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Introduction

This paper will discuss why sales manager, Jim Reed, failed to properly motivate top

salesman, Fred Maiorino to continue and advance in his achievements at Schering-Plough. In

doing so, it will examine Reed's role in promoting Fred's sense of psychological contract

breachand ultimately, violationand Reed's contributions to the injustices done to Fred. It

will explore the misuse of psychological appraisals and goal-setting and discuss Reed's

counterproductive leadership style, leading to his ultimate de-motivation of Fred. This paper will

then recommend alternative behaviors for Reed regarding the psychological contract,

performance appraisal, goal-setting, and development of an effective leadership style, suggesting

specific actions Reed should have taken to inspire Fred to remain a loyal and valued employee of

the company.

Psychological Contract Breach/Violation and Procedural/Distributive/Interactional Justice

At the onset of their relationship, Jim Reed told Fred Maiorino, You're one of the senior

men here. I'll need your help. (Buller & Schuler, 2003, p. 242-243). This remark stuck with

Fred because, for older workers, [p]rotecting self-concept seems to be one of the leading

determinants (Kanfer & Ackerman, 2004, p. 447). Many older workers tend to prefer

collaborative (versus competitive) tasks (Kanfer & Ackerman, 2004, p. 441) since they often

view social interactions as a means of obtaining affective rewards (emotional satisfaction) and

supporting ones identity (Kanfer & Ackerman, 2004, p. 444). The difference of five-ten years

between Fred's age, 59, and Jim Reed's age, in his sixties (Buller & Schuler, 2003, p. 233, 236)

may have contributed to the difference of emphasis the two men placed on Reed's remark.

Kanfer and Ackerman (2004) found that ...younger and older adults express and display less

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evidence of generativity (e.g., providing emotional support to others) than do middle-aged

adults, and midlife workers may respond more positively to managerial strategies that

emphasize cooperation rather than competition (p. 445). Reed possibly made the remark in an

offhanded manner; whereas, Fred took it to heart, as shown in his ability to recall the comment

years later. The case indicates that at no time did Reed ask Fred's advice regarding ways to train

or motivate younger salespersons; nor did Reed solicit Fred's help to mentor new recruits. This

is akin to asking for input from an operational-level worker and then ignoring it, which

Humphreys (2003) described as deflating, and as he observed, such neglect misses the

opportunity to garner the motivational benefits inherent in bottom-up empowerment and can

cause an enormous decline in morale (p. 96).

In Fred's eyes, Reed reneged on his psychological promise to let Fred help him by using

his proven competencies as a senior salesman. As Robinson and Morrison (2000) observed, ...

the relationship between perceived contract breach and violation will be stronger to the extent

that the employee attributes the situation to reneging (p. 532). To create a positive workplace

environment where employees are motivated to do their best, leaders must be role models for

ethics, integrity, values and trust (Pryor, Singleton, Taneja, & Humphreys, 2010, p. 298). Reed

failed as such a role model in that he not only refused to engage Fred as a valued senior member

of the sales team, but he devalued Fred in comparison with more novice salespersons.

Agents may make promises that they have no intention of keeping, or they may renege

on promises that they had originally intended to keep. One situation where the latter may occur is

when the employee is not meeting performance expectations (Robinson & Morrison, 2000, p.

529). Reed may have felt justified in reneging on his statement to Fred because of Fred's

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subsequent lack of performance. Of course, it is conceivable that causality runs the other way:

that employees reduce their performance in response to a perceived breach (Robinson &

Morrison, 2000, p. 541) As DelCampo (2007) observed, Conscientiousness is negatively

related to reports of psychological contract violation. (p. 48), which could partially account for

Fred's decline. Reed initiated a downward spiral of events by giving Fred a reason to mistrust

him, and he increased Fred's downhill speed and momentum by constant failure to communicate

and motivate, as will be shown later.

Reed's initial deceit heightened Fred's state of vigilance, that is, the extent to which the

employee actively monitors how well the organization is meeting the terms of his or her

psychological contract, which is related to the amount of trust underlying the employee-

organization relationship (Robinson & Morrison, 2000, p. 528, 531). As a result of this

heightened vigilance, employees will be more likely to perceive a breach of their psychological

contract (Robinson & Morrison, 2000, p. 530-531). DelCampo (2007) defined the

psychological contract as the unwritten agreement that exists between the employee and

employer that contains a set of mutual expectations (p. 44). Fred had devoted more than three

decades of effort and achievement to Schering-Plough with the expectation of a comfortable

retirement in old age, only to discover the company all too ready to prematurely label him as

obsolete. Having been approached with the company's offer of early retirement, aware that the

company had hired an excessive number of young salespersons to supposedly replace him and

others like him, and being condemned as foolish by his district manager for not taking the early

retirement plan, Fred no longer had confidence in the company's intention to uphold their

psychological contract.

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Fred's perception of this breach of contract intensified when he also perceived that he was

treated with little consideration or respect (Robinson & Morrison, 2000, p. 532). Reed's

subsequent behavior toward Fredthe performance evaluation, spying which resulted in the

two-day suspension without pay, singling him out for especially difficult and punitive goal-

settingonly served to increase Fred's vigilance and intensify his feelings of violation. As

Zagenczyk, Gibney, Kiewitz, and Restubog (2009) found, ...the extent to which supervisors are

supportive/not supportive weakens/strengthens the negative relationship between breach and

POS (p. 254); that is, Reed greatly undermined Fred's perception of organizational support.

Since breach of the psychological contract also prompts behaviors that undermine

organizational effectiveness and efficiency (Lemire & Rouillard, 2005, p. 160), Fred gave back

to Jim Reed and the company the same lack of support he felt he had received from them. As

Suazo (2009) stated, Psychological contract breach (PCB) has been found to be negatively

related to a wide variety of employee workplace attitudes and behaviors (p. 137).

Fred Maiorino and Jim Reed held different ideas about Fred's overall performance and its

measurement, the productivity of goal-setting, the meaning of flexibility in scheduling, the

purpose and practice of coaching, and what constituted equitable treatment of subordinates. As

Robinson and Morrison (2000) defined it, these differences exemplified incongruence and the

three primary factors causing it: the degree to which the employee and agents of the

organization hold divergent cognitive schemata regarding employment obligations, the

complexity and ambiguity of the perceived obligations between them, and lack of sufficient

communication regarding obligations (p. 529). Especially complex and ambiguous, the

performance evaluation and matching market share goals contributed greatly to incongruence,

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particularly since Reed totally failed to communicate Fred's obligations satisfactorily.

Fred experienced both incongruence and reneging as sources of breach in the

psychological contract. However, the development of a sense of breach in the psychological

contract into the intense emotional reaction associated with psychological contract violation

depends on an interpretation process whereby the employee attaches meaning to the perceived

breach (Robinson & Morrison, 2000, p. 528). Fred's perception of a psychological contract

breach intensified to a sense of violation over a period of time due to the attributions he made

regarding events such as being pressured to take the early retirement offer, being asked for help

as the senior salesperson and then given a poorer evaluation than his juniors, being singled out

for disciplinary actions, and being given little regard by the company, which instead, repeatedly

supported and encouraged Reed's actions. At no time during this process did Jim Reed provide

Fred with the communication, empathy, and inspiration he needed to resume his previous level of

commitment to the company and his success as a most valuable player on the district's team. As

a result, Schering-Plough ultimately reneged on its psychological promise of retirement as a

reward for nearly four decades of dedicated salesmanship by abruptly terminating Fred.

Reed also contributed to the violation of justicedistributive (the what) and procedural

(the how) (Harvey & Haines III, 2005, p. 55). In the next section of this paper, it will be shown

how Reed employed a performance evaluation tool that robbed Fred of extrinsic and intrinsic

rewards in a manner that was humiliating, confusing, and confrontational. According to Harvey

and Haines III (2005), distributive justice deals with extrinsic rewards, focusing on the

employee's perceptions of the fairness of the allocation of resources and opportunities, such as

pay receipt of some valued outcome under the control of the organization (p. 55).

