ORGANIZATIONAL BEHAVIOUR

UNIT - III

Motivation - Meaning – Importance - Equity theory

of Motivation - Vroom’s Valence Expectancy theory-
Ken Thomas – Intrinsic Motivation theory- Mc Clell –
theory of Motivation. Motivation and organizational
effectiveness

Introduction

The biggest challenge faced by the organisations is to

get the work done by their employees. This entirely
depends on the motivation levels of the employees.
Their motivation is a result of their needs and
organisational expectations. If the employees are
adequately motivated, the organisation will be able to
meet its objectives.

The term ‘motivation’ is derived from a latin word

mover which means to move. A motive is an inner
state that encourages, activates or moves and that
directs behaviour towards goals. Thus, motivation is
psychological force within an individual that sets him in
motion for the achievement of certain goals or
satisfaction of certain needs.

Motives are somewhere a reflection of human needs.

E.g. A factory worker knows if he will complete his work
on time, he will be rewarded with a bonus or some kind
of financial incentive which can be spent. Thus, here
we can understand that needs are physiological and
psychological drives. On the other hand, drives for

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which an individual has money and wants to spend

become wants. The factors which are utilized for
satisfying or motivating people are called incentives.

Definition of Motivation

Several authors have defined motivation in different ways.

According to Robert Dublin, “Motivation is the complex

set of forces starting and keeping aperson at work in
an organization.”

According to Stanley Vance, “Motivation represents an

unsatisfied need which creates a state of tension or
disequilibrium, causing the individual to march in a
goal-directed pattern, towards restoring a state of
equilibrium by satisfying the need.”

Characteristics of Motivation

1. Psychological process: Motivation is a

psychological process. It is the process to achieve
a desired result by stimulating and influencing the
behaviour of subordinates. A manager should
carefully make an attempt to understand the
needs, motives and desires of every employee in
the organization. The reason for this is that each
person is different and a same kind of
motivational technique does not apply to all kinds
of individuals.
2. Continuous process: Motivation is a continuous
process. When one need is satisfies, another need

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emerges. Therefore, motivation is an incessant

process until the completion of objectives.
Therefore, it is the responsibility of the
management to develop innovative techniques,
systems and methods to satisfy the changing
needs of workers.

3. Complex and unpredictable: Motivation is a

complex and unpredictable task. Human wants
are not definite and they change according to
consequences. A worker may be satisfied in
present situation but due to his changed needs he
may not be satisfied in future. Similarly, even two
persons may not be motivated with similar
behaviour and facilities. Therefore, a manager
must be more conscious to motivate subordinates
and to achieve objectives.
4. Pervasive function: Motivation is the pervasive
function of all levels of management. Every
manager from top to the lowest level in the
management hierarchy is responsible for
motivation. A manager is largely responsible for
motivating his subordinates and secondly other
subordinates in management hierarchy.
5. Influences the behaviour: The most important
objective of motivation is to influence the
employees’ behaviour and thus bringing about the
behavioural changes. The managers influence the
behaviour of workers and encourage them to

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concentrate more on their goals.

6. Positive or negative: Motivation may be
positive or negative. A positive motivation
promises incentives and rewards to workers.
Incentives are both financial and nonfinancial.
Negative motivation is based on punishment for
poor performance like reducing wages, demotion,
job termination etc. On the basis of requirements,
manager can use both positive and negative
motivation for better performance.

IMPORTANCE OF MOTIVATION

Motivating the subordinates is the fundamental duty of

the manager as it ultimately helps in fulfilling the goals
of the organisation. The significance of motivation is
discussed below

1. Cooperation and Goals: Motivated employees

cooperate willingly with the management and

thus contribute maximum towards the goals of
the company.
2. Productivity: Motivated employees attempt to

enhance their knowledge and skills. This enables

increase in the productivity.

3. High Efficiency: It has been observed that when

motivated employees work sincerely towards their

given tasks; they develop a sense of
belongingness which results in conserving the

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organisational resources. This results in

improvement in efficiency.

4. Job Satisfaction: Higher motivation paves the

way for a higher job satisfaction of the employees.

A motivated employee yearning for opportunities
for satisfying needs becomes loyal and committed
towards his work and eventually the organisation.
5. Better Relations: The number of complaints and

grievances reduce when the employeesare

motivated.
6. Good Image: If the employees of the
organisational are motivated and satisfied with
the work environment, the image of the company
as a good employer boosts in the industry.

