ADDIS ABABA UNIVERSITY

ADDIS ABABA INSTITUTE OF TECHNOLOGY

SCHOOL OF CIVIL AND ENVIRONMENTAL ENGINEERING
CONSTRUCTION TECHNOLOGY AND MANAGEMENT

GROUP ASSIGNMENT

TITEL:-MOTIVATION

COURSE: - ORGANIZATION AND LABOR MANAGEMENT

COURRSE CODE: - (CENG-6104)

Name ID
1. Robera Ergabus GSE/5891/12
2. Olana Lelisa GSE/6796/12
Submitted 3. EgizIe Fikadu GSE/6239/12
By: 4. Bahiru Mamo GSE/4844/12

Submitted to: - Ato. Teshome B.

Date of Submission: July, 2021

Addis Ababa, Ethiopia

Organization and Labor management/ Group Assignment on Motivation

Abstract
Though Motivation is one of the most traditional topics in organizational
behavior, it has become more important in contemporary organizations as a result of the
need for increased productivity and the demand to be globally competitive in view of the
rapid changes that organizations are undergoing. The theories try to explain nature and
concept of motivation in their own way and address different outcome variables. Thus,
some theories emphasize its role in productivity while other underscores its importance in
job satisfaction.

The aim of this paper is to study the effect of employee’s motivation on

organization and the different type of motivations. It also tries to have an understandings
on what motivates an employee to work for the overall benefit of the organization.

Motivated and satisfied employees will have committed approach towards

organizational objective; in turn organizations will also have to show similar commitment
towards employee objectives.

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TABLE OF CONTENTS
Abstract…………………………………………………………………………………….i
LIST OF TABLES………………………………………………………………………. iii
LIST OF FIGURES………………………………………………………………………iii
CHAPTER ONE…………………………………………………………………………..1

Introduction……………………………………………………………………………………………………………………….1
1.1. Definitions of motivation………………………………………………………………………………………………………….1
1.2. Objectives of motivation function:……………………………………………………………………………………………3
CHAPTER TWO………………………………………………………………………….4

Theories of Motivation……………………………………………………………………………………………………….4
2.1. Early Theories of Motivation………………………………………………………………………………………………………4
2.2. Contemporary Theories of Motivation……………………………………………………………………………………….9
CHAPTER THREE……………………………………………………………………...24

Motivation Terms and Key Concepts…………………………………………………………………………………24

1. Importance of motivation………………………………………………………………………………………….24
2. Process of Motivation:……………………………………………………………………………………………….25
3. Classifications of motivation………………………………………………………………………………………26
a. Intrinsic motivation…………………………………………………………………………………………………………………26
b. Extrinsic motivation………………………………………………………………………………………………………………..26
4. The relationship between Intrinsic and Extrinsic Motivation………………………………………27
5. Worker’s Performance……………………………………………………………………………………………….28
6. Productivity……………………………………………………………………………………………………………….28
7. How employee motivation affects employees’ performance………………………………………30
8. Relating Rewards with motivations and performances……………………………………………….31
9. Challenges to motivation……………………………………………………………………………………………31
CHAPTER FOUR………………………………………………………………………..33

Conclusion and Recommendations……………………………………………………………………………………33

1. Conclusion………………………………………………………………………………………………………………………………33
2. Recommendation……………………………………………………………………………………………………………………34
Reference:………………………………………………………………………………..36

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LIST OF TABLES
TABLE 1 :SUMMARY OF MOTIVATION THEORIES ................................................................ 21
TABLE 2:CONTINUED ......................................................................................................... 22
TABLE 3: CONTINUED ......................................................................................................... 23

LIST OF FIGURES
FIGURE 1: MASLOW’S HIERARCHY OF NEED (SOURCE: WIKIPEDIA) ..................................... 6
FIGURE 2:HERZBERG’S TWO-FACTOR THEORY (SOURCE: WIKIPEDIA).................................. 9
FIGURE 3:ERG THEORY OF MOTIVATION ( SOURCE: WIKIPEDIA) ....................................... 10
FIGURE 4:REINFORCEMENT THEORY OF MOTIVATION ( SOURCE: WIKIPEDIA) .................... 16
FIGURE 5:EQUITY THEORY OF MOTIVATION ( SOURCE: WIKIPEDIA) ................................... 18

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CHAPTER ONE

Introduction

Nowadays the biggest task of the human resource manager in every business organization
is to motivate and retain employees. Today’s competitive environment requires a work
force that is motivated and committed to reaching work related goals. Motivation is the
force that makes people choose a particular job, stay with the job, and work hard with the
job. A well-managed organization can motivate and retain employees and hence has the
following advantages: reduce turn over, reduce absenteeism, increase productivity and
improve performance.

Motivations contribution to productivity in organizations is highlighted by Armstrong

(2001) who asserts that issues regarding motivation should be closely monitored in
organizations because they affect the sustenance of high levels of performance through
people; from whom management expects results that are in accordance with
organizational goals and objectives. Performance involves employees’ application of
their abilities and efforts; that is why employee motivation is so vital to overall
performance of any organization. An organization becomes successful when its
leadership is strong, engaged and promotes motivation.

Employee motivation is a complex process because as Armstrong (2005) described that it

depends on several factors. Like, individual needs and aspiration, expectation about the
reward, equity and fairness (the felt fair principle) and other factor. Generally speaking
motivation is a life blood of an organization and therefore it is important for managers to
understand the factors that motivate their employees to perform to the best of their
ability. And as motivation concerns, reward system is an important tool for management
use as the channel of employees‟ motivation. Therefore when the reward strategy
designed and implement the mentioned employee motivation factor should be taken in to
consideration and also in order to motivate employees at work the company should
implement desirable total reward strategy.

1.2. Definitions of motivation

Motivation is the willingness to exert high levels of effort toward organizational goals,
conditioned by the effort‘s ability to satisfy some individual need. An unsatisfied need
creates tension that stimulates drives within the individual. Motivated employees are in a
state of tension. To relieve this tension, they exert effort. If this effort successfully leads
to the satisfaction of the need, tension is reduced. But since we are interested in work
behavior this tension reduction effort must also be directed toward organizational goals.

