Encyclopedia of Business and Finance | Motivation

A simple definition of motivation is the ability to change behavior. It is a drive that compels one to act because human behavior is directed toward some goal. Motivation is intrinsic (internal); it comes from within based on personal interests, desires, and need for fulfillment. However, extrinsic (external) factors such as rewards, praise, and promotions also influence motivation. As defined by Daft (1997), motivation refers to "the forces either within or external to a person that arouse enthusiasm and persistence to pursue a certain course of action" (p. 526).

People who are committed to achieving organizational objectives generally outperform those who are not committed. Those who are intrinsically rewarded by accomplishments in the workplace are satisfied with their jobs and are individuals with high self-esteem. Therefore, an important part of management is to help make work more satisfying and rewarding for employees and to keep employee motivation consistent with organizational objectives. With the diversity of contemporary workplaces, this is a complex task. Many factors, including the influences of different cultures, affect what people value and what is rewarding to them.

From a manager's perspective, it is important to understand what prompts people, what influences them, and why they persist in particular actions. Quick (1985) presented these four underlying principles that are important to understanding motivation:

1. People have reasons for everything they do.
2. Whatever people choose as a goal is something they believe is good for them.
3. The goal people choose must be seen as attainable.
4. The conditions under which the work is done can affect its value to the employee and his or her perceptions of attainability or success.

When management was first studied in a scientific way at the turn of the twentieth century, Frederick Winslow Taylor worked to improve productivity in labor situations so important in those days of the developing Industrial Revolution. Taylor developed efficiency measures and incentive systems. When workers were paid more for meeting a standard higher than their normal production, productivity increased dramatically. Therefore, workers seemed to be economically motivated. At this time in history, social issues involved in human behavior were not yet considered. Amore humanistic approach soon developed that has been influencing management ever since.

During the late 1920s and early 1930s, Elton Mayo and other researchers from Harvard University conducted studies at a Western Electric plant in Hawthorne, Illinois, to measure productivity. They studied the effects of fatigue, layout, heating, and lighting on productivity. As might be expected when studying lighting, employee productivity levels increased as the illumination level was increased; however, the same effect was noted when the illumination level was decreased. The researchers concluded that the attention paid to the employees was more of a contributing factor to their productivity level than the environmental conditions. The fact that paying attention to workers could improve their behavior was called the Hawthorne effect. As a result of this research, it was evident that employees should be treated in a humane way. These findings started the human relations movement—a change in management thinking and practice that viewed increased worker productivity as grounded in satisfaction of employees' basic needs. [Many years later, it was discovered that the workers in the Hawthorne experimental group had received an increase in income; therefore, money was probably a motivating factor, although it was not recognized as such at the time. (Daft, 1997)].

Motivation theories have continued to evolve and have their roots in behavioral psychology. They provide a way to examine and understand human behavior in a variety of situations. A simple model of motivation is shown in Figure 1.

Ongoing changes in the workplace require that managers give continuous attention to those factors that influence worker behavior and align them with organizational goals. No one theory is appropriate for all people and for all situations. Each individual has his or her own values and

differing abilities. In business settings, managers apply motivation theories to influence employees, improve morale, and implement incentive and compensation plans.

The following discussion of motivation theories is grouped according to need, process, and reinforcement theories.

NEED THEORIES

Need theories are based on some of the earliest research in the field of human relations. The premise behind need theories is that if managers can understand the needs that motivate people, then reward systems can be implemented that fulfill those needs and reinforce the appropriate behavior.

Hierarchy of Needs Abraham Maslow, a professor at Brandeis University and a practicing psychologist, developed the hierarchy of needs theory. He identified a set of needs that he prioritized into a hierarchy based on two conclusions (Daft, 1997; McCoy, 1992; Quick, 1985):

1. Human needs are either of an attraction/desire nature or of an avoidance nature.
2. Because humans are "wanting" beings, when one desire is satisfied, another desire will take its place.

The five levels of needs are the following (see Table 1):

• Physiological: These are basic physical comfort or bodily needs: food, sex, drink, and sleep. In the workplace, these needs translate into a safe, ergonomically designed work environment with an appropriate base salary compensation.
• Security/safety: People want to feel safe, secure, and free from fear. They need stability, structure, and order. In the workplace, job security and fringe benefits, along with an environment free of violence, fills these needs.
• Belongingness and love: This is a need for friends, family, and intimacy—for social acceptance and affection from one's peers. In the workplace, this need is satisfied by participation in work groups with good relationships among co-workers and between workers and managers.
• Esteem: People want the esteem of others and they want to be regarded as useful, competent, and important. People also desire self-esteem and need a good self image. In the workplace, increased responsibility, high status, and recognition for contributions satisfy these needs.
• Self-actualization: This highest motivation level involves people striving to actualize their full potential, to become more of what they are capable of being. They seek to attain self-fulfillment. In the workplace, people satisfy this need by being creative, receiving training, or accepting challenging assignments.