THEORIES OR MODELS OF MOTIVATION

Various theories of motivation have been classified on

diverse bases in research. These have been discussed
below

 Maslow’s Hierarchy of Needs

Need hierarchy model developed by Abraham Maslow

is one of the earliest works in the area of motivation.
This theoryhas classified the human needs into five
categories as shown in Figure 8.4. Accordingto him,
once a lower level need of an individual is met, he
moves towards the next level needs.

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SelfActualisatio
n
EsteemNeed
s
SocialNeed
s
SecurityNeed
s
PhysicalNeed
s

Hierarchy of Needs given by

Maslow

 Physical or Physiological Needs: These needs

include the basis needs of an individual which
include food, air, water and shelter. They are
lower-order needs and they need to be met first in
order to move an individual for higher level needs.
 Safety needs: After meeting physical needs, an
individual is concerned about the safety needs
which include staying in a safe and secure
environment. At a work place, the managers
ensure meeting of the safety needs by providing
job security, medical insurance and safe gadgets
and machines for working.
 Social or Belongingness Needs: These needs
include the needs for love, affection and
interaction with people. These needs are also
called affiliation needs. Social needs are essential

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to humans so that they do not feel isolated and

depressed. Social needs are met through
friendships, family and intimacy. A manager can
work upon satisfying the social needs by ensuring
that employees are provided with cooperative
teamwork, kind supervision and sufficient work-
life balance.
 Esteem Needs: These needs include two
aspects- self esteem or self respect through
personal achievement and social esteem through
respect and appreciation from others. Managers
should motivate their subordinates by giving
those awards and appreciation certificates for
their achievements.

 Self Actualisation Needs: It is the pursuit of

reaching one's full potential as a person. These
needs are not necessarily fully satisfied owing to
the exploration of new opportunities by an
individual. This depends upon the individual to
individual. The management should help in
meeting these needs by providing the employees
with a challenging tasks and inviting them for
decision making.

 Herzberg Two-Factor theory

Frederick Herzberg developed motivation-hygiene

theory on the basis of studies to understand the factors
affecting satisfaction or dissatisfaction in a work

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environment. These factors have been classified as

motivators and hygiene factors respectively.

 Hygiene Factors: These are the basic factors in

a job and also known as extrinsic factors.
Although, they may not provide positive
satisfaction but absence of these factors lead to
dissatisfaction. Examples of hygiene factors
include status, job security, salary and fringe
benefits.
 Motivators:Thesefactorsareinternaltothejobsthat
providesatisfaction.Thesearecalled intrinsic
factors. Absence of these factors may not to yield
to dissatisfaction but their presence in a job give a
sense of satisfaction. Examples of motivators are
job challenge, advancement, autonomy,
responsibility, etc.

 McClelland’s Achievement Model

David McClelland advocated a model of motivation

classifying the needs classifying as achievement,
affiliation and power. He proposed that an individual’s
behaviour at any time is guided by multiple motives.
But in most situations, one or two motives are
dominant and thus motivation varies with variation of
needs.

 Need for Achievement: People with a high need

for achievement seek to excel and thus tend to

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prefer moderate risks. They choose those tasks

whereby they can take personal responsibility for
finding solutions to the problems. Achievers
require regular feedback in order to check the
progress of their achievements. The management
should give high achievers challenging projects
with attainable goals.
 Need for Affiliation: Those with a high need for
affiliation look out for pleasant relationships with
other people and need to feel accepted by other
people. Such people are desirous of
companionship and helping each other. High
affiliation individuals prefer work that provides
them with significant personal interaction. They
tend to conform to the norms of their work group.
The managers should create an atmosphere of
supportive interpersonal relations for the
individuals seeking for affiliation and thus such
kind of group formation leads to achievement of
goals.
 Need for Power: The need for power is stated by
the desire to influence others. People seeking a
need for power tend to be outspoken and forceful.
They are willing to engage in confrontation. Need
for power could be one of two types - personal
and institutional. Those who need personal power
want to direct others and this need is often
considered as undesirable. Persons who need
institutional power want to manage the efforts of

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others to promote the goals of the organization. It

has been seen that managers with a high need for
institutional power tend to be more effective than
those with a high need for personal power.
 Expectancy Theory

Expectancy theory was propounded opposing the

Herzberg’s two-factor theory. This theory was
developed by Vroom. The theory explains the
behavioural process of why individuals choose one
behavioural alternative over another. It suggests
that individuals are motivated towards objectives
if they think that their performance will be
rewarded for the efforts they will put. Vroom
suggested three variables in this study-
Expectancy, Instrumentality and Valence.

