Motivation is a complex psychological process that influences human behavior. This document discusses several theories of motivation including Equity Theory and Theory Z. Equity Theory proposes that employees are motivated by a desire to be treated fairly in relation to others based on their inputs and outcomes. Theory Z focuses on trust, subtlety, and intimacy between employees and management to improve productivity. The document also covers types and tools of motivation such as rewards, job design, empowerment, and participative management. It emphasizes the importance of motivation for achieving organizational goals and improving performance.

1. SY BMS
CH.1MOTIVATION AND LEADERSHIP
1) Concept of motivation,
importance, tools of motivation.
2) Theory z, equity theory
3) Process theories-
# vroom’s expectancy theory,
# valency-4 drive model
BY:-DR. RENU JAIN

2. CH.1 INTRODUCTION AND
THEORIES OF MOTIVATION
MEANING
Motivation may be defined as a planned managerial
process, which stimulates people to work to the best of
their capabilities, by providing them with motives,
which are based on their unfulfilled needs.
Motivation is derived from the word “motive” which
means an inner state that energises, activates and
directs towards goals.
It can be stated algebraically as
Performance =f(ability*motivation)
Motivation is the process of attempting to influence
others to do your will through the possibility of gain or
reward” -- FLIPPO

3. FEATURES OF MOTIVATION
1) Motivation is a personal and internal feelings:---
psychological phenomenon which generates within an
individual.
2) Motivation is need based:-- It is a behavioural concept
that directs human behaviour towards certain goals.
3) Motivation is a continuous process:-- Because human
wants are unlimited.
4) Motivation may be positive or negative:--
positive promotes incentive and negative threatens
for disincentives.
5) Motivation is a planned process:--People differ in
their approach, to respond to the process of
motivation. Motivation is a psychological concept and
a complex process.

4. TYPES OF MOTIVATION
1) Positive motivation:--When they are shown reward.
Monetary motivation includes incentives, wage plans, bonus
schemes etc.(better standard).Non-monetary motivation
includes praise, participation, social recognition (satisfies the
ego).
2) Negative motivation:--By installing fears in the minds of
people, one can get the desired work done. Fear creates
frustration, a hostile state of mind and an unfavourable
attitude which hinders efficiency and productivity.
3) Fear Motivation:--When incentive motivation fails-often
referred to as the , “carrot and stick,” incentive is the carrot
and fear is the stick.
4) Achievement motivation:--we desire to improve our
competency both to others and to ourselves. for achieve
goals and tackle new challenges. for external recognition.
For positive feedback from both our peers and our superiors.

5. 5) Growth motivation:--need for self improvement. Desire to
increase our knowledge.
6) Power motivation:--we want to have choices and control
over our own lives. We also often aspire to control others
around us. In some cases, the craving for power induces
people to harmful, immoral, or illegal behaviour.
7) Social motivation:--desire to belong and to be accepted
by a specific peer group. Need for acceptance , affiliation
and connection with others.
Which form of motivation is the most effective for
inspiring the desired behaviour in either others or
ourselves is depend on our ability to determine or by the
way they are used.

6. IMPORTANCE OF MOTIVATION
• Job performance depends on ability and environment as well as
motivation.
P= M + A + E
To reach high levels of performance, an employee must want to
do the job well (motivation); must be able to do the job effectively
(ability);and must have the resources and information required for
job (environment).
• motivated employees are also a lot easier to retain, which is
important and preferred ,otherwise costs a lot of money.
1) Improves level of efficiency of employees:--gap between ability
and willingness has to be filled which helps in improving the
performance, which will result into increase in productivity,
reducing cost, improve efficiency.
2) High performance:--motivated employees will put maximum
efforts for achieving organizational goals.
3) Low employee turnover and absenteeism: -- When the employees
are satisfied with their jobs then they will not leave the job. No
absenteeism.

7. 4) Better organizational image:- Which enterprise offer
better facilities to their employees, have a better
employer image and will attract better qualified and
experienced persons.
5) Cordial industrial relations:-- there will be no reason
for conflict among both sides will create a healthy
atmosphere. effective co-operation brings stability.
dispute will reduce. No resistance to change. smooth
and sound organisation . Profit maximization through
increased productivity.
6) Acceptability to change:-- when the employees are
given various opportunities of development, then
they can easily adapt to new situations.
7) Leads to achievement of organizational goals:-- best
possible use of resources. Cooperative work
environment. employees are goal-oriented. Goals can
be achieved if coordination and co-operation.