Focusing on the needs of retraining for growth and challenge as well as rewards and recognition is important to the quality of work life. Managers can affect the physical, social, and psychological environment in the workplace, and they have a responsibility to help employees fulfill their needs.

ERG Theory In his work, Clayton Alderfer expanded on Maslow's hierarchical theory. He proposed three need categories and suggested that movement between the need levels is not necessarily straightforward. Failure to meet a higher-order need could cause an individual to regress to a lower-order need. These ERG theory categories are:

• Existence needs: Needs for physical well-being
• Relatedness needs: Needs for satisfactory relationships with others
• Growth needs: The development of human potential and the desire for personal growth and increased competence (Daft, 1997)

Motivation-Hygiene Theory Frederick Herzberg, a professor of psychology at Case Western Reserve University, studied the attitudes of workers toward their jobs. Herzberg proposed that an individual will be moved to action based on the desire to avoid deprivation. However, this motivation does not provide positive satisfaction because it does not provide a sense of growth. Herzberg's research found that positive job attitudes were associated with a feeling of psychological growth. He thought that people work for two reasons: for financial reasons to avoid physical deprivation, and for achievement because of the happiness and meaning it provides. Herzberg also identified the concept of job enrichment, whereby the responsibilities of a job are changed to provide greater growth and challenge (McCoy, 1992; Quick, 1985 p. 10-12)] 1985. His motivation-hygiene theory includes two types of factors:

1. Motivation is based on the positive satisfaction that psychological growth provides. The presence of factors such as responsibility, achievement, recognition, and possibility for growth or advancement will motivate and satisfy people. The absence of these factors will not necessarily demotivate or cause dissatisfaction.
2. Hygiene is based on an individual's desire to avoid deprivation and the resulting physical and emotional discomfort. Hygiene factors include willingness to supervise; positive working conditions; interpersonal relations with peers, subordinates, and superiors; status; job security; and salary. These factors do not motivate, nor will their presence cause job satisfaction. Their absense, however, will cause dissatisfaction.

Although salary is considered a hygiene factor, it plays an indirect part in motivation as a measure of growth and advancement or as a symbol of recognition of achievement.

Theory X and Theory Y Douglas McGregor, a professor at the Massachusetts Institute of Technology and a social psychologist, was greatly influenced by the work of Maslow. McGregor recognized that people have needs and that those needs are satisfied at work. He described two sets of assumptions about people that he labeled Theory X and Theory Y (Bruce and Pepitone, 1999; Quick, 1985):

• The assumptions of Theory X are that most people will avoid work because they don't like it and must be threatened or persuaded to put forth adequate effort. People have little ambition and don't want responsibility. They want to be directed and are most interested in job security.
• The assumptions of Theory Y are that work is very natural to people and that most people are self-directed to achieve objectives to which they are committed. People are ambitious and creative. They desire responsibility and derive a sense of satisfaction from the work itself.

These assumptions were, at one time, applied to management styles, with autocratic managers labeled as adhering to Theory X and democratic managers to Theory Y. Unfortunately, this fostered a tendency to see people as members of a group rather than as individuals. The important contribution of McGregor's theory was to recognize these two perspectives and to recognize that people can achieve personal objectives through helping organizations achieve their objectives. Their work can be a motivator.

Acquired Needs Theory David McClelland developed the acquired needs theory because he felt that different needs are acquired throughout an individual's lifetime. He proposed three needs:

1. Need for achievement: The desire to accomplish something difficult, attain a high standard of success, master complex tasks, and surpass others
2. Need for affiliation: The desire to form close personal relationships, avoid conflict, and establish warm friendships
3. Need for power: The desire to influence or control others, be responsible for others, and have authority over others.

McClelland found through his research that early life experiences determine whether people acquire these needs. The need to achieve as an adult is influenced by the reinforcement of be havior received as a child when a child is encour aged to do things independently. If a child is reinforced for warm, human relationships, then the need for affiliation as an adult develops. If a child gains satisfaction from controlling others, then the need for power will be evident as an adult (Daft, 1997).

PROCESS THEORIES

Process theories help to explain how individuals select particular behaviors and how individuals determine if these behaviors meet their needs. Because these theories involve rational selection, concepts of cognition are employed. Cognition, according to Petri (1996), "is generally used to describe those intellectual or perceptual processes occurring within us when we analyze and interpret both the world around us and our own thoughts and actions (p. 236).

Expectancy Theory Victor Vroom developed the expectancy theory, which suggests that individuals' expectations about their ability to accomplish something will affect their success in accomplishing it. Therefore, this theory is based on cognition—on thought processes that individuals use.