 Expectancy: Effort Performance

It is the confidence that better efforts will result in
better performance. It is influenced by factors like
having appropriate skills for performing the job,
availability of right resources, availability of
critical information and getting the required
support for accomplishing the goal.
 Instrumentality: Performance Outcome

It is the faith that the individual will receive an

award if he performs well. This depends upon
trusting the people who decide who recieves what
outcome, understanding the relationship between

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performance and reward and finally the

transparency in the system that decides who get
what outcomes.
 Valence:
Valence is the importance associated by an
individual with respect to the expectedoutcome. It
is an expected and not the actual satisfaction that
an employee expects to receive after achieving
the goals. This is dependent on individuals’ needs,
values, goals, preferences and source of
motivation.

 EquityTheory
Equity theory was suggested by J.S.Adams. The
assumption behind this theory is that the
employees experience strong expectations of
justice, balance and fairness in treatment by their
employers. This theory propounds that individuals
are motivated by a desire to be treated equally at
work.
In this theory, two variables are important
namely inputs and outcomes. According to this
theory, the employee constantly assesses their
level of effort against fellow workers and the
reward they receive for their effort.When the
employee feels that the compensation and
treatment for his efforts are fair with reference to
his skills and efforts, he feels satisfied and
motivated. The definition of equity is described in

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following diagram:

Adam’s definition of Equity

 Inputs: These constitute of the quality and

quantity of employee’s contribution to work. They
include time, effort, loyalty, hard work,
commitment, ability, adaptability, flexibility,
tolerance, determination, enthusiasm, trust in
management, support from colleagues and skills.

 Outputs: The outputs encompass the positive and

negative results that an individual gets after
putting inputs into a task. They can be tangible and
intangible. Examples of outputs are job security,
esteem, salary employee benefits, praise,
recognition, etc.

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 McGregor’s Theory X and Theory Y

McGregor has suggested Two contrasting theories on
motivation based on certain assumptions
 TheoryX

Theory X revolves around the traditional approach to

motivation and control. It represents traditional
stereotyped and authoritarian management style. It
has following assumptions:

i. An average human being is lazy and doesn’t

like to work. He will avoid work if he can.
ii. Most human beings lack ambition and thus
don’t want responsibility. They prefer to be
directed rather than to lead.
iii. Most human beings are self centred and in
different to the organizational goals.
iv. Most people are not creative to solve
organisational problems.
v. Most human beings are motivated with
physiological and safety needs.

These assumptions suggest that the human

beings can be motivated by money and the
benefits required for satisfying the physical and
safety needs. According to the theory, the
employees are managed by punishments and
strict control. This type of motivational process

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can only work in the environment whereby the

work is repetitive in nature and promotions are
not frequent. McGregor advocated Theory Y
refuting the assumptionsof Theory X as
nowadays the employees don’t just get
motivated with money andrelated benefits.

 TheoryY
Theory Y assumes that people are not unreliable
and lazy by nature. It has a positive view on
employee motivation and their behaviour. The
management undertakes the responsibility of
helping the employees to develop and express
their creative skills. The assumptions of
McGregor’s Theory Y are as follows:
i. An average person doesn’t dislike work rather
work is natural as play.
ii. An average human being will exert self control
and direct himself for his objectives.
iii. An average individual knows that he will be
rewarded if he is committed for the
objectives. And generally these rewards are
higher order needs namely ego satisfaction
and self-actualisation.
iv. An average person tends to seek responsibility
and is ambitious.
v. Imagination, creativity, and ingenuity can be
used to solve work problems most of the
people.
vi. Considering the present scenario of present

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industrial life, the intellectual potential of an

average man is only partly utilized.
Theory Y is more real and generally used in
the organisations. In support of this theory,
McGregor suggested motivational practices
like decentralisation, delegation, job
enlargement, participation and consultative
management.

 EXTRINSIC AND INTRINSIC MOTIVATION

THEORY
Extrinsic motivation is related to tangible rewards
such as salary and fringe benefits, promotion,
contract of service, the work environment and
conditions of work. Individuals are extrinsically
motivated when they engage in work in order to
obtain some goal that is apart from the work itself.
Extrinsic motivation thus requires an
instrumentality between the activity and some
separable consequences such as tangible or verbal
rewards, so that satisfaction comes not from the
activity itself but rather from the extrinsic
consequences to which the activity leads. Intrinsic
motivation is related to psychological rewards
such as the opportunity to use one’s ability, a
sense of challenge and achievement, receiving
appreciation, positive recognition and being
treated in a caring and considerate manner.

