BOH4M – Grade 12 Business Leadership – Motivation – Theory & Practice

Chapter 14: Motivation – Theory & Practice


  • Easy for corporate leaders to claim people are their most important asset
  • Proof comes in backing such a statement with actions that support it
  • Consideration of the human side of the workplace can become complex as the intricacies of psychology come into play


What is Motivation?


  • Motivation: The forces within the individual that account for the level, direction, and persistence of effort expended at work
  • Reward: A work outcome of positive value to the individual
  • Extrinsic rewards: Provided by another person (pay, bonuses, promotions, time off, verbal praise)
  • Intrinsic rewards: Self-administered and occur naturally during job performance (feelings of competency, personal development, self-control)
  • To achieve maximum motivational potential in linking rewards to performance, managers must:
  • Respect diversity and individual differences
  • Clearly understand what people want from work
  • Allocate rewards to satisfy the interests of both individuals and organization


  • Three types of motivation theories:
    1. Content theories: Help us to understand human needs and how people with different needs may respond to different work situations
    2. Process theories: Describe how people give meaning to rewards and respond with various work-related behaviors
    3. Reinforcement theory: Focuses attention on how people’s behavior is influenced by environmental consequences


Content Theories of Motivation


  • People have needs: Unfulfilled physiological and psychological desires of an individual that create tensions that influence workplace attitudes and behavior



Hierarchy of needs theory (Maslow)

  • Lower order and higher order needs affect workplace behavior and attitudes
  • Lower order needs include physiological, safety, and social needs. Desires for physical and social well being
  • Higher order needs include esteem and self-actualization needs. Desire for psychological growth and development
  • Two principles that describe how these needs affect human behaviour:
  • Deficit principle: A satisfied need is not a motivator of behavior
  • Progression principle: A need at one level does not become activated until the next lower level need is satisfied


ERG theory (Alderfer)

  • Collapses Maslow’s five needs categories into three need levels:
    • Existence: Desire for physiological and material well-being
    • Relatedness: Desire for satisfying interpersonal relationships
    • Growth: Desire for continued psychological growth and development
  • Does not assume that lower level needs must be satisfied before higher level needs, but that any/all needs can influence behavior at one time
  • Does not assume that satisfied needs lose their motivational impact
  • Frustration-regression principle: An already satisfied lower level need can become reactivated and influence behaviour when a higher level need cannot be satisfied


Two-factor theory (Herzberg)

  • Two important aspects to all jobs is job content (what people do in terms of job tasks) and job context (the work setting in which they do it)
  • Herzberg identified a pattern in people’s responses to questions concerning their work
  • Asked what “turns them on” (job satisfaction), they identified things related to job content or satisfier factors – sense of achievement, recognition, responsibility, advancement opportunity, personal growth
  • Asked what “turns them off” (job dissatisfaction), they identified things related to job context or hygiene factors – working conditions, co-worker relations, policies and rules, supervisor quality, salary
  • Improving satisfier factors increases job satisfaction
  • Improving hygiene factors decreases job dissatisfaction
  • To really improve motivation, managers need to give proper attention to satisfier factors
  • Always correct poor context to eliminate sources of job dissatisfaction
  • Build satisfier factors into job content to maximize job satisfaction


Acquired needs theory (McClelland)

  • Thematic Apperception Test (TAT) administered to people asking them to view pictures and write stories about what they see 
  • Identified three needs central to his approach to motivation:
  1. Need for Achievement (nAch): Desire to do something better or more efficiently, to solve problems, or to master complex tasks
  2. Need for Power (nPower): Desire to control other persons, to influence their behavior, or to be responsible for other people. Personal power (exploitive, manipulation for personal gain) is not successful in management; by contrast social power (use of power in a socially responsible way) is essential to managerial leadership
  3. Need for Affiliation (nAff): Desire to establish and maintain friendly and warm relations with other persons
  • Associated each of these needs with a distinct set of work preferences
  • Managers encouraged to recognize these preferences in their workers and then create responsive work environments
  • Workers high in nAch: Prefer work that involves individual responsibility, achievable but challenging goals, and provides performance feedback
  • Workers high in nPower: Prefer work that involves control over others, has an impact on people and events, and brings public recognition and attention
  • Workers high in nAff: Prefer work that involves interpersonal relationships, provides for companionship, and brings social approval
  • People with high need for affiliation alone may not make the best managers
  • Desire for social approval and friendship may interfere with decision making
  • Successful managers are likely to possess a high need for social power that is greater than their strong need for affiliation







Process theories of motivation


  • Concern themselves with how people make choices to work hard or not based on their individual preferences, available rewards and possible work outcomes


Equity theory (Adams)

