Chapter 1: Introduction:-

1.1: Introduction:-

All organizations want to be successful, even in current environment which is highly

competitive. Therefore, companies irrespective of size and market strive to retain the
best employees, acknowledging their important role and influence on organizational
effectiveness. In order to overcome these challenges, companies should create a
strong and positive relationship with its employees and direct them towards task
fulfilment.

In order to achieve their goals and objectives, organizations develop strategies to

compete in highly competitive markets and to increase their performance.
Nevertheless, just a few organizations consider the human capital as being their main
asset, capable of leading them to success or if not managed properly, to decline. If the
employees are not satisfied with their jobs and not motivated to fulfil their tasks and
achieve their goals, the organization cannot attain success.

People have many needs that are continuously competing one with another. Each
person has a different mixture and strength of needs, as some people are driven by
achievement while others are focusing on security. If the managers are able to
understand, predict and control employee behaviour, they should also know what the
employees want from their jobs. Therefore, it is essential for a manager to understand
what really motives employees, without making just an assumption. Asking an
employee how he feels about a particular situation does not provide an accurate
evaluation of his needs, as the interpretation could distort the reality itself. The closer
one gets his perception to a given reality, the higher is the possibility to influence that
specific realty. Thus, managers can increase their effectiveness by getting a better
grasp on the real needs of the employees.

Motivation is derived from the Latin word, “movers” which literally means
movement. All the definitions that you would read in books or in dictionary relate to
the fact that motivation is behaviour and one needs to channelize this behaviour in
order to achieve desired goals and results.

Walker (1980) stated that there is poor relationship between job satisfaction and
performance output. Highly satisfied employees can be poor motivates whereas
highly dissatisfied workers can be good performers. Several variables affect the
relationship between job performance and job satisfaction although no direct causal
between these have been identified. Walker thinks it is useful to view motivation as
summary factor because motivation has impact between employee job satisfaction and
job performance. While Campbell and Pritchard defined motivation as “determinants
of the choice to initiate effort on the given task the choice to expend a certain amount
of effort, and the choice to persist in expending effort over a period of time”.
Therefore motivation is influenced by individual behaviour, skills, abilities,
knowledge and management.

According to Beck (1983) four philosophies underline the various perspectives on

work motivation. These are rational economic man, social man, self-actualising man
and complex man identified by Schein (1985). The rational economic man thinks that
people are solely motivated by economic considerations and they are able to make
economic decisions. The extrinsic reward and emphasising of organization on pay are
originated from this motivation. In case of social man workers are motivated by social
needs which may not met their work. In practice it will focus on establishing the
environment satisfying the social inter-relationships at work. In the case of self-
actualising man people are intrinsically motivated and they feel pride in their work. In
this approach the reward system has high value. According to complex man people
are motivated by great variation of motives, experience and abilities and these
motives are changed passage of time as new motives are learnt and new skills changes
their attitude towards their jobs.
The above-mentioned perspectives on the concept of motivation have inspired many
useful and meaningful definitions of the construct. For example Schultz (1998)
defined motivation simply the personal and workforce characteristics and explain way
people want to behave according to their own way on the job. Beck (1983) also gives
the similar view and said that there are variations in behaviour in employees such as
why some people work harder than others. In this regard we will refer work
characteristics to specific characteristics of a person’s job, for example its task
variety, whereas personal characteristics include those determined by a person’s
personality, for example an intrinsic need for achievement.

But Spector (2003) states the internal state of motivation that person can engage in
particular behaviours and that motivation can be viewed from two angles. On the one
hand motivation encompasses direction in which we select particular behaviour from
choice of behaviours referring to the amount of effort and intensity that the employee
put into a task. The other angle is desire to achieve the certain goal which drives from
individual own desires and needs. Petri (1996) also regarded motivation as internal
state and explain differences in the intensity of behaviour and explain why in one
situation behaviour is occurring and in another situation they are not occurring. The
motivation is useful to increase understanding and prediction of behaviour.
1.2: Definitions:-

According to William G. Scout, “Motivation means a process of stimulating people

to action to accomplish desired goals”.

According to McFarland, “Motivation refers to the way in which urges, drives,

desires, aspirations, strivings, or needs direct, control and explain the behaviour of
human beings.”

According to Robert Dubin, “Motivation is the complex forces starting and keeping a
person at work in an organisation. Motivation is something which moves the person to
action and continues him in the course of action already initiated.”

According to Fred Luthans, “Motivation is a process which begins with a

physiological or psychological need or deficiency which triggers behaviour or a drive
that is aimed at a goal or incentive”.

 Other Definitions:

“Employee motivation is reflection of commitment, level of energy and creativity that

organization employees bring to their job. The motivation is present in every function
of life. Education is motivated by desire of knowledge. Sport is motivated by desire to
win and eating is motivated by hunger.”

“Employee motivation is defined as the enthusiasm, energy level, commitment and

the amount of creativity that an employee brings to the organization on a daily basis.”
1.3: Background of the study:-

The most contentious problem of the modern society, especially in the tough business
environments is providing jobs to able workers. Once this problem is resolved, the
responsibility shifts towards the management of a business organization for now it
becomes its duty to keep its employees motivated in order to perform effectively over
a long period of time.

Motivating is in itself a challenge and keeping people motivated a bigger one most
people suggests that employee motivation is one of the most important and critical
function to be performed by the managers due to need for increasing productivity and
utilizing the resources in the most optimum fashion. The simplest terms in which
motivation can be defined is the stimulation of people’s needs, wants and desires and
lead them into action and converting those unfulfilled expectations by providing the
right channel.