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Procedural justice is defined as the application of fair rules in decisions regarding ones

outcomes fairness ... experienced through the 'way' in which outcomes are determined and

distributed (Harvey & Haines III, 2005, p. 57). Although the newly-implemented evaluation

tool's objective component showed Fred leading the district, and Reed scored Fred Very Good

on 7 of 11 subjective criteria, Reed nonetheless gave Fred an overall score of Good, thereby

robbing him of 7.7% of his pay increase. Fred alone received less than Very Good, in itself a

humiliation. Fred had reason to doubt the fairness of this decision. While the case study does

not say how Reed communicated the results of the first evaluation, it does say that about the

same time the next year, Reed again focused on the least desirable component of Fred's

performance, disregarding his achievements in other areas, and sent Fred a memo saying his

performance was 'well below what you are capable of' and encouraged him to do better.

(Buller & Schuler, 2003, p. 237). The employee responds, too, to the procedure of decision-

making and to the method of communicationthe thoughtfulness of it or lack thereofwhen

evaluating the organization's commitment and support (Harvey & Haines III, 2005, p. 57).

Reed's behavior prompted questions about the distributive and procedural justice and supplied no

answers due to his use of the memo, which did not allow for meaningful dialog.

Interactional justice, a third component closely related to procedural justice, deals with

the quality of the interpersonal treatment, whether the employee feels the company's agent

communicated the decision in a sensitive and ethical manner (Harvey & Haines III, 2005, p. 57).

In other words, it is not just what the employer does that counts but probably also how the

decision is made and communicated (Harvey & Haines III, 2005, p. 64). Reed's conduct sent

implicit messages that he viewed Fred as someone unworthy of that minimal level of respect

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to which all humans should be entitled (Harvey & Haines III, 2005, p. 65).

Performance Appraisals and Goal-Setting

Shortly after Reed told Fred he would be counting on his help as senior member of the

division's sales force, Reed implemented the new performance evaluation system by which he

evaluated Fred lower than any of his juniors. If Reed's unsubstantiated remark about relying on

Fred's help could be seen as the initial push on the downward spiral, the performance appraisal

could be viewed as the slippery slope. The appraisal system Reed implemented did more harm

than good. Caruth and Humphreys (2008) listed eleven characteristics an effective employee

performance appraisal system should reflect: formalization, job relatedness, standards and

measurements, validity, reliability, open communication, trained appraisers, ease of use,

employee accessibility to results, review procedures, and appeal procedures (p.25). The system

used by Reed met only the second of these clearly: job-relatedness.

Caruth and Humphreys (2008) defined formalization as written policies, procedures,

and instructions for use by appraisers and general written information about the system for

employees. The system Reed used had general guidelines but did not include any comprehensive

written policies and procedures nor any information for employees. Despite a semblance of

standardization, the system's subjective elements were not sufficiently standardized to yield

consistent and defensible results, and likewise, its means of measuring performance yielded

imprecise results. Where definitive standards and measurements are not used, reliability

problems often arise in performance appraisal because appraisers lack objective criteria for

evaluating performance, thus opening appraisers to committing performance evaluation errors

that produce inconsistent, unreliable results (Caruth & Humphreys, 2008, p. 27). Reed's system

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was arguably invalid and unreliable. Reed had not been trained in the use of the system and had

been allowed to modify it to suit his purposes. As for the remaining criteria, the lack of

communication, simplicity, accessibility, and procedures for review and appeal destroyed any

credibility the system could have hoped for. Unfortunately, in some organizations there is no

procedure whereby an employee can appeal what he or she considers an unfair or inaccurate

performance appraisal (Caruth & Humphreys, 2008, p. 29). Fred had no such right of appeal.

Caruth and Humphreys concluded, Regardless of the specific approach used to evaluate

performance the system should correspond to the characteristics described above. By

conforming to these guidelines, organizations can assure themselves of more effective and

legally defensible performance appraisal systems. Of equal significance, however, is the ability

of the performance appraisal to function as a feedback control measure which can be integrated

with and incorporated into overall strategy formulation and implementation (Caruth &

Humphreys, 2008, p. 29-30). The case never mentions Schering-Plough's use of the instrument

for corporate strategy. In light of its dysfunctionality, this comes as no surprise.

According to Hammer (2007), it is important to measure those aspects of organizational

performance that are both controllable and important to achieving enterprise success, to

measure them in ways that are useful, and to incorporate the measurement and tracking of past

performance in a disciplined process for performance improvement, to use them for treatment

rather than autopsy, and to encourage, throughout the organization, the proper use of metrics for

improvement rather than regard them as threats to be feared or opponents to be vanquished (p.

25). He went on to say, Even the best metrics and the best process for using them will not

flourish in an inhospitable environment (Hammer, 2007, p. 28). Jim Reed's metrics and process

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fell far short of best and he used them against Fred in a most inhospitable manner.

Gray (2002) asserted that performance appraisals dont produce more competent, loyal

workers because the practice is inherently flawed. It is distorted by evaluator bias Many

employees are skeptical of the evaluation results (p. 16). Fred certainly doubted the validity

of the resultsand with good reason. In early 1987, he ranked first among his district's sales

representatives and continued to be top-ranked during the first half of 1988 when his new boss

gave him the lowest mid-year evaluation of any of the district's sales repsall of whom were at

least twenty years younger (Buller & Schuler, 2003, p. 234). Employees who consistently

produce high volumes of output should consistently receive a higher rating than employees

whose output is lower (Caruth & Humphreys, 2008, p. 27) for a performance evaluation tool to

be valid. This was not the case with Reed's evaluation tool, and as Humphreys and Einstein

(2004) observed, the opportunity for inequity to lead to effort reduction is both sizeable and far

more likely than effort enhancement due to perceived equity (p. 72). Naturally, Fred resisted

the new system and the goal-setting that ensued since older workers tend to avoid situations that

are likely to place them at a disadvantage in comparison to younger workers (Kanfer &

Ackerman, 2004, p. 447). Lee (2005) observed that [e]motional and professional baggage

normally accompanies ratings (p. 55) and [p]oor ratings can stigmatize performance and cause

unnecessary resistance to the acceptance of feedback (p. 54).

While it is true that supervisors must avoid sugar-coating evaluations (Tomlinson &

Bockanic, 2008, p. 84), they must be prepared to explain the employee's flaws, discovered by a

less-than-perfect evaluation, if they are to avoid senseless demotivation. Accurate description

or diagnosis leads to better prescriptions for future success. Therefore, all performance-

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management systems should be designed to generate information and data exchange so that the

individuals involved can properly dissect performance, discuss it, understand it, agree on its

character and quality, and then prevent problems and improve performance (Lee, 2005, p. 54).

Performance conversations should involve a two-way exchange to ensure that the employee

fully understands what is good, what is bad, and why the good performance is good and the bad

is bad (Lee, 2005, p. 55). This communication is vital to the process if it is to be effective in

enhancing future performance. Reed did not give Fred the benefit of such communication.

Lee (2005) observed that feedback is valuable, but ratings constitute feedback of the

worst kind imply that the conclusion drawn has some permanency with the result that a

poor rating might also reduce an employees willingness, readiness, and, in some cases, ability to

perform well (Lee, 2005, p. 56). Feedback is an ongoing activity, and appraisal is periodic

Feedback is information; appraisal is evaluation (Lee, 2005, p. 57). Reed gave Fred little

feedback, only sporadic evaluations and formal appraisals that focused on the past. No one has

the power to alter the past, so it is far wiser to direct attention and efforts toward improving the

future. ... Nonetheless, most appraisal systems mistakenly focus their attention on the past (Lee,

2005, p. 53).

