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Everything you need to know about theories of employee motivation in Management. The primary tasks of management is to get the things done through and by the people for the attainment of the common goals of an organisation.
The success or failure of a business concern depends basically upon the performance given by the people working in it. Therefore, it is necessary for management to inspire and stimulate or encourage the people with a lead to do work for the accomplishment of organisational objectives.
In simple words, it is necessary to motivate the personnel for the attainment of predetermining objectives of the business organisation.
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To do so, a manager must see that his subordinates work efficiently and enthusiastically and give results that are beneficial to the organisation. Business organisational goals cannot be achieved without subordinates’ willingness to put their best efforts.
Some of the theories of employee motivation are:-
1. Maslow’s Need Hierarchy Model 2. Herzberg’s Motivation-Hygiene Model 3. McClelland’s Theory 4. Porter and Lawler Expectancy Model
5. Equity Theory 6. McGregor’s Theory X’ and Theory Y’ 7. Ouchi’s Theory Z and 8. Alderfer’s ERG Theory of Motivation.
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Theories of Employee Motivation in Management
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Theories of Motivation in Management – Top 7 Theories of Employee Motivation
The primary tasks of management is to get the things done through and by the people for the attainment of the common goals of an organisation. The success or failure of a business concern depends basically upon the performance given by the people working in it. Therefore, it is necessary for management to inspire and stimulate or encourage the people with a lead to do work for the accomplishment of organisational objectives.
In simple words, it is necessary to motivate the personnel for the attainment of predetermining objectives of the business organisation. To do so, a manager must see that his subordinates work efficiently and enthusiastically and give results that are beneficial to the organisation. Business organisational goals cannot be achieved without subordinates’ willingness to put their best efforts. The problem of motivation arises here only.
The “Capacity to work” and “willingness to work” are two different things. A person can be physically, mentally and technically fit to work but he may not be willing to work, hence, there is a need of something that awakens a desire to work. This something is motivation. Motivating is therefore, to create a need and a desire on the part of worker to better his present performance.
Thus motivation relates with the “willingness to work”. Performance results from the interaction of physical, financial and human resource. The first two are inanimate, they are translated into “productivity”, only when the human element is introduced. However a human element interjects a variable over which a management has limited control.
While dealing with employees, however is an intangible factor of will, or freedom of choice is introduced workers can increase or decrease their productivity as they choose. This human quality gives rise to the need for positive motivation. Generally, performance is determined by three factors, viz. ability, knowledge and motivation. Performance = (ability + knowledge) x motivation. Among the three, motivation is the most important factor since it deals with human behaviour.
A manager should know that the performance of an employee is a function of his abilities and motivation. The first determines what he can do? The second determines what he will do? While there is a strong positive motivation, the employees output is increased, but where it is negative or a weak positive motivation, this performance level is low. One of the key elements in personnel management is motivation. Motivation is more important task than planning, organising and controlling.
Only the good plans, and policies and excellent organisation cannot make the business organisation successful, in the absence of winning-ness and enthusiasm on the part of workers. It has been experienced on various occasions that highly motivated people have achieved success despite the absence of good plans and policies of effective organisational structure.
Moreover if there is highly motivated subordinate, the less control is necessary to be sure that work will be executed. However motivation is not a substitute for planning, organising and controlling.
Management can do its job effectively only through motivating people to work for the accomplishment of organisational objectives. But according to authors like McGregor, Maslow, Herzberg and Vroom, it is difficult to understand motivation without considering what people want and expect from their work. Maslow’s theory is considered an important theory of motivation because it highlights the needs of the people.
Theory # 1. Maslow’s Need Hierarchy Model:
A.H. Maslow developed a conceptual framework for understanding human motivation which has been widely acclaimed. He defined a person’s effectiveness as a function of matching man’s opportunity with the appropriate position of hierarchy of needs. Process of motivation begins with an assumption that behaviour, at least in part, is directed towards the achievement of satisfaction of needs. Maslow proposed that human needs can be arranged in a particular order from the lower to the higher.
The need hierarchy is as follows:
1. Basic Physiological Needs – The needs that are taken as the starting point for motivation theory are the so-called physiological needs. These needs relate to the survival and maintenance of human life. They include such things as food, clothing, shelter, air, water and other necessities of life.
2. Safety and Security Needs – After satisfying the physiological needs, people want the assurance of maintaining a given economic level. They want job security, personal bodily security, security of source of income, provision for old age, insurance against risks, etc.
3. Social Needs – Man is social being. He is, therefore, interested in conversation, sociability, exchange of feelings and grievances, companionship, recognition, belongingness, etc.
4. Esteem and Status Needs – These needs embrace such things as self-confidence, independence, achievement, competence, knowledge, and success. They are also known as egoistic needs. They are concerned with prestige and status of the individual.
5. Self-fulfilment Needs – The final step under the need priority model is the need for self- fulfilment or the need to fulfil what a person considers to be his mission in life. It involves realising one’s potentialities for continued self-development and for being creative in the broadest sense of the word. After his other needs are fulfilled, a man has the desire for personal achievement. He wants to do something which is challenging and since this challenge gives him enough dash and initiative to work, it is beneficial to him in particular and to the society in general. The sense of achievement gives him psychological satisfaction.
