on accurate and credible information.
(g) Pair feedback with clear expectations for improvement.
IV. Organizational Reward Systems
i) Reward Systems Overview
(1) The subject of organizational rewards includes, but goes far beyond,
monetary compensation since some individuals get more than just a
paycheck from their jobs.
(2) Figure 9-2: A General Model of Organizational Reward Systems
indicates the three components of a reward system: types of rewards,
distribution criteria, and desired outcomes. See Slide 9-23
ii) Types of Rewards See Slide 9-24
(1) Financial, material, and social rewards qualify as extrinsic rewards
because they come from the environment.
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(2) Psychic rewards are intrinsic rewards because they are self-granted.
(3) An employee who works to obtain extrinsic rewards, such as money or
praise, is said to be extrinsically motivated.
(4) One who derives pleasure from the task itself or experiences a sense of
competence or self-determination is said to be intrinsically motivated.
(5) The relative importance of extrinsic and intrinsic rewards is a matter of
culture and personal tastes.
(6) The Real World/Real People: Seventy-one-Year-Old Judith Van Ginkel
Loves 60-Hour Workweeks profiles someone who is intrinsically
motivated.
iii) Reward Distribution Criteria See Slide 9-26
(1) The general criteria for the distribution of rewards are:
(a) Performance: results: tangible outcomes such as individual, group, or
organization performance; quantity and quality of performance.
(b) Performance: actions and behaviors: criteria such as teamwork,
cooperation, risk taking, and creativity.
(c) Nonperformance considerations: where the type of job, nature of the
work, equity, tenure, level in hierarchy, etc., are
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rewarded.
(2) The trend today is toward performance criteria and away from
nonperformance criteria.
iv) Desired Outcomes of the Reward System
(1) A good reward system should attract talented people and motivate and
satisfy them once they have joined the organization.
(2) A good reward system should foster personal growth and development
and keep talented people from leaving.
v) The Building Blocks of Intrinsic Rewards and Motivation
(1) The Building Blocks of Intrinsic Rewards and Motivation Overview
(a) There is a great deal managers can do to create situations in which
employees are more likely to experience intrinsic rewards and be
intrinsically motivated.
(b) Figure 9-3: Thomas’s Building Blocks for Intrinsic Rewards and
Motivation provides helpful direction in fostering intrinsic motivation.
See Slide 9-27
(2) Leading for Meaningfulness
(a) Managers lead for meaningfulness by inspiring their employees and
modeling desired behaviors.
(b) Employees are more engaged and productive when they see the
connection between their work and the organization’s vision.
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(3) Leading for Choice
(a) Managers lead for choice by empowering employees and delegating
meaningful assignments and tasks.
(4) Leading for Competence
(a) Managers lead for competence by supporting and coaching their
employees.
(5) Leading for Progress
(a) Managers lead for progress by monitoring and rewarding others.
vi) Why Do Extrinsic Rewards Too Often Fail to Motivate? See Slide 9-
28
(1) Despite huge investments of time and money for organizational reward
systems, the desired motivational effect often is not achieved because:
(a) There is too much emphasis on monetary rewards.
(b) Rewards lack an “appreciation effect.”
(c) Extensive benefits become entitlements.
(d) Counterproductive behavior is rewarded.
(e) There is too long a delay between performance and rewards.
(f) There are too many one-size-fits-all rewards.
(g) One-shot rewards with a short-lived motivational impact are used.