As any manager can attest, motivating employees to go the extra mile is no easy task, even in palmy times. In periods of economic distress, when companies are under unusual financial pressure, it is especially important to gain employees’ long-term commitment and loyalty. Under-standing how to motivate a workforce during such downturns will serve organizations well not just through the rainy days but through a recovery as well, when other job opportunities may beckon.
With my colleague, Tom R. Tyler, University Professor of Psychology at NYU, we set out to test our prediction that identification with the organization, pride, and respect would be critical to whether employees feel valued and motivated enough to contribute more than is required. If this proved to be true, we reasoned, it could help companies solve the eternal puzzle of how to retain and motivate their employees.
The Organization Man
We knew from previous research that the extent to which employees relate to the organization they work for – their group engagement – is a critical factor in how they fulfill their roles there. A key element of that engagement is their social identity, which we define as a multidimensional construct that works to produce the implications of group membership on the concept of self – a kind of mirroring of group values and shared identity that contributes to an individual’s self-image. The social identities employees form around their work groups and organizations are strongly related to whether they will do more than is required of them. This extra performance is called extra role behavior, and it is essential to an organization’s viability and success.
In order to better understand what motivates such extra role behavior, we explored its relationship to social identity, but we also investigated the interplay of social identity and group engagement with two other elements of organizational life that are known to influence employees’ engagement with the group: how fairly they believe they are treated by their company (their judgments of procedural justice) and how fairly or well they believe they are compensated (their judgment of their economic outcomes).
A Complex Dynamic
Our first hypothesis was that employees’ social identity will be positively related to their extra role behavior. The second was that social identity is shaped by employees’ procedural justice judgments; furthermore, social identity accounts for the effect that employees’ fairness judgements have on their behavior. Our third hypothesis was that social identity is shaped by how employees evaluate their economic outcomes. We tested these hypotheses in each of two field studies. Our first study was conducted in a work group within a major financial services organization where economic concerns are especially prominent. In the second study, a broader and larger test, employees worked in diverse jobs in diverse industries and locales. In both studies we queried employees and, with their permission, their supervisors.
The results in both studies not only supported all our hypotheses, they exceeded our predictions insofar as they indicated that social identity is an even stronger influence than we expected on employees’ motivation to go the extra mile. Furthermore, social identity largely explained the effects of procedural justice and economic outcomes on employee behavior.
Determining that social identity provides the mechanism by which these organizational conditions relate to employee behavior provides critical insight into understanding how, when, and why efforts to shape the context of employees’ work experiences may affect their behavior. It also contributes to the growing acknowledgement within psychology that the collective self – the aspect of the self most closely linked to social identity – plays a fundamental role in shaping employee behavior.
The results for the way employees think about their compensation are especially interesting. It is traditionally believed that pay, benefits, expectations of promotion (and thus, hopes for greater pay), and other similar factors affect behavior because of their economic or instrumental value. Our findings here suggest that a primary way in which economic outcomes may affect behavior is through their impact on social identity.
These findings suggest that the basis of employees’ relationships with their organizations is primarily linked to the role the organization plays in affecting how employees think and feel about themselves. Many important practical implications follow from this insight. First and foremost, the company has great power to motivate their employees if it can help them develop social identities that are grounded in the organization and in their particular work groups. The results also indicate two important levers that organizations can use to encourage the development of social identity. First, they can operate in ways that employees regard as procedurally fair, instituting fair decision-making processes and extending fair quality of treatment. Second, they can provide economic outcomes that employees regard favorably and that encourage employees to link their social identities to the organization.
The key to successfully applying any of these insights is doing it loud and clear. Employee judgments of procedural justice are susceptible to a wide array of subjective influences, and as such, merely implementing fair procedures isn’t enough. Organizations must also ensure that employees are well aware that such procedures are in operation.
Another challenge is to provide economic outcomes in ways that actually encourage the development of a strong social identity. Financial incentives must be dispensed in ways that lead employees to regard their relationship with their organization positively. When such incentives are provided in an environment marked by threats or guided by obligations, it becomes less likely that economic outcomes will positively affect social identity or behavior. Even more, when employees must force their organizations to provide them with better economic outcomes – for instance, by looking for alternate jobs, getting outside offers, or taking collective actions – then it is unlikely that their achieving their goal in this manner will foster social identity or motivate them to work extra hard.
Of course, the practical implications of these studies are influenced by the level of employee in question. Among employees at lower socioeconomic levels, for whom resources are literally critical, the impact of financial incentives on behavior may be more direct. Similarly, social identity may be less likely to shape behavior among employees who have tenuous links to the organization, such as temporary and contract workers, and among workers that do not share demographic group memberships or values with the organization. Still, the results of this and related research clearly suggest the potential value, under many circumstances, of social identity for understanding employee attachment to organizations and, moreover, of social identity-based ways of stimulating higher levels of extra role behavior in hard times.
STEVEN L. BLADER is associate professor of management and organizations at NYU Stern.