Examining ERG Theory On Human Behavior In Organizations

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The human factor within any organization is as dynamic to the success of the organization as quality product manufacturing, service to customers or making deliveries on time. As managers go through their daily routines of running a successful business, they must consider the employees within their control to recognize how personality traits, motivation, and the organizations culture play in the current and future successes of the organization.

Maslow and ERG Theories

When talking about the ERG Theory of motivation and touching on the Maslow Theory of motivation, one first must understand the definition of motivation. There are different definitions for motivation but the one we used for the purpose of this class is "the process that account for an individual's intensity, direction, and persistence of effort toward attaining a goal" (Bethel, 2005). In the past as well as presently, managers were under the assumption that when an employee lacked motivation due to being lazy. Motivation has been viewed as a personal trait, which means some managers seem to think that some employees have what it takes to get things accomplished and some do not (Bethel, 2005).

The ERG Theory (existence, relatedness, growth) is a rework of the Maslow's need hierarchy by Clayton Alderfer from Yale University (Bethel, 2005). Both theories have similarities as well as differences on some important aspects. Although Alderfer does not disagree with Maslow's hierarchy of needs completely, he does not agree with all of them. As with any theory, you will have those who will agree as well as disagree as to which is the most applicable.

Maslow Theory

The Maslow theory is a five step process that each step has to be met before you move to the next step. The first step in the Maslow theory is the Physiological Needs; which are a person basic needs that are vital for survival. They include air, food, water, warmth, sleep, and all the things to make a person comfortable with living.

Once the first step is completed you move to the next step which is Security Needs; which is a person's need for security and safety. Security needs are not as important as physiological needs, but are important for survival. Examples of security needs are security from the elements, car insurance, and health insurance, a nest egg living in a safe neighborhood, a retirement plan, and job security. With the most important being job security. If a person has steady employment, then they can provide themselves with the things they need to make them feel safe and secure.

After completing the first two steps, physiological and security needs, one is ready to advance to the third step, Social Needs. This person has the need to feel love and affection, as well as belonging with groups. In day-to-day living one would want to belong to a community, church, get married and have a family as long as they felt needed.

The fourth step of the Maslow theory is the Esteem Need Theory, which has two versions a lower one and a higher one. The lower is for one to get the respect of others, social status, glory, achievement, and even dominance. The higher form is self respect, self achievement, independence, and freedom. These are considered "higher" because, once you have self respect it is much harder to loose.

The final step in the Maslow theory and in his opinion the most important is the Self-Actualizing Needs. This theory these people should be self-aware, mostly concerned with personal growth, "be all you can be" in fulfilling your personal growth. These are the people that want to become most complete, hence the term self-actualization.

ERG Theory

The ERG theory is a spin off of the Maslow theory by Clayton Alderfer. The ERG Theory is similar to Maslow as it also describes the needs of hierarchy. The ERG Theory takes place in three steps, which are existence, relatedness, and growth.

Existence (psychological and safety) is the lowest level need per Clayton; this is the need to stay alive and safe, now and in the future. This is the psychological and physical needs, once this is met people feel safe and comfortable.

The next level, relatedness (social and external) is the need to be social and maintaining relationships with family, peers, or fellow employees. We want to understand what people think of us, and are hurt when we feel as though we do not fit in with the group.

Growth (internal esteem and self actualization) is the last step and the most important of the three. A person has to have self-development, personal growth, and a since of accomplishment. When we are self-developed, one has a feeling of achievement, fulfillment and wholeness.


When reading both theories, one can see what the similarities and differences in each. Both theories are similar in the fact they both agree there is a need of hierarchy. They both say the bottom need is not as important as the need ranked last on the hierarchy scale. The ERG theory can be mapped to the Maslow theory "existence needs have priority over relatedness needs, which have priority over growth". www.netmba.com/mgmt/ob/motivation/erg/


The Maslow theory dictates that each need must be met in order and completed before one can move to the next level. There are five steps in the Maslow theory, compared to ERG which has combined the steps into three needs and not steps. The ERG theory says you can work on levels simultaneously. Maslow's theory could best be demonstrated by using a pyramid diagram with the lower level need physiological need on the bottom and the most important need self-actualizing need on top. Once each level is completed there is no going back to any lower level need. ERG can best be described as a flow chart where each need is met, but if circumstances change you could go back to a lower level need. When employees are satisfied there will be progression, but when an employee is frustrated there will be regression.

