1

DORANDA COLLEGE,
RANCHI
(A Constituent Unit of Ranchi University, Ranchi)

PROJECT REPORT ON
The Impact of Motivation on Employees
Job Performance in an Organization
IN PARTIAL FULFILLMENT OF MASTER OF COMMERCE PROGRAM,

UNDER RANCHI UNIVERSITY, RANCHI

UNDER THE GUIDANCE OF :

SUBMITTED BY:
Name: -AMREEN NAAZ
Exam roll no:19MC8105946
Class roll no: -398
M.com Sem: - IV (HRD)
Session: - 2019-2021
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DECLARATION

I Amreen Naaz hereby declare that the

project title “Impact of motivation on
employee’s job performance in an
organization”has been prepared by me
and submitted under M.com curriculum.
All the information, facts and figures are
collected by me and our first hand in nature.
Any resemblance from existing work is purely coincidental in nature.

Name of the candidate: Amreen Naaz

Class Roll No. : 398

Exam roll no: 19MC8105946

Session: 2019 - 2021

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CERTIFICATE
This is to certify that project has been
submitted by Amreen Naaz, a student of
M.Com (HRD) Semester-iv, session- 2019-
2021 bearing exam roll number-
19MC8105946 of Doranda College, Ranchi, on
a given topic –Impact of motivation on
employee’s job performance in an organization.
This is for partial fulfillment for requirement for
the award of master of commerce (HRD)
under Ranchi University Ranchi. The work done
by her is appreciable of an outstanding level.

I wish her every success in life.

.

Internal Guide. HOD. External Guide

Dept.of Commerce. Dept.of commerce
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Acknowledgments

I take this opportunity with much pleasure to thanks all the people who
have helped me through the course of my journey towards producing
this project .I sincerely thank my project guide Ms.Shruti Tiwari Dept of
commerce, of his guidance, help and motivation. Apart from the
subject of my research I learnt a lot from him, I am sure will be useful in
different stage of my life.I would like to express my gratitude to-
Dr.S.Chaturvedi ,HOD, Dept of commerce,for his review and many
helpful comments.

I am especially grateful to my colleagues for their assistance, criticism

and useful insight. I would like to acknowledge the support and
encouragement of my friends. My sincere gratitude also goes to all
those who instructed and taught me through the years.

Name of the Student

AMREEN NAAZ
 5 content
SL.NO TOPIC PAGE.NO SIGNATURE

1 INTRODUCTION 7

2 DEFINITION 8

3 DEFINITION IN PSYCHOLOGY 9-10

4 MOTIVATION MODEL 11

5 IMPORTANCE 12-33

6 TYPES 34-37

7 CHARACTERISTICS 37-39

8 MOTIVATIONAL THEORIES 40-45

9 IMPACT OF MOTIVATION 46-62

10 CONCLUSION 63-64
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Introduction to Motivation:
Abraham Lincoln, until past forty, was a failure in almost all activities
he undertook. When asked about the change he said, „My father taught
me to work but did not teach me to love my work. I hit that
accidentally, when I was past forty‟. This „love or will to do‟ (called
motivation) depends on the strength of people‟s motives. Motives are
the expressed needs and could be conscious or subconscious. They are
always directed towards goals.

Motivating people to perform better and thus to achieve

organizational objectives has been the greatest challenge to managers.
Why do some people perform better than others? Why does the same
person act differently at different times? These and many other
questions related to work performance have been confronting
managers continuously.

Motivating people to perform, higher than their normal physical and

mental capacities, and to keep them satisfied is a very complex
function of management.
8

Definition of Motivation:

Motivation is an inspirational process which impels the members of

the team to pull their weight effectively to give their loyalty to the
group, to carry out the tasks properly that they have accepted, and
generally to play an effective part in the job that the group has
undertaken.

In the words of Michael Jucious, „motivation is the act of stimulating

someone or oneself to get a desired course of action, to push the right
button to get a desired reaction‟.

S. Zedeek and M. Blood define, „Motivation is a predisposition to act in

a specific goal-directed way‟.
9

Motivation Definition in Psychology

The study of motivation in psychology revolves around providing the
best possible answers to two fundamental questions: what causes
behavior, and why does behavior vary in its intensity?

Motivational science is a behavioral science that seeks to construct

theories about what constitutes human motivation and how motivational
processes work.

Motivation, when seen in the real world, and when measured by

science, becomes visible and detectable through behavior, level of
engagement, neural activation, and psychophysiology. Some would also
include self-report in this list, but studies show that self-reports have
proven to be highly unreliable sources of information (Reeve, 2015).

Behavior
So how does motivation behave? With presence, intensity, and quality.
Motivation is visible through gestures and facial expressions, intense
effort, immediacy (or as psychologists like to call it short latency).

The presence of motivation can also be inferred from the levels of

persistence and decisiveness in choosing one goal over another, which
taken together make for a high probability of occurrence (Atkinson &
Birch, 1970; 1978; Bolles, 1975; Ekman & Friesen, 1975).
 10

Psychophysiology
There are five psychophysiological expressions of motivation:

Psychophysiological
Expressions

Chemicals in saliva or blood, such as cortisol (stress) or catecholamines

Hormonal activity
(fight-or-flight reaction).

Contraction and relaxation of the heart and blood vessels (as in response
Cardiovascular activity
to an attractive incentive or a difficult/challenging task).

Eye behavior—pupil size (extent of mental activity), eye blinks (changing

Ocular activity
cognitive states), and eye movements (reflective thought).

Electrical changes on the surface of the skin (as in response to a

Electrodermal activity
significant or threatening event).

The activity of the musculature, as with facial expressions (specific

Skeletal activity emotion), bodily gestures, or shifting one’s weight from side to side during
a boring hallway conversation (desire to leave).

Brain Activations
Just like changes in behavior, engagement, and psychophysiology, brain activations
mark the rise and fall and maintenance of motivational states. A different pattern of
neural activity is present with each motivation and emotion. For example, the
hypothalamus is active when we are thirsty, and when we feel disgusted, there is a rise
in insular activity.

Researchers use sophisticated equipment like electroencephalography (EEG) and

functional magnetic resonance imaging (fMRI) to observe, detect, monitor, and
measure brain-based neural activity.
11

Motivation Model
In a nutshell, motives are internal experiences in the form of needs, cognitions, and
emotions and are the direct and proximal causes of motivated action. Social contexts
and external events act as antecedents to motives that cause or trigger motivational
states. Our motives express themselves through behavior, engagement,
psychophysiology, brain activations, and self-report.

The model below illustrates the framework for how motivational psychologists study
the process of motivation and its elements and try to find the answer to the questions
about what causes motivation. It also shows why the study of motivation is so relevant
to people’s lives and how motivation contributes positively to significant life
outcomes like achievement, performance, and wellbeing, to name a few (Reeve, 2015).
 12

IMPORTANCE
Following are the importance of motivation in an organization:

1. Greater efficiency:
Motivation enhances the efficiency of the employees and of organization. When
employees are motivated, they can perform with commitment and dedication.

2. Reduction in absenteeism and labour turnover:

Motivated employees may not remain absent or leave the organization. They
develop a sense of belonging towards the organization and thus improve their
overall performance.
3. Team spirit:
Motivation improves team spirit of employees, and this improves the work
environment and the overall performance of the employee and the organization.