This is the backdrop against which I propose to carry out a research to deduce the
dimensions of relationship between motivation and performance, particularly
emphasizing on which factors are most effective in promoting the motivation of
employees in an organization.

The research proposal entitled “Relationship between motivation and performance”

intends to assess the various factors that affect the level of motivation in the
employees and how motivation is related to their level of performance.

Every profit generating business organization has the ultimate goal of making more
business and hence the profit. The improved business of the organization is largely
dependent on the performance of the employees. Irrespective of the nature of the
business, the employees are the very vital resources and they are the valuable assets
for the organization. Only with the efficiency of the human resource in the
organization a business can become successful (David, 2013). However, this
efficiency of the employees has various dependencies and such dependencies have to
be carefully managed by the management of the organization thereby maximizing the
efficiency and hence the profit of the business.

On increasing the performance of the employees, the management may take various
measures and increasing their motivation for doing a better job is one of such
important measure in the business world. According to Atchison (2003), while the
employees are motivated by one or more needs, the role of the management is to
identify the most appropriate need of the employees and provide them with those
needs, which will eventually encourage the employees for the higher performance.
There is a close connection between the employee’s performance and the motivation
provided to them. These two are going hand in hand in most of the cases. The
research is mainly aimed towards understanding the various theories connected to the
motivation and its impact on the performance of the employees.

In the context of the small business, the motivation for employees is very essential as
it is likely to have a larger impact on the employees’ performance. However, similar
concept can be extended to the larger but private sector companies as well.
According to a survey conducted by PWC in 2012, in the GCC region, more than
80% of the business is either owned by the family business or controlled by the family
entrepreneurs. It implies that motivation for the employees plays a vital role in
inducing their performance. According to (Herzberg, 2003), the motivational factors
can be easily understood by these particular groups of business families and hence
they can be followed effectively towards the development of the business
performances.

The lack of proper motivational factors jeopardizes the performance of many

companies although these companies are equipped with necessary resources.
Organizations may have a well-developed culture and skilled employees but if these
employees are not motivated well there will be no reason for the employees to work
effectively which will end up in poor performance. Manion (2005) also indicated that
the lack of understanding of the need of such motivation has impacted some of the
small and medium enterprises as they are largely affected by these performance
issues. Interestingly these small companies need improved performance to compete
with the larger firms and hence need a better motivational practice.
1.4: Limitations of the study:-

There is a limitation in the study whereby the real motivation level and the
employees’ satisfaction cannot be measured. While employees’ performance can be
measured, it is hard to scientifically link it to the motivation given to the employees,
just because the motivation is a subjective feeling within the employee which cannot
be measured. There are various factors for an employee to be motivated and show
increased performance. The motivational factor can also be irrelevant to the leaders’
approach and the organizational factors, but related to the individual commitment and
carrier focus. In addition to that, the level of the motivation is also not a factor that
could be easily identified and measured. Since this factor is subjective, and they can
only be made as a comparative concept and not an objective matter, it is hard to
measure this level and link it to the motivational abilities of the leaders in the
organization.

After the questionnaire survey and interview with the identified respondents, there
will be no guarantee to ensure that the respondents will be providing the right
responses for the questions asked in regard to the research. Their responses will be a
key factor; however, the respondents may or may not give their opinion with sincere
motive and hence there could be an inadequate data collected which may or may not
be in line with the expectations of the secondary data that would be collected from the
literature reviews of the research. In spite of that possible inconsistency, the opinion
of the respondents will be the key factor in measuring the relationship and
effectiveness which is a main problem in this research study.
1.5: Significance of the Research:-

In the field of human resource management, the importance of motivation and the
impact of motivation on the employees’ performance is always considered as a critical
topic. In this study the same impact is analysed with reference to the employees
working in the organisation. The concept of motivation has been analysed in various
angles as per the motivational theories explained by various experts in the field of
human resource management. Also the performance and its reactive behaviour for the
motivational theories has been explained and analysed based on the explanations
provided by (Murphy, 2009. Based on these references and framework, the need for
the motivations on the employees as a management tool is also identified and
explained in detail. Since the research is concentrating on the organisation employees
and the motivational habits of the mangers in the organizations’ need for the
improved performance for competition with the market is also highlighted in this
study. Thus this study gains importance from the perspective of both employees and
management of the organisation.
1.6: Aims and Objectives:-

The aim of the study is to find if there is a connection between the motivation and
employees’ performance in particular reference to the employees working in the
organisation.

Followings are the Objectives:

 To understand the correlation of employee motivation.

 To determine the factors that increase employees motivation.
 To assess the impact of various factors within a work environment those
motivate the employees to perform.
 To get information about the performance of employees’ in business
organisation and the linkage between both concepts.
 To know about whether the motivation has any direct impact on the
performance of the organisation or not.
 To study the impact of monetary and non-monetary systems of reward on the
employee’s motivation and performance.
 To examine the relationships between the employees’ motivation,
performance, satisfaction and organizational effectiveness.
 To provide set of suggestions and recommendations based on the outcome of
this study.
1.7: Theories of Motivation:-

As we discussed that there are number of ways to motivate employees. Lots of

researchers gave the theories of motivation. I will discuss most common theories.
These theories will give us idea how we can motivate employees. All these theories
have some common points to motivate employees but these theories also have
different opinion.

