MANM4000 Report: Exploring if Money is Truly the Best Motivator

This report critically examines the misconception that money is the best motivator. It analyzes various management theories, including Maslow's hierarchy of needs, the Hawthorne effect, and McGregor's Theory X and Theory Y, to demonstrate that factors beyond monetary rewards, such as self-esteem, recognition, and a sense of belonging, play crucial roles in employee motivation and performance. The report concludes that while money is important, it is not the sole or best motivator, and organizations should focus on creating a supportive and engaging work environment to truly motivate their employees. Desklib provides access to similar reports and resources for students.

MONEY IS THE BEST MOTIVATOR: A MISCONCEPTION
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Executive summary
The study has analysed the misconceptions related to the concept of money being the best
motivator. The study critically evaluates the different misconceptions in relation to motivation. It
analyses these based on the theories of management like Maslow, Hawthorne and Two factor
theories. It has discussed in detail about existence of the different wrong concepts that
organisations believe in. The importance of the management theories and their application in real
world has been discussed elaborately.
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Table of Contents
Introduction......................................................................................................................................4
Findings...........................................................................................................................................4
Analysis...........................................................................................................................................5
Recommendation and conclusion....................................................................................................6
Reference list...................................................................................................................................7
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Introduction
Money has the power to buy things people want and serves as an important unit of exchange. It
led to abolition of barter exchange and is an important source of motivation. It provides
satisfaction to the people and gives them a sense of security and wellbeing. However, money
cannot buy or provide everything and this has been proved in this study with the help of different
management theories. The problem statement of the study is to evaluate and provide evidences
with reference to management theories. The study has tried to prove that money is not the sole
motivating factor.
Findings
There are many misconceptions aligned to this notion of money is the best motivator and these
have been discussed in detail as follows;
Misconception 1: Money is the sole motivating factor
As per the view of Hosszu (2016), money is not the only motivating factor as there are other
factors too that help motivate a person or an employee. Factors like self esteem, sense of
security, status, and mental well being also help in motivating people. As argued by Sangith
(2016), sometimes monetary rewards fail to motivate and satisfy employees if they do not feel
safe or if their work is not recognised. Hence it is a big misconception.
Misconception 2: Money works over creativity
If a person has creative solutions to problems in an organisation and if he or she is denied to
apply creativity at work place then they are denied of effective participation. As opined by Miner
(2015), an employee must feel that he or she is participating in the processes of organisation and
are allowed to take the initiative. This freedom of finding creative solutions to organisational
problems make them feel that they belong to the organisation and work in a better way. Even if
the salary or monetary rewards are high for an employee, if he or she does not get the chance to
use their creativity then they would feel less motivated.
Misconception 3: Monetary rewards make an employee perform better
As argued by Hosszu (2016), monetary rewards do not make an employee perform better if the
organisation is over utilizing or under utilising his or her potential. If the work pressure is too
much, or the work environment of the organization is not of supportive nature, then employees
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would not perform better. This is thus a big misconception because money cannot make an
employee perform better if he or she is not provided with a proper management control and good
work environment.
Analysis
The misconception have been analysed with the help of many management theory and these have
been discussed below;
Figure1: Maslow’s need Hierarchy theory
(Source: Bratton and Gold, 2017)
Maslow’s need hierarchy theory
As per the Maslow’s need hierarchy theory the motivational factors are self actualisation, self
esteem, belonging, safety and physiological needs. Maslow in his theory identified these factors
as motivating factors and has not recognised money. Physiological needs have been the first and
foremost needs a person requires. After that is safety needs which are not necessarily fulfilled
with the help of money. Love and belonging comes third in the hierarchy then, a sense of self
esteem comes fourth and at last is self actualisation. All these needs are not fulfilled by money
and thus it shows that money is not the best motivator (Bratton and Gold, 2017).
Hawthorne effect
As per the Hawthorne effect developed by Elton Mayo an employee works more efficiently if his
or her work is recognised (Sedgwick and Greenwood, 2015). Workers work more effectively if
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their work is studied and measured. They are motivated to work and improve their work on a
regular basis. So it can be inferred from this theory that money has no role to play in making an
employee's performance better (Richter et al. 2015).
Theory X and Theory Y
As per this theory which was developed by Douglas McGregor, there are two types of employees
in an organisation type X and type Y. type X do not work until and unless strict rules are
enforced on them and type Y do not get motivated until and unless they are given control
(bg.k12.ky.us, 2018).
Hence as per these theories it can be inferred that money is not the sole as well as best motivator.
Recommendation and conclusion
Recommendation
As per the study on the misconception related to the notion of money being the best motivator, it
was found out that there are other motivators too. Money cannot be considered the best motivator
because of various reasons discussed in the study. Money has not been the motivating factor in
any of the above theories discussed. The analysis focuses on the sense of belongingness,
acceptance from the organisation and freedom to do the job. Money cannot solely motivate
employees to perform better.
Conclusion
As per the study and the analysis done, money is not the best motivator. The analysis has been
done with the help different theories. Findings has discussed about the various misconceptions
related to the notion. Misconceptions have been critically discussed with the help of Maslow’s
need hierarchy theory and Hawthorne theory. Motivation cannot be bought with the help of
money and this has been properly explained in the study developed by Douglas McGregor. The
theory talks about motivation where in order to motivate the type X employees a more strict set
up in the organisation is required and they perform well only when they are guided by rules. On
failure to do job they must be punished so that they do not fail again. On the other hand in order
to motivate type Y employees, a sense of control over their job process is required to be
provided. Hence it can be concluded that money is not the best motivator.
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Reference list
Book
Miner, J.B., 2015. Organizational behavior 1: Essential theories of motivation and leadership.
Abingdon: Routledge.
Bratton, J. and Gold, J., 2017. Human resource management: theory and practice. New York:
Palgrave.
Journal
Richter, G., Raban, D.R. and Rafaeli, S., 2015. Studying gamification: the effect of rewards and
incentives on motivation. In Gamification in education and business (pp. 21-46). Springer,
Cham.
Sedgwick, P. and Greenwood, N., 2015. Understanding the Hawthorne effect. Bmj, 351,
p.h4672.
Online article
Sangith. Saurabh., (2016). Money is not the best motivator [Online] Available at:
https://www.replicon.com/money-is-not-the-best-motivator-heres-what-to-focus-on-instead/
[Accessed on: 30, August, 2018]
Hosszu, Gabor., (2016), Money VS. Motivation. [online] Available at:
http://goalsinfinite.com/money-vs-motivation/[Accessed on: 30, August, 2018]
Website
bg.k12.ky.us, Is money a motivator, Available at:
http://www.bg.k12.ky.us/userfiles/1033/Classes/32767/IsMoneyAMotivatorArticle.pdf
[Accessed on: 30, August, 2018]
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