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Therefore, inherent in the definition of motivation is the requirement that the individual‘s
needs be compatible and consistent with the organization‘s goals.

Many factors like environment, capital and human resources influences how organization
performs. Though human resources is seen as having the most influence on the
performance of organization. It is legitimate thus to debate that an organization needs to
motivate its employees in order to accomplish its stated goals and objectives. It is
obvious that motivation has been perceived in numerous ways. Many researchers have
tried to come up with a concise theory to formulate motivation but all bring in different
ideas. Research has been conducted about this subject and many theories were designed
which greatly influence organizational behavior.

Today the organizations are highly focused on customer preferences so as to maximize

the returns of business. The organizations have also realized the importance of building
internal competency and capacity so as to survive and compete in this dynamic business
environment.

Ensuring employee commitment towards organizational objective has been a critical

issue faced by majority of the organization. Organizations are doing their best in
understanding various factors, which could motivate the employees and make sure of the
required commitment towards organizational objective. The organizations failing to
development such framework of organizational practices will result in to high turnover of
employees which will burden organization with extra cost of hiring and training new
employees as well as non-execution of organization plans and strategies in the desired
manner and low productivity and performance.

Every organization is concerned with what should be done to achieve sustained high
levels of performance through its workforce. This means giving close attention to how
individuals can best be motivated through means such as incentives, rewards, leadership
etc. and the organization context within which they carry out the work (Armstrong,
2006)[3]. The study of motivation is concerned basically with why people behave in a
certain way. In general it can be described as the direction and persistence of action.

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It is concerned with why people choose a particular course of action in preference to

others, and why they continue with chosen action, often over a long period, and in the
face of difficulties and problems (Mullins, 2005)[1][2].

Motivation can therefore be said to be at the heart of how innovative and productive
things get done within an organization (Bloisi et al., 2003). It has been established that
motivation is concerned with the factors that influence people to behave in certain ways.
Arnold et al. (1991) established three components of motivation namely: [3]

1. Direction: what the person is trying to do

2. Effort: how hard a person is trying
3. Persistence: how long a person keeps on trying (Armstrong, 2006)
Underlying concept of motivation The underlying concept of motivation is some
driving force within individuals by which they attempt to achieve some goal in order to
fulfil some need or expectation. This concept gives rise to the basic motivational model,
which is illustrated in Figu1.1.People’s behavior is determined by what motivates them.
Their performance is a product of both ability level and motivation.

Performance = function (ability ×motivation)

1.3.Objectives of motivation function

The objective of motivation is to create conditions in which people are willing to work
with zeal, initiative, interest, and enthusiasm.

It also creates conditions in which people work with a sense of responsibility, loyalty,
discipline and with pride and confidence so that the goals of an organization are achieved
effectively

In this paper we will

 To explore effective ways of motivation practiced by organizations.

 To explore the challenges to motivation and job satisfaction.

 To understand the factors contribute towards motivation and job satisfaction creating
employee commitment.

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CHAPTER TWO

Theories of Motivation

2.1. Early Theories of Motivation

There have been number of theories on motivation explaining similar aspects of

motivation, they are as following:

2.1.1 Hierarchy of Needs Theory:-It is probably safe to say that the best-known theory
of motivation is Abraham Maslow‘s hierarchy of needs. He hypothesized that
every human being has a hierarchy of five needs:
a. Physiological need: Physiological need is lower order need which includes
hunger, thirst, shelter, sex, and other bodily needs. They are the lowest level in
Maslow‘s hierarchy. Individuals concentrate on satisfying these needs before
turning to higher order needs. Lower order needs are satisfied externally, through
forces outside of the person. Leaders should understand that, to the extent
employees are motivated by physiological needs, their concerns do not center on
the work they are doing. They will accept any job that meets those needs. Leaders
who focus on physiological needs in trying to motivate subordinates assume that
individuals work primarily for money.
b. Safety need: Safety needs are also lower order needs which include security and
protection from physical and emotional harm. Like physiological needs,
unsatisfied safety needs cause individuals to be preoccupied with satisfying them.
Individuals who are motivated primarily by security needs value their jobs mainly
as defenses against the loss of basic needs satisfaction. During the recent
worldwide economic recession, many individuals felt that their security needs
were threatened because of plant closings, permanent reductions in their
company‘s workforce, and the outsourcing of many jobs to foreign lands.
Privatization of many previously public owned firms in Ethiopia threatened many
employees employment security. Psychological safety is also important. By
offering health, life, and disability insurance, organizations promote their
partners‘sense of security and well-being.

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c. Social need: social needs are upper order needs which include affection,
belongingness, acceptance, and friendship. When physiological and security
needs have been satisfied, affiliation needs emerge. Upper order needs are
satisfied internally, that is, from within the person. Leaders should realize that
when affiliation needs are the primary source of motivation, individuals value
their work as an opportunity for finding and establishing warm and friendly
interpersonal relationships. Team leaders who believe that employees are striving
primarily to satisfy these needs are likely to act supportively. They emphasize
employee acceptance by coworkers, extracurricular activities, and team-based
norms.
d. Esteem need: Esteem needs are upper order needs which include internal
(self-respect, autonomy, and achievement) and external (status, recognition, and
attention) esteem factors. The desires for feelings of achievement, self-worth, and
recognition or respect are all esteem needs. Individuals with esteem needs want
others to accept them for what they are and to perceive them as competent and
able. Leaders who focus on esteem needs try to motivate employees with public
rewards and recognition for achievements. Such leaders may use lapel pins,
articles in the company paper, achievement lists on the bulletin board, and the like
to foster employees‘pride in their work.
e. Self-actualization: Self-actualization needs involve individuals realizing their
full potential and becoming all that they can become. Individuals who strive for
self-actualization seek to increase their problem-solving abilities. Leaders who
emphasize self-actualization may involve employees in designing jobs, make
special assignments that capitalize on employees‘unique skills, or give employee
teams leeway in planning and implementing their work. The self-employed often
have strong self-actualization needs

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Figure 1: Maslow’s hierarchy of need (source: Wikipedia)

2.1.2 Theory X and Theory Y.

Douglas McGregor proposed two distinct views of human beings: one basically negative,
labeled Theory X, and the other basically positive, labeled Theory Y. After viewing the
way in which managers dealt with employees, McGregor concluded that a manager‘s
view of the nature of human beings is based on a certain grouping of assumptions and
that he or she tends to mold his or her behavior toward subordinates according to these
assumptions. Under Theory X, the four assumptions held by managers are:

1. Employees inherently dislike work and, whenever possible, will attempt to avoid
it.
2. Since employees dislike work, they must be coerced, controlled, or threatened
with punishment to achieve goals.
3. Employees will avoid responsibilities and seek formal direction whenever
possible.
4. Most workers place security above all other factors associated with work and will
display little ambition.

