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INT B
TOPIC:- IM

By
Kiran R
Second year BBA. LL.B

To
Asst. Prof. Swarnalatha

Date: 2 june 2021

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DECLARATION

I hereby declare that the assignment submitted is an original work except from the
source material explicitly acknowledged.

I further declare that this piece of work has not been submitted for another
purposes to any other colleges.

Bengaluru KIRAN R
Date:02 june 2021
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CERTIFICATE

This is to certify that kiran from BBA.LLB, a student of Christ Academy

Institute of Law (CAIL) has successfully completed the assignment on the topic
“impacts if employee motivation on organization performance” under the
guidance of our Teacher Asst. Prof. Swarnalatha under the direction of
Karnataka State Law University (KSLU).

Bengaluru Asst. Prof. Swarnalatha

Date
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ACKNOWLEDGEMENT

I would like to express my special thanks of gratitude to my teacher Asst. Prof.

Swarnalatha as well as our Principal Rev Fr. Dr. Davis Panadan who gave me the
golden opportunity to do this wonderful project on the topic “impacts if employee
motivation on organization performance”, which also helped me in doing a lot of
Research and I came to know about so many new things I am really thankful to them.

Secondly, I would also like to thank my friends who helped me a lot in finalizing this
project within the limited time frame.

Kiran

bengaluru
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TABLE OF CONTENT

No Contents Page No

1 Introduction 6
2 Contents 8
3 Conclusion 15
4 Bibliography 16
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Introduction

Employee motivation is an intrinsic and internal drive to put forth the necessary effort and
action towards work-related activities. It has been broadly defined as the "psychological
forces that determine the direction of a person's behavior in an organisation, a person's level
of effort and a person's level of persistence". Also, Motivation can be thought of as the
willingness to expend energy to achieve a goal or a reward. Motivation at work has been
defined as the sum of the processes that influence the arousal, direction, and maintenance of
behaviors relevant to work settings. Motivated employees are essential to the success of an
organization as motivated employees are generally more productive at the work place.

After employees are hired and trained, it is important to motivate them to get the desired
efforts from them, to achieve organizational objectives. While designing their compensation
package, we try to meet their expectations at the outset, suitably identifying their extrinsic
and intrinsic needs, within the given policies and procedures of the organization.

However, this is restricted only in those cases, where, we can afford to become flexible, to
attract and retain talents in key positions, without contributing to the general dissatisfaction of
other employees. But major problems on employee motivation become evident when
employees of an organization start perceiving that there is a wide mismatch between their
expectations and organizational commitments. At times, such perceived expectations of the
employees far exceed the organizational commitments, resulting in a significant drop in their
perception.

Motivation is a dynamic organizational-behaviour issue and there cannot be any

organization-specific motivation tool. The subject of motivation, perhaps, received the
highest attention from management thinkers’ worldwide.

Types of employee motivation

There are two types of motivation, intrinsic and extrinsic. An organization needs to
understand for a fact that not employees are clones, they are individuals with different traits.
Thus effectively, motivating your employees will need to acquire a deeper understanding of
the different types and ways of motivation.
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With this understanding, you will be able to categorize your employees better and apply the
right type of motivation to increase the level of employee engagement and employee
satisfaction. Some employees respond better to intrinsic motivation while others may respond
better to extrinsic motivation.

Intrinsic motivation

Intrinsic motivation means that an individual is motivated from within. He/she has the desire
to perform well at the workplace because the results are in accordance with his/her belief
system.1

An individual’s deep-rooted beliefs are usually the strongest motivational factors. Such
individuals show common qualities like acceptance, curiosity, honor, desire to achieve
success.

Research has shown that praise increases intrinsic motivation, so does positive employee
feedback. But it should all be done in moderation. If you overdo any of these, there are high
chances that the individual loses motivation.

It is well observed in children and I am using this as an example here if children are
overpraised for the little things they are expected to do on a daily basis, their motivation level
decreases. Now if you are reading this blog, there are good chances you are not a child,
although we encourage children to read good content, the purpose of writing this blog is to
still focus on adults.

So if you are a manager, supervisor or in a leadership role, please be intentional with your
feedback or praise. Make sure it is empowering and your employees understand your
expectations.

Extrinsic motivation

Extrinsic motivation means an individual’s motivation is stimulated by external factors-

rewards and recognition. Some people may never be motivated internally and only external
motivation would work with them to get the tasks done.

1
 Ryan RM, Deci EL (January 2000). "Intrinsic and Extrinsic Motivations: Classic Definitions  
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Research says extrinsic rewards can sometimes promote the willingness in a person to learn a
new skillset. Rewards like bonuses, perks, awards, etc. can motivate people or provide
tangible feedback.

