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Work Motivation of Highly-Educated Croatian Employees - What Should Managers and HR Experts Know?

Work Motivation of Highly-Educated Croatian Employees - What Should Managers and HR Experts Know? The study dealt with the work motivation of highly-educated Croatian employees, specifically those at the fore of their companies in terms of expertise amid this "Age of Knowledge," in order to provide recommendations for management on how to improve their levels of motivation, and give direction to HR experts on which motivation policies and practices to implement. According to the findings, highly-educated Croatian employees perceive that many regular motivation strategies are insufficiently present in their companies, are generally not satisfied with the motivation strategies applied, and are significantly less satisfied with motivation strategies because they deem them unimportant. Furthermore, they perceive non-material motivation strategies as more effective, assign these strategies greater importance and find them generally more satisfying than material motivation strategies. Finally, the findings indicate that there are no differences in work motivation between highly-educated Croatian employees with different characteristics. JEL: M12, M52 DOI: 10.2478/v10033-008-0009-5 1. Introduction Managers of every company need to ensure that their employees are highly productive in areas consistent with the objectives of the organization. This can only be achieved if employees are highly motivated in their work, and managers are able to actively enhance and maintain this motivation. Motivation at work has been a popular area of research for almost a century, from the 1930s onwards. Contemporary exploratory studies on work motivation have increasingly focused on particular respondent groups (for example Leung and Clegg 2001), industries (for example Jindal-Snape and Snape 2006) or geographic areas (for example Eskildsen, Kristensen, and Westlund 2002; Linz, Good, and Huddleston 2006; Takahashi 2006), as well as on different combinations of those determinants (for example Lee-Ross 2002). Research addressing the issue of motivation factors of Croatian employees has mostly been limited to one company (for example Aneli 1996), one industry (for example, Klepac 2002 about motivation factors in the Croatian bank industry) or one group of employees (for example Frani 2007 about motivation factors of young Croatian managers). In other words, as work *Poloski - Voki: University of Zagreb, Faculty of Economics and Business Trg J. F. Kennedya 6, 10 000 Zagreb, Croatia e-mail: npoloski@efzg.hr *Klindzi: University of Zagreb, Faculty of Economics and Business Trg J. F. Kennedya 6, 10 000 Zagreb, Croatia e-mail: mklindzic@efzg.hr *akovi: RTL Television Krapinska 45, 10 000 Zagreb, Croatia e-mail: martina.djakovic@rtl.hr SEE booklet CC.indd 89 motivation is not a globally uniform concept, its research is suggested to provide insight into the motivation of diverse and under-researched groups of employees (Jindal-Snape and Snape, 2006) and differences resulting from various cultural settings (Eskildsen, Kristensen, and Westlund 2002), which this paper in particular seeks to investigate. The study dealt with the work motivation of highlyeducated Croatian employees, specifically those at the fore of their companies in terms of expertise amid this "Age of Knowledge." Since knowledgeable workers and their productivity are the most valuable assets of a 21st century institution (Drucker 1999, p. 135), what motivates them should be of primary interest to contemporary organizations and their managers. Therefore, highly-educated Croatian employees were selected as a group to be surveyed. The study had three main aims. The first aim was to explore the level of highly-educated Croatian employees' satisfaction with various common material and nonmaterial motivation strategies, and the importance they assign to those strategies. In other words, the study sought to explore the perceptions of highly-educated Croatian employees regarding a range of motivation factors. The second aim was to test assumptions concerning the differences in work motivation among highly-educated employees with diverse characteristics. Namely, studies report different and sometimes contradictory findings with respect to the effect that employee characteristics such as gender, age and educational level have on work motivation (Eskildsen, Kristensen, and Westlund 2002), which was the impetus to explore the issue further. In particular, the relationship between respondents' characteristics (both demographic and those of their companies), and their satisfaction with various motivation strategies and the level of importance they assign to those strategies were analyzed. Upon the collection of the aforementioned data concerning work motivation, the final aim was to identify practical recommendations for managers and human resource (HR) experts with the purpose of improving the productivity of highly-educated Croatian employees. Simply put, the third aim was to provide recommendations for Croatian management on how to improve (or maintain) levels of motivation among their employees. Specifically, since we are living in the "Age of Knowledge," in which human resources are of crucial importance for achieving organizational success, findings on the work motivation of highly-educated Croatian employees could contribute to and enhance the performance of both Croatian organizations and the country in general. Furthermore, since human resource management (HRM) as a business and managerial function has yet to be developed in Croatia, the findings of this research could give direction to HR departments in terms of further development, and suggest precisely which HR practices and policies to implement. 