Business Management Project: Employee Motivation

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Contemporary managers describe their profession as that of motivating their staff. In earlier times, this motivation was usually in form of whippings, dismissals or payment on tasks done. This eventually resulted in injuries, shoddy or poor quality work, and employee resistance/opposition. The managers then had little management skills and were endorsed on consideration of their authoritarian aptitude rather than on their managerial acumen. Motivation has become recognized as the key to performance improvement among employees. Motivation is defined as the drive to select specific behaviors patterns from the available alternatives. An employee performance in an organization characteristically is predisposed by motivation, employee ability, and the work environment prevailing there.

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My study on the core management problem will be focused on Petrochemical Industries Design and Engineering Company (PIDEC), one of the leading engineering design and consulting companies in the fields of oil, gas and petrochemical industries in Iran. Established in 1985, PIDEC is now a subsidiary of Erection and Construction Company (ECC) started in1989, an offshoot of the National Petrochemical Company of Iran. PIDEC is faced with many challenges due to the dwindling income in face of the global sanctions spearheaded by the United Sates due to the countries nuclear development programme. These sanctions have variously affected many of the countries economic sectors as foreign firms shy away from the country to evade repercussions of doing business with the country. PIDEC an international consulting firm is more affected by the boycott of foreign investment as it was mainly dependent on foreign firms investing in the region. The management in trying to sustain and retain the key staff has decided to engage our firm to motivate the employees and endure the difficult period of declining fortunes faced by the company. The main problems faced by the firm include increased political tensions in the Gulf region as foreign investors fear imminent raid from either Israel or United States in view of the country’s religious secular leadership standoff over nuclear development. This has made foreign investors to postpone future investment projects. Other pediments faced by the firm are the slow pace of privatization in the country’s state industries which are potential clients due to the intrinsic labyrinth experienced in the bureaucracy of the country. The gloomy prospects faced by firms operating in Iran have impacted negatively on PIDEC employees who are no longer optimistic of the energy firm future. This has resulted in less performance by the company’s workers as they continuously weigh their future in the firm. PIDEC has therefore decided to retain human resources experts in efforts to stimulate growth and motivate its employees.

The study will focus on motivation as the key to enhancing employee performance and foster growth in the organization productivity to prevail the difficult financial period faced by the firm. The oil consulting firm has tried all the traditional concepts of performance stimulation higher pay or increments, the ‘carrot and stick’ routine, enhanced job satisfaction, improved work tools and technology etc. The company has also been at the forefront of using the Enhanced Oil Recovery (E.O.R.) programmes at some of the aging oil fields and the privately funded development work under the buy-back contracts to boost growth from the stagnant sectors (Rose and Pearson, 2004). A recent research study in the company however revealed that turnover in terms of key employees was still high, absenteeism, laxity and low targets continued to plague the organization even as management endeavored to improve staff remuneration and other counter measures. The company has therefore decided to hire a professional human resource consultant to do a thorough analysis and establish appropriate steps to be taken to halt the malaise.

Main Body

Although Iran is the world’s second largest exporter of oil products after Saudi Arabia, the country firms are encumbered by numerous challenges in view of the negative perception of the country’s leadership among the global financial players. The insistence of the political leaders to continue the nuclear development programme has led to greater isolation and economic sanctions for Iran. The country however is undergoing reforms aimed at boosting growth among the investors. These include the privatization of the country’s state firms which has been done at a slow pace especially in the electrical sector but more vigorous in the oil industry based firms. PIDEC which relies on doing project management, on-site supervision of engineering firms, construction through its technical expertise and expert execution is faced by adverse financial challenges as it tries to sustain growth as many of the potential clients opt for less volatile markets. PIDEC management are also faced with the challenge of convincing their professional staff of the company’s long time future and motivating them to maintain the company’s international reputation to capture regional contracts as a way of countering domestic woes.