Maslow proposed that the needs have a definite sequence of domination. Second need does not dominate until first need is reasonably satisfied and third need does not dominate until first two needs have been reasonably satisfied and so on. The other side of the need hierarchy is that man is wanting animal, he continues to want something or the other. He is never fully satisfied. If one need is satisfied, the other need arises.
According to Maslow, needs arise in a certain order of preference and not randomly. Thus, if one’s lower level needs (physiological and security needs) are unsatisfied, he can be motivated only by satisfying his lower level needs and not satisfying his higher level needs. Another point to note is that once a need or a certain order of needs is satisfied, it ceases to be a motivating factor. Man lives for bread alone as long as it is not available. In the absence of air one cannot live, it is plenty of air which ceases to be motivating.
Appraisal of Maslow’s Need Hierarchy:
Maslow’s need hierarchy has application to the lower level workers in a country like India where the basic needs of the workers are not satisfied. It points out that people are motivated by unfulfilled needs. It also postulates that as lower-level needs are fulfilled, upper-level needs replace them. Thus, Maslow’s theory seems to be a very simple description of the complex process of motivation of human beings.
The limitations of the Maslow’s theory are as under:
(i) Every individual may have a different need hierarchy which may not follow the sequence suggested by Maslow. For instance, an individual may have social or egoistic needs even though his safety need is not satisfied as yet.
(ii) It is wrong to presume that only one need is satisfied at one time. Man’s behaviour at any time is mostly guided by multiplicity of motives. However, one or two motives in any situation may be prepotent, while others may be of secondary importance. Moreover, at different levels of needs, the motivation will be different.
(iii) Money can act as a motivator only for physiological and social needs, not for satisfying higher level needs. Employees are enthusiastically motivated by what they are seeking, more than by what they already have. They may react cautiously in order to keep what they already have, but they move forward with enthusiasm when they are seeking something else. In other words, man works for bread alone as long as it is not available.
(iv) There are always some people in whom the need for self-esteem seems to be more prominent than that of love. There are also creative people in whom the drive for creativeness seems to be more important. In certain people, the level of operation may be permanently lower. For instance, a person who has experienced chronic unemployment may continue to be satisfied for the rest of his life if only he can get enough food and clothes. Another cause of reversal of need hierarchy is that when a need has been satisfied for a long time, it may be under-valued.
(v) It is doubtful that once a need is satisfied it loses its motivating force. It is also doubtful that satisfaction of one need automatically activates the next need in the hierarchy. Some persons will not aspire after their lower-order needs have been satisfied. Human behaviour is the outcome of several needs acting simultaneously. The same need may not lead to the same response in all individuals.
(vi) Needs are not the only determinant of human behaviour. People may engage in behaviours that are in no way concerned with the satisfaction of their needs. In practice, behaviour is influenced by needs, expectations, perception, etc. It is also influenced by the cultural background of people.
Theory # 2. Herzberg’s Motivation-Hygiene Model:
A significant development in motivation was distinction between motivational and maintenance factors in job situation. A research was conducted by Herzberg and his associates based on the interview of 200 engineers and accountants who worked for eleven different firms in Pittsburgh area.
These men were asked to recall specific incidents in their experience which made them feel either particularly good or particularly bad about jobs. The findings of the research were that good feelings in the group under test were keyed to the specific tasks that the men performed rather than to background factors such as money, security or working conditions and when they felt bad, it was because of some disturbance in these background factors which had caused them to believe that they were being treated unfairly.
This led to draw a distinction between what are called as ‘motivators’ and ‘hygiene factors’. To this group of engineers and accountants, the real motivators were opportunities to become more expert and to handle more demanding assignments. Hygiene factors served to prevent loss of money and efficiency. Thus, hygiene factors provide no motivation to the employees, but the absence of these factors serves as dissatisfier.
Some job conditions operate primarily to dissatisfy employees when they are absent, but their presence does not motivate employees in a strong way. Many of these factors are traditionally perceived by management as motivators, but the factors are really more potent as dissatisfiers. They are called maintenance factors in job because they are necessary to maintain a reasonable level of satisfaction among the employees.
Their absence proves to be a strong dissatisfier. They are also known as dissatisfiers or ‘hygiene factors’ because they support employees’ mental health. Another set of job conditions operates primarily to build strong motivation and high job satisfaction among the employees. These conditions are ‘motivational factors’.
Maintenance and Motivational Factors:
Maintenance or Hygiene Factors:
i. Company Policy and Administration
ii. Technical Supervision
iii. Inter-personal relations with Supervisor
iv. Inter-personal relations with Peers
v. Inter-personal relations with Subordinates
vi. Salary
vii. Job Security
viii. Personal life
ix. Working Conditions
x. Status.
Motivational Factors:
i. Achievement
ii. Recognition
iii. Advancement
iv. Work itself
v. Possibility of growth
vi. Responsibility.
Hygiene factors include such things as wages, fringe benefits, physical conditions and overall company policy and administration. The presence of these factors at a satisfactory level prevents job dissatisfaction, but they do not provide motivation to the employees. So they are not considered as motivational factors.