But you need to be careful with extrinsic rewards too! Too much of anything can be harmful
and as a manager or a supervisor, you need to be clear to what extent are you going to
motivate your employees to accomplish organizational goals.

Content

MOTIVATION METHODS
There are as many different methods of motivating employees today as there are companies
operating in the global business environment. Still, some strategies are prevalent across all
organizations striving to improve employee motivation. The best employee motivation efforts
will focus on what the employees deem to be important. It may be that employees within the
same department of the same organization will have different motivators. Many organizations
today find that flexibility in job design and reward systems has resulted in employees'
increased longevity with the company, improved productivity, and better morale.2

Empowerment
Giving employees more responsibility and decision-making authority increases their realm of
control over the tasks for which they are held responsible and better equips them to carry out
those tasks. As a result, feelings of frustration arising from being held accountable for
something one does not have the resources to carry out are diminished. Energy is diverted
from self-preservation to improved task accomplishment.

Creativity and Innovation

At many companies, employees with creative ideas do not express them to management for
fear that their input will be ignored or ridiculed. Company approval and toeing the company
line have become so ingrained in some working environments that both the employee and the
organization suffer. When the power to create in the organization is pushed down from the
top to line personnel, employees who know a job, product, or service best are given the
opportunity to use their ideas to improve it. The power to create motivates employees and
2
 Sridevi, Sandhya (December 2010). "Employee Engagement: The Key to Improving Performance"
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benefits the organization in having a more flexible work force, using more wisely the
experience of its employees, and increasing the exchange of ideas and information among
employees and departments. These improvements also create an openness to change that can
give a company the ability to respond quickly to market changes and sustain a first mover
advantage in the marketplace.

Learning
If employees are given the tools and the opportunities to accomplish more, most will take on
the challenge. Companies can motivate employees to achieve more by committing to
perpetual enhancement of employee skills. Accreditation and licensing programs for
employees are an increasingly popular and effective way to bring about growth in employee
knowledge and motivation. Often, these programs improve employees' attitudes toward the
client and the company, while bolstering self-confidence. Supporting this assertion, an
analysis of factors which influence motivation-to-learn found that it is directly related to the
extent to which training participants believe that such participation will affect their job or
career utility. In other words, if the body of knowledge gained can be applied to the work to
be accomplished, then the acquisition of that knowledge will be a worthwhile event for the
employee and employer.

Quality of Life
The number of hours worked each week by American workers is on the rise, and many
families have two adults working those increased hours. Under these circumstances, many
workers are left wondering how to meet the demands of their lives beyond the workplace.
Often, this concern occurs while at work and may reduce an employee's productivity and
morale. Companies that have instituted flexible employee arrangements have gained
motivated employees whose productivity has increased. Programs incorporating flex-time,
condensed workweeks, or job sharing, for example, have been successful in focusing
overwhelmed employees toward the work to be done and away from the demands of their
private lives.

Monetary Incentive
For all the championing of alternative motivators, money still occupies a major place in the
mix of motivators. The sharing of a company's profits gives incentive to employees to
produce a quality product, perform a quality service, or improve the quality of a process
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within the company. What benefits the company directly benefits the employee. Monetary
and other rewards are being given to employees for generating cost-savings or process-
improving ideas, to boost productivity and reduce absenteeism. Money is effective when it is
directly tied to an employee's ideas or accomplishments. Nevertheless, if not coupled with
other, non-monetary motivators, its motivating effects are short-lived. Further, monetary
incentives can prove counterproductive if not made available to all members of the
organization.

Other Incentives
Study after study has found that the most effective motivators of workers are non-monetary.
Monetary systems are insufficient motivators, in part because expectations often exceed
results and because disparity between salaried individuals may divide rather than unite
employees. Proven non-monetary positive motivators foster team spirit and include
recognition, responsibility, and advancement. Managers who recognize the "small wins" of
employees, promote participatory environments, and treat employees with fairness and
respect will find their employees to be more highly motivated. One company's managers
brainstormed to come up with 30 powerful rewards that cost little or nothing to implement.
The most effective rewards, such as letters of commendation and time off from work,
enhanced personal fulfillment and self-respect. Over the longer term, sincere praise and
personal gestures are far more effective and more economical than awards of money alone. In
the end, a program that combines monetary reward systems and satisfies intrinsic, self-
actualizing needs may be the most potent employee motivator.

Employee performance
There are several factors which influences the employees’ performance. The major factors
include
(i) Employee motivation.
(ii) Teamwork.
(iii) Training and development.
(iv) Performance appraisals.
(v) Employee satisfaction.
(vi) Compensation.
(vii) Job security.
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(viii) Incentives and rewards.