 Fredrick Winslow Taylor and Elton Mayo’s Theories of

Motivation:

Fredrick Winslow Taylor (1856-1917) said that employees are mainly motivated by
pay. His theory argued that workers need supervision because naturally they do not
enjoy work therefore manager should break their work in small tasks and training and
tools so they work efficiently on given task. They are than paid according to number
of items they produced in a set period of time-price-rate pay. This will motivate them
to work hard and maximise their productivity. Taylor method work well and different
organization adopted this method to increase productivity level and lower unit cost.
The most notably advocate was Henry Ford who used them to design the first ever
production line, making Ford cars. This was the start of the era of mass production.
Taylor theory has close links with autocratic management styles and Macgregor
theory X approach. Taylor theory failed soon as workers became bore on repetitive
tasks and they were treated like human machines.
Elton Mayo than gave better theory he said workers are not only motivated with
money by they could be better motivated if we met their social needs whilst at work.
Taylor ignored these second points which cause adverse effect on his theory. He also
conducted an experiment on two groups and examines the effect on their productivity
levels of changing factors such as working condition. From Mayo theory we can
conclude that employees are best by better communication between them and
managers. Employees are also motivated by involvement of managers in their
working lives. They are also motivated when they work in a team. Therefore
Sainsbury should use team working and introduce personal department to involve
managers to look employees to motivate them the increase the production.

 Maslow’s Theory of motivation:

Maslow in (1943) gave hierarchy of human needs based on two groupings: deficiency
needs and growth needs. Within the deficiency needs, each lower need must be met
before moving to the next higher level. According to Maslow employees have five
levels of need physiological, safety, social, ego, and self- actualizing. Once each of
these needs has been satisfied, if at some future time a deficiency is detected, the
individual will act to remove the deficiency.

In this theory the physiological needs include homeostasis such as need for oxygen
satisfaction of thirst and hanger. It also includes sleep and sexual desire. The safety
needs include security and safety. It covers security in all aspects of life. It also
includes security of family, property and morals. The affection, sense of belonging,
social activities, friendships, and both the giving and receiving of love are love needs
in Maslow theory. The esteem needs are both self-respect and the esteem of others.
Self-respect covers the strength independence and freedom and achievement. While
esteem of others include status, reputation, appreciation and attention. The self-
actualization needs include the realization of potential of an individual. In this need
we consider what is the potential of humans and what are they capable of becoming.
These needs may vary widely from one individual to another. Maslow conceived a
human being developing five groups of needs, in sequence, from one to five.

The survival needs start at birth. During childhood everyone aware all groups of
needs. If a manager wants to motivate his employees he should satisfy all five needs.

In Maslow theory once we achieved lower level needs like physiological and safety
levels others does not provide same level of motivation. There are problems in
Maslow theory relating to work situation. The higher level needs do not satisfy their
needs because of work situation. It is the responsibilities of managers to understand
their needs in private and social life not just their attitude at work. There is no time
frame in Maslow theory when the satisfaction of lower level needs and emergence of
higher level needs. Even the people within the same level of hierarchy there have
different motivation factors. There are lots of ways in which people seek satisfaction
for example their esteem needs.

 Fredrick Herzberg’s Theory of Motivation:

Hygiene Factors Motivators

 Company Policy  Achievement
 Supervision and Relationship  Recognition
 Working Condition  Interesting Work
 Salary  Responsibility
 Security  Advancement & Growth

As I have already pointed out, needs such as esteem and self-actualization are more
important for people as they develop. Fredrick Herzberg the friend of Maslow
introduced two factor theory of motivation. He believed that there are certain factors
that business can introduce which will directly motivate employees and work hard to
increase productivity. He named such factors motivation and hygiene Motivator or
intrinsic factors, such as achievement and recognition, produce job satisfaction. He
said there are others factors which will not motivate them or they will not work hard.
He named such factors hygiene factors. Hygiene or extrinsic factors, such as pay and
job security, produce job dissatisfaction.

According to Herzberg all these factors must present in any job because their absence
will give dissatisfaction and decrease productivity and lead to strike in organization.
Their presence will yield average productivity but not necessarily above the average.
The challenge is that their presence does not motivate in a special way. Herzberg
referred this group as dissatisfies. However second group existence will yield
satisfaction and this include achievement, recognition, advancement and growth in
job. According to Herzberg only way to motivate employee is through job enrichment

Herzberg believed that democratic approach is the best approach to motivate

employees by improving the nature of job through certain methods.

 Clayton Alderfer’s Modified Need Hierarchy Theory:

Alderfer produced a modified need hierarchy theory and converts Maslow five levels
of needs into three levels. Alderfer model of need is called ERG model.

(Existence, Relatedness, Growth). According to Alderfer sustaining human survival

and existence are concerned with existence needs. It also cover physiological and
safety needs. Relatedness needs are concerned how people relate to their social
environment and it cover the Maslow need for social and interpersonal relationships.
In Alderfer theory growth needs are in the highest need category and it includes
Maslow needs for self-esteem and self-actualization.

Like Maslow Alderfer also suggest that we should move from lower level needs to
upper level needs. Maslow says that we should not move to the next level needs until
we have not satisfied that need whereas Alderfer suggests that needs are more a
continuum than hierarchical levels. At the same time more than one need may also be
activated. For example if we are unable to satisfy the growth needs in the individual
than relatedness needs may reassume most importance.

Alderfer also proposed number of basic propositions relating to three need

relationships. Some of Alderfer propositions followed Maslow theory but some of
these propositions were the reverse of the theory. Different studies were conducted to
test these propositions among different sample of people in different organization.

These studies showed mixed results. In the proposition where the existence needs are
less satisfied they will get constant support from all six samples. However the
proposition in which existence needs are satisfied desire for relatedness needs was not
supported in any of the six samples. Unlike Maslow the result of Alderfer work gave
the new idea that we do not need to satisfied the lower level needs before a higher
level need emerges as a motivating influence. However the results of Alderfer theory
do support the idea that there is decrease in the strength in lower level needs as they
become satisfied.