Motivational factors, on the other hand, are essential for increasing the productivity of the employees. They are also known as satisfiers and include such factors as recognition, feeling of accomplishment and achievement, opportunity of advancement and potential for personal growth, responsibility and sense of job and individual importance, new experience and challenging work, etc.
Criticism of Herzberg’s Theory:
Herzberg’s theory has been criticised on the following grounds:
(i) Herzberg drew conclusions from a limited study covering engineers and accountants. Engineers, accountants and other professionals may like responsibility and challenging jobs. But the general body of workers are motivated by pay and other financial benefits.
(ii) In Herzberg’s study, the interviewees were asked to report exceptionally good or exceptionally bad moments. This methodology is defective because there is a common bias among human beings to take more credit for good things and put the blame on others for bad things.
(iii) Herzberg gave too much emphasis on job enrichment. But job enrichment is not the only answer. Off-the-job satisfaction of the workers is also very important. Herzberg did not attach much importance to pay, status, or interpersonal relationships which are generally held as important contents of satisfaction.
(iv) The distinction between maintenance factors and motivating factors is not definite. What is a maintenance factor (e.g., pay) for a worker in the United States may be a motivator for a worker in a developing country. Thus, Herzberg ignored the dominating influence of situational variables.
Comparison of Herzberg and Maslow Models:
There appears to be a great similarity between Herzberg’s and Maslow’s models. A close examination of Herzberg’s model indicates that what he actually says is that some employees may have achieved a level of social and economic progress in the society and for them higher level needs of Maslow (esteem and self-actualisation) are the primary motivators. However, they still must satisfy the lower level needs for the maintenance of their current state.
Thus, we can say that money might still be a motivator for operative employees and for some managerial employees. Herzberg’s model adds to the Maslow’s need hierarchy model because it draws a distinction between the two groups of factors, namely, motivational and maintenance, and points out that the motivational factors are often derived from the job itself. Most of the maintenance factors come under comparatively lower order needs. In economically advanced countries, such needs of the employees are fulfilled and hence cease to be motivators.
Maslow’s physiological, security and social needs come under Herzberg’s maintenance factors whereas self-fulfillment under motivating factors. It may further be noted that a part of esteem need comes under maintenance factors and another under motivational factors. The esteem needs are divided because there are some distinct differences between status per se and recognition.
Status tends to be a function of the position one occupies. This position may be gained through family ties or social pressures and so this may not be a reflection of personal achievement or earned recognition. Recognition is gained through competence and achievement. It is earned and granted by others. That is why, status is classified with physiological, safety and social needs as a hygiene factor, while recognition is classified with esteem as a motivator.
Theory # 3. McClelland’s Theory:
Another motivational model stressing higher-level needs is that of David McClelland who described people in terms of three needs – Power, achievement, and affiliation.
These are discussed below:
(i) Need for Power (nPow):
The need for power is expressed as a desire to influence others. In relation to Maslow’s hierarchy, power would fall somewhere between the needs for esteem and self actualisation. People with a need for power tend to exhibit behaviours such as outspokenness, forcefulness, willingness to engage in confrontation, and a tendency to stand by their original position.
They often are persuasive speakers and demand a great deal from others. Management often attracts people with a need for power because of the many opportunities it offers to exercise and increase power. Managers who are motivated by the need for power are not necessarily “power hungry” in the sense in which the expression is often used.
(ii) Need for Achievement (nAch):
The need for achievement would fall between those for esteem and self-actualisation. This need is satisfied not by the manifestations of success, which confer status, but with the process of carrying work to its successful completion.
Individuals with a high need for achievement generally will take moderate risks, like situations in which they can take personal responsibility for finding solutions to problems, and want concrete feedback on their performance. As McClelland points out, “No matter how high a person’s need to achieve may be, he cannot succeed if he has no opportunities, if the organisation keeps him away from taking initiative, or does not reward him if he does.”
Thus, if management wishes to motivate individuals operating on the achievement level, it should assign them tasks that involve a moderate degree of risk of failure, delegate to them enough authority, to take initiative in completing their tasks, and give them periodic, specific feedback on their performance.
(iii) Need for Affiliation (nAff):
McClelland’s affiliative motive is similar to Maslow’s. The person is concerned with forming friendly relations with others, desire for companionship, and the desire to help others. People dominated by the affiliative need would be attracted to jobs that allow considerable social interactions. Managers of such individuals should create a climate that does not constrain interpersonal relations. A manager could also facilitate their need satisfaction by spending more time with such individuals and periodically bringing them together as a group.
Critical Appraisal of Achievement Motivation Theory:
McClelland’s theory and research have significant implications for managers. If the motives of employees can be accurately measured, management can improve the selection and placement processes. For example, an employee with a high need for achievement may be placed in a position that would enable him to achieve. This would result in higher performance. Need for achievement (nAch) is the most crucial to a nation’s economic progress as it contributes to entrepreneurial success.
Achievement motivated people can be the backbone of the organisation. Managers should raise the achievement need level of subordinates by creating a proper work environment.
Achievement motivation model, however, suffers from the following limitations:
(i) Persons with high need for achievement expect similar results from others. As a result, they may lack human skills and patience for being effective managers.
(ii) The research evidence in support of the achievement motivation theory is fragmentary and doubtful.
