Report on Motivation Theories

Organizational Behavior

Course Code: MGT 201

Section: 02

Submitted To

Tanzin Khan

Submitted by Group A

Members:

Imran Rahman - 15104055

Waqqas Iqbal - 15101109

Abdul Mueez - 15101108

Mumtahina Hoque Meem - 14204067

Saleh Md. Abu Sinan – 14104108

Submission Date

14th July 2016

Table of Contents

Introduction 1

Maslow’s Hierarchy of Needs 1

McGregor’s Theory X and Theory Y 3

Locke’s Goal-Setting Theory 4

Equity Theory 5

Conclusion 7

Reference 8
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Introduction

Motivation is one of the most challenging tasks faced by managers today. It is process of
bringing out the best in the employees by inspiring them to do their best. As a matter of fact,
motivated employees are more dedicated toward their work and their organization. However, it’s
a challenge because it’s not so easy to motivate employees. As, motivation is an internal emotion
which comes from attitudes, behavior and thinking, therefore, managers need to understand how
they can motivate their employees and create a favorable work environment so that employees
are motivated and they contribute effectively for the success of their organization. To make the
task of managers slightly easier, many psychologists throughout the history have provided their
insights and theories on employee motivation and psychology. In this report, we are going to
cover two theories from early motivation theories and contemporary theories each. More
precisely, we will discuss about Maslow’s Hierarchy of Needs theory (Early), McGregor’s
Theory X and Theory Y (Early), Locke’s Goal-Setting Theory (Contemporary) and Equity
Theory (Contemporary). First of all, we will give a brief introduction of the theory, after that, the
distinctive features and how the theories work will be provided. By the end of this report, we are
hoping that the reader would have at least a general notion about employee motivation.

Early Theories

Maslow’s Hierarchy of Needs

In a 1943 paper called “A Theory of Human Motivation”, Maslow exhibited the possibility that
human activities are coordinated toward objective fulfillment. Maslow (1943) expressed that
individuals are propelled to accomplish certain necessities. When one need is satisfied a man
looks to satisfy the following one. This five phase model can be isolated into basic and
psychological needs which guarantee survival (e.g. physiological, security, love, and regard) and
development needs (self-realization).
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1. Physiological: These are the physical prerequisites for human survival. In the event that
these necessities are not met, the human body can't work appropriately and will come up
short.
2. Safety: Once a man's physical security needs are generally fulfilled, their wellbeing
needs outweigh everything else.
3. Social: After physiological and security needs are satisfied, the third level of human
needs is interpersonal and includes sentiments of belongingness.
4. Esteem: All people have a need to feel regarded; this incorporates the need self-regard
and dignity.
5. Self-actualization: "What a man can be, he must be." This quotation forms the basis of
the perceived need for self-actualization.

With Maslow's theory, a worker's starting emphasize on the lower arrange requirements of
physiology and security makes sense. Normally, a man starting their career will be exceptionally
worried with physiological needs, for example, sufficient wages and stable pay and security
needs. We need a decent pay to address the issues of our family and need to work in a steady
situation. Once these fundamental needs are met, the worker will need his "belongingness" needs
met. The key point is that employees craving to work in a domain where they are acknowledged
in the association and have some communication with others. With these necessities fulfilled, an
employee will need his larger amount needs of esteem and self-actualization met. Esteem needs
are fixing to a worker's image of himself and his yearning for the admiration and
acknowledgment of others. With self-actualization, the employee will be keen on development
and individual improvement. The fundamental thought of Maslow's Hierarchy of Needs is that
our needs are always showing signs of change. As one need is met, we crave different
necessities. As I would like to think, despite the fact that Maslow's Hierarchy of Needs has
certain inadequacies, it can't be dismissed that to reach the top level, we need to begin from the
base of the pyramid with a specific end goal to achieve the top.
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McGregor’s Theory X and Theory Y

The Theory X and Theory Y management styles were introduced by Douglas McGregor in his
1960 book, "The Human Side of Enterprise." He identified two distinct approaches to
management and labeled them as a way to note the pros and cons of each method. Theory X is a
more traditional, autocratic style while, Theory Y is a more contemporary coaching style.