4. Reduction in wastages and breakages:

Motivated employees take great care in handling machines and other resources.
This will reduce wastages and breakages, thus resulting in higher benefits to the
organization.
5. Cordial relations:
Motivation enables cordial and healthy relationship in the organization. Moti-
vation helps reduce labour grievances and disputes. It ensures sound relations
between the management and the labour. It improves the overall efficiency of the
organization.
13

6. Promotion of innovation:

Motivated employees use their initiative to find out innovative ways in

the performance of their operations. Such employees are more creative
and help the organization to gain the competitive advantage.

7. Optimum use of resources:

Motivation leads to greater employee involvement and lesser wastages. This
leads to optimum utilization of resources.

8. Corporate image:
Motivated employees are more loyal to the organization. They work with a
sense of commitment and dedication. This improves the overall
performance of the employee, which enables better results for the company.
This results in better relations with all the stakeholders.
14

Importance and Significance of

Motivation for Workers, Employees,
Organisation and Business
Importance of Motivation – In an Organisation

Motivation is an important part of managing that inspires

subordinates/employees to maintain and/or improve their efficiencies.

Importance of motivation for an organisation can be examined on the

basis of the following factors:

Importance # 1. Improves Performance Level:

Motivated employees have the ability and willingness to work and
improve their performance level by obtaining relevant education and
training. For example, a highly educated employee with experience of
working in abroad is employed because this employee has new
learning from her/his experiences to share, implement and improve
performance levels of themselves and her/his colleagues.

Importance # 2. Indifferent Attitudes can be Changed:

Motivated employees attempt to change indifferent or negative attitudes of
employees by engaging in supporting conversations without resorting to
belittling and complaining comments, speaking up with a dismissive employee
and addressing an employee‟s inability to work in a team situation. Motivated
employees could also privately discuss negative attitudes, recognise HR policies
and procedures and involve HR, to make them listen their problems and support
them. With such high morale building exercises the possibility of conflicts and
industrial disputes could be minimal.
15

Importance # 3. Reduction in Resistance to Change:

Changes can be uncomfortable and require employees to think and/or

act differently. Changes in a business may seem as a sign of
uncertainty that may further lead to anxiety among employees.
Accordingly, employees should be motivated in an organisation to
embrace changes (if any) positively by developing transparency and
trust during the process of change in an organisation. This motivation
can be created by the management along with their employees by
collectively, identifying and recognising the benefits of possible
changes.

Importance # 4. Reduction of Employee Turnover and

Absenteeism:

Employee turnover is a measurement of the term or number of years

an employee stays and/or replaced in the company. Highly motivated
employees are considered to be the most reliable and valuable assets
to the organisation. They are more loyal, punctual and regular in their
work schedule and stay on-job for a longer period of time in the
organisation. In case of poor working conditions, lack of recognition
and poor relations with colleagues and superiors absenteeism could
increase as these conditions demotivate employees to work harder.
16

Importance # 5. Healthy Corporate Image:

Motivation also helps organisations in improving their image due to

efficient performance, maintenance of self-discipline and productive
internal environment. It creates a good impression and enhanced
image among people outside the organisation.

Importance of Motivation – For Members of an

Organisation

If the members of an organisation are effectively motivated then from such

motivation the expected results are that –

(1) All the members will try to co-operate and co-ordinate their activities with a
view to achieve the goals which they are required to achieve.

(2) All the members will do their best to carry out the plans in accordance with
the policies and programmes laid down by the organisation.

(3) All the members will also try to be as efficient as possible and will try to
improve upon their skill and knowledge so that they may be able to contribute „to
the progress of the organisation as much as it is possible.

Explaining the importance of motivation E. F. L. Brech writes- The problem of

motivation is the key to management actions and in its executive form; it is
among the chief task of the General Manager. We may safely lay it down that the
system of an organisation is a reflection of the motivation from the top.
17

Motivation is getting the members of the term to pull weight effectively, to give
their loyalty to the group and organisation, to carry out properly the activities
allocated and generally to play an efficient part in the purpose or are the real
assets of any organisation. Technology system and methods become ineffective in
these, if the people lack zeal and enthusiasm for work.
All administrative action loses its point unless the members of the enterprise are
willing to contribute their efforts for the fulfillment of their assigned tasks. To
achieve organism and individual goals in an economic and efficient manner,
motivation is an important tool in the hands of management to direct the
behaviour of sub-ordinates in the desired and appropriate direction and thus
minimise the waste of human and other resources.

The importance of motivation in an organisation may be discussed in

detail as follows:

1. High Performance Level is Must for an Organisation- Motivated employees

put higher performance as compared to other employees. The high
performance is a must for an organisation and motivation is a vital
requirement for high performance. A number of researches have proved the
relationship between high performance and high motivation.

2. A Motivated Employee Stays in the Organisation More and their

Absenteeism is Quite Low- High turnover and absenteeism create many
problems in the organisation. Recruiting, training and development of
number of new personnel do not only take a long time but it is expensive
too. In a competitive economy, this is almost an impossible task. This also
affects the reputation of the firm adversely. Motivation brings these rates
lower.
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3. Willingness of the People to Work- Motivation influences the willingness of

people to work and willingness comes from within. A man may have a
capacity to work and he may be physically, mentally and technically fit for
work but he may not be willing to work. Motivation creates a need and
desire on the part of the workman to present his better performance.

4. Motivation is the Basis of Co-Operation to Get the Best Results Out of the
Efforts of the Men on the Job- In their zeal to produce more the members
work as a team to pull the weight effectively, to show their loyalty to the
group and to the organisation, to carry out properly the activities allocated
and generally to play an efficient part in achieving the goals which the
organisation has undertaken.

5. It is Helpful in Building Good Labour Relations- In an organisation all the

members of the staff make their efforts to achieve the objectives of the
organisation and carry out the plans in accordance with the policies and
programmes laid down by the organisation if the management introduces
motivational plans. Both workers and management are benefited by such
plans. While efficiency and wages of operating force increase, productivity
of the organisation increases due to consolidated efforts of the motivated
people.

6. Improvement of Skill and Knowledge- All the members of an organisation

try to be as efficient as possible and to improve upon their skill and
knowledge so that they may be able to contribute to the progress of the
organisation as much as possible because they know that they will get what
has been promised and ultimately they will be able to satisfy their personal
as well as social needs.
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7. Motivation Builds Human Relations- As the human concept of labour has

changed and now labourer is treated as a man and not a commodity. This
attitude contributes towards motivating the people at work. Workers are
invited to participate in the decision-making function of the management.

8. It is an Important Tool of Management- Motivation is an important tool in

the hands of management to direct the behaviour of sub-ordinates in the
desired and appropriate direction and thus minimising the wastage of
human and other resources. It is the best way to achieve the organisational
and individual goals in an economical and efficient manner.

Importance of Motivation – In Modern Organisations

The success of an organisation ultimately depends on how effectively managers
are able to motivate their subordinates. In the words of Allen, „poorly motivated
people can nullify the soundest organisation‟.

The following points bring out the importance of motivation in

modern organisations:

i. Productive Use of Resources:

Motivation enables people to convert physical and financial resources
into useful products. It helps management to get the best out of human
as well as non-human resources.

ii. Increased Efficiency and Output:

Motivation enables people to work enthusiastically. Motivation bridges
the gap between the ability to work and the willingness to perform
wholeheartedly and thereby, increases the overall efficiency and output.
This, ultimately, helps in reducing the cost of operations.
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iii. Achievement of Goals:

Motivation causes goal-directed behaviour. It helps people to move in

an action and earn rewards.

iv. Development of Friendly Relationships:

Rewards, promotional opportunities, challenging work etc. are the
inducements organisations offer to obtain good results from people.
Employees love to work for companies that respect employee
contributions. Their morale would be high. This helps in developing
cordial relations between management and workers.

v. Stability in Work Force:

Attractive motivational schemes satisfy the need of employees. As a
result, their commitment to organisational work increases. Employees do
their tasks loyally and enthusiastically. They are not tempted to leave the
organisation. This means reduced employee turnover.