8. ADVANTAGE /BENEFIT OF
MOTIVATION
• TO ORGANISATION:
a) Puts human resource into action: --help the
enterprise in securing best possible utilization of
resources.
b) Improves the level of efficiency of employees:-ability
and willingness helps in improving the level off
performance of subordinates, increase in productivity,
reduced cost, improve efficiency.
c) Leads to achievement of organisational goals:-- best
possible utilization of resources. Cooperative work
environment. employees are goal oriented.
Coordination and co-operation done through
motivation.

9. d) Builds friendly relations:-- brings employee satisfaction. benefit of the
employees (monetary and non-monetary) (promotion).co-operation
which brings stability. no resistance to the change. individual interest will
coincide with the organisational interest. Profit maximisation through
increased productivity.
e) Leads to stability of workforce:-- when employee have a feeling of
participation then loyal to the enterprise---increase reputation and
goodwill of the concern, good public image. Because older the people,
the experience and their adjustment attitude will be benefit to the
enterprise.
INDIVIDUALS
• Help employee to achieve his personal goal
• Job satisfaction
• Self development
• Always fain by working with a dynamic team
TO BUSINESS
• More motivated employees, the more empowered the team is.
• The more is the team work, more profitable and successful is the
business.
• During amendments , there will be more adaptability and creativity.
• Motivation will lead to an optimistic and challenging attitude at work
place.

10. TOOLS AND TECHNIQUES OF
MOTIVATION
•Motivation tools act as the glue that links
individuals to organizational goals, In addition, make
individuals go beyond the job and be creative.
•It should be accepted that an individual may be
struggling to meet more than one need at a time and
the satisfaction of these needs may depend on multiple
motivation tools at the same time.
•Factors motivating individual can be categorized in 9
groups. These are : instinctive, physiological, social,
socio-psychological, success, energy, attachment, belief
and attitude factors. These factors can easily be used
by others in motivating individuals.

11. Motivation tools
Motivation tools can be categorized into three groups:
1) ECONOMIC MOTIVATION TOOLS: Basic reason for working is
basically economic concerns both for employers and
employees. These tools can be higher income, increase in
salaries, premium pay, profit sharing, employee
participation, economic rewards etc.
2) PSYCHOSOCIAL MOTIVATION TOOLS: Some of the primary
psychosocial motivation tools are autonomous working,
personal power and carrying authority, social status, respect
for personality and life, job and psychological security.
3) ORGANIZATIONAL –ADMINISTRATIVE MOTIVATION TOOLS:
One of the fundamental aspects of employee motivation is to
build an organizational structure based on mutual trust
between the administrators and the employees.

12. METHODS AND TECHNIQUES:
1) Rewards: Firms distribute money and other benefits in
exchange for the employee’s availability, competencies and
behaviour.
a) MEMBERSHIP AND SENIORITY REWARDS: A senior
employee receives more benefit like- advancement, pay
raise, retirement benefits, more perquisites. An MBA
taking up a job in TATA will get more benefit than a small
firm.
b) JOB STATUS BASED REWARDS: Firms use job evaluation
system which helps establish differentials in the status of
jobs. Like-supervisor(high status based reward and more
perquisites).
c) COMPETENCY BASED REWARDS: Competencies are
linked through skills, knowledge, traits, that lead to
desirable behaviours. Competencies are evaluated by
observing specific behaviour patterns.. Where rewards are
linked with competencies. Eg. Skilled based pay-it
motivates the employees to acquire skills .

13. d) PERFORMANCE BASED REWARDS: Link pay to performance rather than to
seniority or membership.
i) Profit sharing: designated employees are allowed to share in the profit
earned by co. Employee stock option schemes encourages the employee to buy
the shares of the co. And reward them through dividend and market appreciation
of the shares.
ii)Team rewards: Some teams are rewarded with special bonus if they
collectively achieve specific goals.
iii) Individual rewards: Very common, piece rate that links pay to the
units produced by an employee. Commission are paid to the sales people. Merit
pay and bonus is based on individuals performance.
2. JOB DESIGN: The job itself as a source of motivation. The process of assigning a
task to a job, including interdependency of those tasks with other jobs, is called as
job design.
a) SKILL VARIETY: The degree to which a job includes difficult activities
and involves the use of multiple skills and talents of the employee .
b) TASK IDENTITY: Completion of a whole and identifiable piece of work
that is doing a job from beginning to end
c) TASK SIGNIFICANCE: Substantial impact on the likes or work of other
people.
d) AUTONOMY : employee with substantial freedom, independence and
discretion in scheduling the work and determining the procedure to be used.
e) FEEDBACK : employee possesses information of the actual result of
his/her performance.