Theory X

This assumes that employees are naturally unmotivated and dislike working, and this encourages
an authoritarian style of management. According to this view, management must actively
intervene to get things done. This style of management assumes that workers:

 Dislike working.
 Avoid responsibility and need to be directed.
 Have to be controlled, forced, and threatened to deliver what's needed.
 Need to be supervised at every step, with controls put in place.
 Need to be enticed to produce results; otherwise they have no ambition or incentive to
work.

X-Type organizations tend to be top heavy, with managers and supervisors required at every step
to control workers. There is little delegation of authority and control remains firmly centralized.

McGregor recognized that X-Type workers are in fact usually the minority, and yet in mass
organizations, such as large scale production environment, X Theory management may be
required and can be unavoidable.

Theory Y

This expounds a participative style of management that is de-centralized. It assumes that

employees are happy to work, are self-motivated and creative, and enjoy working with greater
responsibility. It assumes that workers:
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 Take responsibility and are motivated to fulfill the goals they are given.
 Seek and accept responsibility and do not need much direction.
 Consider work as a natural part of life and solve work problems imaginatively.

This more participative management style tends to be more widely applicable. In Y-Type
organizations, people at lower levels of the organization are involved in decision making and
have more responsibility.

Though these theories are very basic in nature, they provide a platform for future generations of
management theorists and practitioners to understand the changing dynamics of human behavior.
Taken too literally, Theories X and Y seem to represent unrealistic extremes. Most employees
(including managers) fall somewhere in between these poles. Recent studies have questioned the
rigidity of the model, yet McGregor’s X-Y Theories remain guiding principles to the
management to evolve processes which help in organizational development.

Contemporary Theories

Locke’s Goal-Setting Theory

In 1960’s, Edwin Locke set forward the Goal-setting theory of motivation. This theory expresses
that goal-setting is basically connected to task performance. It states that specific and challenging
but attainable goals with appropriate feedbacks add to higher and better task performance.

The Goal-setting theory emphasizes on several aspects of organizational goals. To begin with, it
focuses on the specificity of the goal. Research indicates that specific goals help bring about
other desirable organizational goals, such as reducing absenteeism, tardiness, and turnover
(Locke & Latham 2002). Nearly every modern organization has some form of goal setting in
operation. Programs such as management by objectives (MBO), high-performance work
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practices (HPWPs), management information systems (MIS) include the development of specific
goals. Also the willingness to work towards attainment of goal is main source of job motivation.
Moreover, Goals should be realistic and challenging. They need to be relevant and bound by
deadlines. This energizes the employees to work hard, be more persistent and make them more
effective and efficient. Lastly, appropriate feedback of results directs the employee behavior and
contributes to higher performance. Feedback helps in two important ways. First, it helps people
determine how well they are doing. Second, feedback also helps people determine the nature of
the adjustments to their performance that are required to improve. Managers widely accept goal
setting as a means to improve and sustain performance (Dubrin 2012), when employees know
that their performance will be evaluated in terms of how well they attained their goals, the
impact of goals increases. Even CEOs of organizations such as IBM, General Motors, and
Microsoft Corporation are evaluated on meeting growth, profitability, and quality goals.

There are certainly limitations of every theory. For instance, sometimes the organizational goals
are incompatible with managerial goals. Moreover, too difficult and complex goals encourage
riskier behaviour among employees. On the off-chance, if the employees lack the skills and
abilities essential for achieving the goals, then the goal-setting can fall flat and lead to
undermining of performance.

On the whole, Locke provides a well-developed goal-setting theory of motivation. The theory
underscores the imperative relationship amongst goal and performance. Research underpins
expectations that the best performance appears to result when goals are particular and testing,
when they are utilized to assess performance and connected to feedbacks on results, and create
commitment and acknowledgment.

