1101IBA Lecture Notes - Lecture 9: Equity Theory, Merit Pay, Operant Conditioning
30 May 2018
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Week 9 Management Concepts
Motivation and Rewards
What is Motivation?
• Motivation
o Forces within the individual that account for the level, direction and
persistence of effort expended at work
• A reward is a work outcome of positive value to the individual
o Extrinsic rewards are externally administered. They are valued outcomes
given to someone by another person
o Intrinsic rewards are self-administered (the feelings of competency, personal
development and self-control people experience in their work)
Theories of motivation
• Content theories of motivation helps us to understand human needs
• Process theories of motivation offer additional insights into how people give
meaning to rewards
• Reinforcement theory of motivation focuses attention on the environment as a
major source of rewards
Content theories of motivation
• Needs
o The unfulfilled physiological or psychological desires of an individual
• All people have needs. They engage in behaviors to obtain extrinsic and intrinsic
rewards to satisfy these needs
• Needs cause tensions that influence attitudes and behaviors
Maslos hieah of eeds theo
• Lower order needs: physiological, safety and social concerns
• Higher order needs: Esteem and self-actualization concerns
• The deficit principle states that a satisfied need is not a motivator. People are
expected to act in ways that satisfy deprived needs
• The progression principle states that a need at one level does not become activated
until the next need is already satisfied. People advance through the hierarchy step-
by-step
Theories of motivation
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ERG Theory
• The eistee, elatedess ad goth E‘G theo ollapses Maslos fie eeds
categories into three
o Existence needs are desires for physiological and material wellbeing
o Relatedness needs are desires for satisfying interpersonal relationships
o Growth needs are desires for continued psychological growth and
development
• Does not assume that lower level needs must be satisfied to activate higher level
needs
Hezegs to-factor theory
• Satisfier factors are found in job content, such as a sense of achievement,
recognition, responsibility, advancement and personal growth
• Hygiene factors are found in the job context, such as working conditions,
interpersonal relations, organisation policies and salary
• Improving hygiene factors can make people less dissatisfied with these aspects of
work, but do not in themselves increase satisfaction
Acquired needs theory
• Need for achievement (nAch) is the desire to do something better or more
efficiently, to solve problems, or to master complex tasks
• Need for power (nPower) is the desire to control other people, to influence their
behavior, or to be responsible for them
• Need for affiliation (nAff) is the desire to establish and maintain friendly and warm
relations with other people
• McClelland identifies two forms of power need:
o Need fo pesoal poe
▪ Exploitative and involves manipulation for the pure sake of personal
gratification
o Need fo soial poe
▪ Uses power in a socially responsible way, directed towards group or
organisational objectives rather than personal ones. This need for
social power is essential to managerial leadership
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