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Individuals are intrinsically motivated when they

seek enjoyment, interest, satisfaction of curiosity,
self-expression, or personal challenge in the work.
Intrinsic motivation thus involves people doing an
activity because they find it interesting and derive
spontaneous satisfaction from the activity itself.
One psychological view suggests that very high
levels of intrinsic motivation are 31 marked by
such strong interest and involvement in the work,
and by such a Work Motivation perfect match of
task complexity with skill level, that people
experience some kind of psychological “flow”, a
sense of merging with the activity they are doing
Ken Thomas model of intrinsic motivation
proposes that intrinsic motivation is achieved
when people experience feelings of:
• Choice – ability to select activities and to
perform in ways that seem appropriate.
• Competence – accomplishment felt in skillfully
performing task activities.
• Meaningfulness – opportunity to pursue a worthy
task purpose.
• Progress – feeling that one is making significant
advancement in achieving the task’s purpose.

DIFFERENT METHODS OF MOTIVATION

Organisations have evolved different techniques of
motivating their employees which have been generally
classified into financial and non-financial incentives.

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An incentive is something that stimulates a person

towards some goals. It stimulates human needs and
generates the desire to perform. Therefore, an
incentive is a method of motivating employees.
Incentives are directly linked to increase performance
in companies.
Classification of Incentives used by organisations

Financial Incentives Non-financial

Incentives
Pay and allowances Status
Bonus Praise
Profit-sharing Group Incentives
Commission Participation &
Involvement
Performance related Opportunity for
Incentives Growth
Stock Options Suggestion System

Financial Incentives

Financial incentives also known as monetary incentives

are needed for meeting the basic needs of the
employees. The usual incentives given to employees
are discussed below:

1. Pay and Allowances: Pay and allowances

include salary and allowances in form of dearness
allowance, house rent allowance, etc. Salaries
differ from company to company whereas
allowances are dependent on various factors like
inflation. Some organisations offer a
compensation including both salary and
allowances while some provide a consolidated

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salary.
2. Bonus: Some organisations have a tendency to

distribute bonus to the employees. Minimum

bonus limit is 8.33% of salary or wages in India
under the Payment of Bonus Act, 1965.

3. Profit Sharing:Under profit sharing scheme, the

employees are given a certain share in the profits

of the company when the profits increase beyond
a given limit. This conduct of the management
induces the workers to perform more hard to gain
their share of company’s profits.
4. Commission:Commissionisthevariablepartofcom

pensation.Thisisgenerallygiven asa percentage of

sales to the sales personnel as per their
contribution to the sales. The commission rate
varies from organisation to organisation.
5. Performance linked incentives: Organisations

also provide salary/wages linked incentives where

the amount of incentive is associated with the
performance of the employee.
6. Stockoptions:There are many companies which

offer this kind of financial incentives. The stock

options give employees the right to purchase
company’s shares at a future date on a
predetermined price. The companies offer shares
in lieu of profits to the employees which make
them co-owners of the companies and hence a
higher sense of belongingness in the organisation.

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Non-Financial Incentives

Financial incentives are linked to money which is

meant for meeting basic needs and hence they can
motivate the employees to a certain extent. Employees
cannot be always be satisfied by financial needs. The
management also uses non-financial incentives to
motivate the employees. These are explained as
follows:

1. Status: Status means rank in the society. It is

also applicable in organisational structure

whereby the individuals are given designations or
positions as per their abilities, skills and
experience. This is a way of promotion which
provides motivation to the employees.

2. Praise: Praise is more effective than anyother

incentive. However, this incentive should be used

with great care because praising an incompetent
worker would create resentment among
competent workers. Of course, a pat on the back
of an incompetent worker may act as an incentive
to him for improvement.
3. Group Incentives: At times, group incentives act

as more effective than individual incentives to

motivate the employees. Particularly, when the
prestige or even existence of a group is at stake,
the group members work with a team spirit.This

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result in high morale and sequentially, increases

in its productivity.

4. Participation & Involvement: Involving workers

to participate in management gives worker’s a

psychological satisfaction that their voices are
also heard. This imbibes a sense of importance
among the workers.
5. Opportunity for Growth: When the employees

are provided proper opportunities forgrowth and

career advancement and opportunity to develop
their personality, they feel motivated and become
more committed to the organizational goals.
6. Suggestion System: Many organizations which

use the suggestion system make use of cash

awards for useful suggestions. Sometimes, they
publish the workers name with his photograph in
the company’s magazine or newsletter. This
motivates the workers to be in search for
something which can be of greater use to the
organization.

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