Key Concerns That Face Motivation In Firms Commerce Essay

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Motivation is a key concern in firms across the globe. Managing people in organizations is considered as one of the most important challenges that managers must deal with. From a small family company to the biggest corporations human capital is the most crucial and demanding asset. Depending on the type of business entrepreneurs are trying to establish a corporation culture and at the same time are trying to differentiate from competitors. Therefore, top line managers should always deal and manage employees with a variety of needs and self-objectives. In this essay I will describe the motivation theories that have been examined the past years and try to present the importance of motivating employees and finally develop my own perspective. Although, I will deal with self-motivation and group -motivation theories I will not analyze psychological aspects of motivation. Furthermore, in this essay I will not present either group or individual performance, with leadership and controlling methods. At the first part of the main body I will give the definition of motivation then I will present theories of motivation and finally I will provide some ways that managers use to motivate their employees.

What is motivation?

As I have stated to the introduction motivation is considered as a cornerstone for managers. In this part I will provide the definition of motivation. Motivation is defined as "the intention of achieving a goal, leading to goal-directed behavior." (Moorehead 2009 p). When we refer to someone as being motivated we mean that the person is trying hard to accomplish a certain task and meet the target that has been set by his supervisor. Motivation is clearly important for someone to perform well although motivation alone is not sufficient. Thus, motivation is important but for managers ability is weighted as of major importance also. By referring to ability of managers in motivation, experts mean the skills and knowledge required to perform the job effectively. (Hunt 2004 p 103) Besides the ability of managers to motivate, also important are considered the environmental factors. By mentioning environmental factors experts describe the resources, information, and support that one needs to perform well and determine performance. (Blader 2007, 112-114) Consequently and according to the literature reviewed motivation is important for organizations and managers but must be accompanied with the ability and the environmental factors. From my point of view, I believe that effective communication and intrapersonal relations are also important in order to motivate employees at the right time by respecting individuality.

Theories of Motivation

At previous paragraph I presented the definition of motivation, ability and the impact of environmental factors, adding my point of view about effective communication and intrapersonal skills and the respect of individuality based on my working experience within a multinational company. On the paragraph below I will provide and analyze the theories of motivation and their application. The theories of motivation are divided into three broad categories, a) reinforcement theory b) content theory and c) process theory.

A) Reinforcement theories emphasize to the means through which the process of controlling individual's behavior by manipulating consequences. They focus on the observable rather than what an employee thinks or perceives. Thus, reinforcement views place a premium on observing individuals to see which work-related outcomes are highly valued. By altering when, where, how and why some types of rewards are given, the manager can change the apparent motivation of employees by providing a systematic set of consequences to shape behavior. Moreover, this approach might not 'fit' to all companies, given that some organizations are trying to embody employees with similar culture or each manager is free to develop his own culture in order to achieve team goals. However, personally I believe that although observance is importance but depending on the job sometimes can be misleading. I believe that it might be misleading because environmental factors affect disproportionate each employee due to the variety of needs and personal goals.

B) Content theories focus primarily on individual needs such as the physiological insufficiency that an employee might feel. This approach suggests that the manager's job is to create a work environment that responds positively to individual needs. They help to explain how poor performance, undesirable behaviors, low satisfaction can be caused by unfulfilled needs or needs that are not satisfied on the job. This theory seems to take in consideration individual needs that reinforcement theory does not consider. According to the content theory the employee might perform better since the motivation goals are fixed on individual needs, ability and willingness and employees think that are designed personally for them.

C) Process theories focus on the thought or cognitive processes that take place within the minds of people and influence their behavior. Whereas, a content approach may identify job security as an important need for an individual, the process theory approach attempts to identify why the person behaves in particular ways relative to available rewards and work opportunities and the reason that is the main criteria for medium and upper managers to accept or decline job offers. Therefore, according to my point of view employees and new 'enters' on a job are willing to work only for salary remuneration without concerning for more benefits. Although each type of theory contributes to our understanding of motivation, none offers a complete explanation. Finally, we use the insights of three sets of theories to offer an integrated view of motivational dynamics that should be useful in any work setting. (Miner 2004 p.180)