14. 3) JOB CHARACTERISTICS MODEL:
This model developed by Richard Hackman and GR Oldham seeks to bring the job
close to the person.
A)Empowerment: It is what young job aspirants are looking for in org. It is the
feeling that employee owns .It motivates the employee in an org. Like- delegate
responsibility and authority, change parent role to partner role, have tolerance for
mistakes, share information with subordinates, allow team to form, performance
feedback.
b) Participative management: Association of workers/representatives with
the decision making, reduced conflicts and stress, more commitment to goals, better
acceptance of change.
c) problem -employees: motivation to problem employees-change the place
of work, new boss, new peers, issue verbal threats, translate threats into actions
(suspension), B players(committed and motivated), popularly called as sustained high
performers (SHP) created this category by hindustan lever ltd.- are also to be handled
carefully.
d) quality of work life: adequate and fair compensation, safety and healthy
working conditions, security and growth opportunity, opportunity to use and develop
creativity such as work autonomy, respect for the individuals personal rights.
e)Management by objective: Participative process, involving the managers
and subordinates at every org. Level.
f)Flexitime: flexi working hours
g)2 tired pay system: low wage rate to newly hired than those who already
employed.

15. THEORIES OF MOTIVATION
WILLIAM OUCHI’S THEORY Z OF MOTIVATION
•Developed theory after comparative study of Japanese and American management practices.
•Theory suggests that large complex organisations are human systems and their effectiveness
depends on the quality of humanism used.
•3 major features: trust, subtlety and intimacy
•Mutual trust reduces conflict.
•Subtlety requires sensitivity towards others and yields higher productivity.
•Intimacy implies concern, support and disciplined unselfishness.
FEATURES OF THEORY Z
I) MUTUAL TRUST: TRUST, INTEGRITY AND OPENNESS exist between employees, work groups, union and
management, conflict is reduced, cooperate fully to achieve the organisation’s objectives.
II) STRONG BOND BETWEEN ORGANISATIONAND EMPLOYEES: lifetime employment leads to loyalty.
During adverse conditions forgo dividends to avoid retrenchment of workers. Promotions slowed
down. properly placed so more stable and conductive environment.
III) EMPLOYEE INVOLVEMENT: Improves their commitment and performance. Participation of employees
in the decision-making process, particularly about them-generates a sense of responsibility and
increase enthusiasm in the implementation of decisions.
IV) INTEGRATED ORGANISATION: Focus is on sharing of information and resources. Job rotation which
improves understanding about interdependence of tasks- leads to group spirit.
V) COORDINATION: In order to develop common culture and class feeling in the organisation, the leader
must use the processes of communication, debate and analysis.
VI) INFORMAL CONTROL SYSTEM: Emphasis on mutual trust and cooperation rather than on superior
subordinate relationship.
VII) HUMAN RESOURCE DEVELOPMENT: Managers should develop new skills among employees. Under
this theory potential of every person is recognised and attempts are made to develop and utilise it
through job enlargement, career planning, training etc.

16. •Japanese company operating in the US used theory z. Japanese and
Indian comp. Named Maruti Suzuki motors apply theory z.
•Work place involves open offices. Same uniform irrespective of
designation. Common canteen. Avoid status differentials and class feeling
among employees and thereby facilitate teamwork in the company.
LIMITATIONS OF THEORY Z
I) Merely provides job security and may fail to develop loyalty among
employees. leave org. If better offer, security gives letharginess and
inefficient worker will be permanent.
II) Participation in decision-making is difficult..managers hurt their ego
and freedom. Employees reluctant to participate due fear of
criticism, less contribution.
III) This theory suggest org. Without any structure. Nobody will know
who is responsible to whom.
IV) People differ in attitudes, habits, language, religions, customs so no
development of common culture.
V) Evolved from japanese culture. May not be applicable in different
cultures.
Thus theory Z does not provide complete solution to motivational
problems of all organisations operating under different types of
environment. However, it is not merely a theory of motivation but a
philosophy of managing.