 Murray’s Manifest Need Theory:

Murray model of motivation is known as manifest need theory the early work of
Murray and its colleges at Harvard Psychological Clinic during the 1930s identified
this model. Murray said that motivation is linked with the understanding of human
behaviour. A need he says is a predisposition to behave in a certain way under certain
condition. A need is identified with goal. In the Murray motivation theory the
understanding of human behaviour is essential. Murray identified two types of needs.
These are viscera-genic needs and psychogenic needs. Viscera-genic needs are
concerned with the physical condition of the body e.g. food while according to
Murray there are 27 psychogenic needs and divided them into five classes namely
Ambition, Defence of Status, Response to Human Power, Affection and Exchange of
Information.

In 1938 after several years of clinical observations Murray wrote his classic’
Explorations in Personality’ in which he argued that we should classified individual
according to the strengths of various personalities need variables. These needs will
give motivation force both in term of intensity and direction of goal directed
behaviour.

Murray stated that analysis of such needs was a hypothetical process and occurrence
of this process is imagined to account for certain subjective facts and objective (1938,
p.54).

Murray said that needs should be viewed mostly learned behaviour rather than innate
tendencies which were activated by cues from the external environment. According to
Murray each need has two factors. These factors are qualitative and quantitative. The
qualitative component represents the object toward which the motive is directed and
quantitative represents the strength of motive toward the object.

Murray suggests that in order to understand a person need it was important to

understand previous behaviour and experience. It means that the history of individual
is necessary to understand his needs.

 Porter and Lawler’s Expectancy Model:

Porter and Lawler have developed Vroom expectancy theory. They not only consider
motivational force in their model but they also consider the performance in their
model. They said that the motivational force does not lead directly to performance the
individual abilities and traits are also lead to performance. They also introduce
rewards as a motivational force. Porter and Lawler see performance, satisfaction and
motivation as separate variables and they try to explain the complex relationship
among these variables.

The relationship among these variables is expressed diagrammatically in the below

diagram. Porter and Lawler suggest that job satisfaction is an effect rather than a
cause of performance. It is performance which leads to job satisfaction.

 McGregor’s X & Y Theory of Needs:

During 1960, Douglas McGregor has formulated the X-Y Theory of human needs
which is developed based on the motivational concepts (Michael P. Bobic, William
Eric Davis, 2003). This theory was developed based on the factor that there are some
employees willing to work either by their own motivation or by the motivation
induced from the managers, and based on the employees who are not ready to do any
work, and who are not completely motivated by anything whatsoever.

Bobic & Davis (2003) also believed that according to McGregor theory most of the
organizations following this concept only in managing the motivations of employees
in the organization. McGregor based his theory on the hierarchy of needs developed
by Maslow and built the argument around the needs of the employees. The Theory X
based on three premises.

Another theory was developed by Douglas McGregor which includes two approaches
of the human being’s behaviour at workplace. Theory X which represents people who
do not like to work and try to avoid it as much as they can. They characterized by
laziness, hate taking any responsibilities and looking at job security where the
management is facing a challenge to motivate this type of employees and keep them
on the right track. On the other hand, theory Y represents people who do like to come
to work, put efforts toward it and take responsibility. Employees under theory Y need
to work in a healthy and motivated environment and this is the challenge that the
management might face and resolve (Robbins & Judge, 2012).

According to Strauss (2002) the X & Y Theory is developed based on six

assumptions which are:
 I. Human mind naturally intended to work and involve in spending the energy at
workplace just like playing.
II. The external control from the management by means of punishment or the like
will not motivate the individual as the human mind has the self-control
capacity and that will work based on that motivation.
III. There will be a commitment from employees who are motivated and such
commitment will be the function required from an employee to achieve the
objectives.
IV. The average human being as an employee will be inclined to take over the
responsibility in the perfect conditions,
V. Irrespective of the individual the solution finding capacity for the
organizational problem will be found in every employee of the organization
with varies degree of intensity.
VI. The modern business conditions are limiting the utilization of the intellectual
capacity of the employees to a possible minimum.

 McClelland’s Theory of Needs:-

A refined approach to Maslow’s theory of needs was developed by McClelland and it

is popularly known as McClelland’s Theory of Needs. According to McClelland
(1961), the employees are learned to motivated by themselves, for which there will be
three motivational drivers are identified by default, and these drivers for motivation
are irrespective of the other factors such as age, gender, culture, etc. which are
different from individual to individual. McClelland identified these three drivers for
motivation as achievement, affiliation and power.
According to Peter G. Northouse (2007) the three determining drivers for the
motivation of the employees in workplaces are the achievement, affiliation and
power. Every employee who is motivated will have the intension to achieve
something in the organization as his or her contribution and hence the urge to achieve
will be working as a motivational driver for that person. The ability of the employees
in achieving something big will allow them to take calculative risks, and interested in
getting regular feedback from the supervisors so that their approach can be altered to
achieve the goal effectively. This driver also at times forces the employees to work
alone rather than in a group so that their achievement intension will have more impact
on the motivation and they can get the credit individually.

Afzalur (2010) identified the importance of the other driver in the McClelland theory
of motivation, which is the affiliation. The employees will be motivated with the
feeling of belonging to a group and that will have their motivation pumped up. Being
part of a group will motivate the employees to do better things so that they will be
identified in the group and expects to be liked by other members of the group. This
factor also helps to work in collaboration while there comes a competition and hence
the employees will be motivated. The team work will help the employees to
encourage the other so that they will be working towards a positive outcome and
achieving the organizational goal.