2. Research Areas and Methodology Research Areas. In order to help Croatian managers to motivate their employees effectively and HR experts to perform their jobs better, four aspects of highlyeducated Croatian employees' motivation were assessed: (1) employees' satisfaction with various common material and nonmaterial motivation strategies, (2) the level of importance employees assign to those strategies, (3) the discrepancy between employees' satisfaction and assigned level of importance to various motivation strategies, and (4) the relationship between satisfaction/importance of various motivation strategies and respondents' characteristics (the analysis focused on the following demographic and other categories: gender, age, hierarchical level, pay level, field of work, size of the company, main company activity, ownership structure, existence of HR department, and existence of performance appraisal). Research Instrument. The research was conducted by means of a questionnaire consisting of five parts: (1) demographic characteristics of respondents (gender, age, hierarchical level, pay level, and field of work), (2) their companies' characteristics (size of the company measured by number of employees, main company activity, ownership structure, existence of HR department, and existence of performance appraisal), (3) questions concerning the presence of various material and nonmaterial motivation strategies in respondents' companies, (4) questions concerning respondents' satisfaction with various standard motivation strategies, and (5) questions concerning the level of importance respondents assign to those strategies. Altogether seventeen commonly present motivation strategies were assessed by respondents: ten material motivation strategies (salary, innovation and improvement bonuses, other bonuses and incentives, profit-sharing, gain-sharing, ESOP ­ employee stock ownership plan, additional education, life-insurance, recreation, and company car), and seven nonmaterial motivation strategies (job design, flexible working hours, recognition, feedback, leadership style, corporate culture, and MBO ­ management by objectives). Respondents were asked to indicate the extent of their satisfaction and the level of importance of various material and nonmaterial motivation strategies by circling a number on a five-point Likert-type numerical scale ranging from 1 (not satisfied/not important) to 5 (extremely satisfied/extremely important). Sample. The sample consists of 98 highly-educated Croatian employees that enrolled in graduate programs SEE booklet CC.indd 90 Table 1: Profile of Respondents and their Companies at the Faculty of Economics and Business ­ Zagreb (FEBZG). Graduate students from FEB-ZG were selected as respondents as they come from different occupations and different parts of Croatia, and therefore are suitable representatives of highly-educated Croatian employees. The research questionnaires were completed anonymously by those graduate students that were present at lectures in April of 2006. Table 1 depicts their profile for this study, Figure 1: Average satisfaction and average importance of various motivation strategies SEE booklet CC.indd 91 both in terms of their demographic and their companies' characteristics. The size of the sample is satisfactory when compared with similar studies (see, for example, Jindal-Snape and Snape 2006; Lee-Ross 2002; Leung and Clegg 2001). Data Processing. Statistical analysis consisted of descriptive statistics calculations, t-tests for two related means, and calculations of Cramer's V. Calculations and tests were conducted using SPSS. Several main findings stem from Figure 1. First, there is an evident discrepancy between respondents' satisfaction with various motivation strategies and the value they assign to those strategies. Respondents evaluated higher the importance of all seventeen motivation strategies numbered than their satisfaction with those strategies, a result which will be dealt with in more detail later in the article. Second, respondents are moderately satisfied with the motivation strategies numbered (2.74 on average; nine out of seventeen motivation strategies with an average value less than 3.00). They are especially unsatisfied with the material strategies available in their companies. On average, their satisfaction with those strategies was 2.35; three out of ten of those strategies were evaluated on average less than 2.00 (profit-sharing, gain-sharing, and ESOP); two between 2.00 and 2.50 (innovation and improvement bonuses, and life-insurance); three between 2.50 and 3.00 (other bonuses and incentives, recreation, and company car); only two of those strategies were evaluated on average higher than 3.00 (salary, and additional education). To a higher extent respondents reported satisfaction with nonmaterial strategies. Their average satisfaction with those strategies was 3.14, with none of those strategies evaluated on average higher than 3.50, and with only one evaluated on average lower than 3.00 (MBO). Third, respondents find all seventeen motivation strategies numbered fairly to extremely important. To be precise, only one motivation strategy had an average importance value less than 3.00 (but not far from that 3. Research Results The research results are presented in two parts. First, highly-educated Croatian employees' satisfaction with numbered material and nonmaterial motivation strategies, the level of importance they assign to those strategies, and the discrepancy between their satisfaction and assigned level of importance are presented. Second, the relationships between satisfaction/importance of various motivation strategies for respondents and their demographic/company characteristics are presented. 3.1. Satisfaction with and Importance of Various Motivation Strategies for Highlyeducated Croatian Employees Figure 1 depicts the average respondents' satisfaction with seventeen standard motivation strategies and the average level of importance they assign to those strategies. Table 2: Percentage of Companies that Use Various Motivation Strategies and Motivation Strategies Satisfaction/Importance Rankings SEE booklet CC.indd 92 Table 3: Statistical Differences between Satisfaction and Importance of Various Motivation Strategies value; company car ­> 2.98); two were between 3.00 and 3.50 (life-insurance, and recreation); six between 3.50 and 4.00 (innovation and improvement bonuses, profit-sharing, gain-sharing, ESOP, job design, and flexible working hours); seven between 4.00 and 4.50 (salary, other bonuses and incentives, additional education, feedback, leadership style, corporate culture, and MBO); one strategy was assessed on average as extremely important (recognition ­> 4.60). Altogether, the respondents