BUSI 504 Week 5 Discussion Board Forum 3 Example

Discussion Board Forum 3: Reward Systems and Reinforcing New Behaviors

BUSI 504 Leading Organizational Change, Discussion Board Forum 3 Thread and Replies

Thread by [Student Name]

The choice of term and the three classmates are composites; the textbook, the research articles and the Scripture cited are real, and the requirements follow Liberty's public course guide for BUSI 504.

Thread

Spector (2013) argues that new behaviors fade unless the organization reinforces them, and that the reward system, what the organization pays for, promotes and praises, is the most powerful reinforcer it has. My term is reward systems as reinforcement, and my thesis is that rewards should be redesigned during a change, but carefully, because they can just as easily undo it.

Kerr (1975) named the problem in a famous article: organizations often pay for one behavior and are then surprised that a different one never appears. Among his illustrations were universities that hoped for good teaching but rewarded research, and organizations that hoped for teamwork but rewarded individual performance. In a change effort, the danger is that leaders announce new behaviors while the old reward system keeps paying for the old ones, and employees, reasonably, follow the money. Kerr's point was not that employees are cynical. It was that they read the reward system as the organization's real statement of priorities, and that a speech cannot outweigh a paycheck, a promotion list or a ranking posted every month.

The evidence shows that reinforcement works when it is tied to the right behavior. Stajkovic and Luthans (1997) combined studies of organizational behavior modification, programs that identify specific behaviors and reinforce them with feedback, recognition or money, and found an average improvement in task performance of about 17 percent, with stronger effects in manufacturing than in service settings. Cerasoli et al. (2014) reviewed forty years of research and found that incentives and intrinsic motivation both predicted performance, but differently: incentives predicted the quantity of performance more strongly, while intrinsic motivation better predicted its quality, and intrinsic motivation mattered less when incentives were directly tied to performance.

The practical lesson is to change rewards late enough that they confirm behavior people have begun to value, and early enough that the old rewards do not keep pulling them back. A hospital that asks nurses to collaborate on discharge planning while still ranking them individually on patient throughput will get throughput. If it waits too long to change the measure, the new behavior will never take root. If it changes the measure too early, before nurses understand why collaboration matters, it risks turning a professional practice into one more box to check.

Scripture describes a master who rewarded exactly what he asked for. When Jesus told of a master who entrusted sums of money to three servants before going away, the two who traded with it and doubled it heard themselves commended as faithful and were placed over much more, while the servant who buried his portion lost even that (English Standard Version Bible, 2001/2016, Matthew 25:14-30). The reward was aligned with the behavior the master valued, and everyone knew it in advance.

Reply to Tyler

Tyler, your thread on selection during change made a strong case that hiring is one of the most underused tools in a change effort. Your point that a redesign often fails because the organization keeps hiring people suited to the old design was well taken.

Schneider (1987) would support your argument with a broader one. His attraction-selection-attrition framework holds that people are attracted to organizations whose members seem similar to them, are selected for fit with the existing culture, and leave if they do not fit, so over time an organization becomes more homogeneous. In his phrase, the people make the place. During a change, that cycle works against leaders: the existing culture keeps attracting and selecting people like those already there, which reinforces the behaviors the change is trying to alter.

That connects your term to mine. Reward systems reinforce behavior among current employees, and selection reinforces it across generations of employees. If a company changes its rewards but not its hiring criteria, the new rewards will be working against a steady inflow of people who fit the old culture. Your example of the software firm that redesigned its teams for collaboration but kept hiring for individual technical brilliance is a good case of that mismatch.

Do you think the firm could have used its new reward criteria as hiring criteria, for example by asking candidates for examples of shared credit and helping others? That would align the two levers, so that the people coming in and the rewards they find both point toward the new behavior. It would also send a signal to current employees, who notice who gets hired as closely as they notice who gets promoted.

Reply to Rachel

Rachel, your thread on layoff survivors described something many of us have seen: the people who keep their jobs after a downsizing are often less committed, not more. Your point that survivors judge the organization by how it treats those who leave was well supported.

