Facing Economic Difficulties

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The economic and financial world crisis also known as the Global Financial Crisis or the „Great Recession” whose first main effects were seen starting with 2008 led in early 2009 as the reports demonstrate us to a global jobs catastrophe as the number of global unemployment was significantly increasing.

As a reaction to the situation, countries tried to adopt massive financial rescue measures and established fiscal stimulus packages with little effectiveness, unfortunately. The social implication of the financial crisis and the constant fear of losing the job which became an important stress for the people and a main task on governmental task agenda led to the concept of global jobs pact as a global approach was considered to be needed to make the measures more effective.

The main argument was that a global crisis requires a global system of measures to overtake it.  However, things didn’t go well for every employee and some of the measures took to fight the effects of the crisis started to change their lives.

Recently, Bloomberg quoted Jason Kennedy, the CEO of recruitment firm Kennedy Group, who stated that: “I have never seen it as bad. The future also looks bleak. This will continue for another 14 or 15 months. 2012 is definitely a write-off” (Here Is The City, 2011).

Because of all this for the first time a question arose and the answer could not be found very easily: do the employees enjoy working as they did before the crisis? Research studies were made and managers applied different strategies to keep motivating their employees to maintain the same level of performance.

Motivation theories

Every analysis about motivation takes into consideration the question: “why people do what they do?” Therefore, the study of these behaviors is very important and the employee motivation is a key aspect within the discipline of organizational psychology. Job performance, absenteeism, turnover and counterproductive behaviors could be more easily understood if employee motivation is carefully researched, explained and categorized. Also, if a manager is well aware of the dynamics of these behaviors he can predict the future performance of their employees’. And by knowing what motivates an employee a manager can not only predict his behavior, but even influence it.

That is why several theories regarding motivation were made. The first step was defining motivation (Jex, 2002, pp. 209-210) as it was clear that it is a hypothetical construct as we do not see, nor feel motivation. We can observe its effects.  The motivation determines the form, direction, intensity and duration of a work-related behavior. The motivation theories that emerged in time had as point of origin different aspects of this behavior and were based on needs that were satisfied, content of the jobs or principles of learning.

One of the theories of motivation that is based on the needs of the employee belongs to Maslow and it is known as the Need Hierarchy.  Despite the facts that Maslow’s theory is constructed mainly on clinical observations rather than empirical research and that his goal was to create a “universal” theory that could explain human behavior, his work is very appreciated in the field of organizational psychology. 

The Need Hierarchy consists of five levels and at the first of them, situated at the bottom is psychological needs. Maslow identifies in this category needs required for human existence like food, water, and oxygen. This needs are placed at the bottom of the hierarchy because they are capable of influencing the behavior only when their unsatisfied. After the psychological needs are satisfied, a person rises to a next level of the hierarchy: safety needs. Maslow considers that shelter against elements and predators are needs to be categorized as part of this level. We could develop further and say that a house in a safe neighborhood for him and his family and a guarantee retirement income are safety needs or an employee.

If the safety needs are met, the next level to influence behavior at the workplace is love needs. This level of Marlow’s Need Hierarchy represents the desire to have a meaningful social relationship and to develop and feel a sense of belonging. This affiliation with coworkers that could generate strong social ties may play an important part in overcoming negative aspects in the work environment.

The fourth level of needs is the esteem needs understood as the desire to feel competence and mastery at the workplace by being efficient and achieving the goals. The last level of needs as theorized by Marlow in his Needs Hierarchy is the self-actualization. This level can be reached every time an employee achieves his best potential and that is why self-actualization is very rarely met and hard to define as it is different for each person.

Though nowadays it is considered that Marlow’s theory is unable to predict very well future work behavior, the hierarchy is still seen as a remarkable insight on general motivational factors in humans’ lives (Jex, 2002, pp. 211-212).

The theories regarding motivation can be focused not only on needs but also on job satisfaction. Frederick Herzberg analyzed the job factors that motivates an employee and constructed a two-dimensional paradigm to explain them. The theory is known as Herzberg’s Two Factor Theory (Motivation-Hygiene Theory).

His research makes a difference between hygiene factors and motivators. He states that factors as company policies, interpersonal relations, supervisions, working conditions and salary must be understood as hygiene factors. The fulfillment of all of them by the manager does not increase motivation. According to Herzberg’s theory unsatisfying hygiene factors can create job dissatisfaction and therefore decrease job performance and affect the entire management of the company. 

