Operational Motivation

Operational Motivation Plan

An operational motivation plan will provide a structured driving force for employees to accomplish agreed-upon goals aligned with corporate objectives as set by senior management. The technique proposed is management by objective (MBO), a proven motivational method for employment in a business organization. The incentive element of the MBO program will be to utilize bonus payments to employees that accomplish goals.

Roles and Functions

Senior management of the firm must be committed to the operational motivation plan in order to support success. Robbins (2001) shows one reason that plans such as MBO fail is “lack of top-management commitment” (p. 191). If the MBO program is implemented and not supported wholeheartedly the impact to the firm could be extremely negative from the employee perspective.

Managers within the firm must commit to the first-line management of the MBO program. The execution of the program rests firmly with manager/employee goal setting, tracking, and feedback. The manager is the critical component to establish and supervise the program. Training for managers may be necessary to implement MBO.

The human resources department will be responsible for the overall administration and tracking of the MBO program. This will provide the organizational element necessary for successful implementation and ongoing support. Involvement of the finance department will also be necessary to execute bonus payments. However this will also be coordinated through the human resources department. Policies and procedures will be created to present guidance for managers and employees.

Benefits to the Firm

Through the use of a good MBO program the firm will see increased productivity on the part of the employees. The interactive involvement of employees in MBO goal setting assists to gain a higher output in terms of performance. Robbins (2001) illustrates “the major benefit to using participation, however, is that it appears to induce individuals to establish more difficult goals ” (p. 191). Interaction in the MBO goal setting has been noted as important but the feedback from managers to employees also has a link to output. Robbins (2001) expands on the potential benefit ...

This is a preview of the whole essay

Benefits to the Firm

As noted in several sections of this paper the overall benefits for the organization will include: increased productivity, more focused employees, improved attainment of goals, employee interaction with corporate goals, concrete progress reporting, and support for annual performance reports.

Management by Objective

The MBO technique proposed for motivation of employees typically includes four elements as noted by Robbins (2001) and these include “goal specificity, participative decision making, an explicit time period, and performance feedback” (p. 190). The firm’s MBO program will address those four areas:

Specific Goals;
Interactive Decision Making;
Set Time Period, and
Employee Feedback

Each of these areas will be covered in sections of this paper.

Specific Goals

The first element in the MBO program is to set goals for employee target. These should be distinct and measurable. Each employee must have at least four major goals in the rating period. One goal must be training or self-development oriented.

Managers should not set easily attainable goals just to be viewed as a “good” manager by their employees. Robbins (2001) notes that goal setting theory demonstrates “hard goals result in a higher level of individual performance than do easy goals” (p. 190). Also, Robbins (2001) explains “specific hard goals result in higher levels of performance than no goals at all or generalized goals” (p. 190). Therefore goals set by managers in coordination with employee’s input should be specific and not easy. However the goals should also be realistic. Robbins (2001) agrees noting that “MBO implies that goals must be perceived as feasible” (p. 190).

Employees will attain high achievements if they are motivated due to MBO. Rather than work on timelines not linked to any finite objective the employee will be oriented on these specific goals. A technique to be used as part of the program will include goal setting to push and possibly exceed the usual performance levels of the employees. Robbins (2001) explains that MBO “is most effective when the goals are difficult enough to require stretching” (p. 191).

A process will be established to change goals if required for various reasons. For instance the firm could decide to move in a new strategic direction. Or a new project may be instituted that requires the attention of certain employees and/or teams. That will require a change of goals for those individuals involved. It would certainly not be fair to evaluate the MBO goals of an employee whose objectives had changed per direction from their manager.

Interactive Decision Making

The second element of the MBO program is to get input from employees into goal setting. This will make certain that employee’s have “buy-in” to the goals as agreed upon with management. Robbins (2001) explains, “the manager and employee jointly choose the goals and agree on how they will be measured” (p. 190). This participative decision-making is key to the MBO program.

Managers will meet with employees to set initial draft MBO goals. Senior management to ensure alignment with corporate objectives will review draft goals. Moreover, prior to meeting with employees the managers will have received input from senior management in order to gain insight into the current strategy of the firm. Projects and resulting objectives will be oriented on important company initiatives. As the program progresses the employees will be able to make a more direct link to company goals without as much specific direction.

Set Time Period

The third element in the MBO program is to set a specific time period for completion of the employee goals. As part of a typical MBO program Robbins (2001) notes, “each objective has a specific time period in which it is to be completed” (p. 190). For the purposes of the firm’s MBO program this time period will be one quarter. Additionally this quarterly time period is linked to a review of the goals.

The accomplishment of reviews at the end of the quarter is important. Speed for setting quarterly goals and then for review is imperative. Moreover, bonus payments for the previous quarter will be made at the end of the first month following the end of the quarter under evaluation. Bonus payments should be consistently paid at that time period in order to retain employee satisfaction with the program. In no case should employees receive a bonus payment without first being informed of MBO rating by their manager.

Employee Feedback

The fourth and final element in the MBO program is to ensure that feedback is provided to the employees with set objectives. Managers will provide feedback as a continuous process and not just confined to the beginning and end of the quarterly time period. Managers should ensure they meet with employees throughout the quarter. Robbins (2001) supports the need for feedback noting, “feedback on one’s performance leads to higher performance” (p. 190). Formal MBO reviews at least monthly are required in written form with informal reviews as desired but with a suggested weekly tracking.

Quarterly feedback from managers will become the final evaluation of MBO achievement for each employee. Objective ratings based on a scale of one to ten will be set for the employee. This will have a direct related link to percentage of payments at ten percent per rating; a rating of nine would result in a ninety-percent of bonus payment. Quarterly the bonus payment to any employee will be a maximum of five percent of their annual salary. The first executive in the organization will approve the manager rating for each employee. Executives will rate managers per existing performance review reporting standards. Executives will receive bonus payments using the current board of director input system.