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  • Expectancy Model of Motivation

    In the last byte, we looked at some of the extensions of equity theory. In today’s byte we begin the discussion on Expectancy Model of Motivation.

    While the equity theory focused on the social exchange process; the expectancy theory as the name suggests is based on the perception of individuals and how it acts as a motivation in the work environment.

    The theory of Expectancy was proposed by Vroom and the basic outline includes the understanding that individuals desire certain outcomes of behavior and performance (similar to rewards and consequences of behavior) and that they believe that there is a relationship between the effort they put in and the performance they achieve and the outcomes they receive.

    To understand this further it would be useful to understand the 3 important terms that are used in this theory:

    • Valance:  It is the value or importance that an individual places on a particular reward
    • Expectancy: It is the belief that effort leads to performance
    • Instrumentality: It is the belief that performance is related to rewards.
    We shall continue the discussion in the next byte.

  • Adam’s Theory of Inequity 4

    In the last byte, we looked at some classifications based on the equity expectations of the people. In today’s byte, we look at some extensions of the equity theory.

    The research on equity from the organizational justice has a pretty long history, and has some interesting insight about how an individual’s organizational position influences the self-imposed performance expectation. Following briefly summarizes it:
    It has been observed that when an individual moves two-levels up in the organizational hierarchy with no increase in pay, he/she creates a higher self-imposed performance expectation than a one-level move up with modest increase in pay! Similarly, a two-level demotion in the organization hierarchy with no reduction in pay creates a lower self-imposed performance expectation compared to a one level demotion with a modest decrease in pay!
    This clearly indicates that organizational position is considered more important than pay in determining the level of person’s performance expectations.

    In extreme cases unintended consequences of such inequity and organizational injustice could be manifested in a dysfunctional behavior. Examples of such behavior are aggressive reactions or other forms of violent and deviant behavior that harm both their colleagues and organization. The fortunate piece of the story is that there are very few such instances.

  • Co-founder selection

    An entrepreneur when starting off his venture typically tries to on-board a co-founder, and the most co-founders are friends. On-boarding a co-founder is an interesting junction in the start-up’s journey. Here are possible benefits and drawback one would need to think of in choosing co-founders:

    Clear Benefits:
    Having a co-founder is an indication that the
    ideator has been “sold” the
    idea to someone other than himself/herself, and that someone has joined the pursuit – this is an interesting signal to the outside world (primarily investors & employees). Resource pooling clearly emerges out as a very tangible benefit from such an approach – thereby de-risking to a limited extent.  
    – “I am not alone believing in an idea!“

    Teams enable the entrepreneur pool in some essential “factors of production”, in the classical terminology – land, labor, capital. Definitely, this process has added resources as a result of accumulation from more than one of the founders. In the contemporary world we could possibly look at some more dimensions to the classical factors – network, intellectual capital etc. 
    – “I am possibly better off!” 

    For start-ups, whose first challenge is survival this means: on-boarding a stakeholder would enhance the survivability of a start up; a greater breather space, and potentially a greater growth prospect. 
    – “I survive to fight another day!“
    The
    benefit is not just in terms of physical resources the idea sounding, check and balance mechanism, emotional support etc are all packaged into this. 
    Other implications:
     
    In
    addition to selling the concept of idea, the ideator is also responsible for the firm that gets formed. In many ways the identities
    of the two – the firm and the founder overlap when one starts off. However, realizing that
    these two could be separate over a longer period is important – the
    founder mindful of the distinguishing between the firm and the
    founder, the founder would need to make a decision that is beneficial
    for the firm which could continue perpetually. The co-founder decision one makes
    should be thought out in this light, and with the benefits to the firm be predominantly greater than the personal needs of the founder. Ask the question:
    – “Would the person be the right fit for the firm?”

    The
    ideator when on-boarding a co-founder would also have to note that the
    initial idea could also undergo a change. In addition to accessing new
    resources (means) there are new goals that the firm would need to adjust
    itself to. Ask yourself:
    – “Am I willing to change he goal? will the joint effort of the co-founders make the firm better off?“
    Many
    of the co-founders shared personal friendships – this could potentially
    be the source of the on-boarding, rather than the idea.  We are all
    emotional being, and encouraging friends in their entrepreneurial
    pursuit could be but a logical extension of the friendship. The ideator
    would benefit from reflecting on what each individual in his network
    could get to the table and relate it how the potential exploration could
    be helped by the individual.     Ask yourself:
    – “Is it the idea or is it my relationship alone?”
    Few words of caution in selecting friends co-founders:

    If the common interest is not the idea, and only limited to the social relationship – the firm wouldn’t benefit as much from from such an alignment of the founders. An obligation cannot be the source to a long term commitment; periodic incentivization is needed for one to sustain such a relationship.
     
