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This chapter is from the book

The Evidence

We make rather strong claims—some might say startling and unbelievable—about the pervasiveness of the three sets of goals. We claim that they are nearly universal, applying to roughly 85 to 90 percent of a workforce (that's just about any workforce).

Our assertions might appear to be counterintuitive—they go against common observation and common sense. Managers and employee-relations experts talk endlessly about differences: the differences between individual workers and between categories of workers (such as males and females, older and younger workers, professionals and non-professionals) and between workers in different countries. Are we saying that this is hogwash? Yes, in part.

We already discussed what we consider to be distortions about generational differences—the belief that younger workers are not interested in working as hard as their elders and that they are not concerned about job security. We have solid evidence for our assertion that generational differences are greatly exaggerated as are other purported differences and we will soon provide that evidence.

First, however, consider the following questions in relation to the three factors: do you believe that an entire category of workers—demographic (age, sex, race, and so on), occupational, or national—does not consider being fairly treated by their employer—say, in wages—to be of very high priority? Do you believe that a category of workers exists in which the overwhelming majority does not want to take pride in their work and in their organization? Do you believe that there is a category of workers for whom having congenial and cooperative co-workers is unimportant? Of course, there are individuals to whom these rules do not apply—even individuals who willingly allow themselves to be exploited economically by their employers—but never more than a very small minority in any category.

Are there no major demographic, occupational, or national differences in these needs? Not in the fundamentals we have described (the desire for equitable treatment, achievement, and camaraderie). The differences emerge largely in what will satisfy these needs, which varies because of differing objective conditions and expectations. Let's consider a few examples of this:

  • The work itself. In Chapter 8, "Job Challenge," we discuss the satisfaction people seek from the kind of work they do. We say that workers want to be proud of their work. Pride in work has numerous sources, among them the employees' feelings that their intelligence and skills are being used; that, in turn, is partly a function of the latitude they have to exercise judgment in doing their jobs. We know that the latitude given to, say, the average engineer is normally going to be much greater objectively than what's given to a blue-collar machine operator. Despite this difference, they may experience the same degree of subjective satisfaction with their job autonomy. The machine operator doesn't expect—indeed, would consider it inappropriate—to have the engineer's latitude. But he doesn't want to be treated as an automaton; that is, he wants to exercise the judgment that makes sense for that job and for his skills, and that latitude can be considerable (as you will see in Chapter 8). People at work are not stupid and do not have outrageous expectations. They—no less than engineers—have a need to be treated on the job as intelligent human beings, but the standards by which this is judged are obviously somewhat different.

  • Job security. Chapter 3 discusses job security. How an organization treats employees in this regard is a key source of employee morale, but what is considered fair has greatly shifted in the United States over the last few decades. Although employees in many organizations previously expected lifetime job security, employees today rarely expect that. They understand that the business world has changed, but this does not mean that their desire for security has diminished. The change has been in the criteria that employees use to judge the fairness with which the issue is handled by organizations. Organizations differ greatly in this respect—for example, in whether layoffs are treated as a last resort instead of the first action taken—and these differences have a profound impact on the morale and performance of a workforce.

  • Vacations. A concrete and visible example of a cultural difference is that between the vacations received by workers in the countries of Western Europe compared to those in the United States. On average, Western European countries have much longer vacations; even new employees receive at least a full month of vacation. (Vacation time is five weeks in France, Sweden, Austria, Denmark, and Spain.) This certainly is a major difference, with profound cultural meaning and probably significant economic effect, but what are its implications for our argument regarding the commonality of the major needs? Are European workers lazy? Are they less interested in doing a good job? Do they find their jobs less interesting? There is absolutely no evidence for any such an assertion. By virtue of broad historical and social trends, different countries evolved different patterns of labor relations. Even within the United States, different industries have different patterns, including the amount of vacation time employees receive. These differences result in different subjective standards of what is "fair," but in no way undercuts our proposition regarding the fundamental goals of workers.

Similar comments could be made about the satisfaction of many other goals and subgoals: employee expectations in the United States regarding the fringe benefits an organization provides—especially medical insurance—have greatly changed, and what might have been considered unfair a decade or so ago, such as an organization not paying full medical-insurance premiums, can be entirely satisfactory today; operating in the opposite direction is equipment, where the tools people use on their jobs improve continually, so what was satisfactory before is rarely satisfactory today.

