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The motivation theories used by management

Paper Type: Free Essay Subject: Business
Wordcount: 2965 words Published: 1st Jan 2015

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This chapter provides a brief outline of motivation, types of motivation, major motivation theories and leadership theories on increasing employee motivation. Lastly this chapter identifies the impact of employee motivation on the productivity of the company.

2.2 Motivation

The level of performance of employees relies not only on their actual skills but also on the level of motivation each person exhibits (Burney et al., 2007). Motivation is an inner drive or an external inducement to behave in some particular way, typically a way that will lead to rewards (Dessler,1978). Over-achieving, talented employees are the driving force of all firms so it is essential that organizations strive to motivate and hold on to the best employees (Harrington, 2003).

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The success of any business depends largely on the motivation of the employees. Every person has their own set of motivations and personal incentives to work hard or not as the case may be. Some are motivated by recognition while others are motivated by cash incentives. Motivation can be internal or external. Deadlines are an example of external motivation. The fear of losing a contract or of not finishing a job you started is an example of internal motivation. Both internal and external motivation can be equally powerful.

Financial Motivation is money, incentives, bonus, commission, fame and recognition which are External and Monetary benefits or Non-Financial Motivators like pride, sense of achievement, responsibility, belief, challenge and interesting job, Respect which are Internal. Perhaps the most significant impact of increased employee motivation is that of increased productivity. This is a central aim when adopting an incentive program. If you can increase employee motivation, productivity will follow and with that the inevitable increased bottom line.

Table 1 Four most powerful types of motivation

Type of Motivation


Intrinsic motivation

Satisfaction in the work itself (pleasure, stimulation, learning etc)

Extrinsic motivation

Rewards for doing the work (money, promotion, perks etc)

Personal motivation

Individual values (a love of knowledge, power, security, self-expression etc)

Interpersonal motivation

The influence of other people (competition, collaboration, commitments etc)

Human beings are multifaceted creatures, and we are typically motivated by a mixture of all four elements. This diagram can help make sense of this complexity

The types of motivation combine to produce four key areas to focus on when trying to motivate people.

For example, prior to taking a work, employee will most likely to have a minimum anticipation in terms of pay and opportunities for career progress (personal rewards). You will also want to be certain that it offers you an opportunity to use your skills, learn and stretch yourself in pursuit of a meaningful challenge (personal satisfaction). Probability are you will also want to be given due recognition for your involvement (public recognition). And given how long you are going to spend in the group of your co-workers, you will probably want them to be interesting and enjoyable company (social interaction). Combining different forms of motivation will have the biggest impact on performance. Taking a more balanced approach to motivation will also help you develop better relationships with everyone on your team.

How to Motivate People During a Recession

Deci and Ryan (2000) conducted and replicated an experiment that showed the negative impact of monetary rewards on intrinsic motivation and performance. A group of college students were asked to work on an interesting puzzle. Some were paid and some were not paid for the work. The students that were not being paid worked longer on the puzzle and found it more interesting than the students being paid. When the study was brought into a workplace setting, employees felt that their behavior was being controlled in a dehumanizing and alienating manner by the rewards. It was discovered that rewards would seriously decrease an employee’s motivation to ever perform the task being rewarded, or one similar to it, any time in the future.

Another observation of the study was that employees would expect a reward every time the task was to be completed if the reward was offered at one time. Employees would require the reward in order to perform the job and would probably expect the reward to increase in amount. If the rewards were not increased or if they were taken away they actually served as negative reinforcement.

2.2 Major Theories of Motivation

Motivation is not only in a single direction i.e. downwards. In the present scenario, where the workforce is more informed, more aware, more educated and goal oriented, the role of motivation has left the boundaries of the hierarchy of management. The Fig below shows the major theories of motivation that can be applied in the working environment as well on the employees to see the impact of motivation on the organization as a whole.

Fig shows Major theories of Motivation

2.2.1 Need Approaches

Maslow’s Hierarchy of Needs

Fig Shows Maslow’s Hierarchy of Needs

If motivation is driven by the existence of unsatisfied needs, then it is worthwhile for a manager to understand which needs are the more important for individual employees.