    Last but not the least, co-founder conflicts are extremely common. There are many who do go to the extreme step of saying – be ready to loose friendship if you want to get into a partnership for venturing out into a business. Distinguishing what would form the professional space and what the personal space is important – this ability to separate the issue from the actor would be extremely helpful for founder.

    The call to add on a co-founder is one that could have significant implications on the firm and the ideator. So think through before you on-board your co-foudners.

  • The Last Lecture – Randy Pausch



    For those of you who haven’t heard “The Last Lecture” by Prof Randy Pausch, do watch the above video before reading my review here. That would almost be akin to reading most of the book. Here is his page on Carnegie Mellon Website.

    While most of the points disccussed in the lecture are extended into deeper discussion in the book, but it goes beyond these points in the presentation to give us a closer look into his life. 

    In addition to the philosophical aspect what is mentioned in the book, there are many practical take away that an individual reader like me could take. Quite a few points if I wear my teacher’s hat – could be how he used peer feedback to give hard individual feedback or the excitement and thrill of being able to help many realize their dreams. 


    The emphasis of team in learning is an interesting dimension in the complete learning process. This is an important aspect to look into in the field of education. I loved the concept of “headfakes”, and was thinking of using a few in my sessions going ahead. I feel it is extremely handy!Another point I loved was the emphasis he gave on failures – “the first penguin” which helped get the motivation going. 


    My take: Read the book! Its worth it.

  • Prioritize Stakeholder Acquisition

    I wrote this blog to highlight a best practice
    approach in starting off and tried rationalizing it. It also answers the question as
    to why dealing with the customer as stakeholders of business before any
    other stakeholder would be a good idea.



  • Prioritizing Stakeholders for your start-up to reduce uncertainty

    Murphy’s Law seems to follow entrepreneurs more than anyone else – Yes! anything you believe wouldn’t happen, will most possibly happen. So the challenge is really of being able to live through all these experiences and eventually be able to get the business they intend to create see the light of the day. 

    The notion of such unpredictability in what one does is generally called – uncertainty. There is really nothing certain about the entity that entrepreneurs are trying to create. They have a thought about the need for something they believe would be required by someone… Yes! It is only a thought when it starts like many other thoughts! The entrepreneur chases the thought and attempts to create value – economic, social etc out of the thought by manifesting the thought into the realm or reality.

    In the process there are numerous challenges that come in – beginning with the thought – the entrepreneur would need to really see if the intended product/service is something that would be found valuable and useful for people. The second question is really to see if someone could pay for the same! I have mentioned multiple times about the need for early customer engagement in earlier blogs [read here and here]

    The maximum uncertainty would definitely be on the customer‘s end of the chain. The thought that the entrepreneur would have initiated invariably would have come from his/her prior experience/ability/capacity – essentially – the response to the questions: who am I? What do I know? Whom do I know? She/he would also have attempted evaluating what would it take to create something of value and how someone could and then figure out a way to reach out to the person who could not just use but also pay for the same. 

    This mean the maximum uncertainty for a business is not on the customer‘s side of activities and would progressively reduce in the following order – investors, suppliers and employees. The following diagram indicates the same:
     
    High Uncertainty                                                     Least Uncertainty
    Customer    >    Investor      >    Supplier       >        Employee
    The uncertainty in the above context could be understood as containing two components – the predictability of the behavior of each of the stakeholder and second, the effective control on that the entrepreneur could have on the behavior of each of these. We could visualize the spectrum of predictability and controllability to be as below.

    Least Predictability                                              Most Predictability
    Customer    >    Investor      >    Supplier      >        Employee 
    Least Controllability                                             Most Controllability
    Customer    <    Investor      <    Supplier      <        Employee

    An effective approach for an entrepreneur to be able to leverage and grow his/her business would be to reduce the zone of maximum uncertainty and steadily build the other stakeholders commitments to effectively handle the reduced uncertainty. 
    (click on the stakeholder link to be directed to some best practises in finding a better stakeholder)

  • Adam’s Theory of Inequity 3

    In the last byte, we looked at the various strategies one could adopt to handle a situation of inequity in an organization. In today’s byte, we look at some extensions to the equity theory.     

