NAME: Kesya Grasela Zefanya Hebingadil

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Introduction to Business Exercise

A. Motivation Theory

Motivation Theory

Motivation theory is also divided into several conceptions put forward by

experts. As an initial illustration, there are at least two types of motivation theories,
namely:

Satisfaction theory which tends to emphasize various internal factors that support,
strengthen, direct and stop; and Process theories that analyze how the behavior is
supported, reinforced, directed, and stopped. Among the many motivation theories,
there are three names that most influence thinking related to satisfaction theory,
namely Abraham Maslow, Frederich Herzberg and David McCelland.

Maslow's Theory of Needs:

According to Maslow, a person has five general needs, all of which can be
arranged based on a hierarchy of importance. The most basic needs that must be
satisfied first are physiological needs which are then followed by safety, social,
esteem and self-actualization needs which will be explained in the following
explanation:

Physiological needs, namely basic needs that support human life, starting from
clothing, food, to shelter. Unfulfillment of physiological needs will cause other needs
to become unable to motivate humans. Security needs, namely the need to be free
from physical danger and fear, whether fear of losing work or material things. Social
needs, namely the need for social interaction and interaction and to be part of a group.
Esteem needs, namely the need to be appreciated by others. Self-actualization needs,
namely the need to develop oneself into the figure one dreams of (Krisnandi et al,
2019, p. 158).

Herzberg's Two Factor Theory:

Herzberg's two-factor theory is based on Maslow's hierarchical classification

into upper and lower needs. According to Herzberg, situations that can fulfill these
needs are appreciation and self-actualization which will then increase work motivation
(Krisnandi et al, 2019, p. 159). An organization also needs to facilitate the fulfillment
of the lower level needs of its employees to maintain the employees concerned so that
they remain willing to work in the organization, not to motivate their work behavior.

The two motivational factors proposed by Herzberg are factors that make people feel
satisfied and dissatisfied. The two factors in Herzberg's motivation theory are also
seen as having two situations, namely: situations where people feel healthy and
situations where motivational factors are needed; And intrinsic and extrinsic factors
(Krisnandi, 2019, p. 159).

McClelland's Theory of Motivation:

The results of McClelland's (1968) research show that a strong need for
achievement and a drive for success are related to the extent to which a person is
motivated in carrying out their duties. The needs put forward by McClelland include
the need for achievement, affiliation and power. People with high needs tend to be
interested in taking responsibility for solving various problems, setting goals that are
relatively difficult for them and taking calculated risks to achieve these goals.

Justice Theory (Equity Theory):

The main work motivation factor is evaluating the fairness of an award. In this
case, the subordinate compares the effort he makes and the rewards he receives with
the efforts and rewards made and received by other people in a similar work climate.
In this context, justice itself is a comparison between the input from the work carried
out by someone and the rewards they receive. In this theory, the main key to
individual motivation is satisfaction resulting from equal treatment. The injustice felt
by employees will encourage the employee to try something as a response to this
injustice, for example by reducing productivity levels. Other tendencies of injustice
felt by employees include:

Employees change the amount of input and output themselves or others;

Employees influence others to reduce or change their input and output;

Employees behave to change their own input and output;

Employees look for other comparisons;

Employees leave their jobs.

Expectancy Theory (Expectancy Theory):

Expectancy theory assumes that people will choose a way of behaving from
various alternatives based on their expectations of what they will gain from each
action. These expectations reflect a person's perception regarding the difficulty of
achieving a certain behavior as well as the probability of achieving that behavior.
Expectancy theory is based on the following assumptions regarding behavior in
organizations. Each individual has different goals and levels of needs and desires.
Individual behavior is determined by a combination of various internal and external
factors. Individuals make choices among various behavioral alternatives based on
their expectations of a behavior that has the potential to produce the desired results.

Decisions regarding behavior in organizations are made consciously by the individuals

concerned.

The main principles of expectancy theory can be explained as follows:

P = F (M X A)

Performance (P) or achievement is a function (F) of multiplying motivation

(M), namely strength, and ability (A).
M-F (V1 X E)

Motivation (M) is a function (F) of multiplying the Valence of each first level
result (V1) and expectancy (E) or the hope that a certain behavior will be followed by
a first level result. If expectations are low, there will be little motivation. On the other
hand, if the valence value of an acquisition is zero, then the absolute value or variation
in the magnitude of the hope of completing it will have no effect at all.