17. EQUITY THEORY
•Equity theory is the process theory. It is the J stacy adam’s formulation ,
which is the most highly developed and researched statement.
•Also known as “social comparison theory and inequity theory”.
•It is based on the assumption that the individuals are motivated by their
desire to be equitably treated in their work relationships.
•Employees work for their exchange their services for pay and other
benefits.
•For eg: if the employees perceive they are overpaid or underpaid, they will
be motivated to restore equity.
The 4 terms important in this theory are:
i) PERSON: For whom an equity exist.
ii) COMPARISON OTHER: Any group or individual used by a person as a
reference regarding inputs and outcomes.
iii) INPUTS: age, attendance, interpersonal skills, communication skills, job
effort, level of education, past experience, performance, seniority, social
status, technical skills, training.
iv) OUTCOMES: challenging job assignment, fringe benefits, job security,
monotony, promotion, recognition, responsibility, salary, seniority
benefits, status, symbols, working conditions.

18. • People in the organisations form perceptions of the equity of their
treatment through a 4 step process:
1) They evaluate how they are being treated by the firm.
2) They form a perception of how a “comparison-other” is being
treated. It might be a person in the same work group, someone in
another part of the organization, or even a composite of several
people scattered throughout the organization.
3) They compare their own circumstances with those of the
comparison– other and use this comparison as the basis for
forming an impression of either equity or inequity.
4) Depending on the strength of this feeling, the person may choose
to pursue other alternatives.
A persons assessments of inputs and outcomes for both self and
others are based partly on objective data(eg. Salary) and partly on
perceptions (eg. Level of recognition).
Thus takes the following form:
Outcome (self) compared with Outcomes(other)
Inputs (self) Input (other)
If balance then equity otherwise not.
However, a perception of equity does not require that the perceived
outcomes and inputs be equal, but only that their ratios be same.

19. People may use one of the following methods to reduce inequity:
1) Person altering his inputs
2) Person altering his outcomes
3) People may change their original assessment and decide that they are really
contributing less but receiving more than they originally believed
4) Alter their perception of the comparison. Eg: other is working more hours, extra
work from home
5) They may change their object of comparison.
6) They may leave the situation, by getting transferred to another department or even
seeking a new job.
<Pl. Refer Adams’ equity theory diagram-job motivation –Fig.1.5 page 33 of vipul
prakashan’s book.
Scales measures against comparable references in the market place---if in- equity people
become demotivated, reduce input or seek change/improvement whenever they
feel their inputs are not being fairly rewarded. Fairness is based on perceived
market norms.>
The theory proposes that the motivation to act develops after the person compares
inputs/outcomes with the identical ratio of the comparison other.
Inequity is the perception that the person’s job input/outcomes ratio is not equal to the
inputs/outcomes ratio of the comparison other. The greater the felt inequity, the
greater the motivation to reduce it.
Most researches on equity theory has been focused, dealing with one ratio—between
pay and the quality and quantity of worker output given overpayment and
underpayment.
When the worker feels underpaid, tend to reduce their inputs by decreasing quality and
quantity. When person feels overpaid, increase in quality and quantity.

20. ADVANTAGES
1) The theory has generated extensive research, many of the results being
supportive.
2) It recognises the influence of social comparison processes on motivation.
Individuals are concerned not only with the absolute amount of rewards they
receive for their efforts, but also with the relationship of this amount to what
others receive.
3) Any perceived injustice motivates them to restore equity.
4) It adopts a realistic approach to motivation.
LIMITATION
1) People measure the totals of their inputs and outcomes. Eg: working mother
may accept lower monetary compensation
2) Two employees of equal experience and qualification performing same work for
the same pay may have quite different perceptions of the fairness of the deal.
3) Employees are able to adjust for purchasing power and local market conditions.
Eg. Teacher from bangladesh may accept lower pay because of cost of living is
different.
4) Acceptable More senior staff , more higher compensation
5) Staff perceptions of inputs and outcomes of themselves and others- may be
incorrect, and perceptions need to be managed effectively.
6) For eg. Responsibility is viewed by some as input whereas by others as output.
7) How does a person choose the comparison other?
8) Most studies supporting it have been laboratory experiments with student
subjects.