think that motivation strategies numbered are very important (3.96 on average), with nonmaterial strategies graded on average higher (4.21) than material ones (3.79). Further analysis consisted of observing the presence of various motivation strategies in Croatian companies and associated respondents' satisfaction/importance rankings (table 2). Table 2 reveals that, when looking at rankings, respondents are more satisfied with those motivation strategies that are more present, which was reasonable to expect. The rankings also confirm previously elaborated findings about nonmaterial motivation strategies being positioned better, since they were ranked higher both in terms of respondents' satisfaction and the importance respondents assign to them. The third part of the analysis of highly-educated Croatian employees' work motivation consisted of examining significant differences between their satisfaction and the importance they assign to various motivation strategies. Therefore, t-tests for two related means, with pairs being satisfaction and importance of each of the seventeen motivation strategies, were performed (table 3). As mentioned before, and as is evident from paired differences means signs (all negative), respondents evaluated higher the importance than their satisfaction with all seventeen motivation strategies. Moreover, t-test results revealed that their average importance grades are significantly different (higher) than their average satisfaction grades. To be precise, differences between pair means are all statistically significant, with all but one significant at the 0.01 level. 3.2. Relationship between Satisfaction/ Importance of Motivation Strategies and Respondents' Characteristics In order to provide a measure of the strength of the relationship between the characteristics of highlyeducated Croatian employees (both demographic and those of their companies) and the motivation factors assessed, Cramer's V was used. Table 4 depicts the number and percentage of statistically significant relationships between respondents' demographic characteristics and the satisfaction/importance they attribute to various material and nonmaterial strategies. SEE booklet CC.indd 93 Table 4: Statistically Significant Relationships between Satisfaction/Importance of Various Motivation Strategies and Respondents' Demographic Characteristics Table 4 implies that none of the respondents' demographic characteristics significantly differentiates their satisfaction with various motivation strategies or the importance they assign to those strategies. Although research gives evidence that demographic differences could be related to motivation factors (Eskildsen, Kristensen, and Westlund 2002; Gurvich 2006 in Hartley 2007), the results of this study reveal that only respondents' hierarchical and pay level could to some extent be aligned with their satisfaction with the material motivation strategies present in their companies. The relationships between the characteristics of the respondents' companies and the satisfaction/ importance they assign to various motivation strategies proved not to be significant (table 5). Table 5 indicates that although companies' characteristics are generally associated with employees' work motivation (Jindal-Snape and Snape 2006) no company characteristic was found to be significantly related to the motivation issues explored in the research. 4. Discussion and Recommendations The summary of all obtained results is given separately for material, nonmaterial, and motivation strategies in total. The following findings regarding work motivation in Croatian companies are presented in table 6: (1) average presence of observed motivation strategies in Croatian companies, (2) average satisfaction and average importance respondents assigned to those strategies, (3) average satisfaction and average importance rankings of those strategies, (4) percentage of statistically significant differences between respondents' satisfaction and the importance they assigned to those strategies, and (5) percentage of statistically significant demographic and companies' characteristics related to highly-educated Croatian employees' satisfaction with and the importance they assigned to various motivation strategies. There are several conclusions that can be drawn from Table 6 and serve as rationale for practical recommendations for managers and HR experts concerning their employees' work motivation: Table 5: Statistically Significant Relationships between Satisfaction/Importance of Various Motivation Strategies and Companies' Characteristics SEE booklet CC.indd 94 Table 6: Summary of Obtained Results First, highly-educated Croatian employees perceive nonmaterial motivation strategies to be more present in their companies compared to material ones, which is probably the cause of their greater satisfaction with that group of strategies (both in terms of average value and average ranking). For Croatian managers and HR professionals, that implies the need to invest more in material ways of motivating highly-educated employees, especially when keeping in mind that the expected monetary rewards have a large influence on employees' motivation (Linz, Good and Huddleston 2006). Second, according to both average value and average ranking of motivation strategies, highly-educated Croatian employees find nonmaterial motivation strategies to be more important than material ones. This matches Cohen's (2006) observation that money-based rewards aren't distinctive, individual, or motivational, and that a personal, nonmonetary gift is ultimately more rewarding. Consequently, it is important for Croatian managers and HR experts to consider many different aspects of working conditions beyond financial rewards in order to motivate their employees, as contemporary authors emphasize (for example Strickler 2006; Hartley 2007). Plainly expressed, pay does matter, but convincing people to stay might not cost as much as HR believes (IOMA 2007). The Croatian business environment, just as contemporary business settings all over the world, should thus give relevance to motivation factors such as teamwork, sharing of leadership roles, corporate culture, sincere care and concern, and similar issues (more about the importance and impact of "soft" business practices on