Describing the Components of Equity Theory and the Role of Justice

Table of Content

1.0 Describe the constituents of equity theory and the function of justness

Equity theory is a theoretical motivational theoretical account directors use to maintain employees motivated. Harmonizing to equity theory, defined by Stacy Adams in the 1960s, employees are motivated when they perceive that they are being reasonably treated in comparing to whom they compare themselves to ( Hitt, Black & A ; Porter 2012 ; Samson & A ; Daft 2012 ) . Equity theory consists of three constituents ( McWilliams & A ; Williams 2014 ) . First, inputs are what the employee perceives he or she contributes to the administration ( Pritchard 1969 ) . Input signals can include professional makings, experience, and committedness to the administration ( McWilliams & A ; Williams 2014 ) . Second, results are the returns and wagess based on input that the employee perceives as worthwhile ( Pritchard 1969 ) . Outcomes are touchable and seeable wagess such as workplace benefits, position or wage ( McWilliams & A ; Williams 2014 ) . Last, referents are those whom the employee subconsciously or consciously compares their results to inputs ( O/I ) ratio with to find whether there is a province of equity or unfairness ( McWilliams & A ; Williams 2014 ; Pritchard 1969 ) . Equity occurs when the employee’s O/I ratio is perceived to be the same as their referent’s O/I ratio ( Pritchard 1969 ) . Many administrations such as Transfield Services commit to making equal chances for all of their employees to advance employee motive, self-development and morale. Conversely, unfairness occurs when the employee perceives that their O/I ratio is either higher or lower than their referent’s O/I ratio ( Pritchard 1969 ) . To handle employees reasonably directors need to do certain decision-making procedures and results are crystalline and indifferent.

Distributive and procedural justness drama distinct and of import functions in equity theory. Distributive justness is the procedure of reasonably presenting and training employees based on their positive or negative parts to the administration ( Hitt, Black & A ; Porter 2012 ) . Distributive justness is when the distribution of wagess or penalties are un-discriminatory, just and consistent with former determinations made in similar state of affairss ( Hitt, Black, Porter 2012 ; Samson & A ; Daft 2012 ) . In contrast, procedural justness occurs when directors make indifferent and crystalline determinations about where and how to administer wagess or effects based on employee parts ( Hitt, Black & A ; Porter 2012 ) . Furthermore, results are non ever perceived to be just, so by being indifferent and maintaining managerial procedures and determinations transparent directors can cut down the like-hood that employees will be displeased with the result ( McWilliams & A ; Williams 2014 ) . In drumhead, to make a positive organizational environment directors should guarantee that determinations that will consequence employees are just and transparent.

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2.0 Compare and contrast transactional leading and transformational leading

Transactional leading and transformational leading are two distinguishable leading manners that are used in different concern contexts to bring forth different consequences. Transactional leaders manage employee public presentation by honoring or taking disciplinary action when employees rise or fall short of public presentation criterions set by direction ( McWilliams & A ; Williams 2014 ; Bass 1990 ) . Furthermore, transactional leaders attempt to actuate employees to adhere or transcend organizational public presentation criterions by promising wagess or acknowledgment of employee accomplishment ( Bass 1990 ) . Transactional leading has found to be good in administrations where: intelligence and creativeness is non a critical employee trait ; employees need to be encouraged to excel their colleagues ( Bryant 2003 ; Hamstra et Al. 2014 ) . However, due to the reactive and uninspiring nature of transactional leading, direction effectivity may worsen over clip. Transactional leading promotes an organizational civilization where employees will merely make minimum work required to run into public presentation criterions ( Bryant 2003 ) . Furthermore, originative persons who feel that their potency is being underused may go forth the company to work rivals or get down up their ain company ( Bryant 2003 ) . However, the defects of transactional leading can be overcome by following a transformational leading manner.