21. VROOM’S EXPECTANCY THEORY OF
WORK MOTIVATION
The theory explains that individuals can be motivated towards goals if they believe that : there is a positive correlation
between efforts and performance, the outcome of a favourable performance will result in a desirable reward from a
performance will satisfy an important need, and/or the outcome satisfies their need enough to make the effort
worthwhile.
3 components of expectancy theory:
1. Expectancy : Effort—performance (E-P)
2. Instrumentality : Performance—outcome (P-O)
3. Valence : v(R)
Expectancy: Expectancy is the belief that one’s effort (E) will result in attainment of desired performance(P) goals.
a) Self efficacy: the person’s belief about their ability to successfully perform a particular behaviour.
b) Goal difficulty: Individuals believes that their desired results are unattainable.
c) Perceived control: Individuals must believe that they have some degree of control over the expected outcome.
When individuals perceive that the outcome is beyond their ability to influence, expectancy, and thus motivation is low.
Instrumentality: Instrumentality is the belief that a person will receive a reward if the performance expectation is met-in
the form of a pay increase, promotion, recognition or sense of accomplishment. Instrumentality is low when the
reward is the same for all performances given.
VALENCE: satisfaction of a particular outcome .Rewards of an outcome, which is based on their needs, goals, values and
sources of motivation. Strengthen their motivation for a particular outcome.
1----0----1 In order for the valence to be positive , the person must prefer attaining the outcome to not attaining it.
Expectancy* instrumentality * valence = Motivational force
Value outcomes in the work place include, pay increase and bonuses, promotions, time off, new assignments,
recognition, etc. If management can effectively determine with their employees values, this will allow the
manager to motivate employees in order to get the highest result and effectiveness out of the workplace.

22. ADVANTAGES
1. It provides clear guidelines or increasing employee motivation by altering the
person’s expectancies (E P), instrumentalities (P O) and outcome valencies.
2. Individuals are viewed as thinking, reasoning beings who have beliefs and
anticipations concerning future events in their lives.
3. It values human diginity.
4. Do not act on the basis of unmet needs.
5. It implies that managers must make it possible for an employee to see that
effort can result in appropriate need satisfying rewards.
LIMITATIONS
1. It needs to be tested to learn how research evidence will support it.
2. There are many instances where decisions are made with no conscious
thought. People often make decisions and later try to rationalise them,
rather than use the process.
3. Theory has limited use because it tends to be valid only in situations where
the effort-performance and performance-reward linkages are clearly
perceived by the employees.
Motivation principles such as valency, expectancy and instrumentality can be
drawn from the theory. This can be used to guide managers in designing
organisational rewards, work systems, management by objective and goal
setting.

23. VALENCY-FOUR DRIVE THEORY
•The 4-drive model of employee motivation was presented by Lawrence and Nohria in 2002.
•This model is looking at employee motivation beyond the typical pay model..new way of thinking.
•The 4 drive theory is based on 4 underlying drives– the drive to acquire & achieve, to bond & belong, to be
challenged & comprehend and to define & defend.
1. Drive to Acquire and achieve: Monetary rewards tied to performance in your organization? Competitive
pay? need for high performance is Clearly expressed in your firm? Appropriately recognized for your
performance? Satisfaction with your pay from work? R u able to distinguish yourself through your job?
2. Drive to bond and belong: conducting a team building session should help a company’s employees
positively build and enhance the bonds they have with their co-workers. Collaboration and teamwork
valued and recognized ? Firm supportive of friendship among workers. feeling of being a part of team firm’s
culture encourage sharing?
3. Drive to be challenged and comprehend: We perform better when we are engaged and learning on the job.
Leaders should look at how they can enhance or create challenges for employees and provide them
opportunities to learn and grow. Org. Must look at how they are structuring their jobs, their projects, their
incentives. assignments are challenging? Gaining skills and knowledge as part of your work.
4. Drive to define and defend: Performance rating system open and transparent? Environment welcoming and
non intimidating? Treat people fairly? Support open communication?
This new theory provides a more comprehensive model for employers to increase employee engagement and
motivation.
An important theme of the 4 drive theory is balance between and among drives so they can compliment and
regulate each other.
The 4 drive models indicates that company’s reputation, its moral bearing, being part of some larger aspirational
group, and the culture can be significant factors in how motivated employees are.
Strongest and robust models to help understand employee motivation and engagement.
Great help to managers to increase their employee’s motivation.
LIMITATION:
Purpose is not addressed in the model, whereas purpose is a key motivator in individuals