Further, satisfaction on the job means reduced absenteeism. Employees attend to

their work regularly and sincerely so as to earn rewards. The organisation
benefits because it is able to maintain a stable workforce. The skill and
competence of employees continue to be available to the organisation. This
enhances the image of the firm and helps it to secure the services of competent
people.
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Importance of Motivation – For Workers

1. Increase in Efficiency:
When workers are motivated to satisfy their lower and higher- order
needs, they work to satisfy the organisational needs also. This
increases the efficiency of organisational activities.

2. Communication:
Motivation promotes communication between managers and workers. Both
try to understand each other‟s needs and satisfy them to the extent possible.

3. Need-Based Motivation:
Managers ascertain prime needs of the employees, physiological or
psychological and help them fulfill those needs through motivation.
Motivation, thus, helps workers satisfy their personal needs.

4. Combines Ability with Willingness:

Workers are sometimes able but not willing to perform organisational tasks,
for lack of motivation. Effective motivation combines ability of the workers
with willingness to work and maximises their potential to work.

5. Reduction in Labour Absenteeism and Turnover:

Workers who are satisfied with their work and work environment
contribute positively towards organisational goals and objectives. The rate
of absenteeism and turnover, thus, gets reduced.
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6. Development of Leaders:
Motivation helps managers know the needs of employees. It helps them
guide and lead their behaviour in the right direction. Efficient leaders, thus,
develop as a result of effective motivation.

Importance of Motivation – For Employees

1. Higher Efficiency:
Motivation is an effective instrument in the hands of management to
maximize efficiency of operations. A worker may be very competent
but no activity can take place until the individual is willing to perform
that activity. What employees do depends largely on how much and
why they want to do. Motivated employees give greater performance
than demotivated ones.

2. Optimum Utilization of Resources:

Motivation inspires employees to make possible use of different factors of
production. They work whole-heartedly to apply their abilities and potential
in minimizing waste and cost. The enterprise can make maximum use of its
physical and financial resources.

3. Reduction in Labour Turnover:

Higher motivation leads to job satisfaction in workers. Opportunities for
need satisfaction make employees loyal and committed to the organization.
As a result labour absenteeism and turnover are low.
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4. Better Industrial Relations:

Increased labour productivity in turn results in higher wages for employees.
Motivational scheme create integration or individual interests with
organizational objectives. There arises a sense of belonging and mutual co-
operation at all level. Motivation will foster team spirit among workers. This will
reduce labour unrest and create better relations between management and
workers.

5. Easier Selection:
An enterprise that offers abundant financial and non-financial incentives enjoys
reputation in the labour market. Therefore, it can easily attract competent
persons for filling various vacancies.

6. Facilitates Change:
High Motivation helps to reduce resistance to change. An organization has to
incorporate changes to cope with environmental changes. Properly Motivated
employees accept, introduce and implement these changes keeping the
organization effective.
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Importance of Motivation – In Management

Management tries to utilise all the sources of production in a best possible
manner. This can be achieved only when Employees co-operate in this task.
Efforts should be made to motivate employees for contributing their maximum.
The efforts of management will not bear fruit if the employees are not encouraged
to work more. The motivated employees become an asset to the organisation.

The following is the importance of motivation:

1. High Performance:

Motivated employees will put maximum efforts for achieving organisational

goals. The untapped reservoirs of physical and mental abilities are taped to the
maximum. Better performance will also result in higher productivity. The cost of
production can also be brought down if productivity is raised. The employees
should be offered more incentive for increasing their performance. Motivation
will act as a stimulant for improving the performance of employees.

2. Low Employee Turnover and Absenteeism:

When the employees are not satisfied with their job then they will leave it
whenever they get an alternative offer. The dissatisfaction among employees also
increases absenteeism. The employment training of new employees costs dearly
to the organisation. When the employees are satisfied with their jobs and they are
well motivated by offering them financial and non-financial incentives then they
will not leave the job. The rate of absenteeism will also be low because they will
try to increase their output.
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3. Better Organisational Image:

Those enterprises which offer better monetary and non-monetary facilities to

their employees have a better image among them. Such concerns are successful in
attracting better qualified and experienced persons. Since there is a better man-
power to development programme, the employees will like to join such
organisations. Motivational efforts will simplify personnel functions also.

4. Better Industrial Relations:

A good motivational system will create job satisfaction among employees. The
employment will offer those better service conditions and various other
incentives. There will be an atmosphere of confidence among employers and
employees. There will be no reason for conflict and cordial relations among both
sides will create a healthy atmosphere. So motivation among employees will lead
to better industrial relations.

5. Acceptability to Change:

The changing social and industrial situations will require changes and
improvements in the working of enterprises. There will be a need to introduce
new and better methods of work from time to time. Generally, employees resist
changes for fear of an adverse effect on their employment. When the employees
are given various opportunities of development then they can easily adapt to new
situations. They will think of positive side of new changes and will co-operate
with the management. Motivation will ensure the acceptability of new changes by
the employees.
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6. Creates Supportive Work Environment:

When the needs of employees are satisfied and they get proper recognition, then
they will have positive attitude towards work. The relations between superiors
and subordinates will be cordial and working environment will improve.
Motivation will help in improving co-operation and co-ordination in the
organisation and employees will work in a team-spirit.

7. Helpful in Changing Attitude of Employees:

In the absence of motivation, the employees will be taking the work in a routine
way and will not think of doing their best. Motivation will help in changing the
attitude of employees from negative to positive. The motivated employees will be
using business resources properly and will improve their performance.

Importance of Motivation – In an Organisation

Importance # 1. Improves the Efficiency of Work:

Motivation influences the level of performance of employees, which

depends not only on individual‟s abilities but also on his/her
willingness to achieve a high level of performance. Motivation fills the
gap between the ability to work and willingness to work. Thus, it leads
to increase in productivity, reducing the cost of operations and
seeming overall efficiency.
27

Importance # 2. Sets in Motion the Action of People:

In every organisation, there are physical, financial and human

resources. The utilization of physical and financial resources depends
on the ability and zeal of people to work. Motivation puts human
resources into action. Motivation builds die will power to work among
employees and enables the management to secure the best possible
utilization of all resources.

Importance # 3. Ensures Achievement of Organisational

Goals:

Management can achieve the goals effectively by motivating

subordinates to put in their best efforts towards the fulfillment of the
assigned tasks. If people are not motivated, no purpose can be served
by planning, organizing and staffing functions. By meeting individual
needs through a satisfactory system or rewards, the management can
secure the cooperation of subordinates for the accomplishment of
organisational goals.

Importance # 4. Helps in Creating Friendly and Supportive

Relationships:
Motivation brings about employee satisfaction through financial aid or
reward, recognition of good work and promotional opportunities.
Hence, it leads to cordial and friendly relationship between the
employer and the employees. Industrial disputes are reduced and
there is high morale. Effective motivation helps management to win
resistance to change. Motivated employees support all changes that
are in the organisational interest as they identify their own
advancement with the prosperity of the enterprise.
28

Importance # 5. Motivation Leads to the Stability in the

Work Force:

Motivation builds confidence among subordinates, improves work

performance, secures their loyalty, and reduces absenteeism and
labour turnover. It improves the image of the organisation and
consequently, attracts competent personnel in an organisation.