Theory # 4. Porter and Lawler Expectancy Model:
Porter and Lawler Mode is an improvement over Vroom’s Expectancy Mode.
It is based on four assumptions about behaviour in organisations:
1. Expectancy (Effort-Performance Probability):
It refers to the extent to which the person perceives or believes that his efforts would lead to the completion of a task. Expectancy is stated as a probability, i.e., an individual’s estimate of the probability of an outcome from an action. Since it is an association between effort and performance, its value may range from 0 to 1. If the individual feels that chances of achieving an outcome are zero, he will not even try. On the other hand, if expectancy is higher, the individual would put higher efforts to achieve the desired outcome.
2. Instrumentality (Performance-Reward Probability):
It refers to the probability to which the performance (first level outcome) would lead to the desired reward (second level outcome). For instance, an individual wants a promotion and feels that superior performance is very important in achieving promotion. Superior performance is the first level outcome and promotion is the second level outcome. The first-level outcome of high performance acquires a positive valence by virtue of its expected relationship to the preferred second level outcome of promotion. In other words, superior performance (first-level outcome) will be instrumental in obtaining promotion (second level outcome). The value of instrumentality also ranges from 0 to 1 as it is the probability of achieving the desired outcome.
Motivation is the product of valence, expectancy and instrumentality. These three factors in the expectancy model may exist in an infinite number of combinations depending upon the range of valence and the degrees of expectancy and instrumentality. The combination that produces the strongest motivation is high positive valence, high expectancy and high instrumentality. If all the three are low, the resulting motivation will be weak. In other cases, motivation will be moderate. Similarly, the strength of avoidance behaviour will be determined by the negative valence and expectancy and instrumental factors.
As said above, the motivational force will be highest when expectancy, instrumentality and valence are all high. The management must recognize and determine the situation as it exists and take steps to improve upon these factors for behavioural modification so that these three elements achieve the highest value individually.
A worker may exhibit a poor behaviour or low level of motivation due to:
a. Low Effort-Performance Expectancy:
The worker may lack the necessary skills and training to believe that his extra efforts would lead to better performance. The management could provide opportunities for training to improve skills in order to improve the relationship between efforts and performance.
(i) Behaviour is determined by a combination of factors in the individual and in the environment,
(ii) Individuals make conscious decision about their behaviour in the organisation,
(iii) Individuals have different needs, desires and goals; and
(iv) Individuals decide between alternate behaviours on the basis of their expectations that a given behaviour would lead to a desired outcome.
Porter and Lawler applied their model to study the behaviour of managers and concluded that there exists a complex relationship between job attitudes and job performance. This model encounters some of the simplistic traditional assumptions about the positive relationship between satisfaction and performance. “The emphasis in expectancy theory on rationality and expectations seems to us to describe best the kinds of cognition that influence managerial performance. We assume that managers operate on the basis of some sort of expectancies which although based upon previous experience are forward- oriented in a way that does not seem to be as easily handled by the concept of habit strength.”
The various elements of Porter and Lawler’s model are discussed below:
I. Effort:
It refers to the amount of energy exerted by a person on a job.
II. Value of Reward or Valence:
The outcome of a particular behaviour (i.e., effort put by an individual), has a specific valence (or motivating power or value) for each individual. For instance, the possibility of promotion may have a high valence for individuals who like higher responsibilities and may have a low value for individuals who don’t want to accept higher responsibilities. Thus, valence is determined by the concerned individual and is not an objective quality of the outcome itself.
b. Perceived Effort-Reward Probability:
It refers to the individual’s perception of the probability that different rewards depend upon different degrees of efforts. Value of reward for a person and his perception of effort-reward probability will determine the amount of efforts he will put.
I. Performance:
Efforts lead to performance. But both may not be equal. In fact, performance is determined by the amount of effort and ability and role perception of the individual. That means, if an individual is lacking in ability and/or has wrong role perception, his performance is bound to be unsatisfactory in spite of his putting great efforts.
II. Rewards:
Performance may lead to two kinds rewards, namely, intrinsic rewards such as a sense of self-actualisation and extrinsic rewards such as working conditions and status. The intrinsic rewards are much more likely to produce attitudes about satisfaction that are related to performance. Moreover, the perceived equitable rewards vitally affect the performance-satisfaction relationship. They reflect the fair level of rewards that the individual feels should be given for a particular level of performance.
III. Satisfaction:
The extent to which actual rewards fall short, meet or exceed the individual’s perceived level of equitable rewards determines the degree of satisfaction. If actual rewards meet or exceed perceived equitable rewards, the individual will feel satisfied and if these are less than equitable rewards, the individual will feel dissatisfied.
Satisfaction is only in part determined by actual rewards and that satisfaction is more dependent on performance than performance is on satisfaction. Only through the less direct feedback loops, satisfaction will affect performance. Porter and Lawler’s framework is, thus, a marked departure from the traditional analysis of satisfaction and performance relationship.
In practice, we see that motivation is not a simple cause and effect relationship, rather is a complex phenomenon. Porter and Lawler suggested that managers should carefully assess their reward structure and that through careful planning and careful definition of role requirements, the effort-performance-reward-satisfaction systems should be integrated into the overall system of managing.
