Motivation

Maslow’s hierarchy of needs; financial and non-financial incentives.

Business Studies5 questions

The essentials

Motivation is the process of stimulating people to act in a desired way to achieve goals. A motive is an inner state that energises behaviour, a motivator is the technique used to motivate (such as pay or recognition), and motivation is the process itself. Motivation is an internal feeling; it can be positive (rewards) or negative (punishment), and it is complex because people have different needs.

Key points

  • Maslow's hierarchy of needs, from lowest to highest: physiological needs (food, shelter, basic salary), safety or security needs (job security, stable income, pension), affiliation or belonging needs (friendship, acceptance by the group), esteem needs (self-respect, status, recognition) and self-actualisation needs (becoming what one is capable of; growth and achievement).
  • Assumptions of the theory: behaviour depends on needs; needs are in a hierarchy; a satisfied need no longer motivates; a person moves to the next higher need only when the lower one is reasonably satisfied.
  • Financial incentives: pay and allowances, productivity-linked wage incentives, bonus, profit sharing, co-partnership or stock option, retirement benefits and perquisites (car, housing, medical aid).
  • Non-financial incentives: status, a good organisational climate, career advancement opportunities, job enrichment (more challenging and interesting work), employee recognition programmes, job security, employee participation and employee empowerment.

Exam tips

  • Stock options make employees part-owners, so they are financial incentives.
  • Job enrichment satisfies higher-level needs such as esteem and self-actualisation.

Common mistakes

  • Putting esteem above self-actualisation. Self-actualisation is the highest need.
  • Classifying job security as a financial incentive. NCERT lists it as non-financial.

Practice questions

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