In contrast to these negative views about the nature of human beings, McGregor listed the
four positive assumptions that he called Theory Y:

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1. Employees can view work as being as natural as rest or play.

2. People will exercise self-direction and self-control if they are committed to the
objectives.
3. The average person can learn to accept, even seek, responsibility.
4. The ability to make innovative decisions is widely dispersed throughout the
population and is not necessarily the sole province of those in management
positions.

What are the motivational implications if you accept McGregor‘s analysis? The answer is
best expressed in the framework presented by Maslow. Theory X assumes that lower-
order needs dominate individuals.

Theory Y assumes that higher-order needs dominate individuals. McGregor himself held
to the belief that Theory Y assumptions were more valid than Theory X. Therefore, he
proposed such ideas as participative decision making, responsible and challenging jobs,
and good group relations as approaches that would maximize an employee‘s job
motivation.

Unfortunately, there is no evidence to confirm that either set of assumptions is valid or

that accepting Theory Y assumptions and altering one‘s actions accordingly will lead to
more motivated workers.

2.1.3 Hygien Theory of Motivation.

The motivation-hygiene theory was proposed by psychologist Frederick Herzberg.

Herzberg investigated the question What do people want from their jobs? in an effort to
determine what might lead to a person‘s success or failure at work. He found that
intrinsic factors such as achievement, recognition, the work itself, responsibility,
advancement, and growth seem to be related to job satisfaction. Herzberg also found that
there were characteristics that led to job dissatisfaction. The factors that caused
dissatisfaction were extrinsic such as company policy and administration, supervision,
interpersonal relations, and working conditions.

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Motivator factors include the work itself, recognition, advancement, and responsibility.
These factors are related to an individual‘s positive feelings about the job and to the
content of the job itself. These positive feelings, in turn, are associated with the
individual‘s experiences of achievement, recognition, and responsibility. They reflect
lasting rather than temporary achievement in the work setting. In other words, motivators
are intrinsic factors, which are directly related to the job and are largely internal to the
individual. The organization‘s policies may have only an indirect impact on them. But, by
defining exceptional performance, for example, an organization may enable individuals
to feel that they have performed their tasks exceptionally well.

Hygiene factors include company policy and administration, technical supervision,

salary, fringe benefits, working conditions, job security, and interpersonal relations.
These factors are associated with an individual‘s negative feelings about the job and are
related to the environment in which the job is performed. Hygiene factors are extrinsic
factors, or factors external to the job. They serve as rewards for high performance only if
the organization recognizes high performance. Save Mart Supermarkets rewarded three
employees with a Dodge Challenger car for their excellence in customer service. It
believes that giving employees rewards, such as cars, cruises, and consumer electronics,
motivates them to drive for service excellence. Do you agree with these types of rewards
for motivating employees? Can you identify the hygiene factors used by Starbucks to
attract new employees? It is important to note that those factors that lead to job
satisfaction are not the same as those factors that lead to job dissatisfaction. Job security,
benefits, and feeling safe cannot increase employee job satisfaction, but if these are not
present, they can lead to job dissatisfaction.

Herzberg‘s research led him to conclude that the opposite of satisfaction is not
dissatisfaction as was traditionally believed. Removing dissatisfying characteristics from
a job does not necessarily make the job satisfying. As illustrated in Exhibit 4-2, Herzberg
proposes a dual continuum: the opposite of Satisfaction‖ is No Satisfaction,‖ and the
opposite of dissatisfaction is no dissatisfaction. Herzberg explained that the factors
leading to job satisfaction were motivators that are separate and distinct from the hygiene
factors that lead to job dissatisfaction. Thus managers who try to get rid of factors that

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create job dissatisfaction can create more pleasant workplaces, but not necessarily more
motivated ones. Hygiene factors include company policy and administration, supervision,
interpersonal relations, working conditions, and salary. When these factors are adequate,
people will not be dissatisfied; however, neither will they be satisfied. Motivating factors
include achievement, recognition, the work itself, responsibility, and growth. These are
the characteristics that people find intrinsically rewarding or motivating.

Figure 2:Herzberg’s two-factor theory (source: Wikipedia)

2.2. Contemporary Theories of Motivation

2.2.1. ERG Theory

Clayton Alderfer has reworked Maslow‘s hierarchy of needs to align it more closely
with the empirical research. His revised need hierarchy is called ERG theory. Alderfer
argues that there are three groups of core needs existence, relatedness, and growth
hence, the name: ERG theory. The existence group is concerned with our basic
material existence requirements. They include the items that Maslow considered to be
physiological and safety needs. The relatedness group is concerned with our desire for
maintaining important interpersonal relationships. These social and status desires
require interaction with others if they are to be satisfied, and they align with Maslow‘s

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social need and the external component of Maslow‘s esteem need. Finally, the growth
group is concerned with our intrinsic desire for personal development. This group
includes the intrinsic component of Maslow‘s esteem need and the characteristics
included under self-actualization.

Aside from substituting three needs for five, how does Alderfer‘s ERG theory differ
from Maslow‘s? In contrast to the hierarchy of needs theory, the ERG theory
demonstrates that:-

1. More than one need may be working at the same time, and
2. If the gratification of a higher-level need is stifled, the desire to satisfy a
lower-level need increases. ERG theory is more consistent with our knowledge
of individual differences among people. Variables such as education, family
background, and cultural environment can alter the importance or driving force
that a group of needs holds for a particular person. Several studies have
supported ERG theory, but there is also evidence that it does not work in some
organizations. Overall, however, ERG theory represents a more valid version
of the need hierarchy.