By applying Maslow’s theory of motivation, modern leaders and managers find way of employee motivation for the purpose of employee and workforce management. The basis of Maslow’s theory of motivation is that human beings are motivated by unsatisfied needs, and that certain lower needs need to be satisfied before higher needs can be addressed. As per the teachings of Abraham Maslow, there are general needs (physiological, safety, love, and esteem) which have to be fulfilled before a person is able to act unselfishly. These needs were dubbed “deficiency needs.” While a person is motivated to fulfill these basal desires, they continue to move toward growth, and eventually self-actualization.


As a result, for adequate workplace motivation, it is important that leadership understands which needs are active for individual employee motivation. In this regard, Abraham Maslow’s model indicates that basic, low-level needs such as physiological requirements and safety must be satisfied before higher-level needs such as self-fulfillment are pursued. As depicted in this hierarchical diagram, sometimes called ‘Maslow’s Needs Pyramid’ or ‘Maslow’s Needs Triangle’, when a need is satisfied it no longer motivates and the next higher need takes its place.


Table 2 shows Maslow’s Hierarchy of Needs



Biological and Physiological needs

Air, food, drink, shelter, warmth, sex, sleep, etc

Safety needs

Protection from elements, security, order, law, limits, stability, etc.

Belongingness and Love needs

Work group, family, affection, relationships, etc.

Esteem needs

Self-esteem, achievement, mastery, independence, status, dominance, prestige, managerial responsibility, etc

Self-Actualization needs

Realizing personal potential, self-fulfillment, seeking personal growth and peak experiences.

Source: http://www.businessballs.com/maslow.htm

Alderfer’s ERG Theory

Fig: Clayton Alderfer’s ERG Theory Needs


If the ERG theory holds, then unlike with Maslow’s theory, managers must recognize that an employee has multiple needs to satisfy simultaneously. Furthermore, if growth opportunities are not provided to employees, they may regress to relatedness needs. If the manager is able to recognize this situation, then steps can be taken to concentrate on relatedness needs until the subordinate is able to pursue growth again.


Herzberg’s Two Factor Theory

Fig: Hygiene and Motivation Factors


The psychologist Fredrick Herzberg asked the questions from employees in the year 1950s and 60s for understanding employee satisfaction. He set out to determine the effect of attitude on motivation, by asking people to describe the circumstances where they felt really good, and really bad, about their jobs. What he found was that people who felt good about their jobs gave very different responses from the people who felt bad. Herzberg’s findings revealed that certain characteristics of a job are consistently related to job satisfaction, while different factors are associated with job dissatisfaction shown in Fig?

The conclusion he drew is that job satisfaction and job dissatisfaction are not opposites.

The opposite of Satisfaction is No Satisfaction.

The opposite of Dissatisfaction is No Dissatisfaction

To apply Herzberg’s theory, managers need to adopt a two stage process to motivate people. Firstly, managers need eliminate the dissatisfactions the employees are experiencing and, secondly, managers need to help them find satisfaction.


McClelland’s Learned Needs Theory

One of McClelland’s most well known theories is that human motivation is dominated by three needs. McClelland’s theory, sometimes referred to as the three need theory or as the learned needs theory, categorizes the needs as follows;

The need for achievement

The need for power

The need for affiliation

The importance of each of these needs will vary from one person to another. If the manager can determine the importance of each of these needs to an individual, it will help the managers to decide how to influence that individual.

McClelland asserted that a person’s needs are influenced by their cultural background and life experiences. He also asserted that the majority of these needs can be classified as the needs for affiliation, achievement or power. A person’s motivation and effectiveness can be increased through an environment, which provides them with their ideal mix of each of the three needs.


2.2.2 Cognitive Approach

Expectancy Theory

The expectancy theory says that individuals have different sets of goals and can be motivated if they have certain expectation. Individuals choose behaviors’ based on the outcomes they expect and the values they ascribe to those expected outcomes (Borders 2004). Vroom’s Expectancy theory is based upon the following three variables which he calls Valence, Expectancy and Instrumentality valances (Bartol, Tein, Matthews, Riston & Scott-Ladd 2006).

Valence refers to the value an individual personally places on the reward or upon the expected outcome of a situation. The Valence is high if the reward available is of interest to us. When you have a higher valence you tend to have higher motivation (Bartol, Tein, Matthews, Riston & Scott-Ladd 2006).