The ERG theory is more flexible and states that an employee can be motivated simultaneously by more than one need level. An example of this would be, if an employee had met a goal on time and which satisfied their growth need, even though their growth need had not been satisfied.

Frustration-Regression Principle

This is a process that is included in the ERG theory as an employee is having problems attaining satisfaction of a higher need. The employee becomes frustrated and regresses to the next lower need level. For example, if an employee can not meet their growth need, they will become frustrated and the will revert back to the relatedness need and this will become their source of motivation. If the growth level is too difficult for the employee to reach, they then will revert back to the lower level need that is easier to achieve. This is not what you want to see happen in the work place. Growth needs to be obtainable, if not employees become frustrated, regress back to relatedness needs and start socializing with other employees which can cause a breeding ground for dissatisfaction, gossip, and resistance. Employees may tend to talk about better working conditions, more money, or better benefits. http://www.leadershiptextbook.org/images/7/7d/Maslows_hierarchy_of_needs_vs_erg_theory.jpg

It is a manager's job to determine the needs of each of their employees to make sure they are being utilized at their highest potential. The first question a manager should ask about each employee is "what will it take to motivate this employee"? A manager has to understand the each employee will have different needs. These needs could change weekly, monthly, or even daily and a manager has to be aware of these changes. Circumstances in employee's personal life and well as professional life will have an impact on their needs changing.

The manager or supervisor, your impact on an employee's motivation is very important. The way you speak, your body language, and the look on your face are observed by your employees and this tells them what you think about them as individuals.

As a manager, working with several employees that have been with the company for twenty-five or more years, one has to understand when needs change. One also has to understand that when a person has been doing the same job for this long, they could become bored and complacent with their work. At Gerdau Ameristeel this is not the case, we as managers are responsible to assign work with goals that are attainable and a value to the company.

You as a manager will also dictate how your employees' day will start and finish. When you first have a meeting with your employees in the morning, and you come in grumpy, sleepy looking, a frown on your face, then word will get out across the floor to stay clear of the boss he is in a bad mood. This has a negative impact on the work force and has employees trying to do their work and watching out not to cross your path.

Come in and have a smile on your face and greet the employees with a happy tone and talk about the goals of the day and reassure them of your confidence in their ability of obtaining these goals and you will have a happy work place. It all starts with the manager and the employee's first impression of the day.

Organizational Culture

Possibly when most of us think about culture, we think of social, religious, or ethnic groups. Rarely do we consider the culture of organizations and the different characteristics that those groups possess that make them unique. Organizational culture could be thought of as a community. It takes the whole community working together to exists. Organizational culture defines the group, sets boundaries, creates identity, promotes the group instead of individual interests, and allows for stability of the group (Bethel College, 2004).

We need to recognize the importance of organizational culture and how it develops employees as they enter an organization. The initial entry of an individual into an organization is the process known as socialization. It is the process that adapts the employees to the organization's culture (Bethel College, 2004). There are three stages that an individual will go through when entering an organization: prearrival, encounter, metamorphosis. The prearrival stage is critical for a prospective employee to keep an open mind to the role that they will play in the organization. Everyone comes in with their own values, prior work experience, attitudes, and behaviors. Before ever joining the organization, the individual is exposed to what is to be expected of them. This process allows both to see if they would benefit from each other. Next, is the encounter stage where three things will occur: the individual will realize what is expected of them, how these things will differ from what they previously thought, let go of any preconceived ideas about the organization, roll up their sleeves and get ready to work, or recognize that they have made a mistake and will never fit in with the new organization. Finally, the metamorphosis stage is realized when the new employee has become comfortable with the job and has accepted the role that they will play in the organization.

As a manager, I have an open-door policy with the employees in my department. Allowing them to express frustrations, concerns, new ideas, customer satisfaction or dissatisfactions keeps communication flowing. This seems to be greatly appreciated among our group to encourage teamwork. We spend as much time with coworkers as our family these days and a happy group is a productive group.

The human factor within any organization is as dynamic to the success of the organization as quality product manufacturing, service to customers or making deliveries on time. Whether it is a theory or hierarchy of needs, motivation of employees with the organization or the organizational culture; we must nurture the human part within the organization to succeed.


Bethel College (2005). Human Behavior in Organizations. Boston: Pearson