After an extensive research and study, PIDEC it is clear that the management has been a victim of the wide-ranging myths regarding employee motivation. The company consultant discover that the potential loss of market is not the main reason for low employee morale but other factors which are amenable and which can be rectified through a sustained programme of enhancing staff morale by motivating employees. According to McNamara, it is imperative on the part of management to foremost clear these widespread myths. He has outlined six major fallacies assumed by managers while propagating management practices in organizations. First the assumption that a manager on his/her own is capable of motivating employees. This is erroneous as the employees have to be self-motivated and the manager should erect an environment conducive to self-motivation and empowerment (McNamara, 2008).

Secondly, the assumption that financial benefit as the best or only motivator is wrong. Less monetary-like factors like enhanced job security and a more pleasant place of work has been found to be more effective. A comprehensive study on employee motivation of 31,000 male and 13,000 female employees of the Minneapolis Gas Company seeking to determine the most treasured aspect of a job by potential new staff, gave contrasting result from the expected norms. Job security was top of the list of favored items followed by continued advancement, the nature of work, and lastly pride in working for the company. The traditional ‘high’ motivators like higher remuneration and benefits, working conditions etc, were lowly rated by the two groups in study conducted over a twenty year period. The myth of money as the greatest motivator was therefore dispelled by this study and a manager should seek to understand the motivation of individual employee.

Thirdly the myth of universal motivation model whereby the manager assumes that what motivates him is shared by the rank employees. This is erroneous as different people are predominantly motivated by different things. As some are motivated by job security, other employees may be motivated by money, recognition, advancement etc. The important factor should still be to understand the motivation of individual employees. PIDEC management should guard against this fallacy to ensure fellow employees are motivated by individual concerns.

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Another myth usually advanced by the traditional models of management is that fear is great motivator. This method was propagated and practiced throughout the ages as employees were literally kept on a leash, evolving from slave labor to the early 20th century Fredrick Taylor scientific methods of management that unduly exploited employees like animals in the former and machines in the latter methods. As later proven by modern management theorists, fear will only work for a short duration and employees later develop a negative altitude towards management and the organization as a whole leading to diminished performance.

The myth least comprehended by management is that enhanced job satisfaction is commensurate with better job performance. This has also been proved wrong through research studies and if an organization’s objectives are not enjoined with those of the employees, neither party will be working at tandem. The pursuit of an organization’s goals should therefore be aligned with those of the employees. Lastly the myth that employee motivation is a complex science incomprehensible to ordinary managers is not true as will be outlined in this study.

An organization’s overall motivation is improved job performance to ensure better profits, customer satisfaction and enhanced market penetration. Performance is therefore the integral key for this achievements and it’s regarded as a function of ability and motivation, thus: Job performance =f (ability) (motivation). Ability or aptitude is usually a result of education or training, skill or experience, and continuous development over a long period. Motivation however, is a process that can be promptly achieved.

For PIDEC, to motivate her employees the oil consulting firm must use the basic driving principles as propagated by Outlaw, ‘All successful organizations must begin with a desire to help someone be the best they can be…always remember this destination that will never be reached because it is a continual journey’(Outlaw, 2005). This is achieved by the oil firm endeavoring to initiate possible openings available for employee training to ensure their efficiency. By doing this their hidden potential will be exposed hence assist them in appropriate preferred career profession. This theme must be supported throughout the organization through practical training seminars, workshops and educational assistance. As the company had already initiated Total Quality Management (TQM) programmes, the knowledge gained through training motivates staff as they perceive the organization genuinely cares and has confidence in their ability. The benefits to the oil firm will also be clear with less micro-managing by the boss and the perception that the authorities are also receptive to their ideas thus encourage the indifferent employees to become more enthusiastic towards work and the organization. The employee is further motivated as opportunities for advancement seem to be within their reach.