V1 = (V2 X I)

The valence associated with various first level outcomes (V1) is a function (F)
of the product of the sum of second level valence (V2) and instrumentality (I) or the
relationship between first level and second level achievements.

Reinforcement Theory:

Different from satisfaction theory which explains the "what", process theory
attempts to explain the "how", namely how the consequences of past behavior can
influence future actions in a learning process. According to reinforcement theory,
behavior that is responded to pleasantly with rewards tends to be repeated in the
future, conversely, behavior that is responded to unpleasantly with punishment tends
not to be repeated in the future (Krisnandi et al., 2019, p. 164) .

In order to change a person's behavior through reinforcement, managers need to

change the consequences of each behavior a person may exhibit. Methods for
changing a person's behavior include the following:

Positive Consequences:

A person is given positive consequences if he can change his habits. For

example, if a student who usually comes late can change his behavior by sticking to
the class start time, then the person concerned will be guaranteed to pass the exam.

Criticism and Evaluation

 The habit of arriving late to class can also be changed by always criticizing and
evaluating the habit, namely by saying that the habit is very bad. ignore it It doesn't
matter whether the person concerned can arrive on time or late, the important thing is
that the lecture process continues according to schedule. There is no allowance for late
entry into college.

Punishment

This method is considered very extreme, but quite effective. The use of
punishment to change student behavior aims to give them the opportunity to review
their bad behavior and try to improve this behavior (Krisnandi et al, 2019, p. 164).

Application of Motivation Theory

Designing and running a successful motivation program is not easy. Leaders

cannot simply choose a theory to then apply it literally because in reality, an
organization has its own dynamics and is surrounded by various factors that can
influence the integrity of the application of motivation theory. The application of
motivation theory itself is of course very diverse. For example, we will apply
Maslow's theory of motivation, then several actions that can be taken as motivation
management practices are as follows:

-Providing financial rewards (wages, salaries) to meet physical needs.

-Providing work contracts and pension guarantees so that employees feel

guaranteed and safe.

-Providing an organizational identity so that employees can feel part of it (from

things like the ethos and goals of the company, to small details such as work clothes,
which reflect the company's identity.

-Providing rewards or monetary gifts, promotions and recognition in various

forms for achievements or good work performance. Indirectly, although the salary
received can enable employees to do things that help fulfill their needs, the relevant
organization can give them a scope of work and responsibility for them to do that
(Krisnandi et al, 2019, p. 166) .
Actions that can be taken by leadership include the following:

-Ensure that employees receive financial rewards according to their rights.

-Ensure that employees understand the organization's rules and programs that
support their sense of security, and if possible appoint them as permanent employees.

-Creating a team atmosphere among employees, for example through

consultation and sharing control and responsibility.

-Give recognition to each employee by paying attention to each employee's

development and praising each employee's contribution to the team and organization.

-Helping employee self-development, namely in the aspects of responsibility,

independence and initiative

B. Leadership Style

8 Types of Leadership Style (Leadership):

1. Democratic Leadership (Democratic Leadership)

The democratic type of leadership style is the most effective type. This type
gives employees the opportunity to exercise the authority they carry wisely. Through
this type, employees have the opportunity to train their leadership skills at a level that
is not too high with a level of complexity that is also not high.

Apart from that, this democratic type gives every employee an equal opportunity to
provide instructions, opinions and provide input in the meeting or discussion process.
Because leaders in this type of leadership style make decisions based on input from
their members.

The following are the characteristics of a democratic leader:

-Prioritize joint discussions as a problem solving method

-Convey complete information to the team in making decisions

-Encourage a work environment where everyone expresses their ideas

-Able to mediate when necessary

-Rational

-Flexible

The advantages of this type of democratic leadership are as follows.

-Growing self-confidence in employees because they have the opportunity to convey

input and the input is responded to appropriately.

-For the same reason, it makes employees feel more appreciated and empowered as
well as possible.

Meanwhile the challenges are as follows:

-Tends to need more time to organize large discussions together, accommodate ideas,
discuss, until everyone really agrees without exception

-Members who are less used to or like this type of leadership style tend to experience
pressure from other members because they cannot follow

2. Autocratic Leadership

In contrast to democratic leadership, autocratic leadership is a type of

leadership style where the leader does not ask for or consider his employees' input in
making decisions. Ultimately, employees are required to comply with decisions even
if they disagree. Unfortunately, this type is less sustainable nowadays because they
will quickly lose their employees.