employees' motivation see Cohen 2006; Strickler 2006; Zofi and Meltzer 2007). Additionally, highly-educated Croatian employees' perceptions of greater importance of nonmaterial motivation strategies could be the result of their better salaries on average (that match their educational level), and therefore their greater interest in alternative motivation strategies, especially in fulfilling their highest level needs (mostly nonmaterial needs such as self-actualization, recognition, feedback, participative leadership style, etc.). Third, highly-educated Croatian employees evaluated all seventeen motivation strategies listed in the research as more important than satisfying. This is confirmed by all differences between pairs of values (importance and satisfaction) being statistically significant, and implies that Croatian managers and HR experts should devote considerably more effort, time and money to the development and implementation of a wide range of motivation activities. Fourth, highly-educated Croatian employees' demographic and company characteristics were not found to be significantly related to either their satisfaction with or the importance they assign to various motivation strategies. The lack of differences in satisfaction between employees with different characteristics could be explained by their overall dissatisfaction with the motivation strategies provided by their companies. The lack of differences in importance they assign to those strategies could be partially explained by the currently popular situational approach to motivating employees, which implies that when it comes to matters of motivation one size does not fit all, and that determining what motivates each and every individual is the only way of managing their performance. Croatian managers and HR experts should therefore not treat Croatian highly-educated employees as a monolithic category. Rather, policies and programs to support them should begin with a diagnosis of their personal characteristics and motivation factors aimed at strengthening pull motives that comprise a base for their greater efficiency and effectiveness. 5. Conclusion In order for employees to act as a source of competitive advantage, i.e., to contribute to the development of an enterprise's competitiveness, they need to be knowledgeable and motivated. Motivated employees are considered a vital link for both a company's efficiency and effectiveness, and motivated highly-educated employees SEE booklet CC.indd 95 3/31/2008 15:09:49 are today becoming a primary source of a company's competitive advantage. This study, unfortunately, indicates that Croatian companies do not apply that philosophy and seem even to be unaware of it. Highly-educated Croatian employees, according to the findings, perceive that many regular motivation strategies are insufficiently present or underdeveloped in their companies, are generally not satisfied with the motivation strategies applied, and are significantly less satisfied with the motivation strategies provided than they consider them important, which could all lead to diminished productivity. Furthermore, they are more satisfied with nonmaterial motivation strategies (probably because they perceive those strategies more present than material ones), and assign more importance to them. This suggests that alternative methods of motivating Croatian highly-educated employees, besides financial rewards, should not be neglected, which is in accordance with the fact that knowledgeable workers are in general satisfied with their salaries (because they are on average paid better), and therefore primarily interested in intrinsic awards. Finally, the findings reveal that there are no differences in work motivation between highly-educated Croatian employees with different characteristics, implying that they, regardless of their demographic or company characteristics, perceive that motivation practices are not given enough attention by their managers, and that they should not be treated uniformly or as a group when motivated, because what motivates one person does not necessarily motivate another, as the situational approach to work motivation suggests. Overall, the findings from this research could help Croatian managers and HR experts enhance employees' productivity by understanding what motivates them and their degree of satisfaction with existing motivation strategies. Frani, J. 2007. Vaznost materijalnog nagraivanja u motivaciji mladih managera u Hrvatskoj (The importance of compensations for motivating young managers in Croatia). M.Sc. thesis. University of Zagreb ­ Faculty of Economics and Business. Zagreb. Hartley, S. 2007. Motivating workers. Businessdate 15 (1): 1-3. IOMA. 2007. Rewards Are Now Critical to Keep Valued Employees. www.ioma.com/hr 7 (5): 1, 10-12. Jindal-Snape, D., Snape, J. B. 2006. Motivation of scientists in a government research institute ­ Scientists' perceptions and the role of management. Management Decision 44 (10): 1325-1343. Klepac, J. 2002. Razvoj motivacijskih strategija u funkciji uspjesnosti poslovanja banaka u Republici Hrvatskoj (Motivation strategies for improving performance in Croatian banking sector). M.Sc. thesis. University of Zagreb ­ Faculty of Economics and Business. Zagreb. Lee-Ross, D. 2002. An exploratory study of work motivation among private and public sector hospital chefs in Australia. Journal of Management Development 21 (8): 576-588. Leung, A. S. M., Clegg, S. R. 2001. The career motivation of female executives in the Hong Kong public sector. Women in Management Review 16 (1): 12-20. Linz, S. J., Good, L. K., Huddleston, P. 2006. Worker Morale in Russia: An Exploratory Study. William Davidson Institute Working Paper Number 816: 1-24. Strickler, J. 2006. What Really Motivates People?. The Journal for Quality & Participation 29 (1): 26-28. Takahashi, K. 2006. Effects of wage and promotion incentives on the motivation levels of Japanese employees. Career Development International 11 (3): 193-203. Zofi, J. S., Meltzer, S. 2007. Making motivation personal. www.nursinghomesmagazine.com 56 (3): 92-93. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png South East European Journal of Economics and Business de Gruyter

Work Motivation of Highly-Educated Croatian Employees - What Should Managers and HR Experts Know?

