Okwaho walked up the path to a small, tidy home on his First Nations urban reserve and reluctantly knocked on the door. Chances were the community had already relayed the bad news while he’d been at the hospital but regardless he felt a moral obligation to face Joseph’s mother directly and explain the accident. Joseph was a nineteen year-old who worked for Okwaho as a roofer. He had been hired three months previously. It had been his first fulltime job. Now, after Joseph’s terrible fall today resulting in a badly broken arm, it was unclear whether he would ever regain enough mobility to be able to work as a roofer again. Okwaho did not have to wait long on the porch. Within moments Joseph’s mother answered and his heart fell. He could see by her red-rimmed eyes and wet face that she had been crying. She knew about the accident already. Other family members quickly crowded around her supportively, looking at him. Okwaho had trouble meeting their eyes. He felt like he’d failed them, his new employee, and their entire community. “May I come in”, he asked gently despite his trepidation. The door open further and he went into the warm home trying to find some way to explain what had happened.
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Later, at the office, Okwaho looked over this latest accident report and sighed to himself. He knew it looked bad. Especially given their other safety issues recently. People might think he was an irresponsible business owner but Okwaho had provided detailed safety training and the needed harnesses and other personal protective equipment were always available on job sites. He just couldn’t understand it. Joseph was a good kid who paid close attention to instructions. Why hadn’t he been harnessed in properly? Okwaho felt terrible for the Joseph and his family but he was also worried about his ability to staff up-coming jobs. The injured worker would be away for an indefinite period. This was the third significant accident in five months and it was simply unacceptable. Something was going very wrong with his roofing work teams. He would need to fix it before more people got hurt, but how?
Okwaho owned and managed a small roofing company in Southwestern Ontario. He had nineteen fulltime workers, sixteen of whom did roofing work and three of whom were involved in activities such as sales, marketing, scheduling, book-keeping, and administration. Among the roofers, five people had more than five years of experience each and were highly skilled and able to lead teams. The remaining eleven were less experienced. They took instructions from the senior members of the team on each project. Of those eleven, four were extremely new, having working in roofing for less than a year. Okwaho considered that group of four, none of whom were over age twenty-one, to be “the kids”. When he received a new job Okwaho would select the employees with the right skills (some roofing jobs were more difficult or technically complex than others), and then he would create a self-managed project team. The team, which could have anywhere from 3 to 8 people, would work together until the project was complete and then they would move on to the next one. Okwaho tried to balance the teams such that they had adequate supervision and the “kids” were well placed to learn from others with more experience but he also considered individual personalities and personal preferences for commercial versus residential work. Even with those considerations the team composition varied tremendously from one project to the next so people wouldn’t work with exactly the same colleagues from one day or week to the next.
Five months earlier Okwaho had noticed that many of the projects were taking longer than expected. This created scheduling problems as jobs got backlogged. Customers got upset, in particular those whose contracts involved removing entire sections of roof temporarily. Customers doing planned renovations were especially adamant about having all the work done before winter. Nobody wanted roof work performed once the snow began to fly! In fact most of their winter business came as a result of emergency repairs on roofs damaged by winter storms precisely for that reason.
In response to the backlogs Okwaho decided to create a new incentive. Before deciding on a specific bonus he read about expectancy theory and equity theory. It made intuitive sense to him. Expectancy theory simply stated that in order for people to be motivated certain conditions needed to be met. Firstly, people needed to believe that their level of effort was positively related to their performance (basically if they try harder they will do better). Secondly, they needed to believe that effort would lead to rewards. Finally they needed to believe that the rewards on offer would be relevant and valuable to them personally.
Equity theory was similarly straight-forward. It stated that people compare their own efforts and rewards to the efforts and rewards of others. In addition to comparing themselves to others they also compare their effort/reward balance with prior jobs they have had and even their preconceived expectations. Inequity (such as another person needing to work much less hard to earn the same amount) makes people unhappy and prone to slacking off, leaving the organization, or distorting their perceptions of themselves or others. Perceived equity, by contrast, is motivating.
After much thought, Okwaho decided on a team bonus. He would provide each project team with a target completion date (as usual), but now if they met that deadline the entire team would get a cash bonus. If they did not meet the deadline for any reason other than weather delays there was no bonus. If delays were caused by weather they were given an extension that was equivalent to the missed time. The bonus depended on the project size and scope but ranged from $20.00 per team member for modest residential projects requiring only one or two days to $150.00 per person for extremely large corporate projects requiring weeks. The bonus was generally well-received, although several senior employees expressed surprise and dismay that the “kids” would get the same as they would. Regardless the incentive seemed to accomplish its goals. The percentage of projects completed on time increased from 63% to 87% over the five-month period. Okwaho could understand why. The last time he had visited a job site he had noticed the senior roofers hurrying the new kids up to make sure the job got done in time for them all to get a bonus. The new kids had looked tired and harried but they had gotten it done! Unfortunately, they’d had to replace a few shingles during the quality inspection since in their haste they hadn’t been placed quite properly, but it was still done on time.
Initially, Okwaho had been thrilled with the success of his team incentive. He couldn’t help but notice, however, that in the same five month period three workers had been injured. One, Joseph, had fallen off a steep rooftop while trying to get a tool that was just out of reach. The fall should never have happened but he had not been properly harnessed in with a tie-line. Okwaho did not understand how the others on the worksite could have missed that – they were supposed to take responsibility for watching out for the “kids”. Another worker, one with nine months of experience, had cut off two fingers after failing to install the safety guard on a cutting tool. A third worker had been hit in the head when a colleague decided to throw some excess materials off the roof to hasten clean-up. He hadn’t seen his coworker down below and a concussion had resulted. There had even been an unusual driveway incident. One of his employees had hit a parked, riderless child’s bicycle while rushing to deliver some roofing materials to the site. Nobody was hurt and Okwaho had just bought a new bike for the outraged parents of the owner but was oddly careless of the worker nevertheless. It was strange since in the two years before that they had only had one significant accident. Okwaho wondered if there could be any connection between his incentive program and their poor safety record. After some consideration, he realized that he needed to rethink things.
- Evaluate Okwaho’s existing bonus system through the lens of expectancy theory and equity theory. What are the strengths and weaknesses of the incentive plan when viewed through those lenses? (10 marks )
- Do you think the new incentive plan is influencing safety in this workplace? Explain your reasoning by referring to what you’ve learned about motivation, behavior, and incentive plans. (4 marks )
- What types of incentives or initiatives would maximize both efficiency and safety while maintaining a respectful workplace and being reasonably practical/affordable? Be specific. Include information on what the incentives will be based on, how success or failure will be measured, who will get them, how often they will be issued, and any other details. Explain WHY your strategy would be effective by referring to what you’ve learned about motivation, behavior, and incentive plans. (10 marks)