Reed's performance evaluation tool not only focused on the past, it provided feedback

distorted by evaluator bias and focused on events beyond the employees ability to control

(Gray, 2002, p. 16). Schering-Plough's market shares were not entirely determined by its sales

representatives' efforts and gave no clear indication of what the salesperson had done right or

wrong, only an inconclusive report of which products were doing better or worse over all in

comparison to the products of the company's competitors. Clearly, many factors other than sales

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determined this. Additionally, the subjective component of the evaluation, based solely on the

manager's observations, perceptions, and private interpretations failed to include a standard by

which certain behaviors could be measured equitably.

Reed followed the poorly executed appraisal with counterproductive goal-setting, not an

unlikely consequence of the standard by which he chose to evaluate Fred. Many managers seek

to establish simple, quantifiable standards against which to measure and reward performance.

Such efforts may be successful in highly predictable areas within an organization, but are likely

to cause goal displacement when applied anywhere else (Kerr, 1995, p. 12). Goal displacement

aptly describes Reed's attempts to set goals for Fred, based on faulty performance evaluations.

Looking to history, the exemplary Greek leader, Xenophon, would have advised Reed not

to count on goal-setting to improve Fred's performance. Xenophon would see goal-directed

behavior as more likely involved with the maintenance of effort rather than its enhancement

(Humphreys, 2003, p. D4). However, Locke and Latham (2002) asserted that goals improve

performance in four ways: 1) They direct attention and effort toward goal-relevant activities and

away from goal-irrelevant activities; 2) they lead to greater effort; 3) they promote

persistence; 4) they lead to the arousal, discovery, and/or use of task-relevant knowledge and

strategies (p. 706-707). But for goals to be effective, the employee needs feedback because

without knowing how well they are doing, it is difficult or impossible for them to adjust the

level or direction of their effort or to adjust their performance strategies to match what the goal

requires (Locke & Latham, 2002, p. 708). Reed never gave Fred the feedback on his progress

that would have enabled him to make such adjustments. Regarding Reed's system, performance

goals could not be ascertained before the fact as they were based on historical sales results

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(Buller & Schuler, 2003, p. 242). Such perceived inequity in process and outcomes further

deteriorates reasonable good will towards the leader and results in declining self-confidence and

esteem of followers, creating a broad-based sense of hopelessness (Humphreys & Pane Haden,

2011). Declining self-confidence and esteem and a sense of hopelessness is exactly what

resulted from Reed's implementation of the performance appraisal system and the subsequent

goals he set for Fred without benefit of ongoing feedback and help. Fred consistently met sales

quotas, but the new goals failed to enhance his performance, as Xenophon would have predicted.

Leadership Style

Jim Reed's poor leadership style, as demonstrated by his mishandling the psychological

breach, types of justice, performance appraisal system, and goal-setting, is the overarching

element that determined the outcome of this case, as can be discerned from the following

statements by Humphreys and Pane Haden (2011):

But we know from various studies of procedural and distributive justice, that as leaders, we must provide our followers with transparent mechanisms and systems so that their perceptions of equitable process and treatment are positive. If this is the case, then employees will likely maintain an acceptable degree of trust and recognize the legitimate power associated with leadership. If not, followers become disenchanted, resulting in the loss of morale, which often presents itself in terms of lower productivity and greater resistance to change (Humphreys & Pane Haden, 2011).

Moreover, research indicates that sales leaders can enhance, simply maintain, or actually hinder

follower sales performance based on the leadership style employed (Humphreys, 2002, p. 487).

Reed's leadership style hindered Fred's performance.

For one, Reed was something of a micro-manager, as Sal Marino described them: They

manage by the numbers . They manage by memorandum (Marino, 1998, p. 22). People

who function as micromanagers like to be in control of the workplace, the people and the

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processes. Generally they fail to ask for, receive, acknowledge, or use input They may be

negative are dictators stifle the work environment (Pryor, et al., 2010, p. 296)like Reed.

Reed also relied on his position as the basis of his power, largely ignoring the generation

of any real personal power (Humphreys & Pane Haden, 2011). This led Fred to become

frustrated, fractured, and fearful. (Humphreys & Pane Haden, 2011). As Humphreys and Pane

Haden also observed, ...truly effective leaders also manage from bases of expert power and

referent power (Humphreys & Pane Haden, 2011).

Reed failed to manage from a basis of expert power. Initially, it is possible Fred's sales

reputation intimidated Reed. After all, Fred was younger than Reed, and he had earned many

accolades and won many awards for his top sales performance. If Reed had been a salesman

before being promoted to sales manager, as is typical, he may have envied Fred for years. Since

Reed's coaching consisted of handing Fred medical journals, this does not indicate that Reed

had a strong basis for the exercise of expert power.

As for referent power, Reed does not seem to have even considered the need for it.

Again, he should have learned from Xenophon. Hutchinson pointed out, One of Xenophons

primary maxims was that good leaders know their individual followers and their needs (as cited

by Humphreys, 2003, D2). Further, he did not accept the notion that these needs were static.

Different followers will exhibit different needs and desires at a specific point in time

(Humphreys, 2003, p. D3). Reed cared nothing for Fred's reasons for refusing the early

retirement or leaving later in the day than usual to make his roundshis economic, family, and

health needs. He cared nothing for Fred's need to feel good about his reputation, his seniority,

and years of effort he had put into his career, nor his need of job security and the fulfillment of

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his expectation of a retirement when he was both financially and emotionally ready for it.

A leader can infect his followers with his own emotional chargepositive, negative, or

neutral. Lewis found that followers lacked confidence in leaders who exhibited negative

emotions, and Sy, Cote, and Saavedra found that positive emotions had a much greater influence

than neutral tones (cited by Ilies, Judge, & Wagner, 2006, p. 7). When the leader-subordinate

relationship is formally structured, as with the roles of sales manager and salesman, the leader's

emotions have a greater effect on followers (Ilies, et al., 2006, p. 7). At best, Reed remained

neutral to Fred, but more often, he displayed negativism by focusing on the products Fred did not

sell well while avoiding mention of those he did. Reed admitted to being upset when he saw

Fred's car in the driveway, and he immediately thought the worstwithout bothering to ask Fred

what was going on and without issuing the oral warning dictated by company policynegative

attitudes and actions that resulted in Fred's abrupt two-day suspension without pay. Reed

concluded the worst from observations made while going on sales calls with Fredwithout

discussing those observations with Fredand placed Fred on probation as a result. Reed's

constant negativism spread like a plague to Fred, erupting in a defensive, paranoiac response.

Pryor, et al. (2010) stated that managers of dysfunctional work environments often contribute to

the negativism as they micromanage, abuse power, lack anger management skills, threaten and

demean others, and/or engage in other illegal, unethical, or de-motivating behavior (p. 295).

Reed proved guilty of such dysfunctional leadership.

Padilla, Hogan, and Kaiser described a toxic triangle comprised of "destructive leaders,

susceptible followers and conducive environments," . . . and noted that "destructive leadership

emphasizes negative outcomes for organizations and individuals linked with and affected by

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them" (as cited by Pryor, et al., 2010, p. 294). Reed created and maintained such a toxic triangle.

It could even be said that Reed bullied Fred by singling him out for undesirable attention.

Einarsen defines bullying as "repeated actions and practices that are directed to one or more

workers, which are unwanted by the victim, which may be done deliberately or unconsciously,

but clearly cause humiliation, offense and distress, and that may interfere with job performance

and/or cause an unpleasant work environment (as cited by Pryor, et al., 2010, p. 295). Reed

created a stifling environment for Fred, one which gave demerits for bad behavior (e.g.,

absenteeism or tardiness) but few or no rewards for good behavior and which became a source

of stress for Fred; and as it discouraged dialog, disallowing employee suggestions, it tended to

be negative as well (Pryor, et al., 2010, p. 297).