The following are the characteristics of an autocratic leader:

-Self-confidence and self-motivation are quite high

-Can communicate clearly and consistently

-Comply with regulations

-Reliable

-structured environment
-Very alert

The advantage of autocratic leaders is that they can encourage productivity with a
structured division of work such as delegation, clear and direct communication,
reducing employee stress by making decisions quickly.

Meanwhile, the disadvantage is that this type of leader is susceptible to stress because
he feels that all responsibility is his own burden. This is due to their lack of flexibility
so that sometimes they are not liked by their team.

3. Laissez-faire leadership

Laissez-faire is taken from French which means 'let it be'. As it means, this
type gives employees great authority and leaders give them great trust. This type is
quite common in newly launched startups. Because it is still early days, it is very
important that this type of leader always monitors the performance of his employees
so that their work runs smoothly.

The following are the characteristics of a laissez-faire style leader:

-Able to delegate effectively

-Believes in freedom of choice

-Provide needs and well

-Will take over control when necessary

-Offer constructive criticism

- Maintain good leadership qualities

-Encourage an autonomous work environment

The advantage of laissez-faire is that it encourages accountability and creativity in a

relaxed work environment. So that it can increase employee capabilities.

Meanwhile, the challenge is that this type is not appropriate to apply to new
employees who still need guidance from scratch. This type can also cause an
ambiguous leadership structure if the leader is not good at supervising and employees
do not receive sufficient support.

4. Strategic leadership

Strategic leadership is a type that is often expected by companies because

strategic thinking can encourage the performance of various types of employees at
once. Because leaders will lead many individuals with different personalities and ways
of working in their teams. If the leader understands the best strategy to control this
condition, this leader is certainly highly expected.

The following are the characteristics of a strategic leader:

-Able to motivate the team

-Good communication skills

-Cares about the team

-Encourage collaboration and reciprocal communication

-Committed to the professional growth of the team

The advantage of this type of strategic leader is that they have the capacity to increase
employee loyalty and productivity. They can also encourage the advancement of
employees' work skills and decision making. Because leaders care about employees
well, there is a sense of trust in each other which can encourage good working
relationships.

The challenge is that leaders can experience boredom because they tend to prioritize
the interests of their team before themselves. In addition, they have the potential to
have difficulty maintaining their authoritative role in critical moments due to their
tendency to interact casually in ordinary conditions.

5. Transformational leadership
 Transformational leadership can be defined as a type of leadership style where
the leader encourages himself and his team to transform regularly. For example,
employees have tasks that must be completed every week. What this type of leader
does is push employees out of their comfort zone. Targets that initially seem simple or
easy, this type of leader will encourage their employees to be better or faster at
subsequent targets.

The following are the characteristics of a transformational leader:

-Have mutual respect with his team

-Able to encourage the team

-Able to inspire to achieve targets

-Think about the big picture

Provide the team with challenges of an intellectual nature

-Understand the need for good organization

-Creative

The advantage of transformational leaders is that they really value personal

relationships between teams. This also increases the overall value of the company if
implemented correctly. Not only does it make the team result-oriented, but it also
improves company and team ethics.

Meanwhile, the challenge is that leaders can end up only paying attention to
individuals if they are not careful and pay attention to details.

6. Transactional leadership

This type of transactional leader is common today. Leaders give rewards to

employees when their work results meet expectations. This type of leadership
establishes roles and responsibilities for each employee. Besides that,

The following are the characteristics of a transactional leader:

-Respect the corporate structure

-Able to supervise in detail

-Don't question authority

-Practical and pragmatic

-Encourage employees to always -achieve targets

-Reactionary

The advantage of the transactional type of leader is that it can facilitate employees to
achieve targets well. This is done by planning and creating a clear structure so that
employees can carry out their duties with clear instructions.

Meanwhile, the challenge of this type of leader is the difficulty of focusing on long-
term targets. The transactional type of leader has the potential to stifle creativity if the
rewards offered are not considered commensurate with the employee's efforts. Apart
from that, employees whose character is not too competitive tend to fall behind
themselves so this will make it a challenge for leaders.

7. Coach-style leadership

As the name suggests, coach-style leadership is similar to that carried out by

coaches on sports teams. This type of leader focuses on identifying and nurturing each
individual on the team. They also focus on strategies that can encourage their team to
work better.

This coach-style leadership has strong similarities with the two previous types of
leadership styles, strategic and democratic leadership styles. It's just that specifically
for this type, the leader emphasizes the growth and success of each individual in the
team.