Figure 3:ERG theory of motivation ( source: Wikipedia)

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2.2.2. MC Clellandas’ Theory of Needs

McClelland‘s theory of needs was developed by David McClelland and his associates to
help explain motivation. The theory focuses on three needs: achievement, power, and
affiliation.

They are defined as follows:

1. Need for achievement. The drive to excel, to achieve in relation to a set of

standards, to strive to succeed.
2. Need for power. The need to make others behave in a way that they would not
have behaved otherwise.
3. Need for affiliation. The desire for friendly and close interpersonal relationships.

Some people have a compelling drive to succeed. They are striving for personal
achievement rather than the rewards of success per se. They have a desire to do
something better or more efficiently than it has been done before. This drive is the
achievement need (nAch). From research into the achievement need, McClelland found
that high achievers differentiate themselves from others by their desire to do things better.
The need for power (nPow) is the desire to have impact, to be influential, and to control
others. Individuals high in nPow enjoy being ―in charge,‖ strive for influence over
others, prefer to be placed in competitive and status-oriented situations, and tend to be
more concerned with prestige and gaining influence over others than with effective
performance.

The third need isolated by McClelland is affiliation (nAff). This need has received the
least attention from researchers. Individuals with a high affiliation motive strive for
friendship, prefer cooperative situations rather than competitive ones, and desire
relationships that involve a high degree of mutual understanding.

Relying on an extensive amount of research, some reasonably well-supported

predictions can be made based on the relationship of these needs to job
performance. First, individuals with a high need to achieve prefer and will be
motivated by job situations with personal responsibility, feedback, and an

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intermediate degree of risk. Second, people with a high achievement need are
interested in how well they do personally and not in influencing others to do well.
Thus, they may not make good managers. Third, the best managers are high in
their need for power and low in their need for affiliation.

2.2.3. Goal Setting Theory

The research on goal setting by Edwin Locke and his colleague Professor Gary Latham at
the University of Toronto shows that intentions to work toward a goal are a major source
of work motivation. A goal is what an individual is trying to accomplish; it is the object
or aim of an action. Goals tell an employee what needs to be done and how much effort
will need to be expended. According to Locke, goal setting motivates in four ways Goals
direct attention.

1. Goals direct attention:-Goals indicate where individuals should direct their

efforts when they are choosing among things to do. For instance, recognizing that
an important assignment is due in a few days, goal setting may encourage you to
say no when friends invite you to a movie this evening.
2. Goals regulate effort:- Goals suggest how much effort an individual should put
into a given task. For instance, if earning a high mark in strategic management is
more important to you than earning a high mark in organizational behavior, you
will likely put more effort into studying strategic management.
3. Goals increase persistence:-Persistence represents the effort spent on a task
over time. When people keep goals in mind, they will work hard on them, even in
the face of obstacles.
4. Goals encourage the development of strategies and action plans. Once goals
are set, individuals can develop plans for achieving those goals. For instance, a
goal to become more fit may include plans to join a gym, workout with friends,
and change eating habits. In order for goals to be effective, they should be
―SMART.

SMART stands for:-

 Specific: Individuals know exactly what is to be achieved.

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 Measurable: The goals proposed can be tracked and reviewed.

 Attainable: The goals, even if difficult, are reasonable and achievable.
 Results-oriented: The goals should support the vision of the organization.
 Time-bound: The goals are to be achieved within a stated time.

Goal-setting theory is consistent with expectancy theory. The goals can be considered
the effort-performance link—in other words, the goals determine what must be done.
Feedback can be considered the performance-rewards relationship, where the
individual‘s efforts are recognized. Finally, the implication of goal setting is that the
achievement of the goals will result in intrinsic satisfaction (and may of course be
linked to external rewards).

Contingency Factors in Goal Setting: Are there any contingencies in goal-setting

theory, or can we take it as a universal truth that difficult and specific goals will
always lead to higher performance? Feedback is one of the most important factors
that influence the relationship between goals and performance. Recent research
suggests that when individuals receive negative feedback, they lower their goals, and
when they receive positive feedback, they raise their goals. Self-efficacy may explain
how feedback affects goal behavior.

Self-efficacy refers to an individual‘s belief that he or she is capable of performing a

task. The higher your self-efficacy, the more confidence you have in your ability to
succeed in a task. So, in difficult situations, we find that people with low self-efficacy
are more likely to lessen their effort or give up altogether, while those with high self-
efficacy will try harder to master the challenge.

In addition, individuals high in self-efficacy seem to respond to negative feedback

with increased effort and motivation, whereas those low in self-efficacy are likely to
lessen their effort when given negative feedback. In addition to feedback, four other
factors have been found to influence the goals-performance relationship. These are
goal commitment, adequate self-efficacy, task characteristics, and national culture.
Goal-setting theory presupposes that an individual is committed to the goal; that is, he
or she is determined not to lower or abandon the goal. This is most likely to occur

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when goals are made public, when the individual has an internal locus of control, and
when the goals are self-set rather than assigned.

Does goal setting work equally on all tasks? Research indicates that individual goal
setting does not work equally well on all tasks. The evidence suggests that goals seem
to have greater effect on performance when tasks are simple rather than complex,
well-learned rather than new, and independent rather than interdependent. On
interdependent tasks, group goals preferable. Finally, goal-setting theory is culture
bound. It assumes that employees will be reasonably independent (not too high a
score on power distance), that managers and employees will seek challenging goals
(low in uncertainty avoidance), and that performance is considered important by both
(high in performance orientation).

Our overall conclusion is that intentions—as articulated in terms of hard and specific
goals—are a potent motivating force. Under the proper conditions, they can lead to
higher performance. To a large extent, motivation theories are about rewards. The
theories suggest that individuals have needs, and will exert effort to have those needs
met. The needs theories specifically identify those needs. Goal-setting and expectancy
theories portray processes by which individuals act and then receive desirable
rewards (intrinsic or extrinsic) for their behavior.

Three additional process theories ask us to consider how individuals respond to

rewards. Equity theory suggests that individuals evaluate and interpret rewards. Fair
process goes one step further, suggesting that employees are sensitive to a variety of
fairness issues in the workplace that extend beyond the reward system but also affect
employee motivation. Cognitive evaluation theory examines how individuals respond
to the introduction of extrinsic rewards for intrinsically satisfying activities.