Equity Theory

Introduced in 1963 by Stacey Adams, equity theory is based on the idea that individuals are
motivated by fairness and if they detect inequalities, they will seek to balance their input in order
to reach their perceived equity.
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According to the equity theory, the perception of equitability and in-equitability is what
motivates people to work. Many times inequities can lead to an increase in absenteeism and even
resignation of an organization (Greenberg, 1999). Therefore, it is of utmost importance for
organizations to put this theory under serious consideration when they deal with factors such as
pay, promotions, recognition, etc. that are affiliated with it. Equity theory can also help explain
employee’s behavior and provide HRD with possible factors that might reduce efficiency and
performance, two absolutely vital components that determine how successful (or unsuccessful)
an organization is.

Equity is defined as justice, inequity injustice. Adams defined inequity as “inequity exists for
person whenever he perceives that the ratio of his outcomes to inputs and the ratio of others
outcomes to others inputs are unequal”. It follows that inequity results not only when a person is
under-benefited but also when he is over benefited. A significant issue of the equity theory is the
emphasis on the individual perception of what exists, even though it may not be real. Folger &
Cropanzeno (1994) stated that HRM plays a major role in employees’ perceived fairness of
outcomes. The perception of inequity is based on comparing the individual’s ratio with the
comparison others ratio. For instance, when an employee in another state receives 10,000 BDT
more for the same job, no inequity is felt, but a coworker in the same company with the same
potential and expertise, if they receive a pay raise, inequity may be felt. If someone experiences a
deficit, the result is anger. However, if they receive more than others, a feeling of guilt grows.
Changing inputs, changing outcomes, distorting perceptions of self, distorting perception of
others, choosing a different referent and quitting are some of the schemes employees use to cope
with this feeling of either anger or guilt.

In short, application of the equity theory can help eliminate unpredictability as it can consistently
explain human behavior. The only drawback with it is that it has not accounted for individual
differences and for different cultures.
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Conclusion

All in all, the four theories mentioned above give us some idea regarding the motivation factors
for employees in certain situation and how they might react. It informs us about the possible
elements that motivates and demotivates employees and different processes of motivation.
Moreover, these theories give some notion of how to contribute to employee motivation.
Understanding the potential of the employees and the different need pattern of employees will
help to decide the right financial and nonfinancial motivation and then manager can decide
accordingly how he can motivate employees for the growth of organization. This will ultimately
help to increase the productivity and profitability of the organization. In addition to the existing
areas, HR managers can explore further in this field to be more effective. One such possibility
could be Intrinsic Motivation. Even though this process is slow in changing behavior, requires
lengthy preparation and special attention but it is long-lasting and self-sustaining as it focuses on
the subject rather than the reward or punishment.
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Reference:

Bhatia, T. (2008). Theory X and Theory Y: Theories of employee Motivation - Empxtrack.

[online] Available at: http://empxtrack.com/blog/theory-x-and-theory-y-theories-of-employee-
motivation.

Dubrin, A (2012). ‘Essentials of management’. Mason, OH: Cengage South-Western.

Folger, R., & Cropanzano, R. (1994). Organizational justice and human resource management
Thousands Oak: Sage Publications.

Greenberg, J. (1999). Managing behavior in organizations. 2nd edition. New Jersey: Prentice
Hall.

Heylighen, Francis (1992). "A cognitive-systemic reconstruction of maslow's theory of self-

actualization". Behavioral Science 37 (1): 39–58

Heil, G., Bennis, W., & Stephens, D. (2000). Douglas McGregor, Revisited: Managing the
Human Side of the Enterprise.

Kokemuller, N. (2014). The X&Y: Management Theory, California: Hearst Newspapers.

Locke, E & Latham, G (2002). ‘Building a practically useful theory of goal setting and task
motivation’. American Psychologist, 57(9), 705-717

Lunenburg, F (2011), ‘Goal-setting Theory of Motivation’, International Journal of Management,

Business, and Administration, vol. 15, no. 1.

Maslow, A. H. (1943). A Theory of Human Motivation. Psychological review, 50(4), 370.

McLeod, S. A. (2016). Maslow's Hierarchy of Needs. Retrieved from

www.simplypsychology.org/maslow.html