Similar way, the power is another driver that is encouraging the employees to be
motivated naturally. According to David Pardey (2007) the employees will be
motivated to gain power in the organization so that this power can help them to
control and influence others in the organization. The motivation is induced with an
aim of having more power which can help the employees to win the arguments with
others and hence people work hard to get the power. While the employees are having
power, they also enjoy the competition with others and they gain recognition among
the others in the organization. Due to this nature, the employees are motivated for
getting power in the organization.

Ross (1992) tested the effectiveness of these drivers identified by McClelland in the
motivational theory with the help of a questionnaire. This test was conducted within
the hospitality industry in Australia and it was found that the employees are highly
motivated by these drivers towards achieving excellence in their workplace, and get
recognized by the others as well as by the management in the organization. A similar
study was conducted by Ross (1997) in the tourism industry to identify the
effectiveness of the three drivers identified by McClelland’s theory of needs.
According to this study, Ross (1997) argued that the employees are motivated with
the need of power which is linked to the individual’s need to gain more power in the
organization.

Another test done by Ross (1997) on identifying the effectiveness of the drivers for
the McClelland’s theory of motivation on the 237 backpackers in Australia found that
the need for power and the need for achievement are the two powerful motivators that
will be enhancing the urge of the employees to achieve the organizational goals.

1.8: Factors enhancing Employees’ motivation:-

Employees want to earn reasonable salaries, as money represents the most important
incentive, when speaking of its influential value (Sara et al, 2004). Financial rewards
have the capacity to maintain and motivate individuals towards higher performance,
especially workers from production companies, as individual may use the money to
satisfy their needs. Therefore, pay has a significant impact in establishing employees’
diligence and commitment, being a key motivator for employees. Nevertheless,
studies have shown that pay does not boost productivity on the long term and money
does not improve performance significantly (Whitley, 2002). Moreover, focusing only
on this aspect might deteriorate employees’ attitude, as they might pursue only
financial gains. Fortunately, there are other non-financial factors that have a positive
influence on motivation, such as rewards, social recognition and performance
feedbacks.
Numerous researches have also pointed out that rewards lead to job satisfaction,
which in turn influence directive and positively the performance of the employees.
Moreover, rewards are one of the most efficient tools of management when trying to
influence individual or group behaviour, as to improve organization’s effectiveness.
The vast majority of companies use pay, promotion, bonuses and other types of
rewards to motivate employees and to increase their performance. In order to use
salary as a motivator, managers have to develop salary structures, according to the
importance of each job, individual performance and special allowances.

Employees can also be motivated through proper leadership, as leadership is all about
getting thing done the right way. In order to achieve these goals, the leader should
gain the employees’ trust and make them follow him. Nevertheless, in order to make
them trust him and complete their tasks properly for the organization, the employees
should be motivated (Justin Louis Baldoni, 2005). The leaders and the employees help
one another to attain high levels of morality and motivation.

Trust represents the perception of one individual about others and his willingness to
act based on a speech or to comply with a decision. Therefore, trust is an important
factor for an organization that wants to be successful, as it has the ability to enhance
employees’ motivation and foster interpersonal communication.

Irrespective of the degree of technical automation, attaining high levels of

productivity is influenced by the level of motivation and effectiveness of the staff.
Therefore, developing and implementing employee training programs is a necessary
strategy to motivate workers. In addition, a good communication between the
managers and the workforce can instigate motivation, as the degree of ambiguity
decreases.
1.9: Types of Motivation:-

There are two types of motivation, intrinsic and extrinsic. An organization needs to
understand for a fact that not employees are clones, they are individuals with different
traits. Thus effectively, motivating your employees will need to acquire a deeper
understanding of the different types and ways of motivation.

With this understanding, you will be able to categorize your employees better and
apply the right type of motivation to increase the level of employee engagement and
satisfaction. Some employees respond better to intrinsic motivation while others may
respond better to extrinsic motivation.

A. Intrinsic motivation:
  A definition of intrinsic motivation is:

“Intrinsic motivation refers to the desire to seek, of one’s own will, tasks and
challenges, to expand and train one’s abilities, to explore and learn, without the needs
of external reward.”

Intrinsic motivation means that an individual is motivated from within. He/she has the
desire to perform well at the workplace because the results are in accordance with
his/her belief system.

An individual’s deep-rooted beliefs are usually the strongest motivational factors.

Such individuals show common qualities like acceptance, curiosity, honour, desire to
achieve success.

Research has shown that praise increases intrinsic motivation, so does positive
feedback. But it should all be done in moderation. If you overdo any of these, there
are high chances that the individual loses motivation.

It is well observed in children and I am using this as an example here if children are
overpraised for the little things they are expected to do on a daily basis, their
motivation level decreases. Now if you are reading this blog, there are good chances
you are not a child, although we encourage children to read good content, the purpose
of writing this blog is to still focus on adults.

So if you are a manager, supervisor or in a leadership role, please be intentional with

your feedback or praise. Make sure it is empowering and your employees understand
your expectations.

 There are several advantages and disadvantages of Intrinsic

Motivation:-
I. Advantages of Intrinsic Motivation:-
 Long-lasting
 Self-sustaining
 Focuses on the subject rather than the reward or punishment
II. Disadvantages of Intrinsic Motivation:
 Slow to change the behaviour
 Requires lengthy preparation and special attention
  A variety of approaches may be needed to motivate students

 The following are just a few examples of situations that further

describe intrinsic motivation theory:
 Staying longer at work because you believe in your work
 Working in a team because you like the synergy effects
 Helping other people without rewards because it makes you appreciate your
life more
 Using positive affirmations because you want to change your mind positively
 Learning a new language because you want to connect to people from other
nations
 Playing a strategy game because you like effortful thinking
 Meditating because you want to release stress
 Practicing mindfulness because it helps you making better decisions

 Intrinsic Motivation Factors:

Everyone’s different and that includes what motivates us and our perspectives of
rewards. Some people are more intrinsically motivated by a task while another
person sees the same activity extrinsically.