In comparing, transformational leaders encourage employees to exceed opportunisms and work for the good of the administration. Successful transformational leaders have four key features ( McWilliams & A ; Williams 2014 ) . First, successful transformational leaders are magnetic and can move as an influential function theoretical account whom employees can swear and associate to ( Bass & A ; Avolio, cited in Pillai, Schrisheim & A ; Williams 1999 ) . Second, transformational leaders generate enthusiasm and actuate employees to travel above and beyond organizational public presentation criterions by deputing purposeful and ambitious undertakings ( McWilliams & A ; Williams 2014 ) . Third, transformational leaders provide employees with rational challenges to advance originative thought and employee invention ( McWilliams & A ; Williams 2014 ) . By including employees in organizational determination and scheme devising ( Arnold & A ; Loughlin 2013 ) and giving employees freedom to prosecute personal undertakings Google is able to excite employee creativeness and job work outing accomplishments by making an intellectually stimulating organizational environment. Last, transformational leaders provide attention, larning chances and single mentoring to advance assurance and self-development among employees ( McWilliams & A ; Williams 2014 ) . As a consequence, transactional leading is the preferable manner for advancing creativeness and development ( Hamstra et al. 2014 ) . Therefore, directors should take a leading manner based on the organizational nucleus theoretical account and on the consequences they desire for their administration.

3.0 Discuss the elements and benefits of the balanced scorecard theoretical account

The balanced scorecard is a managerial control model that that goes beyond the traditional method of merely utilizing the fiscal province of the administration to mensurate organizational success. The balanced scorecard simplifies scheme and determination devising by dwelling of four different positions that provide a comprehensive image of organizational public presentation ( McWilliams & A ; Williams 2014 ; Kaplan & A ; Norton 2007 ) . First, in the client position directors focus on finding how clients perceive the organisation’s merchandises and services ( Kaplan & A ; Norton 1992 ) . Customer perceptual experiences can be measured by studies, the rate of client petty criticisms and new clients ( Kaplan & A ; Norton 1996 ) . Second, directors looking from an internal position focal point on placing bing and new critical organizational procedures and mensurating the effectivity and efficiency of those procedures ( Kaplan & A ; Norton 1996 ) . The most efficient manner to mensurate the quality of critical organizational procedures is to compare them to client outlooks or criterions ( McWilliams & A ; Williams 2014 ) . Third, directors looking from an invention and larning perspective strive to place where and how betterments can be made within the organizational substructure for long-run success ( McWilliams & A ; Williams 2014 ; Kaplan & A ; Norton 1996 ) . Last, looking at things from a fiscal position, directors traditionally use fiscal analysis tools to find whether alterations that were made based on the invention and acquisition, client and internal positions have positively contributed to an betterment in organizational public presentation ( McWilliams & A ; Williams 2014 ; Kaplan & A ; Norton 1992 ) . Furthermore, there are besides many benefits of utilizing the balanced scorecard.

The scorecard theoretical account ( McWilliams & A ; Williams 2014 ) can profit the car industry by bettering internal fabrication procedures and increasing the quality of the vehicles by coercing industry directors to see and mensurate organizational public presentation all four positions. First, the balanced scorecard helps directors set clearly defined strategic ends by assisting them clearly define the organizational vision ( Kaplan & A ; Norton 2007 ; Kaplan & A ; Norton 1992 ) . Second, the balanced scorecard enables directors to find how betterment in one position will impact other positions in the administration increasing the chance of long-run organizational success ( Bateman & A ; Snell 2013 ) . Last, the balanced scorecard brings a limited figure of elements together in a study, cut downing information overload and increasing determination and scheme devising efficiency ( Kaplan & A ; Norton 1992 ) . In drumhead, by measuring all four positions directors can assist guarantee the long-run endurance of the administration.

4.0 Explain the difference between ISO 9000 and the Australian Business Excellence Framework

ISO 9000 and the Australian Business Excellence Framework ( ABEF ) are similar in some respects, but both have a different range and certification/awarding procedure. ISO 9000 is a aggregation of international quality confidence criterions ( ISO 9000 to 9004 ) defined by the International Organization for Standardization which is an association of 132 international members ( McWilliams & A ; Williams 2014 ; Kantner 2000 ; Johnson 2000 ) . ISO 9000 is a generic quality criterion theoretical account that can use to any administration ( Briscoe, Fawcett & A ; Todd 2005 ) . Furthermore, ISO 9000 criterions concentrate on the quality of organizational procedures that are used to fabricate or supply merchandises and services with the end of increasing client satisfaction ( Johnson 2000 ; Kantner 2000 ) . Geting an ISO enfranchisement ( Kantner 2000 ) is progressively going a demand for medical administrations that manufacture or develop medical merchandises if they want to retain or pull clients such as infirmaries and pharmaceuticss. To successfully obtain an ISO 9000 certification administrations must show to a accredited 3rd party registrar that they are continuously seeking to better the quality of their internal procedures through planning, commanding and certification ( McWilliams & A ; Williams 2014 ; Johnson 2000 ) . Additionally, there are besides criterions that focus on the quality of direction and organizational procedures.