As a first step in implementing changes in motivational principles in management, the managers must develop leadership. If the leaders are also unmotivated, it will permeate to the rank and file employees hence contaminate the whole organization. The leaders must be passionate about their work. The managers must cultivate trust among their employees as they endeavor to improve the job environment and earn the respect of their subordinates. Outlaw argues that when a manager spawn confidence, enthusiasm and an affirmative altitude, it automatically lead to the better performance in the organization; and the opposite is true to a gloomy, mistrustful, and negative altitude in the workplace, performance suffers (Outlaw 2005). PIDEC must ensure that the change will only be achievable if it starts from the top leadership trickling down to the lower ranks. McNamara asserts that the most important motivational tool should be self-motivation by the leaders as it is more effective in recognizing what motivates you and how your job is aligned or configured to sustain your motivations (McNamara, 2008).

PIDEC as an oil consulting firm must ensure that the organizational goals are aligned to those of the employees to avoid working at cross-purposes. Employees will be discouraged if their hard work is unappreciated or is of no consequence to the organization. Through proper strategic planning, organizations objectives can be set up involving all the employees. These ensure that the employees ‘own’ or feel as a part of the organizations and will be motivated towards achieving this goals. The answer to understanding employee motivation will lie in understanding what motivates or drives them. This is possible through creating forums where the energy firm employees will debate personal and company issues without prejudice. The employees can also be motivated by using the company policies and procedures to sort out issues rather than relying on amity. This is especially in times of personal stressful episodes like family or financial trepidations. With a consistent and broad scheme, an organization averts animosity and other negative bias. These schemes must include compensation or insurance packages, employee performance reward scheme, etc. This will guarantee equitable and concise application of established methods towards resolution of any arising matter rather than the organization leaders being accused of discrimination and bias.

Outlaw argues that when a leader/manager interacts with the staff by engaging them in teaching and team inputs that it assists in building highly flexible and vibrant organizational systems (Outlaw, 2005). The manager in the processes realizes staff royalty while enhancing the performance of individual members. Although performance can be quantified through various established reports like financial reports, the employee performance is sometimes overlooked in the company performance results. The energy firm employee performance evaluation can be done through the employee performance appraisals. This method is accountable where clear goals and objectives from the employee will be set at the beginning of a year or financial period of the company. The performance appraisal can be evaluated or done either quarterly, half-annually or annually depending on agreed criteria to monitor the staff accomplishment. This will provide an insight into the real motivation of the employees as goals are set with the involvement of the individual staff member. The appraisal sets the training needs and objective of the employee for the agreed period hence ensures the employee gets a forum to express desired motivation within the organization. It generates trust from the staff if fairly implemented and also provide the company with an opportunity to evaluate and propagate the company objectives and goals to be linearly achieved by the ‘foot soldiers’.

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This leads to the important concept of keeping the communication lines open. Through open and honest discussion, employees feel an affinity. This is the most effective method of discerning individual employee motivation by communicating candidly their desires and goals within the organization. In PIDEC, managers must strive to be accessible and empathetic towards the employees to ensure an honest and open environment within the organization. This will help unsettled employees to be assimilated while greatly motivating them by making them feel part of a family in PIDEC. The leaders can listen to the employees’ career objectives, areas of improvement within their specific departments while at the same time the leaders can explain particular tough or unpopular organizational objectives. This stabilizes the working environment by motivating employees to share their thoughts on any relevant issue rather than sulking.

The energy consulting firm’s leaders and the organization at large should always strive to keep their ‘word’ to avoid acrimony within the ranks. By faithfully endeavoring to avoid backtracking on important issues the bank will enhance trust and employee royalty. On the other hand lack of trust leads to a disillusioned lot that will in turn cheat on other minor issues like working hours, petty theft, poor customer service etc. Another similar trait is fairness in the organization. Lack of trust can result in a crippling of an organization as the staff gets demoralized as they perform their duties. When unfairly treated, employees tend to turn against the management and decisions are hard to get by or be implemented. The employees fear taking any initiative or unnecessary risks and are always busy covering up to avoid trouble and exposure to the unfair bosses. But when fairly treated, the employees work hard and will always give extra efforts. Fairness also means that lazy and incompetent employees are punished to avoid mediocrity within the organization. The leaders must also ensure faster decision making and avoid incidence of procrastination. This builds confidence among the staff and motivates them as to their leader’s capability, hence avoiding loss of confidence with the management. The leader must also manage up the ladder or anticipate the higher rank or board decisions. This will give the lower ranked confidence in presuming a clear direction on the part of the management.