Both can be effective, but research suggests that extrinsic rewards should be used
sparingly because of the over justification effect. Extrinsic rewards can undermine
intrinsic motivation when used in certain situations or used too often. The rewards
may lose their value when you reward behaviour that was already intrinsically
motivating. Some people also perceive extrinsic reinforcement as coercion or
bribery.

The over justification effect has inspired an entire field of study that focuses on
students and how to help them reach their full potential. Though experts are
divided on whether extrinsic rewards have a beneficial or negative effect on
intrinsic motivation, a recent study showed that rewards may actually encourage
intrinsic motivation when given early in a task.
Researchers examined how reward timing influenced intrinsic motivation. They
found that giving an immediate bonus for working on a task, rather than waiting
until the task was completed, increased interest and enjoyment in it. Getting an
earlier bonus increased motivation and persistence in the activity that continued
even after the award was removed.

 Understanding the factors that promote intrinsic motivation

can help you see how it works and why it can be beneficial.
These factors include:
 Curiosity: Curiosity pushes us to explore and learn for the sole pleasure
of learning and mastering.
 Challenge: Being challenged helps us work at a continuously optimal
level work toward meaningful goals.
 Control: This comes from our basic desire to control what happens and
make decisions that affect the outcome.
 Recognition: We have an innate need to be appreciated and satisfaction
when our efforts are recognized and appreciated by others.
 Cooperation: Cooperating with others satisfies our need for belonging.
We also feel personal satisfaction when we help others and work together
to achieve a shared goal.
 Competition: Competition poses a challenge and increases the
importance we place on doing well.
 Fantasy: Fantasy involves using mental or virtual images to stimulate
your behaviour. An example is a virtual game that requires you to answer a
question or solve a problem to move to the next level. Some motivation
apps use a similar approach.
B. Extrinsic Motivation:
  A definition of Extrinsic Motivation is:

“Extrinsic motivation refers to the behaviour of individuals to perform tasks and learn
new skills because of external rewards or avoidance of punishment.”

Extrinsic motivation means an individual’s motivation is stimulated by external

factors- rewards and recognition. Some people may never be motivated internally and
only external motivation would work with them to get the tasks done.

Research says extrinsic rewards can sometimes promote the willingness in a person to
learn a new skillset. Rewards like bonuses, perks, awards, etc. can motivate people or
provide tangible feedback.

But you need to be careful with extrinsic rewards too! Too much of anything can be
harmful and as a manager or a supervisor, you need to be clear to what extent are you
going to motivate your employees to accomplish organizational goals.

 There are several advantages and disadvantages of Extrinsic

Motivation:-
I. Advantages of Extrinsic Motivation:
 Quickly changes behaviours
 Requires little effort or preparation
 Requires little knowledge of the student
II. Disadvantages of Extrinsic Motivation:
 Provides distraction from learning
  Difficulty in determining appropriate rewards and punishment
 Ineffective after a long period of time
 Once the reward is removed, motivation is lost

 The following are just a few examples of situations that further

describe extrinsic motivation theory:
 Doing a certain work because you are looking for attention
 Working extra hard because you want to become the employee of the month
 Completing tasks because you want to look good in public
 Participating in a survey because you want the incentive
 Participating in a sport because you want to win awards
 Helping others because you hope for praise from friends or family
 Volunteering because it looks good on your resume
 Going to work because you must earn money

 Extrinsic Motivation Factors:

Most people have at some time been cajoled into doing something, and most have
done things for a reward. What is involved in these situations is extrinsic
motivation. Conventional psychological theory holds that people have their own
interior, or intrinsic motivations, such as love, happiness and self-worth. But they
are also motivated by factors outside themselves that for either positive or
negative reasons may cause them to take action. Businesses use many forms of
extrinsic motivation.

 Understanding the factors that promote extrinsic motivation

can help you see how it works and why it can be beneficial.
These factors include:
 Financial Rewards: Commissions, bonuses, stock options and employee
stock plans are compensatory rewards used to motivate employees. Within the
range of extrinsic motivations, these are "carrots." The drive for money and
success can often get people's feet marching.
  Praise and Recognition: Some people aim to please. And nothing pleases
them more than receiving praise for their hard work. This extrinsic motivation
is one of the strongest, most common motivations in the workplace. Numerous
studies show recognition and praise contribute more to job satisfaction than
financial incentives. Regularly delivering sincere and genuine compliments is
a strong extrinsic motivational method.
 Peer Pressure: A teenager and anyone who has been a teenager knows all
about the power of groups as extrinsic motivating factors. The pressure to feel
accepted and valued can in fact be a motivator. Perhaps at some point it was a
motivator to try cigarettes. Or at work, it may be the reason people work their
hardest to keep up with their team or why they take longer or shorter lunches.
If the rest of the kids are doing it.
 Consequences and Punishment: When the heat's on, many people take
action or step up their performance. Knowing the boss will be angry or their
job may be on the line is a reason many people get their work done. Is fear the
best motivational tool in the arsenal? Psychologists and management experts
debate this. But it is definitely an extrinsic motivation.

What is the importance of employee motivation?

According to psychologists, self-realization is a very human thing. It is our basic

nature to nurture something and see it flourish, it is applicable to most things we do in
our day-to-day life. This is true for both social and societal spaces.