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de Gruyter
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Copyright © 2008 by the
ISSN
1840-118X
DOI
10.2478/v10033-008-0009-5
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Abstract

The study dealt with the work motivation of highly-educated Croatian employees, specifically those at the fore of their companies in terms of expertise amid this "Age of Knowledge," in order to provide recommendations for management on how to improve their levels of motivation, and give direction to HR experts on which motivation policies and practices to implement. According to the findings, highly-educated Croatian employees perceive that many regular motivation strategies are insufficiently present in their companies, are generally not satisfied with the motivation strategies applied, and are significantly less satisfied with motivation strategies because they deem them unimportant. Furthermore, they perceive non-material motivation strategies as more effective, assign these strategies greater importance and find them generally more satisfying than material motivation strategies. Finally, the findings indicate that there are no differences in work motivation between highly-educated Croatian employees with different characteristics. JEL: M12, M52 DOI: 10.2478/v10033-008-0009-5 1. Introduction Managers of every company need to ensure that their employees are highly productive in areas consistent with the objectives of the organization. This can only be achieved if employees are highly motivated in their work, and managers are able to actively enhance and maintain this motivation. Motivation at work has been a popular area of research for almost a century, from the 1930s onwards. Contemporary exploratory studies on work motivation have increasingly focused on particular respondent groups (for example Leung and Clegg 2001), industries (for example Jindal-Snape and Snape 2006) or geographic areas (for example Eskildsen, Kristensen, and Westlund 2002; Linz, Good, and Huddleston 2006; Takahashi 2006), as well as on different combinations of those determinants (for example Lee-Ross 2002). Research addressing the issue of motivation factors of Croatian employees has mostly been limited to one company (for example Aneli 1996), one industry (for example, Klepac 2002 about motivation factors in the Croatian bank industry) or one group of employees (for example Frani 2007 about motivation factors of young Croatian managers). In other words, as work *Poloski - Voki: University of Zagreb, Faculty of Economics and Business Trg J. F. Kennedya 6, 10 000 Zagreb, Croatia e-mail: npoloski@efzg.hr *Klindzi: University of Zagreb, Faculty of Economics and Business Trg J. F. Kennedya 6, 10 000 Zagreb, Croatia e-mail: mklindzic@efzg.hr *akovi: RTL Television Krapinska 45, 10 000 Zagreb, Croatia e-mail: martina.djakovic@rtl.hr SEE booklet CC.indd 89 motivation is not a globally uniform concept, its research is suggested to provide insight into the motivation of diverse and under-researched groups of employees (Jindal-Snape and Snape, 2006) and differences resulting from various cultural settings (Eskildsen, Kristensen, and Westlund 2002), which this paper in particular seeks to investigate. The study dealt with the work motivation of highlyeducated Croatian employees, specifically those at the fore of their companies in terms of expertise amid this "Age of Knowledge." Since knowledgeable workers and their productivity are the most valuable assets of a 21st century institution (Drucker 1999, p. 135), what motivates them should be of primary interest to contemporary organizations and their managers. Therefore, highly-educated Croatian employees were selected as a group to be surveyed. The study had three main aims. The first aim was to explore the level of highly-educated Croatian employees' satisfaction with various common material and nonmaterial motivation strategies, and the importance they assign to those strategies. In other words, the study sought to explore the perceptions of highly-educated Croatian employees regarding a range of motivation factors. The second aim was to test assumptions concerning the differences in work motivation among highly-educated employees with diverse characteristics. Namely, studies report different and sometimes contradictory findings with respect to the effect that employee characteristics such as gender, age and educational level have on work motivation (Eskildsen, Kristensen, and Westlund 2002), which was the impetus to explore the issue further. In particular, the relationship between respondents' characteristics (both demographic and those of their companies), and their satisfaction with various motivation strategies and the level of importance they assign to those strategies were analyzed. Upon the collection of the aforementioned data concerning work motivation, the final aim was to identify practical recommendations for managers and human resource (HR) experts with the purpose of improving the productivity of highly-educated Croatian employees. Simply put, the third aim was to provide recommendations for Croatian management on how to improve (or maintain) levels of motivation among their employees. Specifically, since we are living in the "Age of Knowledge," in which human resources are of crucial importance for achieving organizational success, findings on the work motivation of highly-educated Croatian employees could contribute to and enhance the performance of both Croatian organizations and the country in general. Furthermore, since human resource management (HRM) as a business and managerial function has yet to be developed in Croatia, the findings of this research could give direction to HR departments in terms of further development, and suggest precisely which HR practices and policies to implement. 