Thus, the managers should take the following steps to motivate the workers:
(i) Determine the Rewards Valued by each Subordinate – If rewards are to be motivators, they must be suitable for the individual. A manger can determine what rewards his subordinates seek by observing their reactions in different situations and by asking them what rewards they desire.
(ii) Determine the Desired Performance – A manager must identify what performance level he wants so that he can tell subordinates what they must do to be rewarded.
(iii) Make the Performance Level Attainable – If subordinates feel that the goal they are asked to pursue is difficult or impossible, their motivation will be low.
(iv) Link Rewards to Performance – To achieve and maintain motivation, the appropriate reward must be clearly associated within a short period of time with successful performance.
Theory # 5. Equity Theory:
Equity theory of motivation was formulated by J.S. Adams. It is based on the assumption that members of an organisation experience strong expectations of justice, balance and fairness in treatment by the organisation. When a person feels that he is being treated unfairly by the organisation, these feelings can have a variety of adverse effects on the person’s motivation and performance on the job. The equity theory of motivation helps in understanding both the causes and the likely consequences of feelings of inequitable treatment among organisation members.
According to equity theory, two variables are important, i.e., inputs and outcomes. Input are the efforts and skills which a member of an organisation perceive that he puts into his job. Outcomes are the rewards which the member receives from the organisation and his job. Inputs and outcomes are important elements in the exchange relationship between the organisation and its members. When the individual finds equity in the situation or feels that what he receives from the organisation in terms of treatment and compensation is fair in terms of the effort and skills he contributes to the organisation, he is satisfied with the arrangement, and is normally committed to the organisation and its goals.
The individual will also compare his input-outcome ratios with the ratios of inputs and outcomes of some of his colleagues. This comparison is subjective since it is based on his perceptions and feelings. Such a comparison enables him to arrive at a conclusion whether the ratios are in balance or not. If the ratios are in balance, the individual experiences positive feelings of equity, fairness and justice. If they are not in balance, feelings of inequity are generated in the individual. Schematically, equity occurs when –
When an individual feels that his ratio of input-outcome is more or less equal to that of others of his rank and status, there is equity and he feels motivated. The problem arises when these ratios are not in balance. The ratios get imbalanced when a person’s ratio of outcomes to inputs is significantly less or significantly more than the ratios of others with whom he compares himself.
If the ratio is significantly less in comparison with those of others, it means that the individual feels underpaid. He will feel that he does not get outcomes commensurate with his inputs of efforts. In such a case, he is likely to feel angry, hostile and frustrated. If the ratio is significantly higher, the individual feels over-rewarded.
Such a situation may generate a feeling of guilt in the individual. In either case, the individual experiences some tension or anxiety and is motivated to reduce the perceived inequity or imbalance. For example, if the individual feels underpaid, he may try to reduce his input of effort or fight for higher emoluments.
According to equity theory, a feeling of inequity by an individual is uncomfortable and creates tension in his mind.
Perceived equity can be re-established by the following mechanisms:
(i) Changing Inputs – The person may choose to increase or decrease his inputs to the organisation, for example, by working harder or, alternatively, working less hard.
(ii) Changing Outcomes – A person may attempt to change his outcomes by requesting a salary increase or asking for a bigger office or a personal secretary. Anything perceived to be an outcome important to the individual can shift his ratio of inputs to outcomes.
(iii) Changing Perceptions of Inputs and Outcomes – Rather than actually changing inputs or outcomes, a person may change his perceptions of these factors. For example, a person who at first was feeling overpaid in return for his inputs to the company could re-establish equity by distorting upward his perception of his own inputs (e.g., “I now feel that I really do work a lot harder than anyone else does”).
(iv) Changing the Inputs or Outcomes of Others – A person could try to restore equity by attempting to convince a comparison person to reduce his inputs, for example, by not working as hard in the future. Equity can also restored by changing one’s perceptions of the inputs and outcomes of other.
Theory # 6. McGregor’s Theory X’ and Theory Y’:
Theory X:
Theory X indicates the traditional approach to managerial motivation and control. It represents old stereotyped and authoritarian management style of motivation.
The underlying assumptions of this theory are as follows:
(i) The average human being is basically lazy and has an inherent dislike to work. He will avoid work, if he can.
(ii) Most people lack ambition. They are not interested in achievement. They like to be directed.
(iii) Most people have little capacity for creativity in solving organisational problems.
(iv) Most people are indifferent to the organisational goals.
(v) Most people must be closely controlled and often threatened to achieve organisational goals.
(vi) Motivation of average human beings occurs at the physiological (food, clothing, shelter, etc.) and safety levels.
These negative assumptions of human behaviour underlie the traditional mechanisation of people and processes. The world is supposed to be full of unskilled workers, peons and messengers and to manage them is largely a matter of vigilance and strict supervision. Management merely thinks of catering to their physical and safety needs with some fringe benefits, keeping the implied threat of punishment handy in case of need. Thus, carrot and stick approach to motivation is followed. Theory X suggests that threats of punishment and strict control are the ways to manage people. It was practised during the days the Scientific Management approach gained prominence and human beings were treated like machines.