On this paragraph I will focus on reinforcement theory. Reinforcement theory is based on the work of Ivan Pavlov in behavioral conditioning and the later to B. F. Skinner who examined further on operant conditioning. (Skinner, B. F. 1953). According to this theory, behavior is a function of its consequences. Reinforcement in Organizational Behavior and manager's application is the administration of a consequence as a result behavior. Effective management of reinforcement can change the direction, level, and persistence of an individual's behavior. To understand this idea, we need to review some of the concepts on conditioning and reinforcement learnt in psychology. However, this is not the purpose of the essay. The earliest answer to motivation involves the procedure of detecting and understanding individual needs. Specifically, early researchers thought that employees try hard and demonstrate goal-driven behavior to satisfy their personal goals and needs. For example, an employee who is always talking to the phone with friends', relatives or even other employees may have a need for companionship and his behavior may be a way of satisfying his need and maybe discusses them. Albeit, this need is important for an employee might be a reason for low performance of some other employees who might be disrupted. Consequently, an employee's basic need might not be satisfied by his manager because the result for the whole team does not fulfill the goal.

Need-Basic Theories

There are four major theories in the need-based category: Maslow's hierarchy of needs, ERG theory, Herzberg's dual factor theory, and McClelland's acquired needs theory and will be discussed below. Despite the simplicity of reinforcement theory, people go above and beyond the call of duty, and yet their behaviors are ignored or criticized. People with disruptive habits may receive no punishments because the manager is afraid of the reaction the person will give when confronted. They may even receive rewards such as promotions so that the person is transferred to a different location and becomes someone else's problem but that type of employees will always cause problem resulting to a whole slow down of an organization's performance. Moreover, it is common for people to be rewarded for the wrong kind of behavior; Steven Kerr named this phenomenon as "the folly of rewarding A while hoping for B." (McClell 1982, p. 737-743.). Thus, I believe that promoting employees and treating them favorably with the fear of their reaction finally cause more problems to the culture of a company and the misinterpretation of goals, needs and personal development of employees.

Maslow's Hierarchy of Needs

Abraham Maslow is among the most prominent psychologists of the 20th century and the hierarchy of needs, accompanied by the pyramid representing how human needs are ranked, is an image familiar to most business students and managers. Maslow's theory is based on a simple hypothesis. All human beings have needs that are hierarchically ranked. (Maslow, A.H 1943 p.377,386; Maslow, A. H. 1954 p 390). There are some needs that are basic to all human beings, and in their absence, nothing else matters. As we satisfy these basic needs, we start looking to satisfy higher-order needs. Once a lower-level need is satisfied, it no longer serves as a motivator. The most basic of Maslow's needs are physiological needs. Physiological needs refer to the need for air, food, and water. Once physiological needs are satisfied people tend to become concerned about safety. Social needs refer to the need to bond with other human beings, to be loved and to form lasting connection. In fact having no connections can negatively affect health and well-being. (Baumeister, R. & Leary, M. R. 1995. 510).

The satisfaction of social needs makes esteem needs more significant. Esteem needs refer to the desire to be respected by one's peers, feeling important, and being appreciated. Finally, at the highest level of the hierarchy, the need for self-actualization refers to become all you are capable of to become. This need manifests itself by acquiring new skills, taking on new challenges, and behaving in a way that will lead to the satisfaction of one's life goals. Maslow's hierarchy is a systematic way of thinking about the different needs employees may have at any given point and explains different reactions they may have to similar treatment. An employee who is trying to satisfy his or her esteem needs may feel gratified when his/her supervisor praises him/her. However, another employee who is trying to satisfy his social needs may resent being praised by upper management in front of peers if the praise sets him apart from the rest of the group.()

ERG Theory

ERG theory of Clayton Alderfer is an alteration of Maslow's hierarchy of needs. (Alderfer, C. 1969. p 146.) Instead of the five needs that are hierarchically organized, Alderfer proposed that basic human needs may be grouped under three categories, namely, Existence, Relatedness, and Existence need corresponds to Maslow's physiological and safety needs, relatedness corresponds to social needs, and growth need refers to Maslow's esteem and self actualization (Alderfer, C. 1969. p 151) Existence needs - those necessary for the basic human survival - roughly correspond to the physiological and security needs of Maslow's hierarchy. Relatedness needs, those involving the need to relate to others, are similar to Maslow's belongingness and ERG theory's main contribution to the literature is its relaxation of Maslow's assumptions. For example, ERG theory does not rank needs in any particular order and explicitly recognizes that more than one need may operate at a given time. Moreover, the theory has a "frustration-regression" hypothesis, suggesting that individuals who are frustrated in their attempts to satisfy one need may regress to another one. For example, someone who is frustrated by the lack of growth opportunities in his job and slow progress toward career goals may regress to relatedness needs and start spending more time socializing with one's coworkers. The implication of this theory is that we need to recognize the multiple needs that may be driving an individual at a given point to understand his behavior and to motivate him.