2. Research Areas and Methodology Research Areas. In order to help Croatian managers to motivate their employees effectively and HR experts to perform their jobs better, four aspects of highlyeducated Croatian employees' motivation were assessed: (1) employees' satisfaction with various common material and nonmaterial motivation strategies, (2) the level of importance employees assign to those strategies, (3) the discrepancy between employees' satisfaction and assigned level of importance to various motivation strategies, and (4) the relationship between satisfaction/importance of various motivation strategies and respondents' characteristics (the analysis focused on the following demographic and other categories: gender, age, hierarchical level, pay level, field of work, size of the company, main company activity, ownership structure, existence of HR department, and existence of performance appraisal). Research Instrument. The research was conducted by means of a questionnaire consisting of five parts: (1) demographic characteristics of respondents (gender, age, hierarchical level, pay level, and field of work), (2) their companies' characteristics (size of the company measured by number of employees, main company activity, ownership structure, existence of HR department, and existence of performance appraisal), (3) questions concerning the presence of various material and nonmaterial motivation strategies in respondents' companies, (4) questions concerning respondents' satisfaction with various standard motivation strategies, and (5) questions concerning the level of importance respondents assign to those strategies. Altogether seventeen commonly present motivation strategies were assessed by respondents: ten material motivation strategies (salary, innovation and improvement bonuses, other bonuses and incentives, profit-sharing, gain-sharing, ESOP ­ employee stock ownership plan, additional education, life-insurance, recreation, and company car), and seven nonmaterial motivation strategies (job design, flexible working hours, recognition, feedback, leadership style, corporate culture, and MBO ­ management by objectives). Respondents were asked to indicate the extent of their satisfaction and the level of importance of various material and nonmaterial motivation strategies by circling a number on a five-point Likert-type numerical scale ranging from 1 (not satisfied/not important) to 5 (extremely satisfied/extremely important). Sample. The sample consists of 98 highly-educated Croatian employees that enrolled in graduate programs SEE booklet CC.indd 90 Table 1: Profile of Respondents and their Companies at the Faculty of Economics and Business ­ Zagreb (FEBZG). Graduate students from FEB-ZG were selected as respondents as they come from different occupations and different parts of Croatia, and therefore are suitable representatives of highly-educated Croatian employees. The research questionnaires were completed anonymously by those graduate students that were present at lectures in April of 2006. Table 1 depicts their profile for this study, Figure 1: Average satisfaction and average importance of various motivation strategies SEE booklet CC.indd 91 both in terms of their demographic and their companies' characteristics. The size of the sample is satisfactory when compared with similar studies (see, for example, Jindal-Snape and Snape 2006; Lee-Ross 2002; Leung and Clegg 2001). Data Processing. Statistical analysis consisted of descriptive statistics calculations, t-tests for two related means, and calculations of Cramer's V. Calculations and tests were conducted using SPSS. Several main findings stem from Figure 1. First, there is an evident discrepancy between respondents' satisfaction with various motivation strategies and the value they assign to those strategies. Respondents evaluated higher the importance of all seventeen motivation strategies numbered than their satisfaction with those strategies, a result which will be dealt with in more detail later in the article. Second, respondents are moderately satisfied with the motivation strategies numbered (2.74 on average; nine out of seventeen motivation strategies with an average value less than 3.00). They are especially unsatisfied with the material strategies available in their companies. On average, their satisfaction with those strategies was 2.35; three out of ten of those strategies were evaluated on average less than 2.00 (profit-sharing, gain-sharing, and ESOP); two between 2.00 and 2.50 (innovation and improvement bonuses, and life-insurance); three between 2.50 and 3.00 (other bonuses and incentives, recreation, and company car); only two of those strategies were evaluated on average higher than 3.00 (salary, and additional education). To a higher extent respondents reported satisfaction with nonmaterial strategies. Their average satisfaction with those strategies was 3.14, with none of those strategies evaluated on average higher than 3.50, and with only one evaluated on average lower than 3.00 (MBO). Third, respondents find all seventeen motivation strategies numbered fairly to extremely important. To be precise, only one motivation strategy had an average importance value less than 3.00 (but not far from that 3. Research Results The research results are presented in two parts. First, highly-educated Croatian employees' satisfaction with numbered material and nonmaterial motivation strategies, the level of importance they assign to those strategies, and the discrepancy between their satisfaction and assigned level of importance are presented. Second, the relationships between satisfaction/importance of various motivation strategies for respondents and their demographic/company characteristics are presented. 3.1. Satisfaction with and Importance of Various Motivation Strategies for Highlyeducated Croatian Employees Figure 1 depicts the average respondents' satisfaction with seventeen standard motivation strategies and the average level of importance they assign to those strategies. Table 2: Percentage of Companies that Use Various Motivation Strategies and Motivation Strategies Satisfaction/Importance Rankings SEE booklet CC.indd 92 Table 3: Statistical Differences between Satisfaction and Importance of Various Motivation Strategies value; company car ­> 2.98); two were between 3.00 and 3.50 (life-insurance, and recreation); six between 3.50 and 4.00 (innovation and improvement bonuses, profit-sharing, gain-sharing, ESOP, job design, and flexible working hours); seven between 4.00 and 4.50 (salary, other bonuses and incentives, additional education, feedback, leadership style, corporate culture, and MBO); one strategy was assessed on average as extremely important (recognition ­> 