2.2.4. Reinforcement Theory

A counterpoint to goal-setting theory is reinforcement theory. The former is a cognitive

approach, proposing that an individual‘s purposes direct his or her actions. In
reinforcement theory, we have a behaviorist approach, which argues that reinforcement
conditions behavior.

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The two theories are clearly at odds philosophically. Reinforcement theorists’ see
behavior as environmentally caused; internal cognitive events are not matters for concern.
What controls behavior are rein forcers – any consequences that, when immediately
following a response, increase the probability that the behavior will be repeated.

Reinforcement theory ignores the inner state of the individual and concentrates solely on
what happens to a person when he or she takes some action. Because it doesn‘t concern
itself with what initiates behavior, it is not, strictly speaking, a theory of motivation.

But it does provide a powerful means of analysis of what controls behavior, and it is for
that reason that it is typically considered in discussion of motivation. A large amount of
research indicates that people will exert more effort on tasks that are reinforced than on
tasks that are not. Reinforcement is undoubtedly an important influence on work
behavior. What people do on their jobs and the amount of effort they allocate to various
tasks are affected by the consequences of their behavior. But reinforcement is not the
single explanation for differences in employee motivation. Goals, for instance, have an
impact on motivation; so too, do levels of achievement motivation, inequities in rewards,
and expectations.

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Figure 4:Reinforcement theory of motivation ( source: Wikipedia)

2.2.5. Equity Theory

Equity theory suggests that employees compare their job inputs (i.e., effort,
experience, education, competence, and creativity) and outcomes (i.e., salary levels,
raises, recognition, challenging assignments, working conditions) with those of others
and then respond so as to eliminate any inequities.. We perceive what we get from a job
situation (the outcomes mentioned above) in relation to what we put into it (the inputs
mentioned above), and then we compare our outcome-input ratio with the outcome-input
ratio of relevant others. This idea is illustrated in Figure 3.8. If we perceive our ratio to be
equal to that of the relevant others with whom we compare ourselves, a state of equity is
said to exist. We perceive our situation as fair—that justice prevails. When we see the
ratio as unequal, we experience this as inequity. Imagine that you wrote a case analysis
for your strategic management professor and spent 18hours researching and writing it up.
Your classmate spent 6 hours doing her analysis. Each of you received a mark of 75

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percent. It is likely that you would perceive this as unfair, as you worked considerably
harder (i.e., exerted more effort) than your classmate. J. Stacy Adams has proposed that
those experiencing inequity are motivated to do something to correct it. Thus, you might
be inclined to spend considerably less time on your next assignment for your strategic
management professor. Bear in mind that being treated equitably is not the same as being
treated equally.

Equity theory tells us that people who perform better should observe that they are
rewarded better than those who do not perform as well. Thus poor performers should also
observe that they receive lesser rewards than those who perform at a higher level. Paying
equally would mean that everyone is paid the same, regardless of performance. Equity
theory has generally been supported, with a few minor qualifications. First, inequities
created by overpayment do not seem to have a significant impact on behavior in most
work situations. Apparently, people have a great deal more tolerance of overpayment
inequities than of underpayment inequities, or are better able to rationalize them. Second,
not all people are equity sensitive. For example, some employees simply do not worry
about how their rewards compare with those of others. Predictions from equity theory are
unlikely to be very accurate with these individuals.

It is important to note that while most research on equity theory has focused on
pay, employees seem to look for equity in the distribution of other organizational
rewards. For instance, it has been shown that the use of high-status job titles, as well as
large and lavishly furnished offices, may function as desirable outcomes for some
employees in their equity equations. Equity theory demonstrates that, for most
employees, motivation is influenced significantly by relative rewards, as well as by
absolute rewards. However, some key issues are still unclear. For instance, how do
employees handle conflicting equity signals, such as when unions point to other
employee groups who are substantially better off, while management argues how much
things have improved? How do employees define inputs and outcomes? How do they
combine and weigh their inputs and outcomes to arrive at totals? Despite these problems,
equity theory continues to offer some important insights into employee motivation.

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Figure 5:Equity theory of motivation ( source: Wikipedia)

2.2.6. Expectancy Theory

Currently, one of the most widely accepted explanations of motivation is Victor Vroom‘s
expectancy theory.

Expectancy theory is a theory that states that individuals are motivated based upon their
evaluation of whether their effort will lead to good performance, whether good
performance will be followed by a given outcome, and whether that outcome is attractive
to them. From a practical perspective, expectancy theory says that an employee will be
motivated to exert a high level of effort when he or she believes the following:

 That the effort will lead to good performance

 That good performance will lead to organizational rewards, such as a bonus, a
salary increase, or a promotion
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 That the rewards will satisfy his or her personal goals

The theory, therefore, focuses on the three relationships (expectancy, instrumentality, and
valence) as illustrated in Figure 3.5 below. Simply stated, expectancy theory argues that
the strength of a tendency to act in a certain way depends on the strength of an
expectation that the act will be followed by a given outcome and on the attractiveness of
that outcome to the individual. Therefore, it included these three variables:

1. Attractiveness – the importance the individual places on the potential outcome

or reward that can be achieved on the job. This variable considers the unsatisfied
need of the individual.
2. Performance/reward linkage – the degree to which the individual believes that
performing at a particular level will lead to the attainment of a desired outcome.
3. Effort/performance linkage – the probability perceived by the individual that
exerting a given amount of effort will lead to performance.

Effort-Performance Relationship: The effort-performance relationship is commonly

called expectancy. It refers to the individual‘s perception of how probable it is that
exerting a given amount of effort will lead to good performance. For example, employees
are sometimes asked to perform tasks for which they do not have suitable skills or
training. When that is the case, they will be less motivated to try hard, because they
already believe that they will not be able to accomplish what they are being asked to do.
Expectancy can be expressed as a probability, and ranges from 0 to 1. In general, an
employee‘s expectancy is influenced by self-esteem, previous success, help from
supervisors and subordinates, information, and proper materials and equipment.