Two-Factor Theory

Frederick Herzberg approached the question of motivation in a different way. By asking individuals what satisfies them on the job and what dissatisfies them, Herzberg came to the conclusion that aspects of the work environment that satisfy employees are very different from aspects that dissatisfy them. ( Herzberg, F. 1965. p 393,402.) Herzberg labeled factors causing dissatisfaction of workers as "hygiene" factors because these factors were part of the context in which the job was performed, as opposed to the job itself. Hygiene factors included company policies, supervision, working conditions, salary, safety, and security on the job. In fact, many factors in our work environment are things that we miss when they are absent, but take for granted if they are present. In contrast, motivators are factors that are intrinsic to the job, such as achievement, recognition, interesting work, increased responsibilities, advancement, and growth opportunities. According to Herzberg's research, motivators are the conditions that truly encourage employees to force them for trying harder.

Herzberg's research has received its share of criticism. One criticism relates to the classification of the factors as hygiene or motivator. For example, pay is viewed as a hygiene factor. However, pay is not necessarily a contextual factor and may have symbolic value by showing employees that they are being recognized for their contributions as well as communicating to them that they are advancing within the company. Similarly, quality of supervision or relationships employees form with their supervisors may determine whether they are assigned interesting work, whether they are recognized for their potential, and whether they take on more responsibilities. Despite its limitations, the two-factor theory can be a valuable aid to managers because it points out that improving the environment in which the job is performed goes only so far in motivating employees. ( Adler 2008 p 286).

Acquired Needs Theory

Among the need-based approaches to motivation, Douglas McClelland's acquired needs theory is the one that has received the greatest amount of support. According to this theory, individuals acquire three types of needs as a result of their life experiences. These needs are: a) need for achievement, b) need for affiliation, and c) need for power. All individuals possess a combination of these needs. Those who have high need for achievement have a strong need to be successful. A worker who derives great satisfaction from meeting deadlines, coming up with brilliant ideas, and planning his or her next career move may be high in need for achievement. Individuals high on need for achievement are well suited to positions such as sales where there are explicit goals, feedback is immediately available, and their effort often leads to success. (Turban, D. 1993 p 188.) Because of their success in lower-level jobs, those in high need for achievement are often promoted to higher-level positions (McClelland, 1982 p 739). However, a high need for achievement has important disadvantages in management. Management involves getting work done by motivating others. A characteristic example is when a sales person is promoted to a sales manager, the job description changes from actively selling to recruiting, motivating, and training sales people. Those who are high in need for achievement may view managerial activities such as coaching, communicating, and meeting with subordinates as a waste of time. Moreover, they enjoy doing things themselves and may find it difficult to delegate authority. They may become overbearing or micromanaging bosses, expecting everyone to be as dedicated to work as they are, and expecting subordinates to do things exactly the way they are used to doing. (McClelland, D. 1976. p 163-164). Individuals who have a high need for affiliation want to be liked and accepted by others. When given a choice, they prefer to interact with others and be with friends. Their emphasis on harmonious interpersonal relationships may be an advantage in jobs and occupations requiring frequent interpersonal interaction, such as social worker or teacher. In managerial positions, a high need for affiliation may again serve as a disadvantage because these individuals tend to be overly concerned about how they are perceived by others. Thus, they may find it difficult to perform some aspects of a manager's job such as giving employees critical feedback or disciplining poor performers. (Shaw, K. N. 2004 p 140).