(ix) work environment, and
(x) Organizational structure. Though all these factors are important, employee
motivation is the one which has a very high influence on the performance

Motivation theory
Maslow's hierarchy of needs

Abraham Maslow viewed motivation as being based on a hierarchy of needs, of which a

person cannot move to the next level of needs without satisfying the previous level. Maslow's
hierarchy starts at the lowest level of needs, basic physiological needs. Basic physiological
needs include air, water, and food. Employers who pay at least a minimal living wage will
meet these basic employee needs. The next level of needs is referred to as safety and security
needs. This level includes needs such as having a place to live and knowing one is safe.
Employers can meet these needs by ensuring employees are safe from physical, verbal and/or
emotional hazards and have a sense of job security. The third level of needs is social
affiliation and belonging. This is the need to be social, have friends, and feel like one belongs
and is loved. Implementing employee participation programs can help fulfill the need to
belong. Rewards such as acknowledging an employee's contributions can also satisfy these
social and love needs. The fourth level on the hierarchy is esteem needs. This level is
described as feeling good about one's self and knowing that their life is meaningful, valuable,
and has a purpose. Employers should use the job design technique to create jobs that are
important to and cherished by the employee. These first four needs, Maslow called D-Needs
(deficient).

The last level Maslow described is called self-actualization. Maslow called this the B-Need
(being). This level refers to people reaching their potential states of well-being. An employer
who ensures that an employee is in the right job and has all other needs met will help the
employee realize this highest need. "Maslow further expanded self-actualization into four
needs: cognitive, aesthetic, self-actualization, and self-transcendence." 3

Herzberg's two-factor theory

Frederick Herzberg developed the two-factor theory of motivation based on satisfiers and

dissatisfiers. Satisfiers are motivators associated with job satisfaction while dissatisfiers are

3
D'Souza, J.; Gurin, M. (2016). "The universal significance of Maslow's concept of self-actualization".
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motivators associated with hygiene or maintenance. Satisfiers include achievement,

responsibility, advancement, and recognition. Satisfiers are all intrinsic motivators that are
directly related to rewards attainable from work performance and even the nature of the work
itself. Dissatisfiers are extrinsic motivators based on the work environment, and include a
company's policies and administration such as supervision, peers, working conditions, and
salary. Herzberg believed providing for hygiene and maintenance needs could prevent
dissatisfaction but not contribute to satisfaction. Herzberg also believed that satisfiers hold
the greatest potential for increased work performance. Work-life programs are a form of
satisfier that recognizes the employee's life outside of work which, in turn, helps motivate the
employee. Improving a job to make it more interesting can improve the overall satisfaction an
employee is experiencing on the job. A dissatisfier looked at by employees is how
relationships form with colleagues. Colleagues play an important role of the workplace as
they are all interacting daily. Forming high quality relationships with peers can extrinsically
improve employee motivation.

Vroom's expectancy theory

The expectancy theory of motivation was established by Victor Vroom with the belief that
motivation is based on the expectation of desired outcomes. The theory is based on four
concepts: valence, expectancy, instrumentality and force. Valence is the attractiveness of
potential rewards, outcomes, or incentives. Expectancy is a person's belief that they will or
will not be able to reach the desired outcome. Instrumentality is the belief that a strong
performance will be well rewarded. Force is a person's motivation to perform. In general,
people will work hard when they think that it is likely to lead to desired organizational
rewards. Vroom thought that people are motivated to work toward a goal if they believe the
goal is worthwhile and if they perceive that their efforts will contribute to the achievement of
that goal.4

Force = Valence x Expectancy x Instrumentality

Locke and Latham's five goal setting principles

Dr. Gary Latham collaborated with Edwin Locke to expand upon his goal setting theory of
motivation with five key principles designed to motivate the accomplishment and completion
of a particular objective. These five key principles align closely around the SMART goal
setting strategy designed to define objectivity and achievability. The five key principles are:

4
Skemp-Arlt, K.M; Toupence, R. (2007). "The administrator's role in employee motivation
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1. Clarity: Clear goals are measurable and not ambiguous which gives clear definition as
to the expectations of the objective.
2. Challenge: People are often motivated by the anticipated significance upon successful
completion of the particular task.
3. Commitment: There is a direct correlation between Employees motivation to
complete an objective and their involvement in establishing the goal and its
boundaries.
4. Feedback: Consistent feedback during the objective completion process provides
clarity of expectations, ability to adjust difficulty, and the opportunity to gain
recognition.
5. Complexity: People in a highly demanding environment typically already have a high
level of motivation, but it is important that the goal does not overwhelm the
individual to maintain motivation

Locke's goal theory

As Human Relations management took hold, increasing intrinsic motivation and attending to
individuals became a larger concern for employers. Increasing intrinsic motivation could be
achieved through the Goal Setting Theory by Edwin A. Locke. Employers that set realistic
and challenging goals for their employees create employee motivation. By allowing
employees to engage in their job, and achieve satisfaction when reaching a goal it can entice
them to want to keep setting new goals to reach new successes and yield superior
performance. The theory is logical because employees are going to set more difficult goals
but the goals will be attainable with increased effort. Once in the pattern of setting goals,
employees can also develop goal commitment, where they are more likely to stick to jobs
until they are finished.