The above assumptions have been challenged by the human relationists because employees are treated merely as a commodity or passive factor of production. McGregor questioned the assumptions of Theory X which followed carrot and stick approach to motivation of people and suggested autocratic style of leadership. He felt that management by direction and control is a questionable method for motivating such people whose physiological and safety needs have been satisfied and whose social, esteem and self-actualisation needs are important.
In his own words, The ‘carrot and stick’ theory of motivation which goes along with Theory X works reasonably well under certain circumstances. The means for satisfying man’s physiological and (within limits) safety needs can be provided or withheld by management. Employment itself is such a means, and so are wages, working conditions, and benefits. By these means, the individual can be controlled so long as he is struggling for subsistence. Man tends to live for bread alone when there is little bread. But the ‘carrot and stick’ theory does not work at all once the man has reached an adequate subsistence level and after that he is motivated primarily by higher levels needs.
After challenging the validity of Theory X, McGregor developed an alternative theory of human behaviour which is known as Theory Y. This theory assumes that people are not unreliable and lazy by nature. It they are properly motivated, they could really be creative. The main task of the management is to unleash the potential in the employees. An employee who is properly motivated can achieve his goals by directing his own efforts and, thus, he can help in accomplishing the organisational goals.
The assumptions of McGregor’s Theory Y are as follows:
(i) Work is as natural as play, if the conditions are favourable. The average person does not inherently dislike work.
(ii) External control and threat of punishment are not the only means for bringing about efforts towards organisational objectives. The average human being will exercise self-direction and self-control in the service of objectives to which he is committed.
(iii) Commitment to objectives is a function of the rewards associated with their achievement. The most significant of such rewards, e.g., the satisfaction of ego and self-actualisation needs can be direct products of efforts towards organisation objectives.
(iv) The average human being learns under proper conditions, not only to accept but also to seek responsibility. Avoidance of responsibility, lack of ambition and emphasis on security are generally the consequences of experience, not inherent in human characteristics.
(v) The capacity to exercise a relatively high degree of imagination, ingenuity and creativity in the solution of organisational problems is widely, not narrowly, distributed in the population.
(vi) The intellectual potentialities of the average human being are only partially utilised under the conditions of modern industrial life.
Theory Y assumes that goals of the organisation and those of the individuals are not necessarily incongruent. The basic problem in most of the organisations is that of securing commitment of workers to organisational goals. Workers’ commitment is directly related to the satisfaction of their needs.
Thus, this theory places emphasis on satisfaction of the needs of the workers. It does not rely heavily on the use of authority as an instrument of command and control. It assumes that workers exercise self- direction and self-control in the direction of the goals to which they feel themselves committed. Because of these reasons, ‘Theory Y’ is realistic and frequently used at different levels in most of the organisations.
In support of the assumptions embodied in ‘Theory Y’, McGregor cited a few practices wherein the subordinates are given a freedom to direct their activities, to assume responsibility and, importantly, to satisfy their egoistic needs. These practices include decentralisation and delegation, job enlargement, participation and consultative management, and management by objectives.
Appraisal of McGregor’s Contribution:
Douglas McGregor’s Theory X and Theory Y represent extremes to draw the fencing within which the organisational man is seen to behave. No man would belong completely to either Theory X or Theory Y. He possesses the traits of both in varying degrees under different situations. Thus, these theories are important tools in understanding the behaviour of human beings and in designing the incentive schemes to motivate the employees. Neither of the two theories is fully applicable to all the situations and to all types of human beings.
However, Theory X is more applicable to unskilled and uneducated employees whereas Theory Y is more applicable to skilled and well educated employees who are mature enough and understand the responsibility. Therefore, the management should use an amalgamation of both the theories to motivate the different kinds of employees at different levels in the organisation.
The chief merit of McGregor’s contribution is that it helped crystallise and set the right perspective to the findings of Elton Mayo’s Hawthorne Studies which had then puzzled management and productivity experts and set in motion a wave of research into the behaviour of the organisational man. It (along with Hawthorne Studies) can be said to have been the starting point and mainspring that evoked wide and lasting interest in the area of motivation, leadership and techniques of understanding behaviour of the human element of the enterprise.
Theory # 7. Ouchi’s Theory Z:
International attention is being focused on the outstanding performance of the Japanese economy and the success of management practices being adopted by Japanese firms. Interest in Japanese management has rapidly increased in America and other countries. William Ouchi made a comparative study of American and Japanese management practices. He came to the conclusion that many of the Japanese management practices can be adopted in American context.
He suggested the adoption of Theory Z. It may be noted that Theory Z is not a theory in the true sense. It is merely a label interchangeable with type Z. It describes human behaviour as in the case of theories X and Y. The expression ‘Theory Z’ was adopted not for analytical purpose but for promotional purpose. It may be noted that the label Z has been used by Urwick, Rangnekar and Ouchi. But Ouchi’s views have got much publicity in the business world.
Japanese management can be characterized by the following principles – (1) an emphasis on the group rather than the individual; (2) an emphasis on human rather than functional relationships; and (3) a view of top management as generalists and facilitators rather than as decision-makers.
The broad features of Japanese management are discussed below:
1. Lifetime Employment:
Japanese workers tend to make a lifetime commitment to their organisations and, in turn, organisations assume responsibility for lifetime employees. Promotions are based on seniority, loyalty and harmonious behaviour.