Importance # 6. Acceptance of Organisational Changes:

Organisations are created in the society. Because of changes in the

society, changes in technology, value system, etc. Organisation has to
adapt to those changes to cope up with the requirement of the time.
When these changes are introduced in the organisation, there is a
tendency to resist these changes by the employees. However, if they
are properly motivated, they accept, introduce and implement these
changes keeping the organisation on the right track of progress.
29

Importance of Motivation – Briefly Discussed

A manager guides the people in a desired manner in order to achieve

organisational objectives. Two important things are necessary to
perform any job. People should have ability to work and willingness to
work. Unwillingness to work is of no use. Hence, there is a need for
motivation to create willingness in the minds of workers to do a job.

So, the performance may be expressed in the following

formula:

Performance = ability x motivation (willingness)

E. F. L. Brech has explained the importance of motivation as “The
problem of motivation is the key to management actions and in its
executive form, it is among chief tasks of the general manager. We
may safely lay it down that the tone of an organisation is the reflection
of the motivation from the top.”
30

The importance of motivation is briefly discussed below:

1. Maximum utilisation of factors of production – Workers perform the work

sincerely through the inspiration of motivation. This creates the possibility
of maximum utilisation of factors of production viz., labour and capital.

2. Willingness to work – Motivation influences the willingness of people to

work. A man is technically, mentally and physically fit to perform the work
but he may not be willing to work. Motivation creates a willingness on the
part of workers to do the work in a better way.

3. Reduced absenteeism – Financial incentive schemes coerce the workers to

work more. Financial incentive scheme is framed in such a way that
monetary benefits are given on the basis of number of hours engaged. This
reduces absenteeism.

4. Reduced labour turnover – Motivation has both financial and non-financial

incentive schemes. This helps to retain the existing labourers. The
enterprise can plan its activities on long-term basis with the help of reduced
labour turnover.

5. Availability of right personnel – Financial and non-financial incentives not

only retains the existing employees but also attract the employees from
outside the enterprise. In other words, right people are attracted from
outside to work for the enterprise.

6. Building of good labour relations – Motivation helps to solve the labour

problems of absenteeism, labour turnover, indiscipline and grievances. This
ensures building of good labour relations.
 31

7. Increase in the efficiency and output – Both workers and management have
got benefits from motivational plans. On the one hand, wages of the workers
increase corresponding to the increase of output and efficiency. On the
other hand, the productivity of the organisation and its profits increases due
to consolidated efforts of the motivated people.

8. Sense of belonging – A proper motivation scheme promotes closer rapport

between enterprise and workers. The workers begin to feel that the
enterprise belongs to them and consider its interests as their own. Thus
there is no difference between workers and enterprise.

9. Basis of co-operation – Efficiency and output are increased through co-

operation. The co-operation could not be obtained without motivation, so,
motivation is a basis of cooperation.

10. Helps in realising organisational goals – Organisational goals are

achieved quickly through motivation. Motivated employees have a feeling of
total involvement in the performance of organisation task. Employees may
work whole-heartedly for the realisation of organisational goals.

11. Improvement upon skill and knowledge – Employees have promised

efficient job performance or completion. Hence, the employees may
improve upon their skill and knowledge required for the job.
32

Importance of Motivation – In Business

The effective direction, motivation and leadership, takes a business

forward. Amongst all, motivation plays the key role as it helps to
identify and satisfy the needs of employees and the organisation.
Managers use various motivational programmes to encourage
employees to achieve their maximum potential leading to improved
organisational performance.

Let us review the importance of motivation:

1. Motivation Improves the Performance of Employees and

the Organisation:
A manager through motivational techniques satisfies the needs of
employees. A satisfied and content employee is able to use his/her
energies and potential optimally leading to higher levels of performance.
The improved performance of individual employees contributes towards
performance of the organisation.

2. Motivation Develops Positive Attitude:

Motivational techniques like rewards, appreciation, recognition etc. create
desire amongst employees to perform to their maximum potential. In the
absence of motivation, employees may be indifferent towards organisational
goals and may perform at minimum level. Motivation eliminates this
negative attitude and develops the positive attitude towards work leading to
effective realization of organisational goals.
33

3. Motivation Reduces Employee Turnover:

A good manager identifies the motivational needs of employees and provides
suitable opportunities to satisfy them. A satisfied employee prefers to remain
loyal to the organisation and work hard to achieve greater heights. The reduced
employee turnover saves cost related to recruitment and training of new staff and
helps management to retain talented staff.

4. Motivation Reduces Absenteeism:

A sound motivational system satisfies needs and motives of employees making
workplace a source of pleasure and work a pleasant experience. On the other
hand, an employee with unsatisfied needs lacks commitment to work which may
lead to frequent absenteeism. Thus, motivation while keeping employees happy
and satisfied reduces absenteeism leading to increased productivity for the
organisation.

5. Motivation Helps to Introduce Changes Smoothly:

A motivated staff is open-minded and is able to understand that it is important to
adapt to environmental changes for future success and growth of business. They
may readily accept the change as they can foresee additional rewards they will
receive as a result of change.
 34

Types of motivation

Intrinsic and extrinsic motivation

Using motivation to achieve goals and complete tasks will be most impactful when you can identify
the type that works best for you. Most types of motivation fall into one of these categories:

Intrinsic motivation

Intrinsic motivation is internal. For example, you might use intrinsic motivation when you feel inspired
to complete a task because it aligns with your personal core values. If you volunteer for a community
food bank because you derive motivation from helping others, you are likely well-motivated by
intrinsic factors.

Extrinsic motivation

When you are motivated to act by external factors, such as compensation or praise, you are
experiencing extrinsic motivation. Extrinsic motivation drives you to achieve things for rewards such
as a promotion, raise, bonus, awards, and the need to maintain your livelihood, among others.

Incentive motivation

Incentive motivation is when you are motivated to perform a task because of the potential reward.
People who are incentive-motivated typically do not focus on the process of achieving a goal so long
as they get the reward. You can use incentive motivation to boost your career progression and
earning ability. If you want a raise, thinking of the higher standard of living you can acquire with the
extra pay can energize you to meet your production or sales quotas.
35

Achievement motivation

This motivation entails performing tasks to achieve specific objectives. With achievement motivation,
you likely care more about committing yourself to a vision and accomplishing an objective than
attaining awards.

Power motivation

When you spend hundreds of hours to build your own business or become an expert in your field, you
are trying to gain control over your livelihood. If you strive to control your life and that of others, your
motivation is likely power. You enjoy actions that will make you the sole determinant of what happens
to your money, food, health, relationships and more.

Power motivation can be a positive way of developing your career, but it can also lead to challenges. Making
a conscious effort to secure your source of income and adopt healthy eating habits is a noble cause.
However, it is important to respect people’s opinions about their own lives, food choices, religion, knowledge
and other personal choices.

Fear motivation

The fear of negative consequences can drive you to avoid an unpleasant experience such as
termination of employment, demotion, lawsuits, stagnation in a role and more. While fear motivation is
not necessarily healthy or sustainable, it can be a somewhat effective motivator in the short-term.

Affiliation motivation

Also known as "social motivation," this motivation encourages social interaction among people. A
person who is driven by affiliation gets motivated by the spirit of cooperation and by others accepting
their desirable attitudes. This need can motive you to be an active member of social groups.