Employees that work alongside their employers in the goal-setting process have the intrinsic
benefit of participating in decisions, which can lead to higher motivation as they are
empowered in their workplace. As employees reach these personally set goals, management
can reinforce those efforts by showing recognition toward their success.5

5
Miner, John B. (2015-03-26). Organizational Behavior 1: Essential Theories of Motivation and Leadership
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Impacts of employee motivation

Employees constitute the most important organizational asset which is having the highest
significance to the organization. Their performance has a major impact on the performance of
the organization. When the employees act diligently, intelligently, and in appositive manner,
then they give outstanding performance, and because of this, the performance of the
organization improves and becomes superior. In fact, there is a close relationship between the
employees’ performance and the organizational performance with the performance of the
employees critically influencing the performance of the organization measured by the
parameters of Productivity, profit, employee turnover, employee accidents, quality of work
life, product quality, and customer satisfaction.
Employees’ motivation leads to healthy and safe practices at the work place. Employees
concentrate more on the job, put their best efforts on the job, and do not waste their time in
the non productive activities. They are more committed to their jobs. They enjoy their job and
get a feeling of happiness and satisfaction while working on the job. This results into higher
attention of the employees towards their work which in turn leads to improvement not only in
the volume of their output but also towards the quality of the work as well as the output
quality.

Motivation of the employees brings along with it flexibility of work, the challenging and
interesting traits of the work, and a good and co-operative relationship with the supervisors
and the colleagues. The employees get increasing clarity with respect to the goals, priorities,
and objectives at work place. They are inspired to give their best efforts and meet the set
goals and once they achieve the set goals it further motivate them to perform even better.
This produces a spiraling effect for the improvement in their performance.

Motivated employees perform work better than those employees who lack motivation. They
are more innovative as they are always looking for better ways to complete a task. They are
self-directed and goal-oriented. They can produce high-quality work with more or maximized
efficiency and productivity which also leads to the improvement in the performance of the
organization.

Motivated employees are crucial for the success of the organization. The organization can
reach some level of success without highly motivated employees but it rarely achieves its full
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potential. Employees being human need to be rewarded and encouraged for their efforts.
Motivation and reward has a strong link. It is therefore necessary for the organization to find
out what motivates its employees so that it can suitably plan a reward system and gain better
results. The right combination of material and immaterial rewards can boost up the work
motivation of the employees and enhanced their commitment to the organization.

Organizational management is required to consider the employees’ motivation as one of the

organizational policies to increase effectively the performance of the employees at the
workplace. It is an accepted fact that the motivation causes changes in the employees’
behaviour which makes them work intelligently, harder and smarter. Management is to
positively reinforce those employee behaviours which lead to positive outcomes and
negatively reinforce those employee behaviours which lead to negative outcomes. This
improves their quality of work as well as improves their productivity and performance which
in turn improves the performance of the organization.

Conclusion:-

In conclusion, the motivation of workers plays one of the foremost imperatives parts in an
organization‟s performance and confidently contributes to its development and prosperities.
In this manner, it is fundamental for any employers and Managers to get it what really
persuades employees to work hard and how to maximize the general organizational
performance.

Employee motivation is one of the vigorous and most influential tools that can animate or
arouse human resource either for the improvement or for the decline. So it is a touchy issue,
except if Managers to confront effectively may cause obstacle in the workplace and
organizational performance. Reward system is an important aspect every organization as it
influences organizational performance. When employees are not rewarded appropriately for
what they achieve in their performance, it can cause hindrance the organizational
performance.
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Bibliography

1. Sridevi, Sandhya (December 2010). "Employee Engagement: The Key to Improving

Performance"
2.  Miner, John B. (2015-03-26). Organizational Behavior 1: Essential Theories of
Motivation and Leadership
3. ways to improve employee motivation, retrieved 25 August 2017
4. Levine, D.I. (1990). "Participation, productivity, and the firm's
environment". California Management Review. 32 (4): 86–100
5. indianresearchjournals.com
6. www.europarl.europa.eu