  • Perceived inequity is a motivating state
  • Individuals who perceive they are being treated unfairly in comparison to others will be motivated to act in ways that reduce the perceived inequity
  • Respond by changing their work inputs (put less effort into their jobs), rewards received (ask for better treatment), comparison points (make things seem better), the situation (leave the job)
  • People behave according to their perceptions. Those who feel underpaid experience a sense of anger; those who feel overpaid often experience a sense of guilt
  • Managers should anticipate perceived negative inequities and try to manage the perceptions. Equity situations deserving special attention:
  1. Gender equity -Women should earn equal pay for equal work done by men
  2. Comparable worth – People doing jobs of similar value based on required education, training and skills should receive similar pay


Expectancy theory (Vroom)

  • Motivation to work (M) depends on the relationships between three key variables or beliefs:
  1. Expectancy (E): Working hard will result in desired level of performance
  2. Instrumentality (I): Successful performance will be followed by rewards
  3. Valence (V): Value a person assigns to rewards and work related outcomes
  • M, E, I,V are related to one another in a multiplicative fashion: M = E x I x V
  • If either E, I, or V is low, M will suffer


  • To maximize Expectancy, managers should make a person feel competent and capable of achieving desired performance level:
    • Select workers with ability
    • Train workers to use ability
    • Support work efforts
    • Clarify performance goals
  • To maximize Instrumentality, make a person feel confident in understanding which rewards and outcomes will follow performance accomplishments:
  • Communicate performance-outcome possibilities
  • Identify rewards that are contingent on performance
  • To maximize Valence, make a person understand the value of various possible rewards and work outcomes:
  • Identify individual needs
  • Adjust rewards to match individual needs


Goal-setting theory (Locke):

  • Focuses on the motivational properties of task goals: Clear and desirable performance targets issued by management to their subordinates
  • Motivational effects of goals:
  • Provide direction to people in their work
  • Clarify performance expectations
  • Establish a frame of reference for feedback
  • Provide a foundation for behavioral self-management
  • Participation is the key element in goal setting. Managers must work with others to set the right goals in the right way
  • Management by objectives (MBO), where goals are jointly established by managers and subordinates, helps promote participation
  • A positive impact on job satisfaction and performance is more likely to occur when the participation in MBO:
  • Allows for increased understanding of specific and difficult goals
  • Provides for greater acceptance of and commitment to goals
  • In settings where participation is not possible, workers will respond positively if supervisory trust and support exist


Reinforcement Theory of Motivation


  • Focuses on the impact of external environmental consequences on behavior
  • Based on Thorndike’s law of effect: Behaviour resulting in pleasant consequences is likely to be repeated; behaviour resulting in unpleasant consequences is not




Operant conditioning (Skinner)

  • Applied law of effect to control behavior by manipulating its consequences, or learning by reinforcement
  • Reinforcement strategies:
    • Positive reinforcement: Increases frequency of desirable behavior through the presentation of a pleasant consequence
    • Negative reinforcement: Increases frequency of desirable behavior through the removal of an unpleasant consequence
    • Punishment: Decreases the frequency of undesirable behavior through the presentation of an unpleasant consequence
    • Extinction: Decreases the frequency of undesirable behavior through the removal of a pleasant consequence


  • Positive reinforcement should be central to a manager’s motivational strategy
  • Successful implementation is based on:
  • Law of contingent reinforcement: For reward to have maximum reinforcement value, it must be delivered only if desired behavior is exhibited
  • Law of immediate reinforcement: The more immediate the delivery of a reward, the more reinforcement value it has
  • The power of positive reinforcement can be mobilized through shaping: Creation of a new behaviour by the positive reinforcement of successive approximations to it
  • Timing of positive reinforcement can also make a difference on impact:
  • Continuous reinforcement schedule administers a reward each time desired behaviour occurs
  • Intermittent reinforcement schedule rewards behaviour only periodically
  • Continuous reinforcement will elicit desired behaviour more quickly; behaviour acquired with intermittent reinforcement will be more permanent


  • Key ethical concerns surrounding reinforcement over both the results and ethics of controlling human behaviour to serve organizational goals
  • Opponents concerned that the use of operant conditioning principles ignores individuality, restricts freedom of choice, and ignores possibility that people can be motivated by things other than intrinsic rewards
  • Advocates argue that control is part of every manager’s job


Motivation in the New Workplace


  • Pay for performance is consistent with equity (Adams), expectancy (Vroom) and reinforcement (Skinner) theories
  • Merit pay that awards pay increase proportional to individual performance contributions is a logical extension of motivational theories, however, it does not always achieve desired results due to:
    • Lack of agreed-upon and well defined performance measures
    • Lack of consistency in applying merit pay at all levels of the organization


    • Other incentive compensation systems:
  • Pay for knowledge: Skill-based pay or pay based on the number of job-relevant skills workers master
  • Bonus pay plans: Payment based on accomplishment of specific performance targets or extraordinary contribution
  • Profit-sharing plans: Receiving a proportion of net profits earned by the organization during a given time period
  • Gain-sharing plans: Sharing in any savings realized through group’s efforts to reduce costs and increase productivity
  • Employee stock ownership plans: Stock options give the right to purchase shares at a fixed price in the future