Motivation plays a very important factor in a human’s life. Whether it is about

improving ourselves or our organization’s performance. Motivated employees don’t
need to be told how to get things done, they take initiatives, are eager to take up
additional responsibilities, are innovative and go-getters.

Motivated employees ensure:

 There is a positive atmosphere within the organization

 Co-workers are happy and feel safe at work
 Make sure clients are happy
 They always achieve better results than their counterparts
Motivation, therefore, plays a very important factor and ensures employees remain
active and contribute their best towards their organization. Furthermore, a high level
of motivation leads to a lower level of employee turnover.
Chapter 2: Literature Review:

2.1: Introduction:-

Literature review of this document explores various previous research documents and
academic resources in regard to the research topic. Employee motivation and
Employee performance are very important topics in the field of Human Resource
Management and hence various studies have been conducted on these two topics. The
literature review will give more insight into these topics. The main objective of this
dissertation is to analyse the relationship between the employee motivation and the
performance. In this part of the research document, all the components related to the
motivation and the employees’ performance will be discussed; the impact of one on
the other will also be discussed in this literature review section.

The literature review section is structure in such a way that the concept of employee
motivation is discussed first, and then the importance of the performance of the
employees is discussed next; lastly the relationship between the employee’s
motivation and their performance will be discussed. The effect of the employee’s
motivation for the performance will be the key point discussed in the literature
review.

The literature review is very important to substantiate the data analysis of the research
in the later stage of this dissertation. The real-world data will be collected in the later
part of the dissertation and the analysis from the data so collected will be supported
by the literature review. The literature review is also justifying the importance of the
topic that is selected and reason for conducting such a research. On understanding
various theoretical framework on the research topic will help the researcher to
develop the methodology appropriately. The methodology adopted for the research
and research analysis questionnaire are largely dependent on the literature reviews
collected in the research.
2.2: Motivation:-

The word “motivation” was first time used by P.T. Young’s in his book “Motivation
and Behaviour”. According to Robbins, motivation is “the willingness to exert high
levels of effort towards organizational goals, conditioned by the effort’s ability to
satisfy some individual need”.

“Motivation is inferred from a systematic analysis of how personal task and

environmental characteristics influence behaviour and job performance”.

Motivation is used to engage employees in the work. Human behaviour mostly

complex sometimes their needs are driven by their unconscious motives some by
conscious. Maslow, whilst the more recent cognitive psychologists describe
motivation as a product of conscious decision (Williams & Burden, 1997). After
reviewing all the related definitions we define motivation as “a force that originates
individuals to take actions to accomplish personal and organizational goals”.
According to Dr Kamaljit S Birdi (2006) human are just like an iceberg, as the tip of
the ice berg is visible (conscious), but the rest of the parts which is under the surface
is not visible. These factors can be investigated deeper by going deeper into different
types of motivation, i.e. intrinsic & extrinsic motivation. Both theories and empirical
research contains a) need-based motivations are the most biggest factory that engage
people in various behaviours, b) such kind of motivation can be divided into two
major types: extrinsic and intrinsic. Motivational theorists identified and tested
different intrinsic and extrinsic motivators in work environment. Powell, Symbaluk
and Honey, (2005) find out some behaviours that could be motivated that are working
for money, driving a car toward a destination, and reading textbooks for an upcoming
exam. Many behaviours are motivated intrinsically for e.g. arousal, excitement,
enjoyment and flow. There are different opinion regarding intrinsic and extrinsic
motivation, it is sure that, both of them play crucial role in motivating employees.

Employee motivation depends on many intrinsic and extrinsic factors like, interesting
work, job appreciation, satisfaction, stress, job security, promotion and growth,
rewards, work environment, punishment and recognition etcetera (Palaniammal,
2013). The main aim of these factors is to create an environment where people ready
to work with initiative, interest and enthusiasm, with a high personal and group
satisfaction, with the sense of responsibility and confidence to achieve their personal
as well as organizational goals (Palaniammal, 2013).

Intrinsic and extrinsic motivation factors have been under discussion for long time.
According to Locke (1969), more than 3300 articles have been written on this subject.
A survey conducted from sales and banking employees showed that, monetary
rewards (i.e. Good Wages) were the preferred factor for motivation in banking and
sales employment. In 1980, 1986 1992, 2000 and 2015 studies were conducted on
employee motivation. Employees ranked monetary reward at first place, followed by
job security and promotion and growth. A survey on American workers examined 16
aspects of worker motivation, respondents chose interesting work, and enjoying an
opportunity to learn new skills (Spector, 1997). Another study investigated the
importance of job security in organization by selecting a sample of 104 employees
from the central personnel office of a large state agency. Job security was found as an
important factor related to both intrinsic as well as extrinsic motivation and so on.
Different researchers used different intrinsic and extrinsic factors to check employee
motivation in banking sector. After investigating different motivational factors, we
came that four intrinsic (such as: interesting work, job appreciation, job satisfaction,
stress) and four extrinsic factors (job security, promotion & growth, good wages,
recognition) will be consider for this study. These factors are taken on the basis of
Maslow’s Need theory, Alderfer ERG theory, Herzberg’s two factor theory, Four-
Drive Theory and Expectancy theory.

Intrinsic Motivation: Employees have intrinsic motivation, they search for the
enjoyment, interest, satisfaction of curiosity, self-expression, or personal challenge in
the work. Deci and Ryan (1985) argue that the main focus of intrinsic motivation is on
the performance of employee task process only. Amabile (1993) disagree with this
statement and suggested that “intrinsic motivation is completely compatible with
certain kinds of product focus”. For this study we listed four intrinsic factors i.e.
interesting work, job appreciation, satisfaction and stress:

Interesting work is a term that explains the experience of employees who are
passionate about and energized by their work, know the meaning and the purpose in
their jobs, sure that they can express themselves completely at job and feel connected
to those with whom they work and elaborate. It has physiological positive effect,
since there is a belief that one’s work makes a contribution, a sense of connection to
others and a common purpose, a sense of perfection and transcendence”.

