Assumes that employees are primarily motivated by money, and that productivity is improved by setting output and efficiency targets related to pay, otherwise known as a piece-rate payment system.
Advocates an autocratic leadership style, whereby all tasks are micromanaged by managers and workers have no input into how operations are conducted. The theory promotes the division of labour to specialise all operations in order to maximise efficiency.
Maslow believed that people are motivated by psychological needs, rather than by just money. People have to satisfy lower level needs, such as food and water, before progressing to higher level needs, such as societal status.
Physiological Needs - Needs that must be met for survival. Workers need to minimally earn enough to guarantee survival.
Security Needs - Demands necessary for people to feel safe and stable, such as predictability and order. After workers have guaranteed their basic needs for survival, job security and retirement security.
Social Needs - Human social desire to be accepted into a group or family. Once security is guaranteed, workers will need to feel part of a community, to feel valued and appreciated in the organisation.
Esteem Needs - The desire for social recognition and respect. When workers feel comfortable with their standard of living and sense of social belonging, the need to feel a sense of personal significance is next. The respect gained by authority and rank in organisational hierarchy can fulfil these needs for social gratification.
Self-Actualisation - The need to reach self-fulfilment through personal development, in order to reach their full potential. The highest level in Maslow’s hierarchy; once people are confident of their situation and who they are, they begin to yearn for personal growth in order to reach their full potential. Businesses can fulfil these needs by providing opportunities for development, through training, promotions, and offering autonomy.
All factors affecting motivation in the workplace can be categorised into either hygiene factors and motivators, which refer to needs that prevent dissatisfaction, and needs that increase satisfaction respectfully.
Hygiene Factors are aspects of work that do not motivate, but must be met to prevent dissatisfaction. Essentially, they are factors that fulfil basic human needs, such as physiological and security needs.
Motivators are factors that lead to growth and development of workers, and hence increase morale and performance. The theory believes that workers must feel fulfilled and valued, and have a sense of purpose within the organisation to feel motivated. Herzberg recommended focusing on three key areas:
Workers will naturally compare their efforts and rewards to those of others in the workplace, hence each worker should receive remuneration that justifies their efforts. The theory argues that workers will only be motivated if they receive adequate compensation for their output, in comparison to colleagues.
Adams suggested the degree of equity in the workplace is judged on three factors:
Pink distinguishes between Type X and Type I people: Type X people are motivated by extrinsic factors like money, whereas Type I people are motivated by intrinsic factors affecting their psychological needs. Pink’s theory delineates the intrinsic factors driving the success of Type I people, who are argued to outperform Type X people.
Autonomy - Offering decision-making authority to employees in the completion of tasks and responsibilities.
Mastery - Offering opportunities for employees to grow and develop in the direction they wish.
Purpose - Purpose maximisation is emphasised as the most important factor in Pink’s theory. Managers must clearly communicate the purpose of an employee’s efforts, and how they impact the organisation’s pursuit of its goals and objectives.
Pink’s theory acknowledges that without adequate baseline extrinsic rewards, like pay bonuses and perks, people cannot satisfy their basic human needs. But emphasises that financial remuneration and rewards are not and should not be the primary way of motivating personnel.
Salary - Financial rewards set at a fixed annual rate but paid on a monthly basis.
Wages - Rewards for labour services scaled against a measurable quantity of output, such as hours worked.
Commission - Payment to workers based on a proportion of sales or output contributed by a worker.
Profit-Related Pay - Usually an annual bonus to supplement a regular salary that is directly proportional to the profits of the organisation within the same time period.
Performance-Related Pay - A reward for meeting performance-related goals, such as sales targets or success in a task.
Employee Share Ownership Schemes - Rewarding employees with free or discounted shares in the company, allowing businesses to provide monetary rewards without sacrificing cash flow.
Fringe Payments (Perks) - Guaranteed financial benefits for employees in addition to their wage or salary, such as health insurance, contribution to retirement fund, staff discounts, paid holidays and paid sick leave.
Job Enrichment - Offering complex and challenging tasks to enable employees to push themselves to unlock their potential and feel a sense of achievement. However, if employees are handed inexorable tasks, it may squash confidence and reduce staff morale.
Job Rotation - A type of job enlargement that involves workers performing different tasks at the same level of complexity in a systematic way, usually rotating with colleagues. The intention is to provide more variety and avoid repetition and monotony for employees.
Job Enlargement - Broadening the number of tasks and responsibilities of an employee, although the job itself remains essentially unchanged. The intention is to reduce monotony and boredom by adding more miniscule tasks to keep the employee busy. However, burdening employees with too much of a workload will cause dissatisfaction if they are not compensated with financial remuneration or other rewards.
Empowerment - Giving decision-making authority to employees, allowing them the autonomy to execute their own ideas in the completion of tasks. Empowerment boosts motivation as workers gain accountability over the quality of their work, and is achieved through delegation.
Purpose - Inspiring employees with the vision and mission of the organisation, and communicating how their individual efforts can have an impact on the organisation’s direction, achievements, and the greater community, will make them feel valued and have a strong sense of belonging within the organisation. This feeds their morale and leads to greater productivity.