The sense of belonging and contribution to the common good can drive you to become a better
person, leading to more fulfillment and happiness. If financial rewards are not available, this is great
for increasing your dedication to career goals.
 36

Competence motivation

Competence motivation pushes people to become highly proficient at what they do, allowing them to
become subject matter specialists in critical aspects of their jobs. Such professionals include
neurosurgeons, aeronautics engineers and other specialists who use their problem-solving skills to
respond to unique problems. For this set of people, their motivation comes from being able to use
their competence where it will make the biggest difference.

Attitude motivation

This is the motivation that drives an individual to change other people’s perceptions or thoughts.
Attitude motivated people seek to enhance their interactions with other people by improving social
engagements. It focuses on making people around you feel better about you and themselves.

Expectancy motivation

This psychological theory posits that individuals are motivated by the expectation of a desired result
of certain efforts. It measures the degree to which the reward of a particular action motivates you to
pursue the achievement of that goal based on your belief you can receive the reward. The focus of
this motivation is that you should select activities in which you are certain of achieving the desired
results.
 37

Characteristics/Features of Motivation:

1. Interaction between the individual and the situation:

Motivation is not a personal trait but an interaction between the individual and
the situation.

2. Goal-directed behaviour:
Motivation leads to an action that is goal oriented. Motivation leads to
accomplishment of organizational goals and satisfaction of personal needs.

3. Systems oriented:
Motivation is influenced by two forces:
a. Internal forces:
These forces are internal to the individual, i.e., their needs, wants and nature.

b. External forces:
These forces are external to the individual, which may be organizational related
such as management philosophy, organizational structure, and superior-
subordinate relationship, and also the forces found in the external environment
such as culture, customs, religion and values.

4. Positive or negative:
Positive motivation or the carrot approach offers positive incentives such as
appreciation, promotion, status and incentives. Negative motivation or stick
approach emphasizes penalties, fines and punishments.
38

Motivation is a process through which individually does something in order to satisfy some
basic needs. It is a responsibility of a manager to motivate the employees towards the
attainment of organizational goals through a higher level of performance. The motivation
holds the following characteristics:

5. Motivation is Personal and Psychological Concept

Motivation is a personal as well as a psychological concept; hence, the managers have to

study the mental and psychological aspects of the individual. Motivating factors are always
unconscious but they are to be aroused by managerial action.

6. Motivation is a Process

Motivation is a process of inspiring, energizing, reducing and activating the employees to a

higher level of performance. This process starts with unsatisfied needs, moves through
tension, drives and goal achievement, finally, it ends with the reduction of tension aroused by
unsatisfied needs.

7. Motivation is a Continuous Process

Motivation is a continuous on-going process rather than one shot affair. Because an individual
has unlimited wants and needs. Motivation is an unending process. Wants are innumerable
and cannot be satisfied at one time. As satisfaction of needs is an unending process, so the
process of motivation is also unending. As soon as the existing need is fulfilled, another will
appear. Hence, motivation should go continuously.

8. Motivation is a Complex Subject

Motivation is a complex subject in the sense that the individual’s needs and wants may be
unpredictable. The level of need of a person depends on his/her psychological and
physiological aspects.

9. Motivation is Goal Oriented

Motivation should be directed towards the achievement of stated goals and objectives.
Motivation causes goal-directed behavior, feeling of need by the person causes him to
behave in such a way that he tries to satisfy himself. From the viewpoint of the organization,
the goal is to achieve high productivity through better job performance.
39

10. Intrinsic and Extrinsic Motivation

As an individual can be motivated either by intrinsic factors or extrinsic factors. The intrinsic
factors include recognition, social status, self-esteem and self-actualization needs which are
related to inner aspects of an individual. On the other hand, the extrinsic factors are
physiological and social needs such as food, shelter, health, education, salary, and benefits
etc.

11. Positive and Negative Motivation

By the term motivation, we mean positive motivation which is related to the process of
stimulating employees for good performance. But it is not necessary that all the time
motivation must be positive, rather sometimes it can be negative also. The negative
motivation is also known as punishment which is not desired by the employees.

12. Motivation is Behavior-oriented

As motivation is person specific, it is related to the personal behavior of an employee.

Behavior is a series of activities undertaken by an individual in the organizational workplace.
The behavior is directed towards the attainment of goals and objectives.
40

Motivational Theories
There are two prominent motivational theories which explains
conceptually the relationship between motivation and performance,
i.e. Herzberg and Maslow‟s need hierarchy. Both Google and Virgin
Atlantic have been using these conceptual frameworks as a guideline
for creating their motivational techniques and policies (Dudovsky,
2012; Martin, 2012). 2.3.1 Herzberg Theory Two-factor theory was
developed by Frederick Herzberg which is also known as
motivation/hygiene theory, it is a widely-accepted theory in the
research field of motivation and related topics (Haque et al, 2014). As
per his theory, there are two categories of motivating factors; a) Non-
monetary factors are termed as hygiene motivating factors by the
author, for example, individual satisfaction, appreciation and
acceptance. b) Monetary factors were categorized under the second
dimension which would motivate employees for example, wages,

incentives etc. The following diagram illustrates the Herzberg two-

factor theory and various motivating factors.
41

Maslow‟s Theory

Maslow‟s Theory which is popularly known as Maslow‟s Need

Hierarchy is very much interlinked to Herzberg‟s Theory. There are
five levels of needs as per Maslow; Basic needs, Security, Belonging
and love, Esteem and Self-Actualization. Needs of a person should be
met as per the lower to higher level to increase the productivity of the
Individual (Furnham et al, 1998).As per the researcher, human needs
cannot be completely accomplished or neither fulfilled. Even if their
needs are met, the previous factors that motivated the person cannot
be a trigger for further motivation and satisfaction. The above
statements are vital since, the organization should be able to assess
and identify the level of satisfaction among the employees and design
the techniques which can meet their level of needs as per the above
diagram. It is to be noted that there is enormous amount of research
been conducted in the field of employee motivation, which has even
looked at its direct impact on employee performance and
organizational productivity. However, relying on any of these
researches would be difficult since most of these have taken different
approaches in identifying the monetary and non-monetary
transactions.
42

Henceforth, we can also argue that when an employee‟s need has been met
and fulfilled he/she is no longer interested in gaining the same need
thereby, it stops to be an indicator of motivation. Since, the level of
motivation does have a positive impact on the employee performance and
productivity; the organization should take utmost care in locating where
actually the employee belongs in the hierarchical pyramid. And as per that
motivation should be designed and directed towards these employees.
There is enormous amount of research that has been conducted to evaluate
the need and requirement of motivating employees in an organization.
However, there are various types of approaches and strategies produced by
the abovementioned research which makes it difficult to rely on any specific
type of financial and non-financial techniques and strategies.

a) Monetary Factors: These are factors which would induce an

employee to work or be productive due to monetary returns like
salary, incentives, discount coupons, vouchers etc. b) Non-monetary
factors: A trigger or motivator which promotes an individual to
complete a task for individual satisfaction in return of recognition,
self-satisfaction or acceptance, we term it as nonmonetary factors.
There are other examples as well; fairness and goals, self-learning
opportunity, self-accomplishment etc. Due to market crisis, slower
growth in the economy and restructuring of organizations resulting in
job losses, employees are forced to work for less money and for longer
hours. Hence, organizations strive their best to identify the financial
incentives which can increase the employee performance and
eventually meeting the goals and objectives of the organization with
less wastage of resources. Due to the high costs associated with living,
where the costs of basic necessities have increased, none of the
individuals are accepting jobs with a lesser payout. Researches has
proven that monetary factors are more effective than non-monetary
factors in motivating employees in a banking or financial industry
(Delic et al, 2017). One of the reasons for such a finding would be
because it is the nature of Banking industry and employees are driven
by monetary incentives rather than any other. However, it is to be
 43