Herzberg established through his theory that motivators were important elements that enriched an employee and found five factors that could lead to job satisfaction: company policies, interpersonal relations, supervisions, working condition. Also, Herzberg’s theory associates hygiene factors (dissatisfaction) with short-term changes in job performance and motivators (satisfaction) with long-term positive effects on the employee in all aspects regarding the workplace. Although it has a certain lack of empirical support (how to build these motivators or the assumption that all the employees want the same things), Herzberg’s Two Factors Theory was one of the first studies in organizational psychology that focused on job content (Jex, 2002, pp. 214-216).

The ability that humans have to make predictions regarding the future and act accordingly to them has led to another theory about motivation. The theory concerns the cognitive process that allows the employees to willingly direct their efforts in certain aspects of the job. The theory belongs to Victor Vroom and it is known as the Expectancy Theory.  According to Vroom’s theory, an employee will take into consideration all the possible outcomes that are associated with all performance levels and choose to pursue those that could generate the most favorable outcome. The key elements to his theory are Expectancy (E), Instrumentality (I), and Valence (V) each of them representing a belief. Expectancy is understood as the assessment of the attainability of a certain level of performance on the job (determined by the confidence in his own skills, the support required and expected or quality of the equipment and materials used to attain the high level of performance).

Instrumentality is the belief that one outcome is linked to another, in other words, high job performance is linked with a certain reward.  The term valence represents the emotional orientation of an employee regarding outcomes (rewards). Employees will elect levels of job performance that meet these requirements, no motivation could be force on them if the above mentioned conditions do not hold: they do not have the belief that he/she will be able to perform successfully and the task done will not be associated with positive outcomes, therefore having no value for the employee (Jex, 2002, pp. 226-229).

Motivation after the Financial Crisis

These times we are facing today are difficult for all the countries because layouts and cutbacks are ravaging social life as it can be seen better in Greece through the Troika E.U. program for measures to adjust the financial crisis; a program that led to the transformation of all aspects of work process and faced constant and numerous social strikes (Nikolas, 2012). Having these realities as a background certain questions rise and demand an answer, as to the possibility of performing a job just because we like it. The main question here is whether people can afford doing what they like, or if they are forced to do something else, for a better salary. At this level a real strategy regarding motivation is required, so that management can keep employees willing to work.

Managers should make employees feel their efforts are needed and understand what they must do for the main goals of the company to be obtained. The employees could be empowered to use all their skills wherever they may be needed and this process might produce higher motivation. This action will also increase communication and inter-departmental synchronicity. A good leader should maintain the balance and point out all the moments of achievement with praise, acknowledgement and even rewards. A very good example for our study is the pool done in 2010 by Professor Denis Jelacic from the University of Zagreb on 14 companies involved in wood industry regarding employee motivation (Jelacic, 2011)

 His conclusions were that providing for security and taking care of the relationship between employees are the most important goals of the companies for motivating their employees. Professor Jelacic suggested that managers should use rewards and praise and also include the employees into resolving the problems of the company.

Research questions

  1. Can people still perform a job just because they love it?
  2. How can managers keep employees motivated in times of financial difficulties?
  3. How can companies apply motivational theories in the current economic context?

Conclusion

The financial and economic crisis from the last four years led to a series of transformation in all aspects of social life. Job environment was also affected as numerous jobs were lost and the insecurity at the workplaces increased significantly among the employees affecting their motivation and their performance. Several strategies were made according to motivation theories (Marlow’s Need Hierarchy based on the needs of the employee, Herzberg’s Two Factors Theory developed on job content and Vroom’s Expectancy Theory that focuses on the beliefs of the employee regarding the outcome of his actions at the workplace). All this studies reflected that in times of crisis managers should pay more attention to safety factors (working condition and salary, for example), strengthen the relation between employees and make use of praise and reward when the conditions are met in order to increase the motivation and the job performance.

Part B

What is motivation at work like nowadays, when the world is facing economic difficulties?

1.0 Abstract

The aim of this research study is to offer a critical view upon the motivation and job performance of employees in the present day, given the difficult financial conditions and the scars that the recent economic crisis has left on all markets. In order to achieve that aim, an exploratory research approach will be used. In the following lines, after explaining the main issues that arise from the topic, as well as the objectives and a summary of the research questions, the research methodology used in this research will be presented, along with the implications of such methods used, data collection methods and ethical considerations. The research methodology is important, as it represents the means to achieve the aim of the thesis. In addition, ethics is crucial, as unethical collection methods may lead to the invalidity of the data and of the study itself.

