Practices That Motivate

"Practices that Motivate"

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Management 12324

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Abstract

Battered by spiraling economics and global competition the American steel industry struggles to turn molten metal into investor profits. Nucor, on the other hand has taken the past two decades to execute an essential takeover of the industry driving themselves to the top of their industry. Their secret can be attributed to a variety of factors from a performance-based rewards system if we are talking extrinsic motivators, to Nucor's outstanding leadership if we focus on motivation. Nucor continues to develop new and innovative leadership and motivational strategies that are widely considered best management practices throughout today's business environment. Nucor's ability to develop and maintain these strategies has made them a highly successful corporation as both their products and motivation success continues to define them as a company.

Nucor: "Practices that Motivate"

Hundreds of tons of raw materials combined with soaring temperatures beyond 3,000 degrees create an environment in need of motivated employees and outstanding leadership in order to overcome one of the harshest conditions found in any production facility. Gowdy (2011) explains five ways to improve a company's culture by motivating employees, he starts with a company defining their core values; at Nucor employees embracing corporate core values is a top priority. Gowdy (2011) goes on to define hiring the right people, building a system of trust and accountability, tearing down office walls and finally rewarding success. Nucor's secrets to success can easily be defined by these five ways of motivating; one in particular is how the company rewards success with a performance-based rewards system.

Although an extrinsic motivator, a motivator none-the-less as employees are rewarded sometimes double their base salaries. Rewards are focused on "quality, tons produced and shipping through a team" (McShane, 2010, p. 171). This system empowers Nucor employees to have a vested interest in the company and the quality of product the company produces. An example of the company vesting their responsibility for quality into the employees can be clearly seen when a bad batch of product is produced. When this happens the company puts that responsibility back to the employees who produced the batch and will deduct that tonnage of product from the team's weekly bonus calculation. This system of rewards relies heavily upon quality of output not just quality (McShane, 2010, p. 171).

Nucor understand that in order to motivate employees they need to link the rewards program to the employee's performance, ensure the rewards are relevant and valued. Furthermore, Nucor relies on team-based bonuses because their employees work in what is considered a highly-interdependent job that is difficult to measure individual performance." (McShane, 2010, p. 173). The high performance standards that Nucor set for its employees can be considered a mark of an "effective leader if the process is consistent" (Dubrin, 2010, p. 101).

Communication is another key aspect in Nucors success, according to McShane (2010, p. 303) employees at Nucor rely on coercive power to control co-worker behavior in team settings. At Nucor "if you're not contributing with the team, they certainly