Definition of Performance
In a working environment, performance can be classified into two types a)
organizational performance and b) employee performance. In the following
sections, both these terms will be explained in detail. 2.3.1 Organizational
Performance When an individual or groups of employees are able to
achieve their goals and objectives in an organization, it can be termed as
organizational performance (James, 2012). When all the elements of an
organization operate together in achieving positive result in an
organization, a high level of organizational performance is achieved
(James, 2012). In order to assess the success of an organization, the
performance results are compared to the predefined goals and objectives.
Long term strategic objectives, organizational hierarchy, performance
measures and techniques, organizational culture and values and also
rewarding pattern are the various elements which supports an
organizational performance.
 44

Job Performance
Employee performance and job performance are interconnected
where either of them demonstrates how or whether an employee has
completed his allocated job efficiently and effectively. There are
various definitions for the term „performance‟, whatever may be the
relevance of this variable, it is vital for meeting the organizational
goals and also for individual accomplishments. The organizational
performance could be defined as, a group of people working together
in meeting organizational goals and objectives, whereas an individual
uses his existing skills and abilities in meeting the organizational
goals and objectives is referred as employee performance (Patel,
2013). Even though both organizational performance and job
performance aims at achieving organizational goals and objectives
either of them are achieved through different factors. The
organizational performance is related to collectively aiming at
achieving goals and objectives (Pathirage et al, 2004), whereas when
an individual use resources efficiently to meet the goals and
objectives it is related to job (Sonnentag et al,2008). It is to be noted
that the proposed research will only be focusing at organizational
performance in a generic way and more in depth study would be
conducted on the impact of motivation and employee performance.
The ultimate benefit in developing and improving performance will
only be for the respective organization (Sai, 2014). In short term and
as well as in long term organizations can benefit due to the high
performing employees. (Ali et al, 2016). Recently it has been found
that many organizations are investing in employee development
mainly due to the fact that employee performance is directly related
to success of an organization (Hameed &Waheed, 2011).
Organizations should give more importance for employee
development, since it would ensure that employees are efficient and
effective and as well as motivated which would reduce the employee
45

turnover rate. (Bocciardi, 2017). Although, the financial elements in

such developmental activities are high, the return can be both in the
form of tangible and intangible as well. Tangible return can be in the
form of less wastage, profit turnover,

increase in productivity etc. whereas intangible forms could be,

increase in good will and brand name, employee retention and loyalty.
These factors can give the organization a special space in the market
and also among the competitors. But the vital and challenging job is
to find which are the motivating factors which would impact employee
motivation and performance (Dobre, 2013).
46

Influence of financial incentives

Meeting the basic necessities for him and the family in a regular and
long-term basis is the primary aim of any individual working in an
organization. Financial incentives in the form of wages, allowances,
health insurance etc. are offered at the beginning of employment.
(Kumar et al, 2015). It has been proven in research, that these
factors have a pivotal role in affecting the employee attitude towards
his work (Rounok et al, 2011). Secondly, a good working culture and
environment, job retention can be achieved throughfinancial rewards.
But the main issue is that which monetary factors influence the most
and if any would do, which are those? Bonus and increment can be
given to employee as per the performance although salary can be
decided at the point of appointment. It has been found by various
researchers that employees rank „money‟ as the highest motivator for
an individual but there is a lack of research in regards to which
monetary incentive ranks high as a monetary factor. (Yousaf et al,
2014). An employee takes it as a challenge when performance is
linked to bonuses (Rounok and Parvin, 2011). But in contrary, there
has been some research, which has found that bonuses are definite
expectation and is connected to be a vital monetary incentive in
motivating an employee and whereby increasing the performance.
(Hoole (2014). As per Fu & Deshpande (2014), the highest ranking
monetary motivating factor is salary and it has highest impact on
employee performance.
47
48

Financial incentives are in monetary form and help in motivating the

people for better performance. These incentives are usually provided
on individual or group basis.

Following are the main types of financial incentives:

1. Pay and Allowances:
Salary is the basic monetary incentive for every employee. Beside basic
salary, it also includes dearness allowance, travelling allowance and at
times some other allowances too. It also consists of continuous
increment in the pay every year and increase in allowances from time
to time.

2. Productivity Linked Wage Incentives:

Sometimes wage incentive plans are linked with payment of wages to
increase productivity at individual or group level. Their quantum is
based on actual output against targets.

3. Bonus:
It is the incentive which is given over and above the salary or wages of
the employees. Many companies offer the bonus during the festivals
Diwali, New Year etc.

4. Profit Sharing:It refers to providing a share to employees in the

profits of the organization. This helps in motivating the employees to
improve their performance and to contribute their maximum effort for
increasing the profits.
49

5. Co-partnership/Stock Option:
Under this incentive scheme, employees are offered shares at a price
which is lower than the market price. This practice helps in creating a
feeling of ownership among employees and motivates them to give
their maximum contribution towards organizational growth. For
example, in Infosys this scheme has been successfully implemented.

6. Retirement Benefits:
Various retirement benefits such as provident fund, pension and
gratuity, act as an incentive to an employee when they are in service in
the organisation.

7. Perquisites:
Various perquisites and fringe benefits, such as car allowance, housing,
medical aid, education to the children etc. provided by the companies
over and above the salary, also help in motivating the employees.

Working Conditions Every organization strives to achieve some

internal objectives such low sick leave, reduction in employee turnover,
improved employee productivity and performance and these elements
can only be achieved through a good and healthy working condition
(Ahmad & Salman, 2015). Interestingly, there is a lack of consensus
into the argument whether working condition could possibly improve
employee motivation and eventually their performance. Every
employee expects to have a safe and secured working condition
however, there is a lack of research which states that whether non-
financial incentives would enhance their motivational and
performance levels. As per Ahmad & Salman (2015), employee is
motivated and their performance improves when they find
organizational environment which suits their needs and abilities.
 50

Eventually, they become part of the organization and the level of

satisfaction increases leading to more concentration at work and meeting
their goals and objectives. However, this can only be a stimulator for short
time satisfaction which can diminish over time. As per Kahya (2007),
terrible working condition can have a negative impact on employee
performance and productivity thereby detrimental on employee wellbeing.
Employees might feel more stressed, depressed and high level of anxiety in
such working environment (Sekhar et al, 2013). Therefore, it can be argued
that majority of the employee prefer to work in organizations which having
good working culture rather than unhealthy environment. Henceforth,
various research has concluded that good working condition has direct
impact on employee performance and productivity.