2.0 Description

It is commonly agreed by specialists that motivation is the act done by stimulating a person or oneself in order to obtain a certain result or reaction. For this to be achieved, the complex features of motivation must be analyzed and understood.  Motivation is a continuous process, usually generated by managers that always have a goal and that should not be confused with job satisfaction. Over the last century many theories have been made in order to explain the process of motivation with the final goal of helping managers to create strategies to maintain the level of performance of the employees and even predict their future behavior at the work place. 

Motivation is the expression of the human condition always being described by a set of motives - needs, interests, intentions, trends, ideals - that support the achievement of certain actions, deeds, attitudes, and it is a fundamental law in psychology.
Derived from the Latin word "movere" (movement, to move), motivation is an inner state that energizes, activates or moves an individual, channeling or directing his behavior towards a goal or an objective. A motive or need was described by psychologists as an anxiety, a sense of lack or a strong desire or force. Once under the rule of the need, a human being will do something, anything to reduce anxiety, to eliminate the sense of lack and desire, or to alleviate or to mitigate the force. The key to understanding motivation and its significance lies within the relationship between needs, impulses and goals (objectives). The figure below describes the motivational process: needs generate impulses to achieve certain goals.

There are no formal means to motivate employees, as each company has its own way to achieve this goal. With confidence, will and understanding regarding the employees’ wishes, desires, needs and goals, the company can create a way to motivate them. Those who are willing to and can perform better on the job must be given incentives, taking into account their desire to satisfy their needs through their work.

One of the most important theories is Maslow’s Need Hierarchy based on the analysis of human needs. Marlow identifies five levels of needs that work as a hierarchy once every level of needs is satisfied: psychological needs (food, water, oxygen), safety needs (shelter, guarantee retirement income), love needs (meaningful social life, a sense of belonging to the workplace), esteem needs ( the desire to feel competence and mastery at the workplace by being efficient and achieving the established goals) and self-actualization needs (different for every employee and hard to achieve it refers to the process of reaching the employee’s best potential). The theories regarding motivation can be focused not only on needs but also on job content as it is the case with Herzberg’s Two Factors Theory. Frederick Herzberg believes that hygienic factors as he named them like company policies, interpersonal relations, supervisions, working conditions and salary can only decrease motivation if they are not satisfied but have no influence in the process of increasing the motivation of the employee or predict his behavior at the workplace.

The factors that are able to do this are the motivators and Herzberg identifies five of them: company policies, interpersonal relations, supervisions and working condition. Herzberg’s Two Factors Theory is the first one who tried to analyze motivation by focusing on job content.

Victor Vroom’s Expectancy Theory is based on the fact that every employee will consider all the outcomes of the levels of performance and choose the ones that will generate the best reward for him. Vroom’s theory has three key elements to understand this process of motivation, each of them representing a belief: Expectancy (the belief of the employee that he/she is able to perform the job), Instrumentality (the belief that links an outcome-the performed job with another outcome-a reward), and Valence (the emotional orientation of an employee regarding the reward). The relation between these key elements dictates and demonstrates the level of motivation at the workplace in Vroom’s opinion.

However, having a financial and economic crisis as the one we are facing nowadays with numerous measures that changed the working environment worldwide and with a great number of job losses, several studies were made concerning the transformation of the workplace and the strategies a manager should use in order to motivate the employees to maintain the same level of performance. These studies demonstrate that Herzberg’s theory could be applied as companies pay more attention to satisfying the need for safety of the employees, which is considered to be of great importance in this time of insecurity. Safety and paycheck (that has an influence on safety) are among the hygienic factors.

Also it is necessary to establish trustworthy relations between employees to motivate them corresponding to elements from Marlow’s and Vroom’s theories. Empowering the employees, using acknowledgements and even rewards when conditions are met will strengthen the confidence of the employee in his work and increase the motivation and the level of performance. 

Research questions

A first question is if we will be able nowadays because of all the measures took to fight the effects of the financial crisis to perform a job based only on the fact that we love to do it? It is of great importance to understand that the crisis led to a real catastrophe regarding job losses and that the companies must develop strategies in order to maintain increased motivation among the employees so that they could perform their job as usual.

A second question focuses on motivation and the entire process that defines and constructs it. We will demonstrate based on several theories how motivation is created and which are the means to increase it so that the levels of performance remain high.

The third question is how in these times of crisis should companies use the theories of motivation to keep their business as usual? We will show that by satisfying safety needs as working conditions and salary and also by making use of praises and rewards managers are able to increase motivation and levels of performance at the workplace.

In order to provide viable answers for all research questions, the research activity should be conducted according to some rules that will be further discussed in the methodology section.