This type of leader also encourages individuals or employees to pursue special fields
where the individual has great potential to develop. Not only that, this leader is also
ready to accompany and provide emotional assistance to his employees. Therefore,
this type will also encourage a team to communicate as well as possible so that their
work runs smoothly.
The following are the characteristics of a coach-style leader:

-Supportive

-Offer to guide rather than give orders

-Value the learning process as a path to growth

-Balancing between helping his team directly or letting them find -their own solutions

The advantage of the coach-style type is that it can encourage the growth of new
employee skills. They can also think freely and maintain a company culture full of
self-confidence. It's no surprise that this type of leader is often seen as a highly valued
mentor.

Meanwhile, the challenge is that this process takes time compared to other types. The
leader's efforts to approach each individual in the team can cause the work target to be
pushed back if the leader is unable to act quickly.

8. Bureaucratic leadership

Bureaucratic leaders adhere to company policies or company habits. Almost

the same as the authoritarian type of leader, but much less rigid. Employees have the
opportunity to provide input. However, such input can be quickly rejected if it is not
in line with company policy.

Employees in this type of leadership do not receive as much control as in the

authoritarian type of leadership. On the other hand, this type tends to cause employees
to be unable to innovate optimally. This happens when the leader considers that the
company is already successful so that it no longer needs major innovation.

The following are the characteristics of the type of bureaucratic leader:

-Details and task oriented

-Prioritize rules and structure

-Have a good work ethic

Strong-willed
-Committed to the company

-Discipline

The advantage of a bureaucratic type of leader is that it is efficient for companies or

agencies that require strict regulations and regulations. Each individual in the
company must have a specific role so that their performance becomes more efficient.
This type of leader also separates work from personal relationships between
employees to avoid causing the team to slow down in achieving targets.

Meanwhile, the challenge is that this type of leader causes limited employee
creativity. This ultimately causes the company to be slow to change and not suitable
for a work environment that demands high dynamics

C. Contiuum of Leader Behavior

The leadership continuum presents a series of types of decision-making

behavior in business organizations that range between two opposing management
styles, namely autocratic and democratic. This continuum was introduced by Robert
Tannenbaum and Warren Schmidt in 1958.

In this leadership continuum, autocratic management occupies the extreme left

point which is characterized by a leadership model that is centered on the boss or
manager. In contrast, democratic management is at the extreme right, characterized by
a leadership model that is centered in the hands of subordinates or subordinates.

Tannenbaum and Schmidt detail seven types of leadership behavior in decision

making between the two management styles above. The further to the left the greater
the manager's control. Conversely, the further to the right the greater the freedom of
subordinates in making decisions in the team.

The following are seven types of leadership behavior in decision making:

 1. The leader makes a decision and announces it. The manager makes his own
decision and then notifies the team. Subordinates or team members are not involved in
the process at all but are asked to implement the decision.

2. Managers sell decisions. The manager makes his own decisions, but he
understands that there is resistance from some team members. In this situation, the
leader persuades and convinces all team members to accept the decision he has taken.

3. Leaders provide ideas and ask for suggestions. The manager makes decisions
and gives the team the opportunity to ask questions and make suggestions. However,
the final decision remains in the hands of the manager.

4. Leaders provide tentative decisions that can be changed. Managers make

decisions temporarily and are not final, team members can provide suggestions and
influence the manager to change the decision.

5. Leaders pose problems, ask for advice, and make decisions. The manager
consults with the team first, listens to their various suggestions and input, then uses it
as a basis for making decisions.

6. The leader formulates the boundaries and asks the group to make decisions.
Managers only prepare broad frameworks and guidelines, while the decision-making
process is left to the team.

7. Leaders allow subordinates to carry out functions within the limits that have
been formulated by superiors. The manager gives the team the freedom to make
decisions as long as it is within the limits that have been regulated and determined.

Of the seven behaviors, number –3 shows that the manager's authority is quite large in
making decisions within the team, although to different degrees, while
subordinates/team members have a very limited role or even none at all. This is also
called a top-down one-way approach.

Behaviors number 4 and 5 are moderate types, where the manager still makes
decisions, but by asking for suggestions and input from the team. This is a two-way
approach model with an emphasis on consultation.
Meanwhile, numbers 6 and 7 show a greater role for team members in the decision-
making process. This leadership style emphasizes participation or joint decision
making in the group.