The expectancy theory is based on an individual's effort and performance, as well as the desirability of outcomes associated with high performance. The value of or preference for a particular outcome is called valence. To determine valence, people will ask themselves whether or not they can accomplish a goal, how important is the goal to them (in the immediate as well as the long term), and what course of action will provide the greatest reward. An individual's expectation of actually achieving the outcome is crucial to success, and many factors influence this (Daft, 1997; Quick, 1985).

The expectancy theory can be applied through incentive systems that identify desired outcomes and give all workers the same opportunities to achieve rewards, such as stock ownership or other recognition for achievement.

Equity Theory The equity theory focuses on individuals' perceptions of how fairly they are treated in comparison to others. It was developed by J. Stacy Adams, who found that equity exists when people consider their compensation equal to the compensation of others who perform similar work. People judge equity by comparing inputs (such as education, experience, effort, and ability) to outputs (such as pay, recognition, benefits, and promotion).

When the ratio is out of balance, inequity occurs. And inequitable pay can create an impossible situation when implementing salary and incentive systems. According to Daft (1997), Individuals will work to reduce perceived inequity by doing the following:

• Change inputs: Examples include increasing or reducing effort.
• Change outcomes: Examples include requesting a salary increase or improved working conditions.
• Distort perceptions: This occurs when individuals cannot change their inputs or outcomes; one example is artificially increasing the importance of awards.
• Leave the job: Individuals might do this rather than experience what they perceive to be continued inequity.

When administering compensation and incentive programs, managers must be careful to assure that the rewards are equitable; if programs are not perceived as equitable, then they will not contribute to employee motivation.

REINFORCEMENT THEORIES

Theories of reinforcement are based not on need but on the relationship between behavior and its consequences. In the workplace, these theories can be applied to change or modify on-the-job behavior through rewards and punishments.

B. F. Skinner, a professor at Harvard, was a highly controversial behavioral psychologist known for his work in operant conditioning and behavior modification. His reinforcement theories take into consideration both motivation and the environment, focusing on stimulus and response relationships. Through his research, Skinner noted that a stimulus will initiate behavior; thus, the stimulus is an antecedent to behavior. The behavior will generate a result; therefore, results are consequences of behavior.

According to McCoy (1992), "The quality of the results will be directly related to the quality and timeliness of the antecedent. The more specific the antecedent is and the closer in time it is to the behavior, the greater will be its effect on the behavior.…The consequences provide feedback to the individual" (p. 34).

If the results are considered positive, then the behavior is positively reinforced. When the behavior is positively reinforced, the individual is more likely to repeat the behavior. People tend to have an intrinsic (internal) need for positive reinforcement. And when a behavior is ignored, the behavior tends to go away or become extinct. The four types of reinforcement are the following (Daft, 1997):

• Positive reinforcement: The application of a pleasant and rewarding consequence following a desired behavior, such as giving praise.
• Negative reinforcement: The removal of an unpleasant consequence following a desired behavior, such as a manager no longer reminding a worker about a weekly deadline when the worker meets the deadline. This reinforcement is also called avoidance.
• Punishment: The application of an unpleasant outcome when an undesirable behavior occurs to reduce the likelihood of that behavior happening again. This form of reinforcement does not indicate a correct behavior, so its use in business is not usually appropriate.
• Extinction: The withdrawal of a positive reward. If the behavior is no longer positively reinforced, then it is less likely to occur in the future and it will gradually disappear.

Continuous reinforcement can be effective in the early stages of behavior modification, but partial reinforcement is more commonly used. Reinforcement is most powerful when it is administered immediately.

The appropriateness of a reward depends on the situation. But for managers to apply rewards appropriate for work performance, it is necessary to understand what constitutes a reward. And no single reward will be perceived as positive by all employees. Rewards, however, are important in behavior-based incentive plans because they reward employee behavior that is desirable for the company. According to McCoy (1992), both incentives and recognition provide a reward; however, incentives drive performance while recognition is an after-the-fact display of appreciation for a contribution.

Financial rewards are certainly important in compensation programs. Social recognition provides employees with a sense of self-worth by acknowledging the contributions they have made. This recognition could be given in the form of a ceremony that helps to validate and is an important compensation—and one that probably costs a company very little in relationship to the benefit to employees (McCoy, 1992).

SUMMARY

The application of motivation theories can help managers to create work situations and employee recognition systems that help workers fulfill their needs. As Maslow wrote, "man has a higher nature…and…this higher nature includes the needs for meaningful work, for responsibility, for creativeness, for being fair and just, for doing what is worthwhile and for preferring to do it well" (pp. 244-245).

Some aspects of all jobs may be routine or mundane, but other aspects can be developed to promote job satisfaction and increased productivity. The sharing of responsibility can provide opportunities for growth, renewal, and achievement. This empowerment of workers can heighten employee motivation and improve morale. Both long-term and short-term incentive programs are needed for the employee commitment and effectiveness necessary to achieve organizational objectives. And in all instances, workers must be treated fairly and equitably.