Our argument, then, is not that there are no demographic, occupational, or cultural differences or that the differences are unimportant. It comes down to this: when we say that workers want to feel pride in their work, we mean almost all workers, whoever they are, whatever they do, and whenever or wherever they do it. The fundamentals are constant, but knowing how to satisfy those fundamental needs often requires knowledge of the expectations of particular groups of workers. To cite an extreme example, if an organization decided to halve the vacation time of European workers based solely on the assumption that their fundamental need to do a good job and to be treated fairly are the same as American workers, that organization is in for big trouble.

But don't make the opposite error, namely, to assume that the obvious cultural, occupational, and demographic differences in expectations and standards signify major differences in basic goals. For example, treat a blue-collar worker as if all that interests him is his wages—that exercise of his judgment on the job doesn't matter—and you wind up with an indifferent or hostile employee. At the other extreme, treat engineers and scientists as if wages don't matter—that all they want is an opportunity to be creative—and you wind up with hostile engineers and scientists (if they stay with the organization at all).

Table 1-4 summarizes a representative portion of the strong quantitative evidence on which we base these claims. As we will explain, the table shows that employee morale strongly relates to the degree to which each of the three needs is satisfied, and that the relationships are extraordinarily similar across all demographic, occupational, and national groups. There are no differences in the strengths of the goals to speak of; they are, indeed, nearly universal.

How do we know, in a systematic, quantitative way, whether a goal is important and how universal it is? One way is to correlate satisfaction with it with employees' overall satisfaction with the organization. Table 1-4 does this within a number of groups. Overall satisfaction is a product of the degree to which employees feel their specific goals are being met, so the higher the correlation between satisfaction with a specific goal and overall satisfaction, the more important we can assume the goal to be. If an employee doesn't care much about something—say, the color of the walls where she works—liking or not liking it would have no impact on how she feels about the organization as a whole. Compare that to the importance of how she feels about her pay or boss. This reasoning is identical to how the performance approval rating of the president of the United States—determined from political-opinion polls—is a function of how Americans feel about specific aspects of the president's performance, such as his handling of the economy, of national security, and so on. The stronger the correlation is between a specific aspect and the overall approval rating of the president's performance, the more important that aspect is.

Table 1-4 Evidence for the Near Universality of the Three Factors

Correlations with Overall Satisfaction

 

Equity

Achievement

Camaraderie

Total

.59

.43

.36

Within Racial and Ethnic Groups

White

.60

.45

.34

Black

.57

.45

.34

Hispanic

.58

.47

.41

Asian

.63

.45

.41

Native American

.54

.44

.37

Within Tenure Groups

0–2 yrs

.60

.48

.35

2–5 yrs

.60

.45

.33

5–10 yrs

.58

.42

.33

10–20 yrs

.59

.44

.36

> 20 yrs

.56

.39

.36

Within Genders

Women

.59

.42

.35

Men

.59

.45

.37

Within Levels

Mgt

.58

.44

.33

Non-Mgt

.58

.43

.36

Within Positions

Professional

.60

.46

.36

Non-Professional

.55

.39

.30

Within Regions

North America

.60

.45

.37

Europe

.58

.40

.32


The relationship between variables (such as between overall satisfaction and satisfaction with pay or the color of the walls) can be assessed in various ways. In our analysis, it is measured by a statistic called the correlation coefficient, which has a symbol of "r." The higher r is, the stronger is the relationship. r can range from .00, which means no relationship, to 1.00, which means a perfect relationship. (r can also be negative, in which case, the relationship is inverse: the higher on one variable, the lower on the other.)

Our basic finding is that highly significant positive correlations exist between the questions on our surveys that tap the three needs and overall satisfaction. These correlations hold up in all demographic, occupational, and national groups and at approximately the same level. Illustrations of these correlations are shown in Table 1-4 where the following questions are used to tap the three needs:

  • For equity. "How would you rate your organization on taking a genuine interest in the well-being of its employees?"

  • For achievement. "Do you agree or disagree: my job makes good use of my skills and abilities."

  • For camaraderie. "How would you rate the cooperation and teamwork within your work unit?"

The question measuring overall morale is "Considering everything, how would you rate your overall satisfaction in [organization] at this time?"

The correlations shown in Table 1-4 were calculated using data from 135,000 employees in 40 organizations surveyed over the last 5 years. All four questions were asked in identical ways for each organization. For those readers interested in tests of statistical significance, all the correlations are highly significant, beyond the .00001 level!

