This chapter addresses issues of leadership and motivation. It describes the differences between political and administrative viewpoints. The chapter also describes how a market-based perspective differs from that of elected officials and public administrators. It explains the concept of the psychological contract and how it can be used to clarify relationships. The chapter also explains the basic components of equity and expectancy theory. It presents four innovations to enhance productivity: total quality management, job enrichment, work-life balance, and teamwork. Political leaders, agency managers, and human resource directors are responsible for creating and funding human resource programs that provide incentives for superior performance. The chapter explores the ways in which elected officials, managers, and personnel specialists affect an employee's motivation to perform. It discusses the meaning of "spirituality at work." The chapter also discusses the ways that elected officials, managers, and personnel specialists affect an employee's ability to perform.