The energy firm must also ensure a fair reward system for the top performers in the organization. By doing this, the motivation towards even higher achievements will be attained as all the employees get inspired to achieve similar rewards. This also means that the lazy non-achievers who persistently fail to meet their targets are punished through the company’s laid down procedures. A culture of a respective altitude must be cultivated within the organization. By humanly treating all employees in a respective manner, they will tend to be less motivated to work for the organization or give a fuller performance effort. The energy firm’s leaders must avoid the tendency of humiliating employees in front of their fellow workers. Similarly avoid public humiliation as regards their sex, race, physical shortcomings to avoid deep rooted rancour among the employees and lack of motivation. The firm’s leaders should always strive to build character and confidence among the staff and stimulate them into greater achievements. However, in cases of commendation it should be done publicly to build confidence and pride among the complimented employee.


In summary PIDEC consulting firm’s management must however remember that motivation or lack of it affects all aspects of an organisation. In United States, 2.8 million workdays are lost annually due to absenteeism hence in the less motivated organizations, they usually create a budget segment consisting of 5.3 percent of their total budget aimed at covering up this types of negative costs. However in the highly motivated organizations, only a budget of approximately 3.7 percent of their total budget is set aside as the better stimulated or motivated employees give better performance and have fewer tendencies to work absenteeism or slacking. They are more liable to endure and supports the organization accomplish its goals and objectives. The University of Colorado in its HR Guide to Motivating Employees quotes Kaye and Jordan-Evans book, Love em’ or Lose em’ listing of the top reasons in retaining employees as: career growth; learning and development; exciting work and challenge; meaningful work; making a difference and a contribution; great people; being part of a team; good boss; recognition for work well done; fun on the job; autonomy, sense of control over my work; flexibility, for example, in work hours and dress code; fair pay and benefits; inspiring leadership; pride in the organization, its mission, and quality of product; great work environment; location; job security; family-friendly employer; and cutting-edge technology (Boulder, 2008).

Motivation is the greatest stimulator of an organization’s growth. Any organization that recognizes that it’s most valuable asset is its employees; motivate them in their work environment and gains tremendously from its efforts. Motivation is not all about better wages, nice offices and benefits but rather includes the ‘smaller’ details including a better recognition and reward system, appreciation and fairness, and respect in the workplace. My analysis on PIDEC has led to a premise that the firm can therefore enhance its performance and that of its staff by observing this model while implementing proper organization structures that ensure equitable and fair reward and punishment to the employees. The company can also initiate total quality management programmes aimed at incorporating employees at all levels of the company towards enhanced growth. An education and training programme for the employees is in order while still establishing similar framework for the oil consulting firm’s leaders who must recognize that motivation starts with them.

The onus is on PIDEC management to lead from the front in exploiting the potential of the firm’s employees to ensure sustained development while exploring new international markets using its rich resource base of employees to counter the loss of domestic economic equilibrium. By following the above model and stratagem, PIDEC can be at the forefront in ensuring a better work environment for its staff and hence enhance or secure its growth potential.


  1. Boulder, U. o. (2008). Guide to Motivating. CU-Boulder , 4.
  2. Clark, R. E. (1999). The CANE Model of Work Motivation:. In J. Lowyck, Trends in Corporate Training (pp. 2,16,17). Leuven Belgium: University of Leuven Press.
  3. McNamara, C. (2008). Basics About Employee Motivation (Including Steps You Can Take). Field Guide to Leadership and Supervision.
  4. Outlaw, W. D. (2005). Motivating and Training Your Employees.
  5. Rose, Norton and Laurie Pearson. Foreign Investment and Protection Act. Energy Report. London: Enhanced Oil Recovery, 2004.

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