ERG theory

Existence, relatedness, and growth (ERG) theory is a flexible behavioral template that seeks to explain how managers in any industry can most effectively motivate workers under their charge to maximize worker productivity and job satisfaction. First proposed by Clayton P. Alderfer in 1969, the ERG model defines three types of needs common to workers no matter their field: existence, the basic requirements for day-to-day living; relatedness, the need for social interaction; and growth, the complex need for creativity, self-esteem, and worthwhile work.

Background

Behavioral psychologists, sociologists, and business resource managers have, since the mid-twentieth century, worked on creating appropriate theoretical models for meeting the basic desires and goals of the organization while, at the same time, addressing the needs and wants of the individuals who create that organization’s workforce. The workplace is a complex of individuals, each with their own backstories, needs, and expectations about the immediate and long-term rewards of committing their time, energy, and creativity to a job.

Starting in the 1940s, psychologist Abraham Maslow began to develop what became known as Maslow’s hierarchy of needs, which centers on five basic human needs arranged in a pyramid of ascending hierarchy: on the lowest level, level 1, are physiological needs, the basic requirements of food, air, hydration, and shelter; level 2 includes safety needs, the need for stability, order, and organization; level 3 includes social needs, the need to interact with family, friends, coworkers, and neighbors; level 4 includes esteem needs, the need to achieve worthwhile ends; and level 5, the highest level, includes self-fulfillment and self-actualization needs, which, in Maslow’s view, were rarely fulfilled by one’s employment. Maslow contended that as each need was met within a workplace, the worker could move onto the next, higher level of achievement, thus providing each worker with a significant degree of motivation. Satisfy one, Maslow argued, and a worker would be prepared to move onto more complex needs and greater rewards.

For almost three decades, network managers and behavioral psychologists tested Maslow’s model. In 1969, Clayton P. Alderfer, a psychologist teaching at Yale University, proposed a significant revision of Maslow’s model in his landmark article "An Empirical Test of a New Theory of Human Need," published in Organizational Behavior and Human Performance. Alderfer argued that Maslow’s model was problematic for three reasons: 1) it assumed that every individual within a network was identical; 2) it did not account for the fact that individual needs were simultaneous rather than hierarchical (for instance, the need for food and shelter never goes away, even while pursuing self-actualization); and 3) it did not account for how or why workers failed to follow the logical ascent to the highest level of motivation. Alderfer, whose credentials were in psychology rather than business, wanted to know why so many workers failed to achieve self-fulfillment in their work, and why so many workers settled for less.

Impact

According to Alderfer, Maslow’s theories were not compelled to take into account individual differences, how each worker brings to the workplace a unique set of life experiences, a unique set of personal and professional goals. Alderfer reorganized Maslow’s basic needs and simplified them from five to three areas. In the first area, existence, Alderfer grouped those basic physical needs that a regular paycheck traditionally provides: nourishment, shelter, health, safety, as well as routine, schedule, and security. These needs correlate to the first two levels in Maslow’s hierarchy of needs. In the second area, relatedness, Alderfer proposed that workers are motivated to satisfy more complex social needs that reflect their position within a range of communities, including their relationships with coworkers and supervisors, friends outside the workplace, and family members. Work, Alderfer argued, inevitably impacts each social relationship and, in turn, each social relationship impacted how a worker approached the workplace and its responsibilities. Relatedness roughly correlates to level 3 and aspects of level 4 in Maslow’s hierarchy. In the third area, growth, Alderfer posited that workers have the need for work to be meaningful, for workers to feel engaged and creative, and to be able to find levels of self-fulfillment and self-esteem in the work they produce. Alderfer’s growth needs align with Maslow’s level 5 and aspects of level 4.

Alderfer’s ERG model assumes that the satisfaction of existence, relatedness, and growth needs does not necessarily follow a progression from basic needs to higher-level needs, as in Maslow’s hierarchy. The ERG model also assumes that the order in which an individual seeks to fulfill these needs may differ based on cultural or other preferences, and that an individual may be motivated by all three needs simultaneously. Furthermore, unlike Maslow, Alderfer did not see self-actualization and self-esteem as rare. Instead, he proposed that effective managers recognize the individuality of workers under their direction, dedicate office operations to making appropriate goals viable and expected for each worker, and foster a work environment where every worker feels creative and engaged. Failing to do that, Alderfer contended, ensures that workers would, in fact, simply accept that work can only provide basic requirements and a network of relationships, but not growth. Alderfer called this phenomenon the frustration-regression principle.

Bibliography

Alderfer, Clayton P. "An Empirical Test of a New Theory of Human Needs." Organizational Behavior and Human Performance, vol. 4, no. 2, 1969, pp. 142–75.

Alderfer, Clayton P. The Practice of Organizational Diagnosis: Theory and Methods. Oxford UP, 2010.

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