Performance-Rewards Relationship: The performance-rewards relationship is

commonly called instrumentality. It refers to the individual‘s perception of whether
performing at a particular level will lead to the attainment of a desired outcome. In
particular, will the performance be acknowledged by those who have the power to
allocate rewards? Instrumentality ranges from –1 to +1. A negative instrumentality
indicates that high performance reduces the chances of getting the desired outcome. An

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instrumentality of 0 indicates that there is no relationship between performance and

receiving the desired outcome.

Rewards–Personal Goals Relationship: The rewards–personal goals relationship is

commonly called valence. It refers to the degree to which organizational rewards satisfy
an individual‘s personal goals or needs and the attractiveness of those potential rewards
for the individual. Unfortunately, many managers are limited in the reward they can
distribute, which makes it difficult to personalize rewards. Moreover, some managers
incorrectly assume that all employees want the same thing. They overlook the
motivational effects of differentiating rewards. In either case, employee motivation may
be lower because the specific need the employee has is not being met through the reward
structure. Valence ranges from –1 (very undesirable reward) to +1 (very desirable
reward).

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Table 1 :Summary of motivat

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Table 2: Continued

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Table 3: continue

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CHAPTER THREE

Motivation Terms and Key Concepts

1. Importance of motivation
Organizations are in deep need of motivated employees, as it is being understood that
motivation affects which helps to achieve following organizational objectives:
(a) High level of performance: It is the duty of every manager to ensure that the
employees have a high degree of motivation. He should offer monetary and non-
monetary incentives. Highly motivated workers would be regular for work, and have a
sense of belonging for the organization. Quality of product will be improved, wastage
will be minimum and there will be increase in productivity, and performance level will be
high.
(b) Low employee turnover and absenteeism. Employee turnover and
absenteeism is caused due to low level of motivation on the part of managers. When
dissatisfaction is increased, employees do not enjoy the work assigned to them.
Therefore, there is a tendency of absenteeism. The workers hunt for an alternative job and
leave the organization whenever they get an opportunity. High level of absenteeism
causes low level of production, wastages, poor quality and disruption in production
schedules. Increased turnover is disastrous for any organization as it puts strain on
financial position of the organization due to additional recruitment, selection, training and
development. Motivation is therefore a very important management tool to achieve
organizational excellence.
(c) Acceptance of organization change. Management must continuously scan
the external and the internal environment. There has been a great impact of. Social
change and technology evolution on the motivation level of employees. Social change
increases aspirations of workers and put an additional demand on the organization, which
must be considered positively so that conducing working environment is created.
Technical innovation, better working conditions, better R & D facilities, encouragement
to employees and existence of better personal policies should be part of any organization.
This will facilitate retention of employees. Management must ensure that the changes are
introduced in the organization and its benefits explained to the employees so that there is

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no resistance to change and organizational growth is achieved. Re-engineering,

empowerment, job enrichment, job rotation, introduction of new technology and
processes will go a long way to boost employee morale and achieve high degree of
motivation.
(d) Organizational image: Employees are the mirrors of any organization.
Managers must lay down high performance standards coupled with high monetary and
nonmonetary rewards. Training & development programmers should be regularly
organized and employee skill improved. It will have a positive impact on the employees
and the image of the organization will be improved. It will also reduce employee turnover
and better employee will look forward to join the organization. High organizational
image will contribute towards brand image of the product and services the organization.
Motivation will therefore create the following important features of successful
organization:
 Unified direction of the group/Teams
 Higher level of effectiveness and efficiency
 Elevated organizational commitment
 Optimum use of resources
 Building a performance oriented environment (Creative & Innovative)
 Increases organization ability to face uncertain business challenges
 Employee retention and attraction for stable and continuous manpower supply

2. Process of Motivation:
It involves four steps:
Motive: It indicates the inner state of mind that energizes, activates or moves a person
and directs his behavior towards goals.
Behavior: Behavior is the sum of various activities and attitudes of a person
Goals: Motives generally create a state of disequilibrium physiological or psychological
imbalances within the individual. Attaining the goal restores this balance.
Feedback: the system of feedback is important to understand and analyze the motives,
behavior, goals and incentives for motivation

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3. Classifications of motivation
Motivation can be classified as intrinsic and extrinsic motivation. Intrinsic or internal
motivation and extrinsic or external motivation. The two motivations differ in the source
of pressure or pleasure that boosts each of them. Amabile (1993) elaborates further, by
saying the followings:

Individuals are intrinsically motivated when they seek enjoyment, interest,

satisfaction of curiosity, self-expression, or personal challenge in the work. Individuals
are extrinsically motivated when they engage in the work in order to obtain some goal
that is apart from the work itself (Amabile 1993, 185-201.)

a. Intrinsic motivation

This type of motivation comes out from an individual pleasure or interest in the
task and it does not involve working on activities for the sake of external rewards, it
instead necessitates the feeling of inner pleasure in the activity itself. It can be seen as a
force that involves doing activities without external incentive. According to Amabile
(1993), individuals are intrinsically motivated when they seek enjoyment, interest,
satisfaction of curiosity, self-expression, or personal challenge in the work (Amabile
1993, 185-201).

b. Extrinsic motivation

It is the opposite of intrinsic motivation, it regards the carrying out of an action in

order to achieve an external rewards. The source of extrinsic motivation is from an
individual physical environment.

More job benefits, bigger salary, incentives and job promotion are some rewards
that leads to extrinsic motivation. (Deci 1972, 217-229) describes extrinsic motivation as
money and verbal reward, mediated outside of a person, on the other hand intrinsic
motivation is mediated inside the person. A person can be intrinsically motivated to do a
task if there is no clear reward for the task done except the task itself or the feelings
which upshot from the task. Amabile (1993) argues that employees can either be

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intrinsically or extrinsically motivated or even both. (Amabile 1993, 185-201) It is

obvious that intrinsic and extrinsic motivators apply differently to persons.

Vroom (1964) indicates that some employees concentrate on intrinsic outcomes

while others are centered on extrinsic 7 outcome. According to Story et al. (2009),
individuals high in intrinsic motivation seem to prefer challenging cognitive tasks and
can self-regulate their behaviors, so, offering rewards, settling external goals or
deadlines, will do little for them, unless they are also high in extrinsic motivation.

