Source: Image of gold medal, man talking to man and woman, images by Video Scribe, License held by Jeff Carroll.
Hi, I'm Jeff. And in this lesson, we'll learn about the major modern theories of motivation and how they are relevant to business. So let's get started.
We discussed classical theories in a previous lesson. And those historical theories are important to understand so you have a full knowledge of motivational methods. But the classical theories don't discuss why or how the motivation develops. They also don't discuss what it takes to maintain a high level of motivation among employees.
That is where current motivational theories come in. These theories and the actions they suggest are important to HRM. Three primary theories are expectancy theory, which is a theory of motivation which argues that individuals will work harder if they believe that what they expect and want will actually happen. This is the graph that corresponds to this theory.
Equity theory, which is a theory of motivation, which argues that employees will work more consistently and generally enjoy the job more if they believe all employees are being treated in the same manner. If an employee sees their fellow employees receiving more benefits, while putting in the same amount of work, it will be demotivating. And goal setting theory, which is a theory of motivation, which argues that setting meaningful goals will increase productivity. In this case, it can be beneficial to use SMART goals. Those are goals that are Specific, Measurable, Achievable, Relevant, and Time-Targeted.
Though many people believe that money is the only motivator for work, our discussion of contemporary theories says otherwise. Next, we'll discuss two management methods that can be used to motivate employees without relying upon money. There is management by objectives, also known as MBO. This is a system of management, which argues that if both managers and employees understand and agree upon the organizational objectives, then there will be higher motivation and productivity.
There are typically five steps with MBO, top management support-- where buy-in is gained with the top executives-- set basic goals, communicate with each employee, periodic review of the progress on objectives, and finally evaluation at a set time. Another more modern option is participative management and empowerment. This is a system of management which argues that engaging employees in decision-making about their work will increase job satisfaction.
When employees help design how they would like to do their work and the goals they need to achieve, they are more invested in the outcome. A manager might use one or both of these methods to motivate employees. A more autocratic manager might prefer the MBO since it allows the manager to determine the goals, where a free rein or democratic manager might use the participative management and empowerment more to create a collaborative relationship with his or her direct reports.
OK, good job. In this lesson, we learned about the limits of classic motivational theory and how contemporary theories of motivation are more useful to an organization. We also discussed two motivational plans that can be used by managers. Thanks for your time, and have a great day.