Equity Theory

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Equity Theory of Motivation

The equity theory of motivation is used to describe the relationship between the employees perception of how fairly is he being treated and how hard he is motivated to work

Motivation is the activation of an energized goal-oriented behavior. Everyone takes up a job as they are motivated by some factor or the other. Some are motivated by the challenge they will face in carrying out their job, some are motivated by the level of fame they may earn, others and majority of people are motivated by the money they will earn. The last factor plays a major role in making or breaking a company. People will work better when they are motivated enough with the pay scale, the incentives and the perks they are offered in return of a job well done.

Introduction to Equity Theory

There was a time when employers thought employees to be just another input required for production of output, that is, goods and services. This thinking was changed with the research conducted known as Hawthorne Studies, by Elton Mayo from 1924 to 1932. This study showed that employees are not just motivated by the money, but their attitudes as well. Thus, the Hawthorne Studies initiated the human relations approach to management and the needs and motivation of employees was the primary concenter of managers.

Equity Theory Examples

As the main focus of the researchers moved towards employees and their motivation factors, following the Hawthorne Study results, there were many theories put forward to understand employee motivation. The following are the five major equity theory examples that have helped in understanding motivation. •Maslow's Need-Hierarchy Theory: Maslow put forward five levels of needs of employees. These needs included physiological, safety, ego and self-actualizing. Maslow put forward an argument that said the lower level needs of employees need to be satisfied before the next higher level need is fulfilled to motivate them. The motivation was categorized into factors by Herzberg; motivators and hygiene. The motivators including intrinsic factors like achievement and recognition help produce job satisfaction. The hygiene or extrinsic factors like pay and job security lead to job dissatisfaction.

Vroom's Theory: This theory was based on the belief that employee effort leads to performance and performance leads to rewards. These rewards can be positive or negative. The positive rewards lead to a more positive employee who is highly motivated. The negative rewards lead to obviously a less motivated employee.

Skinner's Theory: This theory states that the positive outcomes will be repeated and behaviors that lead to negative outcome won't be repeated. Thus, managers should try and reinforce the employee behaviors, such that it leads to positive outcomes. Negative reinforcement by managers will lead to negative outcomes.

Adam's Equity Theory Model: This theory shows that employees strive to achieve equity between themselves and their coworkers. This equity can be achieved when the ratio of employee outcomes over inputs is equal to other employee outcomes over inputs.


Adams' Equity Theory - Balancing Employee Inputs and Outputs

Adams’ Equity Theory calls for a fair balance to be struck between an employee’s inputs (hard work, skill level, tolerance, enthusiasm, etc.) and an employee’s outputs (salary, benefits, intangibles such as recognition, etc.). According to the theory, finding this fair balance serves to ensure a strong and productive relationship is achieved with the employee, with the overall result being contented, motivated employees. Understanding the Theory

The Adams Equity Theory is named for John Stacey Adams, a workplace and behavioral psychologist, who developed this job motivation theory in 1963. Much like many of the more prevalent theories of motivation (theories by Maslow's Hierarchy of Needs, Herzberg's Theory, etc.), Adams’ Equity Theory...
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