4.60). Altogether, the respondents think that motivation strategies numbered are very important (3.96 on average), with nonmaterial strategies graded on average higher (4.21) than material ones (3.79). Further analysis consisted of observing the presence of various motivation strategies in Croatian companies and associated respondents' satisfaction/importance rankings (table 2). Table 2 reveals that, when looking at rankings, respondents are more satisfied with those motivation strategies that are more present, which was reasonable to expect. The rankings also confirm previously elaborated findings about nonmaterial motivation strategies being positioned better, since they were ranked higher both in terms of respondents' satisfaction and the importance respondents assign to them. The third part of the analysis of highly-educated Croatian employees' work motivation consisted of examining significant differences between their satisfaction and the importance they assign to various motivation strategies. Therefore, t-tests for two related means, with pairs being satisfaction and importance of each of the seventeen motivation strategies, were performed (table 3). As mentioned before, and as is evident from paired differences means signs (all negative), respondents evaluated higher the importance than their satisfaction with all seventeen motivation strategies. Moreover, t-test results revealed that their average importance grades are significantly different (higher) than their average satisfaction grades. To be precise, differences between pair means are all statistically significant, with all but one significant at the 0.01 level. 3.2. Relationship between Satisfaction/ Importance of Motivation Strategies and Respondents' Characteristics In order to provide a measure of the strength of the relationship between the characteristics of highlyeducated Croatian employees (both demographic and those of their companies) and the motivation factors assessed, Cramer's V was used. Table 4 depicts the number and percentage of statistically significant relationships between respondents' demographic characteristics and the satisfaction/importance they attribute to various material and nonmaterial strategies. SEE booklet CC.indd 93 Table 4: Statistically Significant Relationships between Satisfaction/Importance of Various Motivation Strategies and Respondents' Demographic Characteristics Table 4 implies that none of the respondents' demographic characteristics significantly differentiates their satisfaction with various motivation strategies or the importance they assign to those strategies. Although research gives evidence that demographic differences could be related to motivation factors (Eskildsen, Kristensen, and Westlund 2002; Gurvich 2006 in Hartley 2007), the results of this study reveal that only respondents' hierarchical and pay level could to some extent be aligned with their satisfaction with the material motivation strategies present in their companies. The relationships between the characteristics of the respondents' companies and the satisfaction/ importance they assign to various motivation strategies proved not to be significant (table 5). Table 5 indicates that although companies' characteristics are generally associated with employees' work motivation (Jindal-Snape and Snape 2006) no company characteristic was found to be significantly related to the motivation issues explored in the research. 4. Discussion and Recommendations The summary of all obtained results is given separately for material, nonmaterial, and motivation strategies in total. The following findings regarding work motivation in Croatian companies are presented in table 6: (1) average presence of observed motivation strategies in Croatian companies, (2) average satisfaction and average importance respondents assigned to those strategies, (3) average satisfaction and average importance rankings of those strategies, (4) percentage of statistically significant differences between respondents' satisfaction and the importance they assigned to those strategies, and (5) percentage of statistically significant demographic and companies' characteristics related to highly-educated Croatian employees' satisfaction with and the importance they assigned to various motivation strategies. There are several conclusions that can be drawn from Table 6 and serve as rationale for practical recommendations for managers and HR experts concerning their employees' work motivation: Table 5: Statistically Significant Relationships between Satisfaction/Importance of Various Motivation Strategies and Companies' Characteristics SEE booklet CC.indd 94 Table 6: Summary of Obtained Results First, highly-educated Croatian employees perceive nonmaterial motivation strategies to be more present in their companies compared to material ones, which is probably the cause of their greater satisfaction with that group of strategies (both in terms of average value and average ranking). For Croatian managers and HR professionals, that implies the need to invest more in material ways of motivating highly-educated employees, especially when keeping in mind that the expected monetary rewards have a large influence on employees' motivation (Linz, Good and Huddleston 2006). Second, according to both average value and average ranking of motivation strategies, highly-educated Croatian employees find nonmaterial motivation strategies to be more important than material ones. This matches Cohen's (2006) observation that money-based rewards aren't distinctive, individual, or motivational, and that a personal, nonmonetary gift is ultimately more rewarding. Consequently, it is important for Croatian managers and HR experts to consider many different aspects of working conditions beyond financial rewards in order to motivate their employees, as contemporary authors emphasize (for example Strickler 2006; Hartley 2007). Plainly expressed, pay does matter, but convincing people to stay might not cost as much as HR believes (IOMA 2007). The Croatian business environment, just as contemporary business settings all over the world, should thus give relevance to motivation factors such as teamwork, sharing of leadership roles, corporate culture, sincere care and concern, and similar issues (more about the importance