Motivation

Ford and Ford (2009) observed that if a manager suppresses dialog, he or she will miss

opportunities to get employees to buy into their program (p. 99). Reed likely anticipated

resistance on the part of Fred to his goal-setting since it was based on a performance evaluation

system that had not been properly explained or defended. When managers perceive resistance

as a threat, they may become competitive, defensive, or uncommunicative (Ford & Ford, 2009,

p. 99). Reed remained uncommunicative. He did not consider that Fred, having decades of sales

experience in the district, might expose legitimate flaws in the new goals and projections; or else,

he did not want to know if such flaws existed. Frustrating though it is, resistance can lead to

better results (Ford & Ford, 2009, p. 100). But Reed demanded results his way. He did not

really care to win Fred's support for those goals, only to coerce Fred's performance to achieve

them. As Humphreys (2003) stated, Conversely, mere compliance based upon coercion, would

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result in diminishing effort no matter the nature of the reward (p. D4), in this case, the negative

reward of avoiding discipline or termination. Kerr (1995) rightly determined that a reward

system should positively reinforce desired behavior, not constitute an obstacle to be overcome

(p. 13).

Reed, unlike the heroic Greek leader, Xenophon, did not accept the idea that follower

motivation is the responsibility of leadership. (Humphreys, 2003, p. D2). Reed judged Fred to

be lacking in motivation but felt no compunction to motivate him. Initially, Fred may not have

lacked motivation but merely the ability to grasp and apply the concepts and practices needed to

attain the new goals. Hersey and Blanchard (1996) discussed readiness to do a task as the

amount of willingness and ability a follower demonstrates, and posited that the number one

error in diagnosing willingness is to view someone who is insecure or apprehensive as

unmotivated (Hersey & Blanchard, 1996, p. 46). They gave the following example: I may be

completely committed to a job, quality, and the organization. I may be motivated to do well.

But if I'm insecure about my ability to do the job, my insecurity must be addressed before I can

move toward full readiness. Someone or something will have to help me over the hurdle

(Hersey & Blanchard, 1996, p. 46). That someone should have been Jim Reed.

Instead of helping Fred over the hurdle by providing the kind of understanding, training,

and coaching that could have enriched his job, Reed enlarged or loaded Fred's job, increasing

his burden and his stress. Herzberg (2003) said, Job enrichment provides the opportunity for

the employee's psychological growth, while job enlargement merely makes a job structurally

bigger, and he cited as an example: Challenging the employee by increasing the amount of

production expected (p. 93). Reed did not take the time to exhibit an awareness of Fred as an

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individual of worth or respond to Fred with any consideration for his personal needs and goals

and cognitive frame of reference; therefore he neglected to develop the leader/follower dyad.

Humphreys (2002) emphasized, The importance of this leader/follower dyad is particularly

important within a selling environment (p. 487).Motivation, leadership, and personality form a

triad that determines the motivating aspect of the leader-follower dyad (Humphreys and Einstein,

2004, p. 63). Reed's creation and maintenance of the toxic triangle stands in antithesis to this.

Specific Suggestions to Avoid Perceived Breach of Contract

Reed did the right thing when he recognized Fred as his senior salesman and told him he

would need his help. What Reed should have done is follow up that remark with dialog. If Reed

had invited Fred to offer suggestions for training and motivating the junior sales force, Fred

would have felt respected and satisfied that Reed's words could be trusted. Organizational

justice reactions have been shown to be positively related to employee trust in supervisors

(Harvey & Haines III, 2005, p. 53). Fred's perception of the company's campaign to get rid of its

older workers would have been modified by this gesture. Then, if Reed had involved him in that

training and motivation by pairing him with new salesmen from time to time, this would have

involved him in a way that highlighted his strengthshis experience and knowledge baseand

contributed to his prestigeall of which are important to middle age and older workers (Kanfer

& Ackerman, 2004). This type of performance without substantial investment of effort, in

turn, is likely to enhance self-concept and self-esteem (Kanfer & Ackerman, 2004, p. 450).

Additionally, the more inexperienced salesmen would benefit as well by Fred's mentoring.

It would be important, however, for Reed to share with Fred, in a manner akin to

confidentiality, how important it is to the self-esteem of the younger salesmen to allow them

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opportunities to work out solutions and try new ideasand if outcomes proved positive, for Fred

to even adopt some of those methods in support of his young colleagues. Salthouse and Maurer

explained that a successful older worker may rely on accumulated knowledge to solve problems;

whereas, younger workers have to use reasoning to find new solutions to each problem (as cited

by Spitulnik, 2006, p. 47). For older workers, knowledge is typically substantial, whereas time

and cognitive effort are often in shorter supply. the most effective motivational interventions

for midlife and older workers may be those that target the utilization and distribution of relevant

knowledge and experience. Along these lines, we anticipate that interdependent team

environments may be particularly beneficial for facilitating this form of work motivation

(Kanfer & Ackerman, 2004 p. 455-456). Maximizing the strengths of both generations in this

type of cooperative effort would be a novel approach in the arena of sales, which is usually

highly competitive, pitting one salesperson against another within the same company and often

within the same district. However, if Reed planned to implement goals involving market shares,

it behooved him to define the competition as the sales force employed by other drug companies,

not Schering-Plough's own.

While increasing the potential of his sales force to meet the new criteria, Reed's

enlistment of Fred's help in a manner most suited to Fred's abilities in his later season of life

would have assuaged Fred's assumptions about the company's attitude toward older employees

and greatly mollified his feelings of psychological contract breach. As Zagenczyk et al. (2009)

observed, a supportive relationship with a supervisor may ameliorate the negative effects of

PCB experienced by an employee (p. 241).

After establishing credibility with Fred and demonstrating an understanding of or

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empathy with his needs, Jim Reed should have plainly made himself available for interactive

communication with all his followers. He should have declared himself to be approachable.

Suazo (2009) posited, Increased communications and interactions may provide opportunities for

managers to explain the reasons and feelings associated with PCV would be less intense

because the employee would have been treated with dignity and respect (p. 155). In such a

context, Fred quite likely would have perceived in Jim Reed an ally since he was, himself, an

older employee, and could have felt comfortable confiding his concerns, suspicions, and fears

about his future with the company. [R]esearch suggests that similarities accentuate the positive

characteristics and dissimilarities accentuate the negative characteristics of a dyadic relationship

(Suazo, Turnley, & Mai-Dalton, 2008, p. 296). This type of dialog would have ameliorated

Fred's interpretation of the company's actions and prepared Fred to have a better attitude toward

the changes that the company, via Reed, wanted to implement.

Perceived contract breach will be more likely to the extent that the promises underlying

the psychological contract are conveyed implicitly rather than explicitly. A factor that will

minimize perceived contract breach via incongruence is communication between the employee

and organizational agents (Robinson & Morrison, 2000, p. 530). An open-door policy of

communication would have minimizedpossibly even eliminatedany incongruence.

Likewise, Reed's treatment of Fred would have prevented Fred's uncertainties from escalating

into feelings of anger and betrayal. One way to reduce feelings of anger and betrayal is to

offer honest and adequate explanations for the situation. As our results show, even if an

employee blames the organization for a perceived psychological contract breach, feelings of

violation will be less intense if the employee feels that he or she was treated with fairness,

20

honesty and respect (Robinson & Morrison, 2000, p. 543).

