Managing for Competitive Advantage (part 16)

Reinforcing Performance

 by

 Charles Lamson 

Goals are universal motivators. So are the processes of reinforcement described in this section. In 1911, psychologist Edward Thorndike formulated the law of effect: Behavior that is followed by positive consequences probably will be repeated. This powerful law of behavior laid the foundation for countless investigations into the effects of the positive consequences, called reinforcers, that motivate behavior: Organizational behavior modification attempts to influence people's behavior and improve performance, by systematically managing work conditions and the consequences of people's actions.

Four key consequences of behavior either encourage or discourage people's behavior (See Figure 1).

FIGURE 1 The Consequences of Behavior

1. Positive reinforcement---applying a consequence that increases the likelihood that the person will repeat the behavior that led to it. Examples of positive reinforcers include compliments, letters of recommendation, favorable performance evaluations, and pay raises. It is important to remember that feedback and social reinforcers, including recognition for a job well done, are as powerful as monetary reinforcers (Kouzes and Posner, The Leadership Challenge (1987)). 
2. Negative reinforcement---removing or withholding an undesirable consequence. For example, a manager takes an employee (or a school takes a student) off probation because of improved performance.
3. Punishment---administering an aversive consequence. Examples include criticizing or shouting at an employee, assigning an unappealing task, and sending a worker home without pay. Negative reinforcement can involve the threat of punishment, but not delivering it when employees perform satisfactorily. Punishment is the actual delivery of the aversive consequence. Managers use punishment when they think it is warranted or when they believe others expect them to, and they usually concern themselves with following company policy and procedure.
4.  Extinction---withdrawing or failing to provide a reinforcement consequence. When this occurs, motivation is reduced and the behavior is extinguished, or eliminated. Examples include not giving a compliment for a job well done, forgetting to say thanks for a favor, and setting impossible performance goals so that the person never experiences a success.

The first two consequences, positive and negative reinforcement, are positive for the person receiving them---the person either gains something or avoids something negative. Therefore, the person who experiences these consequences will be motivated to behave in the ways that led to the reinforcements. The last two consequences, punishment and extinction, are negative outcomes for the person receiving them: Motivation to repeat the behavior that led to the undesirable results will be reduced. 

Sometimes organizations and managers reinforce the wrong behaviors. Whereas executive stock options were intended to motivate executives to care more about the company's stock price, they have motivated executives to engage in inappropriate behaviors to manipulate the stock price rather than create real value. The company that bases performance reviews on short-term results is reinforcing a short-run perspective in decision-making. At the same time, it is discouraging behaviors that will pay off in the long run.

Managers must identify which kinds of behaviors they reinforce and which they discourage. The reward system has to support the firm's strategic intent, defining performance in terms of the pursuit of strategic objectives. Reward employees for developing themselves in strategically important ways for building new skills that are critical to strengthening core competencies and creating value.

Managers should be creative in their use of reinforcers. Innovative managers use non-monetary rewards, including intellectual challenge, greater responsibility, autonomy, recognition, flexible benefits, and greater influence over decisions. These and other rewards for high-performing employees, when creatively devised and applied, can continue to motivate when pay and promotions are scarce. 

*SOURCE: MANAGEMENT:: THE NEW COMPETITIVE LANDSCAPE, THOMAS S. BATEMAN & SCOTT A. SNELL, PGS. 400-402*

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