3.0 Methodology

The research methodology is a way to solve the research problem systematically. It deals with defining the problem, the formulation of a hypothesis, methods adopted for data collection and statistics techniques used for analyzing the data, and the logic behind their use. (Saunders 2009).

There are several research methods available to choose from, as reflected in the scheme below:

The present study will be undertaken by the researcher to explore the level of job satisfaction at a chosen company, and highlight the effectiveness of motivational theory in this time of economic difficulties. The researcher will send the survey questionnaire to at least 100 employees of the company to obtain the quantitative data. The quantitative data will then be analyzed and the resulting information can range from simple counts such as the frequency of occurrences of a certain phenomenon, to more complex data such as test scores, prices or rental costs.

To be useful, the data needs to be thoroughly analyzed and interpreted. This process will be assisted by quantitative data analysis techniques. They range from creating simple tables or diagrams that show the frequency of occurrence and using statistics such as indices to enable comparisons, through establishing statistical relationships between variables to complex statistical modeling (Saunders 2009). 

Quantitative data can be divided into two separate groups: categorical data and numerical data. Categorical data is that data that returns values which cannot be measured statistically but can either be classified into various sets or categories, according to the characteristics that identify or describe the variable,  or placed in a ranking order (Saunders 2009). Secondary data is also used to evaluate the previous research and theoretical models.

3.1 Research approach

In this study an explorative research approach is used to assess the job satisfaction of the employee working at a chosen company and to assess the effectiveness of motivational theories to job satisfaction in the context of the harsh economic times in the present day.

The exploratory approach is explained in this context and it is supported by Nieswiadomy (2008). It is depicted as a method used in case the knowledge of a certain topic is very limited. Additionally, this research type is used as a descriptive approach, which is also best suited when the information upon a certain topic or issue is scarce. Bickman and Rog (1998) support this method, stating that the descriptive approach is used, as quoted, “when the researcher is attempting to answer ‘what is’ or ‘what was’ questions” (as cited in Bickman and Rog, 1998, p.15). The descriptive research method has certain limitations, as it can not be used in the identification of a cause and effect relationship, but it plays a crucial role in highlighting an interesting phenomenon.

Secondary research is very often the basis of exploratory research. The researcher may review available literature and data from previous research studies, or can pursue various qualitative approaches, such as individual discussions with managers, employees, customers, competitors and other key players involved in a company. Additionally, the researcher may pursue a more formal approach, doing in depth interviews, case studies, pilot studies, or focus groups. Additionally, exploratory research is not typically generalizable to the population at large.

3.2 Research design  

A descriptive research design will be adopted for the present study so as to assess the job satisfaction of the employee and the effectiveness of motivational theories. The strategy used for obtaining the primary data necessary for the analysis is the survey.

In a descriptive survey design is used to obtain data from the selected sample. The survey strategy is usually associated with the deductive approach. Surveys are very popular and they are commonly used in management researches. It is most frequently used to answer who, what, where, how much and how many questions. It therefore tends to be used for exploratory and descriptive research. Surveys are popular, because they permit the collection of a huge amount of data from a significantly numerous population, in an extremely economical way.

 Surveys are conducted usually through a questionnaire administered to a sample. After the data is collected, it is standardized, to allow the researcher to interpret and compare it easier. In addition, the survey strategy is perceived as convincing by the general academic society, and it is both easy to explain and to understand, comparatively. On a daily basis, a news bulletin or a newspaper reports the results of a new survey that indicates, for example, that a certain percentage of the population thinks or behaves in a particular way, attempting to explain why this happens (Saunders 2009).

The survey strategy allows collecting quantitative data which can be analyzed quantitatively using descriptive and inferential statistics. In addition, the data collected using a survey strategy can be used to suggest possible reasons for particular relationships between variables and to produce models of these relationships.

3.3 Sample and Data Collection Methods

The research will use various statistical methods to analyse the collected data. The questionnaire will first start with development of frequency tables & charts. The relationship between different variables will be evaluated by using the Pearson Correlation method. This method has been recommended by Yin (2009) as it helps to analyse the positive or negative relation or no relation if r = 0. The researcher is also planning to use Chi-Square Test to verify the hypothesis. Moreover the research will use deductive approach in the research where the collected data will be analysed and the results will be deduced.

4.0 Ethics

The researcher has no intentions to affect the brand image of the company and no critical data would be shared with any third party. All the respondents have been given an ethical consent form and they can leave the study at any point if they are not comfortable. No discrimination has been done on the basis of ethnicity, belief or sexual orientation or colour of skin. However, it was made sure that the respondents know English and are over 18 years of age, due to the nature of the study.

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