    If we really look at the theory that we have been discussed, it was really inequity that we were setting as the subject matter and not equity itself. As research has progresses, certain revisions have been suggested to this basic equity theory. One such interesting approach has been suggested by classifying individuals based on their preference for equity. These are:

    1. Equity Sensitive
    2. Benevolent
    3. Entitled
    Equity Sensitive people are those individuals who prefer an equity ratio equal to that of his or her comparison other. This sensitivity has a great bearing on the way people spend their free time – it would define whether they would invest the time into the work or do something else.

    Benevolent refers to those individuals who are comfortable with an equity ratio lesser than that of their comparison other. The Entitled on the other hand are people who are comfortable with equity ratio greater than that of their comparison others. The Entitled behavior is generally observed in the younger generation of the affluent families. If we were to call Benevolent as givers, the Entitled could be called as takers.

    We could remember the above using the following diagram.

  • Adam’s Theory of Inequity 2

    In the last byte, we looked at Adam’s theory of Inequity and mentioned that we could continue the discussion in today’s byte.

    When in a situation of inequity, and individual could find one of the seven strategies listed below:

    1. Alter the person’s outcomes
    2. Alter the person’s inputs
    3. Alter the comparison other’s outcomes
    4. Alter the comparison other’s inputs
    5. Change who is used as a comparison other
    6. Rationalize the inequity
    7. Leave the organizational situation
    Within these strategies, a large number of tactics could be tried out. Each tactic comes with its own pros and cons. The selection of a strategy and a set of tactics is a sensitive issue with possible long-term implications. It is essential to consider the consequences when one chooses a strategy and a tactic to handle the inequity.

    Research has indicated that those people who feel that their compensations are equitable have displayed greater job satisfaction and organizational commitment. Thus a lot of the equity theory helps explain important organizational behavior. This theory could also be extended to manage important labor relationships.

  • Adam’s Theory of Inequity

    In the last byte, we looked at demand and contributions as part of social equity theory. In today’s byte, we look at Adam’s theory of inequity.

    Sometimes one finds oneself unmotivated and angry about the compensation/hike that was granted by the organization one worked for.

    If one were to reflect on what could have lead to this discomforting feeling and we map it on to the equity theory, we realize we could develop a output-input ratio based on the expectations and their fulfillment.

    Let us begin by defining an important concept that would follow this ratio that we have just mentioned – Inequity

    Inequity – is a situation in which a person perceives he or she is receiving less that he or she is giving, or is giving less than he or she is receiving.

    Looking back the situation described earlier, a person would examine the contribution portion of the exchange relationship – the individual considers their input (own contribution) in the relationship and their outcomes (the organization’s contribution) in the relationship. We could summarize this in the following diagram:

    In essence, inequity leads to the experience of tension, and the tension motivates people to act in a manner to resolve the inequity – this was proposed by Stacy Adams.

  • Demands and Contributions

    Continuing from the last byte where we continued discussion on Demands and Contributions, we shall look at these in today’s byte too. We shall refer to the diagram in the earlier byte at various points to gain clarity.

    Demands are expectations that parties have on the others in the relationship. Each party in the exchange makes a demand on the other. Organizations express its demands on the individual in the form of goal or mission statements, or job expectation or performance objectives and performance feedback. It is through these formal mechanisms through which people learn about the organization’s demands and expectations.

    Individuals to possess needs that need to be satisfied (we could look back at earlier theories discussed to understand this in greater detail). It is these needs that form the basis of the expectations or demands placed on organization by the individual. It has been found that employees need fulfillment and the feeling of belongingness are both essential to a healthy exchange and have the feeling of organizational membership.

    As the other side of the coin – every demand comes in with some form of contribution. Each party to the exchange makes demands on the other; each also has contributions to make to the relationship.  The demands expressed are satisfied through the contributions made to the relationship. Employees satisfy the organization’s demands using their skills, abilities, knowledge, energy, networks etc. Organization’s contribution in the relation would be in the form of salary, security, benefits, promotions, status, social affiliations etc.

    The question of fairness still remains when we look at this sort of an exchange.