This table contains the correlations for three demographic breaks: race/ethnicity, gender, and tenure, and for occupation and regions of the world. Those familiar with correlational data, will, we trust, be amazed at just how similar the patterns are. In every instance, the item measuring the equity goal correlates in the .50s or .60s with morale, that measuring achievement in or near the .40s, and that measuring teamwork in the .30s and .40s. The possible reasons for the differences in sizes of the correlations—why equity should be the highest and teamwork the lowest—are discussed later in this chapter. For now, suffice it to say that not only are all the correlations highly significant, which verifies the importance of the goals, but to all intents and purposes, they are also the same in all categories of employees.

Which aspects of work do we find not correlated with overall employee morale? They tend to be about what might be termed the "frills" of work. Although senior management often spends much time on them, they don't really touch on workers' basic goals and what goes on in important ways in their daily workplace activities. We refer to matters such as the aesthetics of the physical work environment (such as the wall color), recreational activities (such as holiday parties), various formal "programs" (such as suggestions programs), and formal communication mechanisms (such as a company newsletter). It's not that employees don't care about these at all, but that they matter much less than other more fundamental concerns. It matters much less to them, for example, that there be a well-designed company newsletter or a suggestions program than that their immediate supervisors communicate and listen to them. We are in no way suggesting that the frills be dropped—almost everyone likes a holiday party—but that they be seen as supplements to, not substitutes for, the more basic policies and practices that we discuss throughout this book.

Similar findings are obtained in analyses of answers to the open-ended questions. This type of analysis shows that the things employees spontaneously write in about what they "like most" and "like least" about their organizations almost invariably involve the three factors. These findings are given as examples throughout this book. The frills are almost never mentioned.

How the Three Factors Work in Combination

Our analysis shows that the three factors interact with each other in an interesting way. The Three Factor Theory asserts that employees seek to satisfy three needs—equity, achievement, and camaraderie—in any employment situation. It further asserts that, when all three needs are met, it results in enthusiasm directed toward accomplishing organizational goals. As we discuss in Chapter 2, enthusiasm is not just about being happier or more content—it is employees feeling that they work for a great company, one to which they willingly devote time and energy beyond what they are being paid for or what is expected and monitored. A great company for employees is one that largely meets all of their needs for equity, achievement, and camaraderie. Until that happens, it is no more than a "good" company.

Statistical support for this idea can be seen in the way individual satisfaction of the three needs interact to produce overall satisfaction. They just don't add to one another in their impact, but multiply each other's impact. Figure 1-1 shows how employees respond to the question, "Considering everything, how would you rate your overall satisfaction in [organization] at this time?" The percentages shown are just those saying "very satisfied," the highest possible response to the question. The percentages are shown for four categories of employees: those whose satisfaction with all three needs is relatively low (labeled "None"), those who have just one need being satisfied, those who have two, and those for whom all three needs are being satisfied (labeled "All Three"). The questions used to assess satisfaction with the three needs are the same as in the correlational analysis shown in Table 1-4, namely, "How would you rate your organization on being concerned about the well-being of its employees?," "My job makes good use of my skills and abilities," and "How would you rate cooperation and teamwork within your immediate work unit?"

Figure 1.1Figure 1-1 The exponential impact of the Three Factors.

It can be seen that as more satisfied needs are added, the percentage of very satisfied employees increases exponentially. When all three needs are being satisfied, the percentage is 45! What would you think of as a great company in which to work? It's probably not just having very good pay and benefits, or challenging and enjoyable work, or having terrific co-workers. It involves all these needs, and when all these needs are satisfied, something unique happens to many employees and their relationship with the organization... It is what we call enthusiasm.

There is one more wrinkle, namely, the special effect of equity. More in-depth analysis suggests that although all the needs are important, equity has a certain basic importance. That is, if people are not satisfied with the fairness with which they are treated, satisfaction of either of the other two needs has a relatively minor effect on morale. On the other hand, feeling fairly treated does have a major impact even when one or both of the other needs are not being satisfied. That is the reason the correlations of overall satisfaction with the equity need are consistently higher than the correlations with the other two factors.7

The moral of the story is that it can be difficult to get employees excited about a company that, say, gives them challenging work to do (part of the achievement need) when they have a basic sense of inequity as to how they are treated. But equity alone is not enough to create enthusiasm: the impact of fair treatment is greatly magnified when all three needs are being satisfied.

These analyses and conclusions hold up in an amazingly consistent way across demographic groups, occupations, and world regions.

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