The ABEF is a concern quality model created to mensurate direction efficiency and increase the fight of Australian administrations. The ABEF standards is based on 12s nucleus constructs and seven classs that are focused on all facets of direction procedures from the efficiency of organizational leading to the operational effectivity of the administration ( Hsien Hui & A ; Kay Chuan 2002 ) . In contrast to the ISO 9000 third party scrutinizing procedure, the ABEF provides appliers with the tools needed to execute a self-assessment of their ain administration ( Hsien Hui & A ; Kay Chuan 2002 ) . The self-assessment is conducted by comparing organizational and managerial procedures against the ABEF standards ( McWilliams & A ; Williams 2014 ) . Organisational and direction effectivity are so reviewed and the collected information is used to deploy solutions to better future public presentation ( McWilliams & A ; Williams 2014 ) . An Australian company responsible for fabricating aluminum was able to increase profitableness while still cut downing their impact on the environment by comparing their direction and operation effectivity to the ABEF standards ( Hsien Hui & A ; Kay Chuan 2002 ) . In add-on, the ABEF distributes annually awards based on organizational conformity to the ABEF standards which can bolster positive acknowledgment for first-class concern patterns ( McWilliams & A ; Williams 2014 ) . Therefore, keeping quality managerial and organizational procedures is critical for organizational repute, profitableness and growing.

List of Mentions

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Bass, BM 1990, ‘From transactional to transformational leading: acquisition to portion the vision’ ,Organisational Dynamicss, vol. 18, no. 3, pp. 19-31, doi:10.1016/0090-2616 ( 90 ) 90061-S

Bateman, TS & A ; Snell, SA 2013,Management: leading & A ; join forcesing in a competitory universe,tenth edn, McGraw-Hill/Irwin, New York, NY

Briscoe, JA, Fawcett, SE & A ; Todd, RH 2005, ‘The execution and impact of ISO 9000 among little fabrication endeavors ‘ ,Journal of Small Business Management, vol. 43, no. 3, pp. 309-330, doi:10.1111/j.1540-627X.2005.00139.x

Bryant, SE 2003, ‘The function of transformational and transactional leading in making, sharing and working organisational cognition ‘ ,Journal of Leadership & A ; Organizational Studies, vol. 9, no. 4, pp. 32-44, doi:10.1177/107179190300900403

Hamstra, MRW, Van Yperen, NW, Wisse, B & A ; Sassenberg, K 2013, ‘Transformational and transactional leading and followers’ accomplishment goals’ ,Journal of Business and Psychology,vol. 29, no. 3, pp. 413-425, doi:10.1007/s10869-013-9322-9

Hitt, MA, Black, JS & A ; Porter, LW 2012,Management, 3rd edn, Prentice Hall, Upper Saddle River, New Jersey

Hsien Hui, K & A ; Kay Chuan, T 2002, ‘Using the Australian concern excellence model to accomplish sustainable concern excellence ‘ ,Corporate Social Responsibility & A ; Environmental Management, vol. 9, no. 4, pp. 196-205, doi:10.1002/csr.28

Johnson, PL 2000,ISO 9000: the twelvemonth 2000 and beyond, 3rd edn, McGraw-Hill, New York, NY

Kaplan, RS & A ; Norton, DP 1992, ‘The balanced scorecard – steps that thrust performance’ ,Harvard Business Review,vol. 70, no. 1, pp. 71-79, viewed 26 May 2015, & lt ; hypertext transfer protocol: // T=P & A ; P=AN & A ; K=9205181862 & A ; S=R & A ; D=hbs & A ; EbscoContent=dGJyMNLr40SeqLQ4y9f3OLCmr02eprJSr6m4S6+WxWXS & A ; ContentCustomer=dGJyMPGvtE+3prBRuePfgeyx43zx & gt ;

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Pillai, R, Schriesheim, CA & A ; Williams, ES 1999, ‘Fairness perceptual experiences and trust as go-betweens for transformational and transactional leading: a two-sample study’ ,Journal of Business,vol. 25, no. 6, pp. 897-933, doi:10.1177/014920639902500606

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Samson, D & A ; Daft, RL 2012,Management,4th edn, Cengage Learning Australia, South Melbourne, Victoria

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