Job Appreciation can be described as “acknowledge the value and meaning of an

event, a person, a behaviour, an object and positive feeling that has connection to it”.

Job Satisfaction can be defined like feeling that reflects whether employee needs
are or not fulfilled by the individual job. Organization should organize, arrange and
manage job to satisfy workers.

Stress can be described like “mentally or emotionally disruptive or there is upsetting

condition occurring in response to adverse external influences”.

Extrinsic Motivation: Employees have extrinsic motivation when they engage in

the work in order to obtain some goal that is apart from the work itself. This research
is held by the help of four extrinsic motivational factors i.e. job security, good wages,
promotion & growth, and recognition:

Job Security is described as “the perceived powerlessness to maintain desired

continuity in a threatened job situation”

Good Wages can be defined as “the monetary compensation to employee who gets
for the offering his or her services to a company” (Authors).

Promotion and Growth can be described generally like “an employee who has
demonstrated exceptional performance or has developed the appropriate skills and
knowledge that needs to take on the higher job responsibility”.
Recognition can be defined as “it is the organizational rewards that is given to
employee cause of desire attitude. It can be greeting, approval, appreciation, financial
reward etc.” (Authors).

Bartol and Martin (1998) consider motivation a powerful tool that reinforces
behaviour and triggers the tendency to continue. In other words, motivation is an
internal drive to satisfy an unsatisfied need and to achieve a certain goal. It is also a
procedure that begins through a physiological or psychological need that stimulates a
performance set by an objective.

As compared to financial resources, human resources have the capability to create

competitive advantage for their organizations. Generally speaking, employee
performance depends on a large number of factors, such as motivation, appraisals, job
satisfaction, training and development and so on, but this paper focuses only on
employee motivation, as it has been shown to influence to a significant degree the
organizational performance. As Kalimullah (2010) suggested, a motivated employee
has his/her goals aligned with those of the organization and directs his/her efforts in
that direction. In addition, these organizations are more successful, as their employees
continuously look for ways to improve their work. Getting the employees to reach
their full potential at work under stressful conditions is a tough challenge, but this can
be achieved by motivating them.

On the other hand, Mary (1996) explains organizational effectiveness as the extent to
which an organization fulfils its objectives, by using certain resources and without
placing strain on its members. The goal model defines organizational effectiveness
referring to the extent to which an organization attains its objectives, while the system
resource model defines it in terms of the bargaining power of the organization and its
ability to exploit the environment when acquiring valuable resources.

2.3: Employee Performance:-

Employee production and employee job performance seems to be related but

performance is in some cases can be measured like the number and value of goods
produced. However, in general productivity is associated with production-oriented
terms (e.g. turnover) and performance is linked to efficiency or perception-oriented
terms (e.g. supervisory ratings and goal accomplishments). According to Hunter and
Hunter (1984) crucial in job performance is the ability of the employee himself. The
employee must be able to deliver good results and have a high productivity.
According to Vroom (1964) an employee’s performance is based on individual
factors, namely: personality, skills, knowledge, experience and abilities.

Job performance refers to how well someone performs at his or her work. Job
performance has been defined as work performance in terms of quality and quality
expected from each employee (Khan et al., 2009). Oluseyi and Ayo (2009) argued
that job performance is related to the willingness and openness to try and achieve new
aspects of the job which in turn will bring about an increase in the individual’s
productivity. Job performance can be defined as “all the behaviours employees
engage in while at work”. A good employee performance is necessary for the
organization, since an organization’s success is dependent upon the employee’s
creativity, innovation and commitment.

Chaudhary and Sharma (2012) think that motivated employees are more productive
than non-motivated employees. If employee is satisfied and happy, then he/she will do
his/her work in the best amazing manner. The result will be positive and will motivate
other employees in office. In order to increase work effectiveness and performance, it
is important to address a number of issues, including increasing motivation among
employees, making them feel satisfied with their job and increase their-job related
wellbeing in general.

There are the effective ways how to manage organizations, develop and stimulate
their employees to let organizations perform well (Patterson, M.G. et al (1998)). HR
management has a significant impact on performance, so employees work in a certain
way or behave in a way that can lead to reach the organization goals. Employees are
performing different jobs in an organization according to the nature of the
organization. Mostly employee perform tasks like production, storage, manufacturing,
transportation, marketing, purchasing, distribution, promotion of business, finance
and accounting, HR, research and public relation. It’s should be performed by the
employees in the better after that they can give their best output at the job. It will be a
great impact on the total production, sales, profit, progress and market position of the
company in the market.
2.4: Measuring Job Performance:-

According to Kostiuk Peter F & Follmann, Dean A, 1989 in most organizations,

performance is measured by supervisory ratings, but these data can’t provide with
right results since they are highly subjective. Breaugh (1981) states in his research
that there are four different performance dimensions on which employees are
measured, named: quality, quantity, dependability and job knowledge.

2.5: Employee Motivation and Performance:-

We already argued that managers need to motivate employees to perform better in the
firm, (Ramlall2008). However, it is only later research that succeeded in establishing
a positive correlation between employee motivation and job performance. In this
study, relationship between employee motivation and performance will be explained.
After that, it will be described how employees can be intrinsically or extrinsically
motivated to perform well.
Chapter 3: Research Methodology:-

3.1: Introduction:-