By building a relationship with Fred, based on respect for his accomplishments and value

as a member of the district's sales team, Reed would have enhanced Fred's commitment to the

company and its goals rather than diminished them. DelCampo (2007) emphasized the role of

relationship by saying, ... the relational component of the psychological contract is built upon

employee/employer interaction and development of trust, respect, and loyalty over time.

companies must focus on relational aspects in order to retain valued employees and capitalize on

their loyalty (p. 45). Harvey and Haines III (2005) reiterated the importance of relationship

with regard to distributive, procedural, and interactional justice when they stated, The highest

satisfaction was associated with situations high in both distributive and procedural justice. One

could argue that interactional justice is in fact the component of procedural justice that is most

responsible for this type of effect because of the interpersonal nature of emotional support (p.

63-64). Even if Reed's distribution of a Good evaluation and singularly challenging goals had

been warranted, Fred would have found the procedure to be more just had Reed established an

emotionally supportive interpersonal relationship with Fred and communicated these in the

context of that relationship.

Jim Reed, as Fred's supervisor, in many ways represented the company to Fred and

ultimately proved he could be Fred's advocate or prosecutor to those who wielded even greater

power. Supervisors play an especially meaningful role in the development and maintenance of

the psychological contract (Suazo, et al., 2008, p. 296). This is especially true when there has

been a perceived breach on the part of the employee or the company. The supervisor can bridge

the gap.

21

Specific Suggestions for Use of Performance Evaluations

Performance appraisals can have varying levels of success in managing performance and

fostering high performance (Lindbom, 2007, p. P102). Performance appraisals are not without

value, but in order to capitalize on the value of performance appraisal as a strategic control

metric, the system must be formalized to the greatest degree possible, so the results can be

consistently fed back into the strategic process for decision-making, inspiration, improvement

initiatives, problem-solving, and the successful alignment and/or realignment of people and

processes (Caruth & Humphreys, 2008, p. 26). Since Reed felt comfortable modifying the

performance evaluation tools designed by the company, he should have made the effort to

establish standardized definitions for the subjective components that would guarantee a uniform

interpretation for each salesperson he appraised and that would clearly set forth expectations that

were both reasonable and acceptable to the company and his sales force (Caruth & Humphreys,

2008, p. 26).

Setting standards for the interpretation of the subjective elements of the appraisal must be

followed by the development of a reasonable method to measure the results in order to compare

performance with those standards and evaluate performance accurately (Caruth & Humphreys,

2008, p. 26), keeping in mind that the method used is valid if it measures what it is designed to

measure: actual job performance as compared with the established standards (Caruth &

Humphreys, 2008, p. 27). This is where the measurement of market shares to indicate

salesperson performance fell short. It indicated physician's preferences of one company's drugs

over those of another, but it did not adequately relate this to salesperson performance. Since this

component of the appraisal system had been developed by the company, Reed may have been

22

compelled to use it; however, he should have used it for what it was, a measurement of physician

preference, not sales performance. He should then have made a legitimate connection between

the two by establishing criteria based on salesperson performance, such as, the ability of the

salesperson to explain the reasons those physicians, pharmacies, and hospitals in his or her area

preferred one drug to another and offer suggestions as to how they might be persuaded to prefer

Schering-Plough's products. The explanations might lead to suggestions beyond the scope of

sales, e.g., the price, packaging, or availability of the products for the physician's patients and

their preferences. This information could prove valuable to the company, and the salesperson

could then contribute to increased market shares in more ways than one. If the system is firmly

based on standards and measurements, it will probably be not only easier to use but also more

valid and reliable (Caruth & Humphreys, 2008, p. 28). Reed's salespersons, including Fred,

would have a clearly defined goal: find out why a competitors' drug appears preferable and

analyze the information sufficiently to offer relevant suggestions to alter the situation. It would

follow that any suggestions involving sales technique would constitute self-set goals.

Reed should be sure his sales reps thoroughly understood the evaluation criteria and

corresponding goals and were equipped to obtain the necessary information and make

appropriate suggestions based on that information. Lee (2005) declared that employers should

accurately describe the performance elements being rated and communicate this information

to the employee (Lee, 2005, p. 55). Failure to communicate clearly the method and purpose of

an appraisal system to the employees being appraised by it is counterproductive. Such secrecy

causes employees to doubt the fairness of such a system and perceive inequity, thereby

diminishing motivation and possibly leading to charges of discrimination and feelings of breach

23

or even violation since employees recognize they have implicit rights to certain kinds of

information that directly affects them on their jobs (Caruth & Humphreys, 2008, p. 28-29).

Caruth and Humphreys (2008) further pointed out that permitting employees to review their

performance records builds a safeguard into the system in that employees have the opportunity to

detect errors that may have been made in performance evaluations and that employees must

have access to these records in order to initiate efforts to improve (p. 28-29).

In addition to giving his sales reps a clear understanding of the evaluation system and

how it was being applied to them, Reed should have provided training aimed at meeting the new

criteria. Essential to the effectiveness of a performance appraisal system is thorough training

In addition to formal training sessions, opportunities for coaching and counseling by the

appraisers immediate supervisors and managers should also be incorporated into the systems

procedures (Caruth & Humphreys, 2008, p. 28). This training should have incorporated

psychological components to help the sales reps encourage an honest confession from clients as

to reasons for their drug preferences, and it should have been designed to enhance analytical

skills to enable reps to draw appropriate conclusions and offer reliable suggestions as a result of

the client data. Humphreys made it clear that leaders, such as Reed, are obliged to ensure that

operating employees aren't so woefully uninformed that they cannot intelligently participate in

the process. Effective communication requires some level of give and take, of negotiation

between organizational levels (Humphreys, 2003, p. 96).

Fred would have especially benefited from such training since, as Staudinger and Baltes

found, older adults carry bodies of knowledge that are more easily activated when proper

performance conditions are introduced" and the type of training most beneficial to older adults

24

combined dialogue with a partner with a period of individual thought, which suggests

cognitive development in older adults may benefit from combinations of group interaction and

individual processing time (as cited by Spitulnik, 2006, p. 46). Spitulnik (2006) stated, It is

necessary to understand emotions, motivation, cognitive skills, and attitudes of older workers to

determine what is required to accommodate the aging workforce (p. 44). Armstrong-Stassen

and Templer (2005) asserted, Training methods for older employees should place greater

emphasis on hands-on learning techniques, be self-paced, and take a practical learning

approach (p. 65). Reed would have done well to heed this advice and promote generational

cooperation with group discussions, in which older salespersons' practical experience and

accumulated knowledge could be balanced with younger salespersons' innovative thinking and

quicker cognitive skills, after which, the individual sales reps could assimilate the ideas gleaned

from such a meeting and each plan how they might implement them to best advantage. Reed

should have then followed up with periodic meetings in which his sales reps reported on the

success or lack thereof met by the various strategies employed. Not only would such teamwork

have yielded a benefit to the novices, but to Fred as well since Kanfer and Ackerman (2004)

found that older adults with stronger self-concept in the work domain may be more responsive

to role-based motivational interventions than individuals with weaker work-related self-concept

(p. 455). Fred, in particular, had strongly identified himself with his work and would have

responded well to this type of training.

While all these changes would have greatly increased the merit of the performance

evaluation, another element must be included to achieve maximum utility of an appraisal system.

An effective performance appraisal system assures that feedback is provided on a continuous

25

basis, not in the form of a written annual evaluation, but in the form of daily, weekly, and

monthly comments from an employees supervisor The annual evaluation and its

accompanying interview or performance discussion must be devoid of surprises. (Caruth &

Humphreys, 2008, p. 27). Reed would have needed to change his quarterly assessments, too, so

that they provided the type of ongoing, current, relevant feedback needed by his sales reps to

adjust present behavior in a timely manner so as to meet performance expectations. Instead of

reaching into the past for historical sales data that bore little relevance to present market shares,

Reed should have monitored the company's market share data daily and communicated this often

and regularly to Fred and the other salespersons. Most experts agree that timely and accurate

feedback is the key to sustained, successful performance (Lee, 2005, p. 53). As previously

suggested, this feedback should be two-way. The goal is to have the employee assist us in

describing, interpreting, and redirecting performance feedback, not reacting to the rating.