2. Emphasis on Group:
Japanese relish life in groups. By focusing on the group instead of the individual, Japanese companies are able to get best out of their employees in terms of both quantity and quality. Japanese management emphasizes the permanence of the group. The employees are appointed with the understanding that they are joining for life. Pay and incentives for workers depend partly on the financial performance of the group. Group cohesiveness is supported by company songs, recitations of the company creed, and other activities. The “us against them” mentality in a Japanese company is likely to put the company against its competitors—not the workers against management.
3. Concern for Employees:
American organizations tend to view people as tools to fill slots that have specific job descriptions. In Japan, however, the permanence of the group forces managers to place more emphasis on people than on the system. This emphasis on human relations can be seen in careful recruitment practices, a concern for the whole employee, harmonious resolution of conflict, etc. The companies provide housing facilities, welfare facilities and counselling services to their employees.
4. Collective Decision Making:
Employees and managers seek consensus on decisions and endorse collective decision-making processes. Thus, joint decision-making is emphasized by the Japanese management.
5. Role of Top Management:
Managers are generalists and they operate as social and symbolic leaders. Their role is that of facilitator and not of decision-maker. In other words, group decision-making is encouraged. The managers do not follow specialised career paths as is the case with the American managers.
Theory Z represents the adoption of Japanese management practices by the American companies. The ‘hybrid’ type of system incorporates the strengths of Japanese management (group decision making, social cohesion, job security, holistic concern for employees, etc.) and American management (quick decision-making, individual freedom, risk-taking by individuals, etc.).
The features of Theory Z or US-Japanese system of management are discussed as under:
1. Strong Bond between the Company and the Employees:
Theory Z suggests life time employment in the company as followed in Japan. Retrenchment, lay off, etc., should be avoided as far as possible. Along with financial incentives, the management should also use non-financial incentives to motivate the workers. To strengthen the bond between the company and the workers, the management should follow the paternalistic style. The needs of workers must be satisfied.
2. Employees’ Participation:
The employees must participate in decision-making. They must be consulted by the management and their suggestions must be considered. This will increase their commitment to the organisational decisions. Thus, decision-making under Theory Z is less centralised and more consensus seeking. It involves the employees in decision-making and gives them due recognition.
3. Mutual Trust:
There should be trust between employees, supervisors, work groups, unions and management. According to Ouchi, trust, integrity and openness are closely related”. All these are necessary for an effective organisation. To develop trust, there should be complete openness and candour in relationships. The chances of conflicts should be reduced to the minimum. Attempts should be made to achieve win-win relationships in the organisation. This would make the employees committed to the organisation.
4. Integrated Structure:
No formal structure is recommended by Theory Z. The organisation structure should be based on team-work as in case of a basketball team where there are no formal reporting relationships and the players play together. An integrated organisation need not have any chart or visible structure. The employees must develop the group spirit.
5. Human Resources Development:
The management must work to develop new skills among the employees. In theory Z, human resources potential is recognized and the greater emphasis is on job enlargement and career planning as well as socialisation. Technical training, research and development are also emphasised.
6. Informal Controls:
Theory Z requires the managers to reduce their reliance on formal control system. As far as possible, organisational controls should be informal and flexible. In other words, the managers should emphasize mutual trust and cooperation rather than their authority over the subordinates. There should be free flow of information throughout the organisation so that corrective actions could be taken quickly whenever needed.
It is obvious that Theory Z is a comprehensive philosophy of management. It is not merely a technique of motivation. It rather involves a complex amalgamation of management principles and techniques for obtaining maximum cooperation of the employees. It provides a complete transformation of managing people at work as compared to Theory X and Theory Y. It calls for mutual trust between management and workers, strong bond between organisation and workers, involvement of employees in decision-making and so on.
Theory Z has been practised successfully by the Japanese firms operating in the U.S.A. With the collaboration of Indian organisations and Japanese firms, there has been a lot of talk about the application of Theory Z to Indian conditions. In Maruti Udyog (having collaboration with Suzuki Motors of Japan), an attempt has been made to implement Theory Z.
The work-place has been designed on the Japanese pattern. There is a common canteen for all employees irrespective of level in the organisation. Similar uniform has been introduced for all. These practices have been followed to avoid class feeling among the employees and to remove the problems the status differentials among different levels bring about.
Theories of Motivation in Management
– Common Theories: Maslow’s Need Hierarchy, Alderfer’s ERG Theory, Herzberg’s Two Factor and McClelland’s Three Needs Theory
The most common theories of motivation are the following:
1. Abraham H. Maslow’s Need Hierarchy or Deficient Theory of Motivation
2. Alderfer’s ERG Theory of Motivation
3. Herzberg’s Two Factor or Hygiene/Maintenance Theory
4. McClelland’s Three Needs Theory.
1. Maslow’s Need Hierarchy (Or Deficient Theory of Motivation):
The crux of Abraham H. Maslow’s theory, which was propounded in 1943, states that human needs are arranged in a hierarchy composed of five categories. Maslow began his theory based on the assumption that man is an animal with a hierarchy of needs. Of these needs, there are some that are lower on the scale of necessity and others that are higher. According to the theory, as and when the lower needs are satisfied, higher needs emerge and are required to be satisfied. Higher needs cannot be satisfied unless the lower needs are fulfilled.