Employee Engagement Management who are involved in employee

engagement are considered to be very interested in employee suggestions
and reviews. Employee engagement helps in increasing employee
motivation and commitment by inducing employees with a sense of
accountability, loyalty and respect from the management side. An
organization‟s performance and development is directly related to employee
engagement activities. As per Porter & Kramer (2011), an organization
which has more interest in employee engagement will have low rate of
employee turnover, fewer job related accidents, high customer satisfaction,
absenteeism and improvement in organization productivity. There are
various researches that has found employee engagement as an important
non-
51

financial motivator (Mehta, 2013; Rounka&Parvin, 2011). However,

there is a lack of research in regards to how and why employee
engagement is having a positive correlation to employee motivation
and performance. Interesting it has also been found as an influential
tool for increasing employee commitment since, it gives them a feeling
that their opinions are ideas are valued by the management. However,
as per Galagan (2015) research, he found that employee engagement
leads to waste of time other resources since it might just give a wrong
intimation that employee with minimal effort is happy for his output
in comparison to that employee who has made his best effort to
increase his performance and productivity. Google, is one of those
organization who have successfully collaborated employee
engagement in its employee motivations strategies for their
organization success like many other leading firms. In Google, they
have set up a “people analytics team” who will conduct study on
regular basis to understand what employee needs today as against
tomorrow/future. It is conducted through a survey among the
employees in which they can list their need and the necessity and
benefit of these needs if its provided. Once the data is collected, the
analytics team will create a program which will be equipped with these
needs that they can thrive for. As per Durmaz (2013), Google has
organized a working environment where there is a sense of
transparency and trust among the employees, and it was also found
that the success of Google was mainly because their employees love
their job. As per the People Analytics and compensation Vice-
president of Google states that „One of the tenets we strongly believe in
is, if you give people the freedom, they will amaze you‟(Loosvelt, 2013).
Henceforth, it can also be argued that in the case of Google, employee
engagement has played an important role as a non-financial motivator
for employee performance and motivation.
52

There are several other organizations who have given immense

importance for employee engagement just like Google. For example,
Virgin Atlantic, Royal Bank of Scotland and Standard Chartered Bank.
But it is to be noted that not all organization incorporate employee
engagement in a straightforward. But firms like
AllgemeineElektricitätsGesellschaft (AEG) consider employee
engagement surveys are too complicated therefor, modifications in
welfare and training programs will be more beneficial for employees
(Overell, 2012).

Performance Appraisal
Every management will set up goals and objectives for their
employees. Hence, employees should be able to assess how well they
have been performing their jobs and meeting their assigned goals and
objectives. Alongside of self-assessment employees should also receive
constructive feedback from their managers or supervisors to improve
their skills and also to develop. Employee performance is usually
measured in organizations through performance appraisals which are
conducted in a regular basis. However, there is a lack of research
conducted to the hypothesis whether performance appraisal has a
direct impact on employee engagement and performance? As per Chen
& Silverthorne (2008), there are three types of performance appraisal;
a) Appraisal based on employee‟s output deliverable. In which the
productivity of an employee over a period of time is assessed by his
manager. b) Appraisal by the supervisor‟s by comparing to their peer
or subordinates in case if it was a group project with common goals
and objectives. c) Self-appraisal, in which employee set up own goals
and objectives and measure against them.
53

An employer usually reaches at an agreement with the employee in

which he states each of the expected employee‟s goals, objectives and
task targets and it is made aware to them on a regular basis. However,
it is to be noted the abovementioned agreement is a usual organization
procedure conducted on a regular basis rather than as a non-financial
motivator for employee motivation and performance. In one of the
research it was found that most of the managers and employees found
appraisal process as a big issue. They also mentioned that they use to
dislike the process and it is also a dreadful task in their work calendar
(Cuneen, 2006). In most of the cases, it concludes as a usual
organization procedure whereby the employer and employee involve
in shallow discussion and reiterate the same goals and objectives,
whereby the main objective of the procedure is left out i.e., employee
performance improvement. As per Coens& Jenkins (2000), there are
major issues even at the basic set up of planning and objective setting.
It was in Winston‟s (1997) study that he pointed that the appraiser
should be qualified enough to conduct the appraisal procedure and the
appraisal system should be designed in such a way that could bring
clarity, equality and able to identify productivity through rewards.
Henceforth, it can be concluded that further research is required to
find out whether performance appraisal is a non-financial motivator
for employee motivation and performance but it is definitely a good
tool for measuring performance.
54

Job Security
Job security is a sense of safety in retaining their current job in the
organization and also a sense of feeling that they will be able to retain
this job for a long term. There are several factors which lead to job
security sense for an employee. For example, salary, employee
developmental activities and also for providing good living condition
for themselves and for his/her family. However, due to recent
economic downturn there has been a regular staff reduction which can
also be part of mergers, cost-cutting and reducing overheads. Job
security is also having a psychological effect on employee, when an
employee is having a job insecurity it has a negative impact on his
performance and also on his lifestyle (Rizvi et al, 2012). As per Sekhar
et al (2013), job security motivates an employee to work towards
attaining goals and objectives since he has a guaranteed income which
will have a positive impact on his lifestyle and thereby improving the
productivity. However, there is still lack of research in regards to
whether job security is a non-financial motivator. However, as per
Leung (2009), it was found that when employees have a feeling
security in his job he is interested in investing more time and effort in
the organization and also tend to have long term commitment to the
management which can also be termed as employee motivation and
performance.
55

Training
Most of the organization provides training for their employee to
improve their skills and talents and also to equip with latest
developments. Training can have several benefits for the organization
such as; career development, promotion within the organization and
diversity development. An employee‟s skills can be improved through
good training programs and which can impact employee job
performance as well. Through, a better job performance will be eligible
for promotion and also for various monetary benefits. Sense of job
security and earning potential also increases among the employees
due to skill development (Kulkarni, 2013). Hence, the researcher
posed the questions whether training can be non-financial motivator
and impact employee performance? In a case study on Mattel, a toy
manufacturer, it was found that management made it mandatory for
full time employees to undergo 66.5 hours training on an annual basis
and also the part time employees should undergo 53 hours of training
annually for increasing employee commitment and also for self-
development. It was also found that 31% of open positions in the firm
was filled by internal employee which was considered as the return on
investment by the management (Caccamese, 2013). Although, it is
evident that big corporation like Mattel do heavily invest on training
programs but whether it leads to employee performance is still to be
further looked into. It is also not clear whether training and
performance are correlated to each other. However, there are some
research which has contributed towards this correlation for example, a
research was conducted over 100 employees and enquired the factors
which lead to employee performance and productivity. And majority
of the employees responded that training and motivation as the two
main factors (Khan, 2012). Other variable followed by the training and
motivation were management attitude and organization culture. As
per Ahmad& Salman (2015), training programs have an important role
in improving employee performance.
56

This has also motivated many organizations in investing in training

and developmental programs for their employees.

Relationship between employee motivation and employee performance

From the abovementioned examples on Google and Virgin has proven

that employees who are happy and satisfied in their job are highly
motivated to work towards attaining goals and objectives thereby
improving their performance. Henceforth, employee performance will
directly impact on organizational productivity and success. Therefore,
it can be said that motivation and employee performance are
positively correlated. However, it has to be noted that both financial
and non-financial factors lead to employee motivation and thereby
improving their performance level. There is a lack of evidences in
relations to which financial and non-financial factors dominantly leads
to motivation since there research outcomes were mixed responses.
Employee performance is negatively affected when there is a lack of
motivation leading to demoralized. When an employee is having a
clear purpose and is motivated, he would work efficiently to achieves
his /organizations goals and objectives effectively. Therefore, both
employee and organization development is achieved. As Lathan
&Pinder (2005), motivation and performance is positively correlated.
As per the researchers it is the management‟s responsibility to identify
the required motivational variables and use them to motivate their
employees which would directly impact their performance. When an
organization is able to identify motivational factors accurately,
management can design effective motivational programs and
performance appraisal schemes. Virgin,Google and Mattel were good
case studies which stated that financial nonfinancial incentives are
used mainly for employee performance and not only for employee
retention. Hence, it can be argued that employee motivation and
employee performance are positively correlated.
 57

Like job security, training and salary, motivation is also a critical variable that
can have a significant impact on the performance of employees and quality of
service.