Finally, those with high need for power want to influence others and control their environment. Need for power may be destructive of one's relationships if it takes the form of seeking and using power for one's own well and prestige. However, when it manifests itself in more altruistic forms, such as changing the way things are done so that the work environment is more positive or negotiating more resources for one's department, it tends to lead to positive outcomes. In fact, need for power is viewed as important for effectiveness in managerial and leadership positions. (Spreier, S. W. 2006. p.72-82). McClelland's theory of acquired needs has important implications for motivating employees. While someone who has high need for achievement may respond to goals, those with high need for affiliation may be motivated to gain the approval of their peers and supervisors, whereas those who have high need for power may value gaining influence over the supervisor or acquiring a position that has decision-making authority. And, when it comes to succeeding in managerial positions, individuals who are aware of the drawbacks of their need orientation can take steps to overcome these drawbacks.

Expectancy Theory

According to expectancy theory, individual motivation to put forth more or less effort is determined by a rational calculation. (Blader, S. L. 2007 p 117-122). According to this theory, individuals ask themselves three questions. The first question is whether the person believes that high levels of effort will lead to desired outcomes. This perception is labeled as expectancy. The second question is the degree to which the person believes that performance is related to secondary outcomes such as rewards. This perception is labeled as instrumentality. Finally, individuals are also concerned about the value of the rewards awaiting them as a result of performance. The anticipated satisfaction that will result from an outcome is labeled as valence or passion. In fact, managers can influence all three perceptions. (Cook, C. 1980. p 63-66.)

To influence their expectancy perceptions, managers may train their employees, or hire people who are qualified for the jobs in question. Low expectancy may also be due to employees feeling that something other than effort predicts performance, such as political behaviors on the part of employees. In this case, clearing the way to performance and creating an environment in which employees do not feel blocked will be helpful. The first step in influencing instrumentality is to connect pay and other rewards to performance using bonuses, award systems, and merit pay. Publicizing any contests or award programs is helpful in bringing rewards to the awareness of employees. It is also important to highlight that performance and not something else is being rewarded. For example, if a company has an employee-of-the-month award that is rotated among employees, employees are unlikely to believe that performance is being rewarded. In the name of being egalitarian, such a reward system may actually hamper the motivation of highest performing employees by eroding instrumentality. Finally, to influence passion and willingness, managers will need to find out what their employees value. This can be done by talking to employees, or surveying them about what rewards they find valuable. (Spreier, S. W. 2006 p 83).

Goal Setting Theory

On the paragraphs above I presented the main theories for motivation. On this paragraph I will present the Goal setting theory which is one of the most influential and practical theories of motivation. It has been supported in over 1,000 studies with employees, ranging from blue-collar workers to research and development employees, and there is strong evidence that setting goals is related to performance improvements.( Latham, 2006 p.332-340) In fact, according to one estimate from a variety of researches , goal setting improves performance between 10% and 25% or more. (Pritchard, R. p. 1988. p 73 ,Latham, G. 2004 p 128).On the basis of evidence such as this, thousands of companies around the world are using goal setting in some form, including companies such as Coca-Cola, PricewaterhouseCoopers, Nike, Intel, and Microsoft to name a few. Accumulating research evidence indicates that effective goals are SMART. SMART goals are specific, measurable, achievable, realistic, and timely approach in achieving targets that companies demand from their employees.

Why do SMART goals motivate

There are at least four reasons why goals motivate. (Latham, G. P. 2004 p.126-129) First, goals give us direction; therefore, goals should be set carefully. Giving employees goals that are not aligned with company goals will be a problem because goals will direct employee's energy to a certain end. Second, goals energize people and tell them not to stop until they reach that point. Third, having a goal provides a challenge. When people have goals and when they reach them, they feel a sense of accomplishment. Finally, SMART goals urge people to think outside the box and rethink how they are working. If a goal is substantially difficult, merely working harder will not get you the results. Instead, you will need to rethink the way you usually work and devise a creative way of working. It has been argued that this is how designers and engineers in Japan came up with the bullet train. Having a goal that went way beyond the current speed of trains prevented engineers from making minor improvements and urged them to come up with a radically different concept. (Kerr, S. 2004 p.135-137.)


To conclude, motivation is the main way to force employee to contribute in achieving company's goals. However, employees should consider all those theories that I have presented above in order to detect the motivation theory that best fits in the company and make employees happy and productive. This is the main reason that many managers have moved a step forward from the basic need theories, and reached to the SMART theory. From my point of view I believe that the SMART and the goal setting theory is the most appropriate nowadays, because we live in a society that consumes therefore, money bonus, incentive trips and other valued incentives make employees happy and productive.