Understanding Theories And Their Application Business Essay

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Latham, G. P., & Pinder (2005) describe motivation particularly at work to be the set of energetic forces that are both within and beyond an employee's being, to initiate and determine the form, direction and intensity of work related behaviour. Thus, motivation is a psychological process due from to an interaction between the employee and the environment.

Human capital is the most important asset of an organization. Thus managing their performance is critical to any organisations sustenance.

According to Moorhead and Griffin, job performance depends on three main factors: Motivation, Ability and Environment. Deficiency in any one of these factors will result in a sub optimal level of job performance. Thus it is imperative for managers to ensure that these three conditions are met.

In this era of globalisation, managers need to understand the motivations of a diverse workforce, and be creative in building the right incentives to retain talented staff. (Nicholson & Nairn 2006). The knowledge acquired from this study of different types of theories helps them take 'constructive steps' to improve their employees' work performance.

Theories when applied in practical will need to be tweaked depending on various factors. We will take a look at such applications going forward. Even after understanding these theories there are a lot of operational procedures managers need to understand to improve employee performance.

The theories on motivation can be broadly grouped into need based and process motivational theories. (Griffin & Moorhead 1992)

In this essay we will focus on the importance of a few of need based theories by delving into the real life case studies of how motivational theories were put in practise and eventually led to significant business benefits.

Understanding theories and their application

It is very likely that a single theory when applied may not result in motivated behaviour. A single model may not be been able to cater to all the 'complexities of the internal and external influences' on human motivation and performance. (Elding 2005) (Wilkinson, Orth, & Benfari 1986)

But Iguisi (2009) states that managers need to build their strategy for motivating employees by first selecting a motivation theoris as a reference point. When the Hertzberg's theory is followed, management should begin by focusing on earnings and job security (hygiene factors) before focusing on interesting work and full appreciation of work done (motivator factors). If Vroom's theory is used, management should begin by building challenging tasks for the employees in line with the organizational goals and objectives. While Hofstede's work-goal theory when applied shifts the focus to advancement to higher level jobs, earnings, and security of employment for employee productivity. But what motivates employees differs from organisation to organisation and from country to country given the context in which the employee works. (Iguisi 2009)

Managerial processes and styles should integrate societal and cultural needs with motivation theories and place priority on certain elements of models. Literature lays stress on application of such models to be specific to cultures for effective implementation. (Jelavic & Ogilvie 2009 ) (Iguisi O 2009)

Maslows Hierachy of Needs proposes that human motives fall into a hierarchy of categories. The most basic level of need is food, air and basic necessities, which is further followed by safety needs and social needs of affiliation. The highest stages are the need for esteem or Self-Actualisation. This theory proves to be extremely instrumental while determining rewards to motivate employees. When applied, instead of a 'one size fits all ' reward system, managers could identify the level of hierarchy and tailor rewards for individual needs. However these hierarchy levels changes with time as the employee ages. Motivational incentives of a young employee will differ from that of an older employee nearing retirement. Understanding of this hierarchy of needs ensures that managers are constantly re assessing employee needs and strategies to motivate. (Buhler 2003)

Herzberg in his proposed motivation-hygiene theory of motivation suggests that certain factors (motivator factors) lead to job satisfaction, whereas others (hygiene factors) prevent dissatisfaction but cannot engender satisfaction. (Elding 2005). This theory is essential to understand that quick fixes and use of hygiene factors to increase satisfaction will not be fruitful. Managers need to build enriched roles for more satisfaction (Buhler 2003) (Herzberg 1987)

The importance of these motivation theories for a manager can be seen in various uses of them to improve employee productivity in several countries. However, as seen in various literature and discussed above, the applications of these theories need to be are tailored as per cultural differences in countries.

The application of motivational theories can be best understood in a study by Katsva and Condrey (2005), at the facilities of the Russian Ministry of Atomic Energy (Minatom) in 1998 to explore factors of employee motivation in Russian nuclear power plants. The nature of the nuclear research industry and the cultural and political differences of Russia from the West made it difficult for western approaches to personal management to be applied to this public firm.

As per the literature, the lack of motivation and retention led to significant brain drain in this knowledge critical sector, making it critical that steps to motivate and retain talent are taken. The rate of accidents due to personal error was also pretty high. The literature identifies the underlying cause of Minatom's inability to offer competitive quality products at a lower price as a lack of motivation.

Russia, unlike the west, had a tradition of non-monetary culture. The ideological systems were more important than money in motivating people to work.

The knowledge of the content theories which focus on internal needs and drives that energize human behaviour, thus hold significance in this particular situation. The study showed that the key motivators were prestige of work and leadership. Although salary and other monetary motivators are important, they were not the primary motivators within the Russian nuclear industry.

This study aimed to the use McClelland's theory for need in achievement, power and affiliation to the Minatom case along with the Herzberg's two-factor theory. The motivators identified were achievement, recognition, responsibility, the work itself, growth, and advancement. Through use of these theories, adapted for the Russian culture the literature goes on to make relevant recommendations for the firm.

It thus, reinforces that fact that inspite of starkly contrasting Russian cultural values, 'particularly the utilitarian approach of money and wealth and the key values for the need for promotion, self-actualization, self-esteem, achievement, and recognition' , the western concepts of motivation are still applicable and relevant.

During the study of various literatures it was found that while motivational theories can suitably form the basis of understanding the key motivators of employees, there are deviations depending on the industry and its contemporary nature (Dash & Singh 2008). As per a study performed by Dash & Singh (2008), with employees in the ITES sector the results of the study mostly conformed to Hertzberg's two-factor model. The motivating factors were intrinsic work factors i.e., related to the work itself, and central to the completion of tasks while the hygiene factors are extrinsic factors. However, several new factors significant to contemporary organisations such as relationship with peers and boss, company policies, leader's maturity at work, emerged as relevant motivators and the relevance of factors such as job security, promotion significantly dropped. There was very noticeable difference was the emphasis on company policies, recognition, and relationship at work. The study indicated the major driving forces in the ITES work culture and also contemporary work culture. This study demonstrated evolving aspects of motivational theories with the changing times and the need for managers to stay abreast of these changes.


According to Thorndikes law of effect, employee behaviour is shaped by the consequences that follow the behaviour. Thus by introducing a positive consequence of behaviour or managers can create a ripple effect amongst their workers. (Buhler 2003). The knowledge of the various motivational theories gives managers an extensive bag of motivational tools to work with.

Ennelander (2013) even goes so far to suggest that identification and achievement of motivational goals should be part of a manager's performance evaluation process.

In the 21st century, managers need to continuously and proactively design systems and processes to ensure that employees can blossom and contribute effectively to an organisation. There are several other need based and process based motivational theories which can be combined to be effective in motivating the workforce. But of course, as seen in various literatures, the application of the theories requires careful consideration of cultural, organisational and individual differences.