Feedback can accomplish the same positive goal as a rating without the negative side effects

(Lee, 2005, p. 54). Lee (2005) noted that the performance-management system must give the

employee enough information about what is wrong and why it is wrong, and enough support to

change it in order to achieve its true end, performance improvement (p. 53) and the

reinforcement of immediate positive feedback when performance is good (p. 55).

Lee (2005) summed it up: The best approach to performance management, bar none, is

good supervision. Performance feedback on an ongoing basis is good supervision. A good

performance appraisal process with poor supervision will not yield good performance (p. 60).

Specific Suggestions for Goal-Setting

As a result of improving the performance management system, Reed could have more

26

readily gained Fred's cooperation setting and meeting appropriate goals. By supplying Fred with

training and support in concert with his needs and abilities, Reed would have enhanced Fred's

self-efficacy, which, in turn, would have enhanced Fred's goal commitment, an assumption

supported by research (Locke & Latham, 2002, p. 708). Such treatment would have led to Fred's

desire to repay Reed and the company with the efforts needed to reach its goals; whereas, Reed's

treatment of Fred resulted in a negative response (Zagenczyk, et al., 2009. p. 239).

If Reed had first given Fred specific learning goals instead of initially setting high

performance goals without adequate support, he could have set difficult learning goals later with

the realistic expectation that Fred would perform well (Locke & Latham, 2002, p. 709), provided

the learning goals were accompanied by training adapted to Fred's age-related skills and abilities.

As Kanfer and Ackerman (2004) found, age is likely to be positively associated with increased

preferences for physical security, job security, salary, and opportunities for skill utilization

through late midlife. In contrast, age should be negatively associated with preferences for job

variety, feedback, and provision of external goal assignments (p. 446). With this in mind, Reed

should have set goals for Fred while constantly assuring him he would be granted every

opportunity to succeed and his job and salary were not in any immediate jeopardy. In the context

of allowing Fred to mentor new recruits, participate in group brainstorming and progress

reporting, and gain skills in a manner conducive to his cognitive and emotional needs, Reed

would have minimized the negatives associated with Fred's age and the new challenges

represented by assigned goals.

Locke and Latham (2002) observed, Another factor that may facilitate performance on

new, complex tasks is the use of proximal goals. when proximal outcome goals were set in

27

addition to the distal outcome goal, self-efficacy and profits were significantly higher and

employees who were allowed to participate in setting goals set higher goals and had higher

performance than those who were assigned goals by the supervisor (p. 709). Reed may have

preferred to set the distal outcome goal, but he would have done well to encourage Fred's

participation in setting proximal goals. He should not have done this by sending Fred a memo.

To raise Fred's self-efficacy and elicit a favorable response, Reed should have emphasized to

Fred the confidence he placed in him by assigning a challenging goal. He should have

encouraged Fred to set the bar high for those younger and less experienced than he. Reed should

have sought to inspire Fred with a vision of excellence that would exceed his previous

achievements and allow him to eventually end his career in glory (Locke & Latham, 2002).

Then Fred would have seen the setting of proximal goals to attain the ultimate goal as worthy of

his time and effort. As Kerfoot (2004) put it, Leadership is vision with purpose (p. 348).

Nevertheless, it was important for Reed to explain the rationale for any goals he set, even

if Fred lacked the confidence or understanding to participate in setting goals for himself. Reed

should have known that, according to Latham, Erez, and Locke, from a motivational

perspective, an assigned goal is as effective as one that is set participatively, provided that the

purpose or rationale for the goal is given. However, if the goal is assigned tersely (e.g., Do this .

. . ) without explanation, it leads to performance that is significantly lower than for a

participatively set goal (as cited by Locke & Latham, 2002, p. 708). Reed should have engaged

in dialog with Fred to determine if the goals he is setting will satisfy the needs of all concerned

the company, Reed, and Fred.

Expectancy theory suggests that individuals, acting through self-interest, adopt courses

28

of action perceived as maximizing the probability of desirable outcomes for themselves, which

provides a leader with unique opportunities to simultaneously meet both follower needs and

organizational requirements (Isaac, Zerbe, & Pitt, 2001, p. 212). In other words, expectancy

theory can be summarized as: I will put forth my best effort (not exceeding my preferred level of

effort for the reward) if I can expect to perform well at that level of effort, and if I believe the

promised reward will be forthcoming, and it is a reward that I value. It has been suggested that

Reed should have made the effort to become acquainted with Fred's interests and personal goals

and to have already provided the means by which Fred could reasonably expect to succeed.

Effective goal-setting demands the sacrifice of time. Isaac, Zerbe, and Pitt (2001) noted this by

saying, leaders must expend a significant amount of effort to ensure an alignment between the

personal goals of their followers and those of the organization (p. 219). By providing Fred with

a vision of the glory of crowning achievement, the security of his job until he was ready to retire,

and substantial pay increases for high performance, Reed would have been able to capitalize on

this theory and reap his own rewards as a successful leader.

Having provided Fred with an inspiring vision, he should then have translated it into

specific strategies, broken it down into concrete, finite goals (Ilies, et al., 2006, p. 11). If Reed

had inspired Fred to greatness, Fred would have been more inclined to implement a learning

approach and thus build skills and competencies that would enable greater subsequent

performance which then would cause an increase in his self-efficacy, further encouraging the

establishment of challenging, yet now-reachable goals (Ilies, et al., 2006, p. 11-12). Reed

should have begun by communicating a worthy vision, guided Fred in his acquisition of self-

efficacy, and only afterward expected him to establish challenging proximal goals by which to

29

reach the company's performance goals. As Humphreys and Einstein (2004) stated, ...effective

leaders must set task goals and objectives for individual followers that lead both to

organizational goals and match the follower's skills and abilities. A mismatch diminishes

follower motivation (p. 69).

Specific Suggestions to Improve Leadership Style

According to Humphreys (2002), it is the primary task of a sales manager to enhance the

performance of the salesperson (p. 487); therefore, Reed had an obligation to improve his

leadership abilities. For Reed to have been a successful leader, he must have adapted his

behavior to meet his followers' needs, especially Fred's, and his particular situation (Hersey &

Blanchard, 1996, p. 45). The first thing Reed should have done is stop viewing Fred as a

function or a problem and start seeing him as a person. This means Reed had to dialog with

Fred, and in particular, listen to Fred, not just send Fred memos and issue ultimatums. Reed

should have observed Fred, not in order to find fault but in order to get to know him as an

individual, what are his work habits and traits, his strengths and his weaknesses. Only then

could Reed have adjusted his behavior to maximize outcome. As Buzady (2011) determined,

one can become a more efficient manager by taking the right action at the right time by being

attuned to individual followers; in other words, when one is attuned to one's followers, one will

know when to increase and decrease their workloads and how to interact with them during their

different phases of motivation (p. 36).

Humphreys and Einstein (2004) described how Reed could excel even further: Very

effective leaders, and we believe truly transformational leaders, go beyond the matching of goals

and skills and attempt to match their behaviors, communication, and rewards with the needs and

30

desires of individual followers (p. 69). Reed needed to have learned to alter feedback and

communication to become congruent with Fred, which means he would have behaved and

spoken in a way Fred would most readily understand, respond to, and appreciate (Humphreys

and Einstein, 2004, p. 71). Reed should have established goals and objectives that are

congruent with organizational goals as well as Fred's skills, abilities, and efficacy in order to

increase dyadic temperament congruence with Fred, increasing Fred's expectancy and

performance (Humphreys and Einstein, 2004, p. 71).