This resembles the standard economic theory of diminishing returns. The hierarchy of needs at work in the individual is a routine tool of the personnel trade, and when these needs are active, they act as powerful conditioners of behaviour in the form of motivators. From the lowest level to the highest level, the needs are physiological or body needs, safety and security needs, social or affiliation needs, ego or esteem needs, and self-realization or self-actualization needs.
These are briefly discussed here:
i. Physiological or Body Needs:
This is the lowest level need, which has to be fulfilled before an individual craves for any of the other needs. An individual moves up the ladder responding first to the physiological needs for nourishment, clothing, and shelter. These physical needs must be equated with pay rate, pay practices, and to an extent with the physical conditions of the job.
ii. Safety and Security Needs:
The next in order of needs is safety. This is the need to be free from any danger, either from other people or from the environment. The individual wants to be assured that he/she is secure, once his/her bodily needs are satisfied.
The safety needs may also take the form of job security, security against disease, misfortune, old age, etc., as also against industrial injury. Such needs are generally met by safety laws, measures of social security, protective labour laws, and collective agreements.
iii. Social or Affiliation Needs:
The next need is to be able to work in a group, be identified as a member of that group, and belong to it. This need also involves the need to love and be loved. In a large organization, it is not easy to build social relations.
iv. Ego or Esteem Needs:
These needs reflect an individual’s desire to achieve a certain status and recognition, respect, and prestige in the workplace. Some of these needs are also related to one’s self-esteem, such as the need for achievement, self-confidence, knowledge, competence, etc.
v. Self-Realization or Self-Actualization Needs:
After fulfilling all the other needs, an individual reaches this stage, as per Maslow’s theory. The individual becomes growth-oriented, self-directed, detached, and creative. To quote Maslow, ‘A musician must make music, an artist must paint, a poet must write, if he is to be ultimately happy. What a man wants to be, he must be. This need we may call self-actualization’.
The creativity of a man in producing new and practical ideas, and in bringing about productivity, innovation, and reducing costs might satisfy some of these needs.
2. Alderfer’s ERG Theory of Motivation:
Taking Maslow’s theory as the starting point, Clayton Alderfer (1969) built a theory which he claims has realistic application to a work organization. According to him, Maslow’s five levels of needs can be amalgamated into three—existence, relatedness, and growth—resulting in his approach being termed as the ERG Theory.
i. Existence Needs – These include all forms of physiological and safety needs or the first two levels of Maslow’s hierarchy.
ii. Related needs – These include relationship with other people (social needs of Maslow’s third level) and the need for recognition and respect that forms the part of Maslow’s fourth level (esteem needs).
iii. Growth needs – Similar to Maslow’s notion of self-actualization, these are concerned with the desire to be creative and to achieve full potential in the existing environment.
The novelty of Alderfer’s theory lies not in the regrouping of the needs but in doing away with the hierarchy of human needs. He conceived the ERG theory, thereby avoiding the implication that the higher up an individual is in the hierarchy, the better he is.
According to him, different types of needs can operate simultaneously, and if a particular path towards satisfaction is blocked, the individual will both persist along that path and at the same time regress towards more easily satisfied needs. In this way, he distinguishes between chronic needs which persist over a period and episode needs which are situational and can change according to the environment.
3. Herzberg’s Two Factor or Hygiene Theory:
According to Herzberg (1968), every human has two different categories of needs, which are essentially independent of each other and affect his/her behaviour in different ways. When people are dissatisfied with their jobs, they are possibly concerned about the environment in which they are working. On the other hand, when people feel good about their jobs, this has to do with the work itself.
Herzberg’s Two Factor, Hygiene, or Motivation Theory calls the first category of needs ‘hygiene factors’ because they describe a man’s environment and serve the primary purpose of job satisfaction. Hygiene factors include company policies, administration, supervision, working conditions, interpersonal relations, wages and allowances, status, and security.
He calls the second category of needs ‘motivators’ since they seem to be effective in motivating the people to superior performance. Motivators or job content factors include achievement, recognition, increased responsibility, challenging work, growth, and development.
According to Herzberg, both the sets of factors work in only one direction. The absence of hygiene factors may dissatisfy the workers, but will not demotivate them. Similarly, in the absence of motivation factors, workers may remain motivated, but their absence does not make them dissatisfied.
4. McClelland’s Three Needs Theory:
According to this theory, every individual gets motivated by a bundle of particular needs. It also posits that certain needs act more strongly on some individuals than the others.
In early studies that attempted to understand the qualities of leadership, one of the first types of personality traits to be observed was an apparent need by some people to excel without any external rewards. When asked to play a ring toss game without the imposition of any rules, some people would stand so close that they would never miss and some would stand so far away that winning or losing would be greatly due to chance.
Others, however, would be very calculative in their distance to ensure that winning or losing was due in large part to their own skill. If they missed the toss, they would move a little closer; if they won the toss, they would step back a bit.
The idea of the theory is that we all have the drive to excel or achieve to some degree, but some people have a lesser amount of this drive than others. This theory proposes that each of us has these three needs, to a varying degree.