Brockner et al. (1987) tested this in a series of studies and found that survivors reacted most negatively when they identified with the laid-off employees and believed those employees had been treated unfairly, for example with little notice or compensation. When the departing employees were seen to have been treated fairly, survivors' commitment and effort held up much better. The findings suggest that the treatment of the people who leave is itself a message to the people who stay.

Trevor and Nyberg (2008) added an important consequence. In a study of companies that downsized, they found that downsizing was followed by higher voluntary turnover among remaining employees, and that HR practices that embedded people in the organization, such as job security provisions and good benefits, weakened that effect. The people most likely to leave are often the most employable, which can strip an organization of the very talent a change depends on.

Your example of the hospital system that cut middle managers and then saw several high-performing nurses resign fits this pattern well. From the standpoint of my thread, layoffs are also a form of reinforcement, since they teach survivors what the organization values. How do you think the hospital could have handled the cuts so that survivors drew the right lesson? Generous notice and outplacement help for the departing managers would have been a start, but I suspect the nurses also needed a clear explanation of who would now support them, since the middle managers had been their link to resources.

Reply to Marcus

Marcus, your thread on training during change was helpful, especially your point that organizations often train people in new skills and then return them to unchanged jobs. You argued that training alone rarely produces lasting change, and the research backs you up.

Blume et al. (2010) conducted a meta-analysis of training transfer, the extent to which skills learned in training are actually used on the job. They found that transfer depended not only on the trainees' ability and motivation but also on the work environment, above all whether supervisors and coworkers backed the use of new skills, and that transfer was stronger for open skills, such as leadership, when the environment supported their use. Training delivered into an environment that does not support the new behavior tends to fade.

That finding links your term directly to mine. The work environment includes the reward system. If employees learn a new customer-service approach in training but are still measured on call length, the reward system will undo the training within weeks. Kerr (1975) would recognize the pattern: the organization hopes for the trained behavior and rewards the old one.

Your example of the insurance company that trained claims adjusters in empathy and then kept a strict quota on calls per hour illustrates this exactly. Did the company ever change the quota, or did the training simply fade? I would be interested to know whether any supervisors protected their teams from the quota, since that would show how much supervisors can influence transfer even when the formal system works against it. If some did, their teams might be the best place to start a pilot of a revised measure.

References

Blume, B. D., Ford, J. K., Baldwin, T. T., & Huang, J. L. (2010). Transfer of training: A meta-analytic review. Journal of Management, 36(4), 1065-1105. https://doi.org/10.1177/0149206309352880

Brockner, J., Grover, S., Reed, T. F., DeWitt, R. L., & O'Malley, M. (1987). Survivors' reactions to layoffs: We get by with a little help for our friends. Administrative Science Quarterly, 32(4), 526-541. https://doi.org/10.2307/2392882

Cerasoli, C. P., Nicklin, J. M., & Ford, M. T. (2014). Intrinsic motivation and extrinsic incentives jointly predict performance: A 40-year meta-analysis. Psychological Bulletin, 140(4), 980-1008. https://doi.org/10.1037/a0035661

English Standard Version Bible. (2016). Crossway. (Original work published 2001)

Kerr, S. (1975). On the folly of rewarding A, while hoping for B. Academy of Management Journal, 18(4), 769-783. https://doi.org/10.5465/255378

Schneider, B. (1987). The people make the place. Personnel Psychology, 40(3), 437-453. https://doi.org/10.1111/j.1744-6570.1987.tb00609.x

Spector, B. (2013). Implementing organizational change: Theory into practice (3rd ed.). Pearson.

Stajkovic, A. D., & Luthans, F. (1997). A meta-analysis of the effects of organizational behavior modification on task performance, 1975-95. Academy of Management Journal, 40(5), 1122-1149. https://doi.org/10.2307/256929

Trevor, C. O., & Nyberg, A. J. (2008). Keeping your headcount when all about you are losing theirs: Downsizing, voluntary turnover rates, and the moderating role of HR practices. Academy of Management Journal, 51(2), 259-276. https://doi.org/10.5465/amj.2008.31767250