For employees that are high in intrinsic motivation, emphasis could be placed on
the engaging nature of the task and encouragement of self-set goals and deadlines (Story
et al 2009). Furnham et al (1998) argue that introverts are more extrinsically motivated
and extraverts are more intrinsically motivated. However, it does not only seems that
persons are differently motivated but intrinsic and extrinsic motivation have effect on
each other. (Story et al 2009, 391-395)

4. The relationship between Intrinsic and Extrinsic Motivation

The difference between intrinsic and extrinsic motivation is apparent, yet
researchers argues that intrinsic and extrinsic motivation also have an effect on each
other. Deci (1972) claims that in some cases extrinsic motivation can minify intrinsic
motivation. He argues that if money is administered contingently, it minifies intrinsic
motivation.

But this event will not occur if the money is non-contingently distributed.
Amabile (1993) respond to this discussion by stating that although extrinsic motivation
can work in opposition to intrinsic motivation, it can also have a reinforcing effect: ”once
the scaffolding of extrinsic motivation is taken care of, intrinsic motivation can lead to
high levels of satisfaction and performance”. She went further to state in her research that
both intrinsic and extrinsic values can motivate employees to do their respective work,
however intrinsic and extrinsic motivation can have very different effects on employees.
(Amabile 1993, 185-201) In conclusion, it can be stated that employees can be
intrinsically and or extrinsically motivated to carry out certain work (Amabile, 1993), and
that extrinsic and intrinsic motivation can reinforce each other, but in some cases

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extrinsic motivators can also minify intrinsic motivation (Deci 1972, 14-23). Moreover,
researchers, argue that not all people are evenly motivated, some employees are more
intrinsically and others are more extrinsically motivated (Furnham et al 1998, 1035-
1043).

5. Worker’s Performance
This is the extent to which workers carry out an assignment or task. It refers to
the degree of accomplishment of the task that makes up an employee’s job (Cascio,
1992). Based on Wager and Hollenbeck (1992) performance for them is getting more
out of what you put in. this means doing better than what you have done before.
Worker’s performance is the price of evaluating the employees in the work place. In
appraising the employee, their progress performance, results or personality are
rewarded and assessed by their employer (Suh, 2003).

Based on Tabah (2012) worker’s performance is a very sensitive concept

which ought to be well understood. It is concerned with how people perform, why
they perform, how their performance affects the organization as a whole. Worker’s
performance helps us to understand some of the complexities in the behaviour of the
worker as well as the organization as a whole. That notwithstanding, worker’s
performance here was measured by looking at the worker’s productivity.

6. Productivity
Productivity in general has been defined in the Cambridge International and
Oxford Advance Learner’s dictionaries as the rate at which goods are produced with
reference to number of people and amount of materials necessary to produced it. On
the other hand, productivity has been defined as the utilization of resources in
producing a product or services (Gaissey, 1993). It has further been defined as the
ratio of the output (good and services) and input (Labour, capital or management). The
definition of productivity is utilized by economists at the industrial level to determine
the economy’s health, trends and growth rate whiles at the project level, it applies to
areas of planning, cost estimating, accounting and cost control (Mojahed, 2005).

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This has been given a mathematical expression as follows: Productivity = Output

Input (Heizer and Render, 1999) Clearly, it can be seen from the mathematical
expression that productivity will increase when output increase with input being
constant or decreasing input with output constant. The United States for almost
100years, was able to increase productivity at an average rate of 2.5% per annum and
that doubled their wealth every 30years (Heizer and Render, 1999).

Productivity improvement can be realized if the following factors can be

accomplished. (i) Faster set-up of machine tools (ii) Better quality control (iii) More
flexible in changing product specification. (iv) Proper material handling. Surely, there
exist a positive correlation between productivity and some variables namely: Labour;
Material; Capital; and Management. Total factor productivity gives a more general
definition of productivity and it takes into consideration the combination of various
input factors and is measured (Haas et al, 1998).

Motivation is key of successful organization to maintain the continuity of the

work in a powerful manner and help organizations to survive.
Performance Management a process which contributes to the effective
management of individuals and teams in order to achieve high level of
organizational performance, as such, it establishes shared understanding about
what is to be achieved and approach to leading and developing people which
ensure that it is achieved (Armstrong and Baron 2004).
Human Resource Management as distinct approach to managing the
workforce and argues that, although personnel management will also select and
training that matters and should be linked to high performance and
commitment rather than compliance (Guest 1997)
Employees Feedback is to know opinions of employee about things which
happened or not happen in organization. (Internet).
Intrinsic Motivation come from a person’s internal desire to do something,
motivated by such things as interest, challenge, and personal satisfaction (Mc
Gregor2004).
Extrinsic Motivators come from outside the person and include such things as
pay, bonuses, and other tangible rewards (Mc Gregor2004).
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Total Rewards is a strategy which recognize that pay, although important, is

not the only motivator, and that there are other tangible and non-tangible
rewards that can encourage amore committed work force (according to the
CIPD 2004a)

7. How employee motivation affects employees’ performance

The extent in which employees are motivated in their work depends on how well those
employees are able to produce in their job. Motivation is expected to have a positive
effect on quality performance; employees who are characterized by a high level of
motivation show a higher work and life satisfaction. Having a high level of motivation is
therefore in itself valuable for employees and a decrease in motivation might affect
employee’s performance.
The motivation leads to high level of initiative and creativity from the employee
and where monitoring is difficult, motivation is therefore extremely important for
ensuring high quality performance.
There are assessment tools which help to understand what makes a particular
employee tick. But better still is a manager who invests time in getting to know his or her
staff. This means they understand the different personalities and can figure out their
behaviors.
Tools that employers have in order to improve motivation

 Reward: Receiving a bonus or raise can be all the incentive some need to work harder.
But reward can take many different forms and could be something as simple as incentive
pay or paid time off, gift vouchers or prizes for hitting targets, travel perks or health
benefits.

 Trust: Employees want to know you have their best interests at heart while employers
want to know they can trust employees to do a job well. Building a culture around trust
creates a positive atmosphere which motivates your staff and benefits productivity.