To further congruency, Reed needed to study leader-follower models and try to apply

them to his own personality and Fred's. For example, Keirsey developed temperament portraits

that describe followers and leaders in terms of Artisans, Guardians, Idealists, and Rationalists (as

cited by Humphreys & Einstein, 2004, p. 67). Reed might be termed a Rationalas a follower,

pragmatic, skeptical, self-contained, and focused on problem solving and systems analysis and

as a leader, skeptical and pragmatic with support for the innovation of the latest performance

management tool. Fred, if one considers the opinions of his clients who were well-acquainted

with him and his self-assessment, could be described as an Idealist. His enthusiasm garnered

high sales volume; he took time to develop meaningful relationships with the receptionists,

nurses, and doctors he called on regularly; he trusted his intuition rather than proscribed methods

to bring him success; prided himself on his genuine desire to give his best effort to the task at

hand; and trusted the company to honor his investment of thirty-five years. The temperaments of

these two men were not congruent. Reed wanted Fred to respond like a Rational or Guardian

follower; whereas, Fred needed an Idealist leader, and might have settled for an Artisan.

According to the Humphreys and Einstein (2004) model, followers have needs that can be

31

somewhat discerned or defined on the basis of temperament, and it is the leader's responsibility

to adapt his or her temperament in order to match goals and responses to those followers' needs

and abilities, offering intrinsic and extrinsic rewards of value to the followers so they will be

satisfied and motivated rather than dissatisfied and frustrated (p. 60). Striving for congruency

requires leaders to look beyond themselves and occupy themselves with the interests, needs, and

development of others rather than focus solely on their own preferences and advancement.

Although this kind of selflessness is usually associated with the servant leader, described by

Kerfoot (2004) as thinking more about others than yourself, and in forgetting yourself in the

service of others (p. 348), it is, in fact, the straightest path the leader can take to achieve his or

her own goals and that of the organization. Humphreys (2005) asserted that transformational

leadership might prove to be especially effective in rapidly changing environments whereas

servant leadership would likely be more appropriate if the context were less dynamic (p. 1411).

As Humphreys noted, Transformational leaders gain acceptance of the organizational mission

by developing the ability within followers to look beyond their own self interests (Humphreys,

2002, p. 488). This can best be done by example.

Although some test results have shown that transactional leadership produces better

results for sales managers, (Humphreys, 2002, p. 490), and this may have been true in the past,

the intensely relational and exceptionally dynamic high-tech environment salespersons face now

demand the innovation, adaptability, and interpersonal skills associated with transformational

leadership. For Reed to expect exceptional results from the application of old methods to a new

and vastly different performance management system showed lack of creative thinking. The old

transactional methods, especially as he applied them in the negative, failed miserably. Reed

32

needed to learn how to be a transformational leader and implement behaviors to reach his goals.

Bass defined transformational leadership as comprised of four distinct dimensions:

idealized influence (charisma), inspirational motivation, intellectual stimulation, and

individualized consideration (as cited by Ilies, et al., 2006, p. 1). Charisma is considered by

many as the most critical factor providing vision and a sense of mission, instilling pride in and

among the group, and gaining respect and trust (Humphreys, 2002, p. 488). House first

formally linked charisma to leadership, arguing that leaders promote change by articulating a

clear vision and creating a strong bond with followers that leads to acceptance of the vision

(cited by Ilies, et al., 2006, p. 1). Charismatic leaders are characterized by strong communication

of positive emotions (Ilies, et al., 2006, p. 6-7). Friedman et al. concluded that 'much of what is

meant by charisma can be understood in terms of expressiveness'" (cited by Ilies, et al., 2006, p.

7). Humphreys (2002) added, Inspirational motivation a companion of charisma is

typically demonstrated by the communication of high expectations, using symbols to focus

efforts, and expressing important purposes in simple ways (p. 488). Further, Xenophon

believed enhanced morale and performance were driven by inspirational words and symbols

(Humphreys, 2003, p. D2). Reed would have done well to gain a clear vision of what he hoped

to accomplish and what the company wanted its sales force to accomplish and then to

incorporate definite, easy-to-recall symbols and slogans to use within the district as tools to

inspire motivation.

Besides idealized influence and inspirational motivation, Reed needed to stimulate Fred

and his other followers intellectually. An intellectually stimulating leader assists followers in

looking at old problems from new and different perspectives (Humphreys, 2002, p. 489). If

33

Reed had implemented some of the suggestions previously made for performance management,

training, and goal-setting, in particular as they involved teamwork among sales reps rather than

the more typical competition, he would have stimulated Fred and others to think outside the

proverbial box and to pour their new ideas into the proverbial new wineskins.

Of the four dimensions of a transformational leader, chief is individual consideration.

Humphreys (2002) noted that ...the transformational behavior of individualized consideration

was strongly related to follower sales productivity (p. 495). Since this element is of the utmost

importance and has been alluded to throughout the paper's suggestions for Reed, it would be of

great benefit to quote Humphreys (2005) at length as he summarizes transformational leadership

with an emphasis on individualized consideration:

Transformational leaders pay close attention to the personal differences among their followers. They often act as mentors to their subordinates, coaching and advising followers with individual personal attention. These leaders are intent on removing obstacles that might inhibit the performance of their followers. A primary component of individual consideration is the understanding that each follower has different needs and that those needs would change over time. Therefore, transformational leaders must accurately diagnose the needs of individual followers in order to optimize each follower's individual potential. ...present reasons for followers to alter their perceptions of performance issues and their own attitudes and values. ... inspire their followers to accomplish great feats (Humphreys, 2005, p. 1412).

Ford and Ford (2009) applied this principal to handling resistance and opposition: If you

can gain perspective by paying attention to, understanding, and learning from behaviors you

perceive as threatening, you will ultimately deliver better results (p. 100). Burns extended this

to motivation based on an appeal to common ideals and moral values (cited by Ilies, et al., 2006,

p. 1). For a leader to be able to base motivation on common ideals and values, he or she must

34

know what ideals and values his or her followers share. In every situation, leaders must

understand themselves and their followers and effectively diagnose the leader/follower

relationship, as well as the situation, if enhanced follower motivation is the ultimate goal

(Humphreys, 2003, p. D5).

Specific Suggestions for Reed to Motivate Fred

Although previous suggestions have touched upon the subject of motivation, this final

section of the paper will be devoted to additional ways Reed could have motivated Fred.

Foremost, Reed should have replaced coercion with consent since the leadership ideal is to

maintain influence through consent, not coercion (Humphreys & Pane Haden, 2011). Instead of

threatening Fred with disciplinary actions for failure to meet goals for which he was ill-equipped

and lacked the motivation to pursue wholeheartedly, Reed should have asked Fred why he did

not want to set goals and why he believed his style of salesmanship, largely intuitive, would be

sufficient for the future as it had been in the past. Reed should have shared with Fred the

elements of change that would impact his performance if he continued to rely on historical

methods; but to do this, Reed himself would have had to discard historical methods of evaluation

in favor of daily feedback in relation to the company's new criteria. By helping Fred understand

the new developments that made reliance on tried and true methods of meeting sales quotas no

longer adequate, Reed could have allowed Fred the opportunity to give him informed consent

rather than bullying Fred into compliance.

Humphreys and Einstein observed that enhancing follower motivation is a leadership

responsibility that entails leader communication, feedback, and behaviors that are congruent to

35

an individual follower's information and engagement preference based upon temperament

(Humphreys and Einstein, 2004, p. 66). Lindbom (2007) said, constant feedback is a regular

part of doing business. Manager and employees regularly discuss what is expected and why.

When corrective action is needed, managers know what behaviors were not effective and can

effectively communicate this evaluation to their employees while also explaining the behaviors

that will be successful (p. P105). This type of communication and ongoing feedback was

missing from Reed's interaction with Fred. For one, Reed should have discontinued his reliance

on memorandums to communicate important matters, especially those involving motivation.