Motivation intends to encourage behavioural alteration. Motivation is used as an

important force to empower an individual to meet specific objectives. Grant
(2008), on his research on employee motivation, states that motivation helps to
enhance profitability, execution, and constancy. Com-paring to highly motivated
employees, less motivated employees are more arranged towards freedom and
self-reliance along with more self-propelled impetus towards their job.
Comparing to less motivated employees, employee responsibility towards their
work also increases in case of highly motivated employees‟ (Guay et al., 2000).

The assortment of various models and theories relevant to motivation is more

closely examined in the subject of organisational behaviour. According to Baldoni
(2005), “Employee development creates a persuasive spark that explores the
capacity of theirs”. There is undeniable connectivity between employee
motivation and their job satisfaction in addition to organisational responsibilities
(Kachalla, 2009). Based on the nature of the organisation or business, motivation
is the most important factor to achieve organisational goal and objectives.
 58

Several types of research have proved that rewards positively influence the
employee performance leading to a job satisfaction. Among various tools used to
motivate employees or group behaviour to improve organisational performance,
motivation stands out the best.

As a tool to motivate employees and their performance most organisations today

use to pay pro-motion, bonus, reward and another type of reward (Wahyuni et al.,
2014). Salary is a great motivator, but if it is meant to be used as a motivator, the
organisation or institution at first needs to develop a salary structure based on
the significance, essentiality and productivity of the job, individual performance
and special allowance.

Leadership can be used as another significant tool to motivate an employee, as

leadership is about finishing the thing in a correct and progressive way. It is
important to gain the trust of employees and make them follow their manager or
instructor to meet the objectives. Moreover, if a leader wants to build his trust
around the organisation and make the employees do their work appropriately,
they need to be motivated (Baldoni, 2005b). There should be a reciprocal
cooperation for each other between a leader and the employees to attain higher
motivation and morality.

Trust is nothing but a perception of an individual about other individuals and

his/her eagerness to coordinate based on a speech or to have firm belief with a
decision. So, to succeed as an organization trust is another important factor as it
helps to improve employees‟ motivation (Shanks, 2008).

No matter how technology has progressed in recent years, effectiveness of the

staff is the key component to attain a high level of success. In this manner,
development and implementation of employee training program is an essential
strategy to motivate employees. Also, a great correspondence between the
workforce and the manager can invigorate motivation as the number of
uncertainty decreases (Graves et al., 2013).
 59

4. MOTIVATIONAL PROCESS:
Acknowledgement of the unfinished needs is the beginning of motivation. Goals
which satisfy these needs are then recognised and the most appropriate
behavioural way is selected to fulfil these goals. Motivation process is
diagrammatically presented below:

Abbildung in dieser Leseprobe nicht enthalten

Figure: Motivation Process (Vroom, 1985)

Motivation is separated into two categories. These are extrinsic and intrinsic.
Amabile (1997) explains intrinsic and extrinsic motivation as follows:

1. Intrinsically motivated individuals look for pleasure, interest, fulfilment of

interest, personal challenges to the work, etc.

2. Extrinsically motivated individuals took part in the work to attain definite

goals, and the goals are separated from themselves.

Intrinsic motivation is mediated inside the individual whereas extrinsic

motivation is mediated outside the individual in the form of money, verbal
support and other elements (Deci1, 1972). Even if there is no evident reward,
individuals are naturally motivated to perform any given task aside from the
feelings which result from the action. Individuals can be either extrinsically or
intrinsically motivated or both (Amabile, 1997).

The application of extrinsic and intrinsic motivator varies from person to person.
Some people focus on intrinsic outcomes whereas other entered on extrinsic
outcomes (Vroom, 1985). Intrinsically motivated individuals appear to incline
towards exciting reasoning task and can direct themselves towards the practices
deliberately hence offering rewards or setting external goals is a futile attempt
unless they are similarly high on external motivation. Stress should be given
preference as the appealing nature of the task and the reinforcement of self-set
objectives and dead-lines for the workers having high intrinsic motivation.
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Relationship between extrinsic and intrinsic motivation:

The researcher argues that both extrinsic and intrinsic motivation
affect each other in spite of the fact that distinction between extrinsic
and intrinsic motivation is clear.

Deci1 (1972) claims that intrinsic motivation negatively affects

extrinsic motivation i.e. extrinsic motivation diminishes intrinsic
motivation. He further contends that if fiscal measures are not
regulated contingently, intrinsic motivation diminishes. But if money
is non-contingently disseminated, it won‟t happen. While responding
to this discourse, Amabile (1997) expresses that al-though extrinsic
and intrinsic motivation work divergently, on the contrary, it can have
a supporting impact: “intrinsic motivation can prompt raised amount
of satisfaction and performance once the scaffolding of extrinsic
motivation is dealt with progressively.” In her work, she additionally
states that both extrinsic and intrinsic motivation excites the
employees to do their job, but they have altogether distinct
consequences on the employees.

Abbildung in dieser Leseprobe nicht enthalten

Figure: Relationship between Intrinsic and Extrinsic

Motivation (Guay et al., 2000)

Employees can be both extrinsically and intrinsically motivated to

perform a specific task (Amabile, 1997). Both motivation concepts
strengthen each other, but sometimes intrinsic motivation is
diminished by extrinsic motivator (Deci1, 1972). Besides, all
individuals are not similarly motivated; few are motivated extrinsically,
and other are motivated intrinsically (Furnham & Argyle, 1998).
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The Effect of Motivation on Employee Productivity :

Motivated employees are inclined to be more productive than non-
motivated employees. Most businesses make some pains to motivate
workers but this is normally easier said than done. Employees are all
individuals with different like‟s dislikes and needs, and different
things will motivate each.

1. Motivated Employees Are More Productive : If employee will satisfied

and happy then he/she will do his /her work in a very impressive way,
and then the result will be good, on the other hand motivated
employee will motivate other employees in office.

2. Decision-making and practical Expectations : It is important to engage

employees in the decision-making process, but create realistic
expectations in the process.

3. Job Description, Work Environment and Flexibility : Employee doing the

right job for his personality and skill set, and performing well at the
job greatly increases employee motivation and satisfaction. A safe and
non-threatening work environment is necessary to maintain a high
level of employee motivation. Flexible human resource policies,
flexible time, work from home, childcare also be liable to have happier
and more motivated workers.
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4. Pay and Benefits : Keeping employees motivated with good benefits

is easy. Where to draw the line at generous benefits that motivate all
employees, versus raises and larger salaries to retain and attract the
best workers and keep them happy and motivated to be working for
you, are more difficult.

5. Company Culture : Creating a positive and employee-friendly company

culture is a great motivational tool.
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Motivated employees are inclined to be more productive than non-

motivated employees. If employee will satisfied and happy then he/she
will do his /her work in a very impressive way, and then the result will be
good, on the other hand motivated employee will motivate other
employees in office. Job performance management is the process
through which managers ensure those employees activities and outputs
are congruent with the organization’s goal. Therefore it is the
organizations priority to ensure that motivational tools which encourages
initiative and stimulates efforts from the employees are put in place for a
better performance and deliverance of quality service. The performance
of an employee is measured by the output that the individual produces
and it is related to productivity. Productivity is defined variously as (i) that
which people can produce with the least effort (ii) output per employee
hour, quality considered (iii) the increased functional and organizational
performance, including quality (iv) a ratio which measures how well an
organization (or individual, industry, country) converts input resources
(labour, materials, machines etc.) into goods and services. It is about
aligning the organisational objectives with the employees agreed
measures, skills, competency requirements, development plans and the
delivery of results. The emphasis is on improvement, learning and
development in order to achieve the overall business strategy and to
create a high performance workforce.
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