 Recognition: It’s simple but recognizing an employee’s hard work can have a tremendous
impact. It can also spur them on to achieve more. Recognition can take many forms from
an informal “thank you” or Kudos to a glitzier employee of the month or year award.

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 Career advancement: One study found that the number one reason for employees leaving
their jobs was career development. It makes sense - employees want to use their skills.
They also want to learn new skills. If your company doesn’t offer a clear career
development path, they may leave. And if they don’t leave, they’ll be far from productive.

 Purpose: Organizational is a strong motivator for many workers – especially younger

employees. Engaging your staff with your business’s purpose can help increase
commitment to your business and improve motivation.

8. Relating Rewards with motivations and performances

In corporate world, reward system is considered to be critical for high level
performance as it helps to maximize performance and also helps to retain high
performers. In fact, reward system and strategies lie at the foundation of attracting,
retaining, and inspiring skilled, competent, and capable staff that can contribute to the
prosperity of the company. The importance of high performers is reflected by the fact that
human resource is considered to be a unique and inimitable resource that has ability to
provide long term competitive advantage. Thus if a company is able to attract talented
and high performing employees and also succeeds to retain them and keep them loyal to
the company then in long term the company maintains a competitive advantage over its
competitors (Liu and Tang, 2011).
According to Fareed and associates (2013), the relationship and connection between
rewards, employee motivation, is critical to the success of an organization either public or
private sector.

9. Challenges to motivation
It is altogether not very easy for an organization to create a motivated and committed
environment, following are a few challenges faced:
 Dynamic and competitive business environment
 Ignorance and less understanding of importance motivation on the part of
management
 Non commitment of organization towards employee expectation, a narrow
mindset

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 Non – competitive organizational structure and people policies and practices

 Less understanding of the employee expectations
 Existing performance management system
 The vague organizational expectation from employees
 Competitive employee market, creating high mobility of employees

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CHAPTER FOUR

Conclusion and Recommendations

1. Conclusion

Most of the researches have concluded that motivated employees have positive effect on
the organization productivity and performance. This makes motivation as the most
important aspect of any organizational setup and creating an environment, which
facilitates and supports employee to perform optimally. Today’s business organization
requires organizations to be more creative and innovative which cannot happen without
having a committed and loyal employee base.
The success of every business depends upon many factors but the most important
factor that affects the business is its employees. If the employees of a business are
motivated towards organizational objective, the business can achieve its goals very
easily. The job of any manager in an organization is to get things done through its
employee and for this the manager should be able to motivate employees.
Motivation is a very important aspect of any work place, if the employees are not
motivated then there is no job satisfaction and this leads to reduced productivity.
Employee motivation strategy is different for different organizations and for different
employees, also could be one important factor allowing employees to decide whether to
stay or leave the organization. Motivation practice and theory are different and difficult
subjects touching every area of any organization. The topic of employee motivation is not
properly understood and poorly practiced by many organizations; as a result there is
increase in employees leaving the organization in search of better places to work. Human
nature is very complex and to understand the motivating factor of every employee is a
difficult task.

Therefore, an effective leadership and management is required to appreciate

employees. Employee motivation requires research and study of human nature and
involves a well-defined approach to deal with human beings. Observations and research
in this field has proved that well motivated employees are more productive and creative.

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2. Recommendation

Employees will do only if you want them to do or otherwise if you motivate them to do.
Motivation is a skill, which must be learnt and practiced for any business to survive and
succeed. In addition the fact that employee motivation is directly linked with business
profits makes it all the more important to keep employees encouraged and in high spirits.
Human capital is the most asset of any organization. Today’s organization also faces a
big challenge of retention as well as attraction of new talent in the organization, and
motivational strategies could be one important contributors to organizational success in
long-term.

 The first thing organization need to understand is that motivation is a process

which is effective if continuous in nature and the same is to be made known to
the top and middle level management
 The organization will have to understand and clear any thoughts otherwise
could hinder the process of motivation like; Money is only thing that can
motivate employees, fear could be used to achieve results, at the same time
organizations need to understand that increased Job satisfaction does not
means increased job performance.
 Organizations will have to design strategies in alignment with corporate goals
and objectives and the same to be conveyed to the employees and allow them
to know their contribution in achievement of the same.
 The key to motivating employees is to have a clear understanding of employee
expectation and also understand what motivate the employees individually
and collective groups.
 Organizations will have to involve employees in goal setting and decision
making; this will increase employee participation and give a sense of
responsibility in achievement of organizational goals and objective.
 Organizations have to develop performance management system which
effectively rewards, recognizing and appreciating positively and consistently.

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 Organization will have to create career development and advancement

opportunities to the employees. An environment promoting team spirit,
knowledge sharing and employee engagement to allow employees identify
themselves with the organization.
 Organization has to design and frame organizational structure and processes
such as training and development, performance management, compensation
and rewards etc which supports and facilitate work and helps creating a
motivated and committed environment in the organization.

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Reference:
Dr.Chandrakant Varma, “Importance Of Employee Motivation & Job Satisfaction For
Organizational Performance” University Of Mumbai.

Obiekwe Nduka “Employee Motivation And Performance”,Thesis, Centeria university of

applied sciences.
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December, 2014; Accepted 20 May, 2015

Burleson, B, and Steiner, “Human Behaviours”, New York, Harcourt Brace and
Jovanovich, 1964.

V.G. KONDALKAR, (6th November, 2006) ”Organizational behavior” published by

New Age International (P) Ltd., Publishers.

Adams, J. S. (1965). Inequity of social exchanges advances in experimental social

psychology. New York: Academic Press.

Alderfer, C. (1972). Existence, relatedness, & growth. New York: Free Press.

Herzberg, F., Mausner, B. and Snyderman, B.B., (2011). The motivation to work (Vol.
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Herzberg, F., Mausner, B. and Snyderman, B.B., (2011). The motivation to work (Vol.

1).Transaction publishers

Maslow, Abraham H. 1954, Motivation and Personality, 2nd edition. Harper & Row, 369

Dr.Chandrakant Varma, february (2017), “Importance of Employee Motivation & Job

Satisfaction for Organizational Performanc”, International Journal of Social Science &
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