Expectancy is the belief that your efforts will result in attainment of the desired performance. This belief is generally based on an individuals past experience, self confidence. Expectancy would be zero if an individual felt it were impossible to achieve a given performance level (Bartol, Tein, Matthews, Riston & Scott-Ladd 2006).

Instrumentality is the belief that the success of the situation is linked to the expected outcome of the situation, e.g. it’s gone really well, so I’d expect praise. It is also the belief that if one meets the performance expectations, he or she will receive a greater reward. This reward may come in the form of a pay increase, promotion, recognition or sense of accomplishment. (Bartol, Tein, Matthews, Riston & Scott-Ladd 2006)

Equity Theory/ Social Comparison Theory

Source: http://www.businessballs.com/adamsequitytheory.htm

According to Equity theory the employees perceive what they get from a job situation (outcomes) in relation to what they put into it (inputs) and then compare their inputs-outcomes ratio with the inputs-outcomes ratios of relevant others (Shown in Fig). If an employee perceives her ratio to be equal to those of relevant others, a state of equity exists. In other words, she perceives that her situation is fair-that justice prevails. However, if the ratio is unequal, inequity exists and she views herself as under rewarded or over rewarded.

Source: http://www.businessballs.com/adamsequitytheory.htm

Goal Setting Theory of Motivation

Goal-setting theory “focuses on identifying the types of goals that are most effective in producing high levels of motivation and performance and explaining why goals have these effects.” Goal-setting theory is found within the field of organizational behavior; however, it can be applied to any general area where goals may be achieved. http://www.ehow.com/about_5382265_goalsetting-theory-motivation.html

Source: http://faculty.washington.edu/janegf/goalsetting.html

In order to direct ourselves we set ourselves goals that are:

Clear (not vague) and understandable, so we know what to do and what not to do.

Challenging, so we will be stimulated and not be bored.

Achievable, so we are unlikely to fail.

If other people set us goals without our involvement, then we are much less likely to be motivated to work hard at it than if we feel we have set or directed the goal ourselves.http://changingminds.org/explanations/theories/goals.htm


Reinforcement theory of motivation overlooks the internal state of individual, i.e., the inner feelings and drives of individuals are ignored by Skinner. This theory focuses totally on what happens to an individual when he takes some action. External environment of the organization must be designed effectively and positively so as to motivate the employee. This theory is a strong tool for analyzing controlling mechanism for individual’s behaviour. http://www.managementstudyguide.com/reinforcement-theory-motivation.htm

Table 3: Reinforcement schedule




positive reinforcement (raise above baseline)

negative reinforcement (raise up to baseline)


punishment (bring down below baseline)

extinction (stay at baseline)

Source: http://motivationcentre.blogspot.com/2006/03/reinforcement-theory.html

Table 4 Types of Reinforcement

Types of Reinforcement


Positive reinforcement

This implies giving a positive response when an individual shows positive and required behavior. Ex. You make a sale, you get a commission. You do a good job; you get a bonus &a promotion.

Negative reinforcement

This implies rewarding an employee by removing negative / undesirable consequences. Both positive and negative reinforcement can be used for increasing desirable / required behaviour.


It implies absence of reinforcements. In other words, extinction implies lowering the probability of undesired behaviour by removing reward for that kind of behaviour. For instance – if an employee no longer receives praise and admiration for his good work, he may feel that his behaviour is generating no fruitful consequence. Extinction may unintentionally lower desirable behaviour


It implies removing positive consequences so as to lower the probability of repeating undesirable behaviour in future. In other words, punishment means applying undesirable consequence for showing undesirable behaviour. For instance – Suspending an employee for breaking the organizational rules.

Source: http://www.managementstudyguide.com/reinforcement-theory-motivation.htm

2.3 Leadership Style Influencing Motivation

Leadership style is the manner and approach of providing direction, implementing plans, and motivating people (Kurt Lewin,1939). Leadership Style influences the level of motivation of employees. Different Leaders have different style for managing the employees working under them. Fig explains the style of leadership influencing the motivation of employees.

Fig: Leadership Style Vs motivation

Source: http://www.motivation-tools.com/workplace/leadership_styles.htm


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