Face-to-face dialogs would have allowed Fred to ask questions and provide input into situations

involving his career and would have helped Reed to match tasks, goals, and objectives to Fred's

skills and abilities. A mismatch diminishes follower motivation (Humphreys, 2003, p. D4).

In Fred's case, matching his skills and abilities to company goals and objectives involved

being able to adjust to the realities of an aging workforce and learning competencies to

support the older workers (Spitulnik, 2006, p. 51). Isaac et al. (2001) advised consideration of

the time and effort needed to attain an outcome and whether the follower would find it worth the

cost, stating, Life stages and the corresponding constraints they impose warrant discussion in

order to establish realistic expectations between the parties (p. 220). According to Kanfer and

Ackerman (2004), nearly half the workers in the United States are over age 45, making Reed's

need to consider age-related motivational issues a necessity for any manager. Reed himself was

in his sixties, and therefore, he would have benefited from acknowledging his own age-related

issues. Older workers become less willing to exert excessive amounts of effort over time. For

tasks involving acquired knowledge and skills, this is not a problem since the older worker

36

excels in these areas; therefore, it is easier to motivate an older worker to apply existing skills

and knowledge to a task. It is more difficult to motivate the same worker to accomplish a task

requiring complex cognitive skills and innovative thinking because of the increasing effort

involved. To keep Fred motivated as new criteria demanded new ideas, Reed could have enlisted

Fred's help with tasks that took advantage of his knowledge base and experience (Kanfer &

Ackerman, 2004, p. 451). As previously mentioned, involving him in the training and mentoring

of younger salespersons would have made good use of Fred's strengths in a way sure to motivate

him to excel.

Reed needed to acknowledge that Fred's experience might have impeded his ability to

adapt to the new structure since he had to unlearn ingrained habits while learning new skills

(Spitulnik, 2006, p. 47). Instead of chiding Fred for a perceived lack of motivation, Reed should

have discussed the difficulties Fred was having and listened carefully to his responses in order to

make some adaptations to his own methods and expectations. Reed could have contributed to

Fred's success and satisfaction by providing him more choices and flexibility (Spitulnik, 2006, p.

48). For instance, Reed could have allowed Fred to begin his workday later in the morning to

accommodate his health, provided Fred documented his begin and end times to show he

continued to fulfill his obligation to the company by working a full day. A comp time policy

within Reed's department would have allowed Fred to make up absences due to his wife's illness

by working on the weekend since pharmacies and hospitals remain open during those times.

This policy would benefit younger salespersons with family obligations as well. Flexibility often

motivates workers to exceed the organization's expectations out of gratitude for stress reduction.

Above all, Reed should have provided the emotional support Fred neededunderstanding to

37

allay doubts about his job security, improved self-efficacy during the period of change,

affirmation of his value to justify the decades invested in his career. When supervisors address

the need to provide this type of support, older workers like Fred are then motivated to participate

in development activities leading to enhanced performance (Spitulnik, 2006, p. 49).

Reed should have changed his attitude from negative to positive. This would have made

coming to work more enjoyable for Fred and the other sales reps. Workplace fun is not an

oxymoron. Fun is enjoyment, pleasure. one can experience less or more fun at work there

are factors that can decrease or increase the pleasure that one experiences at work (Pryor,

Singleton, Taneja, & Humphreys, 2010, p. 294). Pryor, et al. (2010) stated, It is our contention

that motivated employees have more fun at work (p. 299). By improving his management

skills, taking a personal interest in Fred, being willing to adjust his preferred cognitive and

communication style to be more congruent to Fred's, Reed could have motivated Fred by making

work more fun, and the more fun Fred had at work, the more motivated he would be. Although it

is not mentioned in the case what type of facial expression Reed usually wore, his negativity

would lead one to assume he rarely smiledcertainly not at Fred. Reed should make a

conscious effot to smile every time he saw Fred, heard his voice, or his name was mentioned in

Reed's presence. It is difficult for anyone to maintain a negative attitude while smiling often.

Key to Reed's being able to motivate Fred would be his adoption of a transformational

leadership style. Ilies et al. (2006) distinguished between the motivational effects of

transformational leaders, which they called promotion and those of non-transformational

leaders, which they called prevention, describing these as promotion, which is associated with

goals that represent individuals' beliefs of their ideal selves and reflect hopes and aspirations, and

38

prevention, which is associated with goals representing beliefs of ought selves and refer to duties

and obligations (p. 14). Einstein wrote: Transforming leadership is not something done to

followers to motivate them; rather it is a reciprocal relationship between leader and follower

(cited by Humphreys and Einstein, 2004, p. 62). They judged that the ability of leaders to

comprehend a follower's temperament, particularly when that temperament is different from their

own, and respond with behaviors, feedback, and communication that are congruent with the

follower's preference and perspective will enhance follower motivation to a greater degree than

those leaders who either lack the capacity or will to do so (Humphreys and Einstein, 2004, p.

67). If Reed comprehended Fred's temperament and responded appropriately, he would have had

much less difficulty motivating Fred.

Another thing Reed needed to change was his concept of coaching. Giving Fred some

books and materials and telling him to do his best did not constitute effective coaching.

Watching Fred to discover possible mistakes or oversights so he could criticize him and set

punitive goals did not constitute effective coaching either. Yet, Reed believed he had coached

Fred. Lindbom (2007) asserted that coaching may be the most important job requirement in the

role of a manager (p. P101) but called it a difficult task for many managers (p. P105).

Managers must know what behaviors are critical to achieving expected results and which

behaviors are ineffective (Lindbom, 2007, p. P102). For Reed to coach Fred, he must have first

learned how to achieve the desired results himself, making note of effective and ineffective

actions, and then learned how to transmit that learning to Fred.

Reed did not utilize a rewards system other than the annual evaluation, which resulted in

the company's awarding a substantial pay increase versus a good pay increase for Very Good

39

or Good performance. He should have gotten to know Fred well enough to determine what

intrinsic and extrinsic rewards he valued and how much effort he was willing to put forth to

attain them. Reed needed to get better acquainted with expectancy theory. Expectancy theory

states that the strength of the tendency for an individual to perform a particular act is a function

of (a) the strength with which he expects certain outcomes to be obtained from the act, times (b)

the attractiveness to him of the expected outcomes (Hackman & Porter, 1968, p. 418). As Isaac,

et al. (2001) stated, expectancy theory emphasizes individual perceptions of the environment

and subsequent interactions arising as a consequence of personal expectations (p. 214). Once

again, the mandate is clear: Reed needed to know Fred in order to motivate Fred.

In fact, Xenophon contended that the quality of the leader/follower relationship has an

effect on how much a reward is valued, according to Humphreys (2003, p. D4). Whereas a

relationship based upon leader referent power would enhance the significance of intrinsic

rewards, extrinsic rewards would likely be the only option in a more coercive exchange

relationship (Humphreys, 2003, D4). This explains why Reed used coercion with the threat of

disciplinary action rather any promise of reward because he did not bother to consider Fred as an

individual worth his attention, but rather, a problem to be solved or an error to be corrected.

Humphreys (2003) elaborated on Xenophon's perspective by explaining, When leaders attempt

to understand their followers, they will be more likely to present a desired incentive, as well as

deliver it in the form and setting desired by those followers (p. D4). He also stated, Some

models show dissatisfaction resulting in diminished effort. Although he would acknowledge a

difference in degree, Xenophon believed the referent power associated with transforming leader

behaviors would lead to extra role behavior and enhance effort regardless of individual

40

satisfaction with rewards and he further believed that a charismatic leader with referent power

could satisfy and motivate followers no matter what the reward; whereas, no incentive could

ultimately motivate followers sufficiently when the leader used only coercion to influence them

(Humphreys, 2003, p. D3).

Ultimately, Reed ought to study history and learn a thing or two from Xenophon.

41

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