and impact of "soft" business practices on employees' motivation see Cohen 2006; Strickler 2006; Zofi and Meltzer 2007). Additionally, highly-educated Croatian employees' perceptions of greater importance of nonmaterial motivation strategies could be the result of their better salaries on average (that match their educational level), and therefore their greater interest in alternative motivation strategies, especially in fulfilling their highest level needs (mostly nonmaterial needs such as self-actualization, recognition, feedback, participative leadership style, etc.). Third, highly-educated Croatian employees evaluated all seventeen motivation strategies listed in the research as more important than satisfying. This is confirmed by all differences between pairs of values (importance and satisfaction) being statistically significant, and implies that Croatian managers and HR experts should devote considerably more effort, time and money to the development and implementation of a wide range of motivation activities. Fourth, highly-educated Croatian employees' demographic and company characteristics were not found to be significantly related to either their satisfaction with or the importance they assign to various motivation strategies. The lack of differences in satisfaction between employees with different characteristics could be explained by their overall dissatisfaction with the motivation strategies provided by their companies. The lack of differences in importance they assign to those strategies could be partially explained by the currently popular situational approach to motivating employees, which implies that when it comes to matters of motivation one size does not fit all, and that determining what motivates each and every individual is the only way of managing their performance. Croatian managers and HR experts should therefore not treat Croatian highly-educated employees as a monolithic category. Rather, policies and programs to support them should begin with a diagnosis of their personal characteristics and motivation factors aimed at strengthening pull motives that comprise a base for their greater efficiency and effectiveness. 5. Conclusion In order for employees to act as a source of competitive advantage, i.e., to contribute to the development of an enterprise's competitiveness, they need to be knowledgeable and motivated. Motivated employees are considered a vital link for both a company's efficiency and effectiveness, and motivated highly-educated employees SEE booklet CC.indd 95 3/31/2008 15:09:49 are today becoming a primary source of a company's competitive advantage. This study, unfortunately, indicates that Croatian companies do not apply that philosophy and seem even to be unaware of it. Highly-educated Croatian employees, according to the findings, perceive that many regular motivation strategies are insufficiently present or underdeveloped in their companies, are generally not satisfied with the motivation strategies applied, and are significantly less satisfied with the motivation strategies provided than they consider them important, which could all lead to diminished productivity. Furthermore, they are more satisfied with nonmaterial motivation strategies (probably because they perceive those strategies more present than material ones), and assign more importance to them. This suggests that alternative methods of motivating Croatian highly-educated employees, besides financial rewards, should not be neglected, which is in accordance with the fact that knowledgeable workers are in general satisfied with their salaries (because they are on average paid better), and therefore primarily interested in intrinsic awards. Finally, the findings reveal that there are no differences in work motivation between highly-educated Croatian employees with different characteristics, implying that they, regardless of their demographic or company characteristics, perceive that motivation practices are not given enough attention by their managers, and that they should not be treated uniformly or as a group when motivated, because what motivates one person does not necessarily motivate another, as the situational approach to work motivation suggests. Overall, the findings from this research could help Croatian managers and HR experts enhance employees' productivity by understanding what motivates them and their degree of satisfaction with existing motivation strategies. Frani, J. 2007. Vaznost materijalnog nagraivanja u motivaciji mladih managera u Hrvatskoj (The importance of compensations for motivating young managers in Croatia). M.Sc. thesis. University of Zagreb ­ Faculty of Economics and Business. Zagreb. Hartley, S. 2007. Motivating workers. Businessdate 15 (1): 1-3. IOMA. 2007. Rewards Are Now Critical to Keep Valued Employees. www.ioma.com/hr 7 (5): 1, 10-12. Jindal-Snape, D., Snape, J. B. 2006. Motivation of scientists in a government research institute ­ Scientists' perceptions and the role of management. Management Decision 44 (10): 1325-1343. Klepac, J. 2002. Razvoj motivacijskih strategija u funkciji uspjesnosti poslovanja banaka u Republici Hrvatskoj (Motivation strategies for improving performance in Croatian banking sector). M.Sc. thesis. University of Zagreb ­ Faculty of Economics and Business. Zagreb. Lee-Ross, D. 2002. An exploratory study of work motivation among private and public sector hospital chefs in Australia. Journal of Management Development 21 (8): 576-588. Leung, A. S. M., Clegg, S. R. 2001. The career motivation of female executives in the Hong Kong public sector. Women in Management Review 16 (1): 12-20. Linz, S. J., Good, L. K., Huddleston, P. 2006. Worker Morale in Russia: An Exploratory Study. William Davidson Institute Working Paper Number 816: 1-24. Strickler, J. 2006. What Really Motivates People?. The Journal for Quality & Participation 29 (1): 26-28. Takahashi, K. 2006. Effects of wage and promotion incentives on the motivation levels of Japanese employees. Career Development International 11 (3): 193-203. Zofi, J. S., Meltzer, S. 2007. Making motivation personal. www.nursinghomesmagazine.com 56 (3): 92-93.

Journal

South East European Journal of Economics and Business – de Gruyter

Published: Apr 1, 2008

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