motivation theory in business

How to Implement Motivation Theory in Business Management

Managing people and finding ways to make them more productive are crucial parts of running a business aside from giving importance to branding and visual identity. According to a Gallup study, employees work 20% better when motivated. Because of that, employers need to determine the best strategy to raise workers’ morale. Business owners and managers can utilize motivation theory in business. These theories are widely used to increase individuals’ and teams’ performance in many organizations.

That being said, let’s take a look at five examples of popular motivation theories and how to implement them in your business management.

What Are the 5 Motivation Theories?

There are numerous theories regarding human motivation. Let’s take a look at five of the most popular theories you should consider to increase employee motivation and productivity.

1. Maslow’s Hierarchy of Needs

Maslow’s theory divides human needs into five hierarchical levels. These levels are physiological needs, safety needs, belongingness and love needs, esteem needs, and self-actualization needs.

maslow hierarchy of needs pyramid

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The main rule of this theory is that humans need to fulfill their lower-order needs before the higher-order ones become relevant. For example, before basic needs like sleep, food, and shelter are satisfied, people do not seek to satisfy upper-level needs like personal development, learning, or friendship.

This theory is applicable in various fields, including business management. When a leader or manager understands their team members’ position in this hierarchy of needs and applies the correct approach, they can effectively motivate employees to perform better and move ahead with their tasks.

2. Herzberg’s Motivator and Hygiene Theory

Frederick Herzberg’s motivator-hygiene theory, also known as the two-factor theory, classifies work motivation into two main categories. The first category is motivator which includes intrinsic motivation from the job itself, such as recognition, achievement, or challenging work.

The other category is hygiene that consists of extrinsic factors such as status, job security, salary, and paid insurance. The absence of these hygiene factors can influence workers’ dissatisfaction and potentially increase the employee turnover rate.

The key is to balance these two factors by providing employees with enough benefits and keeping them motivated with chances to grow as a professional. Successfully balancing these factors may result in higher job satisfaction and retaining high-quality talents in their position.

3. McClelland’s Needs Theory

According to McClelland’s needs theory, there are three non-hierarchical key motivators:

    • Achievement – This category includes employees’ needs to achieve professional goals, do better work, and compete with the standard of excellence.
    • Affiliation – This covers employees’ desires to belong and be accepted in the social group.
    • Power – This category covers employees’ needs to impact and influence others, control their workflow, and establish their authority within the organization.

Since these three categories are separated and non-hierarchical, each employee might lean towards one particular need more than the others. Managers need to recognize their employees’ needs and match their personal traits with an appropriate position and responsibilities.

4. McGregor’s X and Y Theory

McGregor’s X and Y theory, also known as the participation theory, refers to two different approaches to employee management based on their attitude towards work.

Theory X sees employees as individuals who lack work motivation and only see their job as a means to fulfill their financial needs. According to this theory, managers need to constantly monitor their employees and implement a more authoritarian management style.

On the other hand, theory Y sees employees as highly motivated and enjoying what they do. Because of that, managers don’t need to give direct rewards or punishments to motivate their team members. Instead, they can focus more on providing sufficient autonomy and building healthy relationships at the workplace.

Managers can use a combination of both categories to find the most appropriate management style. However, keep in mind that it is best to adjust this approach based on the needs of each team member.

5. Vroom’s Expectancy Theory

Vroom’s expectancy theory suggests that people are more motivated to do a certain action if they expect favorable results. Based on this theory, expectation can also affect employees’ performance and work motivation.

There are three variables that influence a person’s motivation, namely:

  • Expectancy – The belief that increased effort will lead to improved performance. This is closely related to several factors, including available resources, skills, and support to get the job done.
  • Instrumentality – The belief that someone will get a valuable outcome if they perform well. This is affected by several factors, such as a clear understanding of the relationship between performance and results, trust in people, and process transparency.
  • Valence – This variable covers the level of importance an individual puts on an expected outcome. For example, if an employee prioritizes work-life balance, they are more likely to value company time off.

According to the expectancy theory, a company can increase employees’ performance by offering incentives. Note that businesses need to develop rewards that employees will appreciate to maintain motivation.

How to Implement Motivation Theories in Business

After discussing the five popular motivation theories, let’s explore five steps businesses can take to implement these theories in their workplace.

1. Involve the Employees

Ensuring every employee is involved in relevant projects or general workplace activities is important for maintaining their motivation. However, this can be especially challenging with remote working, since around 70% of remote workers can feel left out of the workplace.

team meeting in the office

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Try to include all relevant workers in every project cycle, from conception to completion. Keep them updated on every change in the project to give them a sense of ownership. This can help motivate employees to do a better and more thorough job.

It is also important to encourage employees to share their ideas and views about projects or the overall business process. Workers can be more motivated to contribute and give valuable ideas when their opinions are welcomed and appreciated.

2. Develop Attainable Goals for Motivation

When running a business, communicating clear goals and objectives to employees should be your priority. This enables them to understand what they are working towards and the best way to achieve it. However, these goals need to be realistic and attainable.

Developing unreasonable objectives for your business or projects might demoralize your employees and hinder their performance. Therefore, it is best to understand your team’s capabilities and create goals accordingly.

Every objective should be measurable and easily understood by everyone in the team. Consider presenting these goals to your employees with clear action plans, deadlines, and checkpoints. Also, don’t hesitate to change or adapt your goals as needed.

3. Implement the SMART principle

According to this principle, your business goals must be specific, measurable, actionable, results-oriented, and time-bound.

By implementing this rule when developing and communicating objectives, employees know how much commitment is needed to achieve desirable results.

Employees are also less likely to slack off or make mistakes when they understand the stakes and consequences of their actions.

4. Link Business Objectives with Individual Goals

Employees need to understand that their personal achievements and goals can significantly impact the company’s business performance. Therefore, consider explaining their roles and responsibilities when assigning tasks.

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Don’t forget to implement Vroom’s expectancy theory by attaching rewards to employees’ personal goals as motivation. The reward doesn’t have to be financial, but it can help workers understand that achieving certain objectives can benefit them personally.

5. Ask for Feedback

Good communication between employees and leaders or business owners is the cornerstone of a healthy workplace and successful company. After implementing business strategies and company goals, don’t forget to ask for feedback from employees.

This can help you identify issues or aspects of your business management that need improvement. Your employees may also feel more appreciated if you consider their concerns and input regularly.


Understanding the best way to motivate employees can benefit your business significantly in the long run. With proper motivation, workers can grow into their potential and put more effort into achieving the best results.

When employees feel supported by the company, they are also more likely to stay longer. This allows your business to retain valuable talents and develop their skills further. In this article, we have looked at five examples of popular motivation theories.

Aside from that, we have also learned about the five best ways to implement motivation theories in business management. These include:

  • Involving the employees
  • Developing attainable goals
  • Implementing the SMART principle
  • Linking business objectives with individual goals
  • Asking for feedback

Remember that no motivation theory in business is perfect. Therefore, the best way to use them is by combining aspects of each theory based on your company’s and employees’ needs. Good luck.

Read more about how psychology is used in marketing strategies.

Mary J.


I am a passionate blogger and the chief editor at my own content marketing company PRable. Since college, I was interested in break-through technology and technical writing about innovative products and services that change our everyday lives for the better. I am also interested in web design and photography.