Using the concepts of job design, goal setting and incentive systems, discuss how Nucor Steel Company successfully motivates its employees.

Name three common biases in performance appraisals.

Liking is when the rater and the ratee have an existing relationship. The feelings of like or dislike can bias the ratings.

Leniency is when managers give employees ratings that are higher than what is warranted.

Stereotypes are beliefs about different groups that are generalized to the person in question even if that belief has little basis in reality.

148. Name two types of individual incentives and describe each.

Piece rate incentives are when employees are paid on the basis of individual output produced.

Bonuses are onetime rewards that follow specific accomplishments of employees.

Merit pay involves giving employees permanent pay raises based on past performance.

Sales commissions reward sales employees with a percentage of sales volume or profit generated.

Awards are methods that convey appreciation for worker performance and include such items as plaques, mugs, and gift cards.

149. Name and describe two group- or team-based incentives.

Team bonuses are one-time rewards that follow specific accomplishments of teams of employees.

Gainsharing is a company-wide program where employees are rewarded for performance gains compared to past performance. An example of this is labor cost savings.

Profit sharing involves sharing a percentage of company profits with all employees.

Stock options give an employee the right, but not the obligation, to purchase company stocks at a predetermined price.

ESSAY

150. Using the concepts of job design, goal setting and incentive systems, discuss how Nucor Steel Company successfully motivates its employees.

Nucor employees act almost like owners on their jobs. They are encouraged to fix things when they see they are wrong and have appropriate power to do so. Nucor Steel is very well known for pushing authority and responsibility down to the lowest levels in the hierarchy, which shows how effectively the firm has designed jobs for enrichment.

Incentive systems at Nucor are so effective that Nucor employees are the highest paid steel workers in the world. Much of the earnings comes from ties to performance; in fact everyone, including the CEO, has pay tied to corporate performance. The system is such that low performers are penalized while high performance is rewarded and employees become increasingly committed to the firm.

The formula for Nucor success is simple: Align company goals to employee goals and give employees power to make things happen. The employee turnover rate is one of the lowest in the industry and the firm one of the most successful.

151. Choose a job. Using the Hackman and Oldham job characteristics model, analyze that job for its motivational properties. Comment on ways to enhance the job’s motivational properties and potential.

Example job is college instructor.

Skill variety of the job would be high as instructors teach, develop materials, tutor, counsel, etc.

Task identity is high since the instructor has her own course and teaches it as she sees fit throughout the entire semester or term.

Task significance is also high as the instructor’s job affects students’ well-being among others.

Autonomy is high as instructors have the freedom to choose their own textbooks, make their own handouts, exams, etc.

Feedback is high as instructors are evaluated formally by their students, by their deans and by other groups including informally on websites such as ratemyprofessor.com.