Alderfer’s ERG Theory

ERG theory was developed by organizational behavior scholar Clayton Alderfer to everyone the problems with Maslow’s needs hierarchy theory. ERG theory groups human needs into three broad categories: existence, relatedness, and growth. (Notice that the theory’s name is based on the first letter of each need.) As Exhibit 5.1 illustrates, existence needs correspond to Maslow’s physiological and safety needs. Relatedness needs refer mainly to Maslow’s belongingness needs. Growth needs correspond to Maslow’s esteem and self-actualization needs.

Existence needs include a person’s physiological and physically related safety needs, such as the need for food, shelter, and safe working conditions. Relatedness needs include a person’s need to interact with other people, receive public recognition, and feel secure around people (i.e., interpersonal safety). Growth needs consist of a person’s self-esteem through personal achievement as well as the concept of self-actualization presented in Maslow’s model.

ERG theory states that an employee’s behavior is motivated simultaneously by more than one need level. Thus, you might try to satisfy your growth needs (such as by completing an assignment exceptionally well) even though your relatedness needs aren’t completely satisfied. ERG theory applies the satisfaction-progression process described in Maslow’s needs hierarchy model, so one need level will dominate a person’s motivation more than others. As existence needs are satisfied, for example, related needs become more important.

Unlike Maslow’s model, however, ERG theory includes a frustration-regression process whereby those who are unable to satisfy a higher need become frustrated and regress to the next lower need level. For example, if existence and relatedness needs have been satisfied, but growth need fulfillment has been blocked, the individual will become frustrated and relatedness needs will again emerge as the dominant source of motivation.

Although not fully tested, ERG theory seems to explain the dynamics of human needs in organizations reasonably well. It provides a less rigid explanation of employee needs than Maslow’s hierarchy. Human needs cluster more neatly around the three categories proposed by Alderfer than the five categories in Maslow’s hierarchy. The combined processes of satisfaction-progression and frustration-regression also provide a more accurate explanation of why employee needs change over time. Overall, it seems to come closest to explaining why employees have particular needs at various times.

CONTENT THEORIES OF MOTIVATION

Most contemporary theories recognize that motivation begins with individual needs. Needs are deficiencies that energize or trigger behaviors to satisfy those needs. At some point in your life, you might have a strong need for food and shelter. At other tomes, your social needs may be unfulfilled. Unfulfilled needs create a tension that makes you want to find ways to reduce or satisfy those needs. The stronger your needs, the more motivated you are to satisfy them. Conversely, a satisfied need does not motivate. In this section, we will look at the four content theories of motivation that dominate organizational thinking today.

Maslow’s Needs Hierarchy Theory
One of the earliest and best-known content theories is needs hierarchy theory. Developed by psychologist Abraham Maslow, this theory condenses the numerous needs that scholars have identified into a hierarchy of five basic categories. At the bottom are physiological needs, which include the need to satisfy biological requirements for food, air, water, and shelter. Next come safety needs – the need for a secure and stable environment and the absence of pain, threat, or illness. Belongingness includes the need for love, affection, and interaction with other people. Esteem includes self-esteem through personal achievement as well as social esteem through recognition and respect from others. At the top of the hierarchy is self-actualization, which represents the need for self-fulfillment – a sense that the person’s potential has been realized.

Maslow recognized that an employee’s behavior is motivated simultaneously by several need levels, but behavior is motivated mostly by the lowest unsatisfied need at the time. As the person satisfies a lower-level need, the next higher need in the hierarchy becomes the primary motivator. This concept is known as the satisfaction-progression process. Even if a person is unable to satisfy a higher need, he or she will be motivated by it until it is eventually satisfied. Physiological needs are initially the most important, and people are motivated to satisfy them first. As they become gratified, safety needs emerge as the strongest motivator. As safety needs are satisfied, belongingness needs become most important, and so forth. The exception to the satisfaction-progression process is self-actualization; as people experience self-actualization, they desire more rather than less of this need.

Although Maslow’s needs hierarchy is one of the best-known organizational behavior theories, the model is much too rigid to explain the dynamic and unstable characteristics of employee needs. Researchers have found that individual needs do not cluster neatly around the five categories described in the model. Moreover, gratification of one need level does not necessarily led to increased motivation to satisfy the next higher need level. Although Maslow’s model may not predict employee needs as well as scholars initially expected, it provides an important introduction to employee needs and has laid the foundation for Alderfer’s ERG theory, which has better research support.