The equity theory of motivation employee motivation. The research supports equity predictions in the area of underpayment, but the overpayment effects have not been satisfactorily demonstrated. The equity theory of motivation deals with the way people. Perceptions of equity and justice and their implications. These assumptions of the theory x employee may lead to various problems, such as a tough management that believes in punishment and tight controls and a soft management who strives for harmony in the workplace, at the xepense of efficiency. John stacy adams introduced equity theory in 1963, and addressed our tendency to compare ourselves to others. It can be used in personal life, government or business.
Equity theory proposes that a persons motivation is based on what he or she considers to be fair when compared to others redmond, 2010. They make the crucial choices about who pays the taxes, who gets into college, who gets medical care, who gets drafted, where the hazardous waste dump is sited, and how much we pay for public services. Equity predictions are more likely to apply to people who are morally mature. Adams equity theory, a powerful theory of motivation. Equity, or more precisely, inequity is a major concern of industry. An employee compares his an employee compares his or her jobs inputs with an outcomes ratio. Equity theory and its applications in the various spheres of life. Equity theory and its applications in the various spheres. In this essay i aim to describe two theories equity theory and social exchange theory of relationships and to consider how they might influence the therapist engaged in couples counseling, noting their similarities and differences. I will follow a line of investigation on equity theory in regard to its fundamental importance to organizations since it is assumed to be one of. Inputs are what you bring to the situation, like your skills, time and education. Learn vocabulary, terms, and more with flashcards, games, and other study tools. Criticism to equity theory directed towards both the assumptions and practical application of equity theory 22. Adams equity theory leadership skills training from.
There are some practical difficulties also in applying equity theory e. Complex perceptions one of the starting points for the pursuit of knowledge about the perception of justice and equity by individuals and groups is attributed to the theory of inequity, proposed by adams 1963, 1965. The relevance of scientific management and equity theory in. This paper will focus on examining equity theory, its propositions and underlying assumptions. Equity theory states that the employees perceive what they get from a job situation outcomes about what they put into it inputs and then compare their inputs. Instead, theory z is a hybrid management approach combining japanese management. Every employee of an organisation expects that he should be treated with justice. Equity theory of motivation management study guide.
Martin university of mississippi in this article, we take a look at why and how managers should communicate with their employees the. Equity theory project gutenberg selfpublishing ebooks. The results are discussed in terms of limitations to equity theory. And in the end, it ensures the betterment of the overall economic condition of a county. But, in reality, the concept of fairness is not appreciated by all.
According to the theory, employee motivation is the result of the balance between what an. Based on the maslows theory and equity theory, according to their characters, the questionnaire aim to find the limitation of these two theories, check whether the two theories follow the real situation. When applied to the workplace, equity theory focuses on an employees workcompensation relationship or exchange relationship as well as that employees attempt to minimize any sense of unfairness that might result. Introduction to equity theory first developed in 1963 by john stacey adams employees seek to maintain equity between the inputs that they bring to a job and the outcomes that they receive from it against the perceived inputs and outcomes of others. The central theme of the theory is the judgment of fair treatment. A reference point theory of mergers and acquisitions.
The utility of equity theory in enhancing organizational effectiveness dr. This theory is based on social comparisons and the notion that unequity is a motivating state. Equity theory criticisms a number of demographic and psychological variables affect peoples perception of fairness and interactions with others people might perceive equity inequity not only in terms of the specific inputs and. Equity theory is a conceptualization that focuses on the causes and consequences of peoples perceptions of equity and inequity in their relationships with others. The equity theory of motivation how to keep your team motivated. A taxonomy of organizational justice theories jerald greenberg ohio state university a taxonomy is presented that categorizes theories of organizational justice with respect to two independent dimensions. Equity is measured by comparing the ratio of contributions or costs and benefits or rewards for each person. This paper discusses and describes the equity theory of motivation with its implications to managers in the light of a real organizational example. Adams equity theory how fairness affects employee motivation. We acknowledge the existing limitations of theory development and suggest an alternative research approach. Adams equity theory, which stresses the importance of striking a balance between employee inputs and outputs. Equity theory comes under process theory which gives the perception whether the individual is going to work hard or not depending upon the rewards and possible outcomes. Equity theory adams equity theory explains the thought process an employee uses to determine the fairness of management decision making. There is nothing wrong in this expectation by the employees.
To understand adams equity theory in full, we need to first define inputs and outputs. Its about the balance between the effort an employee puts into their work input, and the result they get in return output. Equity theory why employee perceptions about fairness matter. The following points highlight the top five theories of equity. Then you can start reading kindle books on your smartphone, tablet, or computer no kindle device required. Under the proprietary theory, the entity is the agent, representative, or arrangement through which the individual entrepreneurs or shareholders operate.
Mcclelland theory is one of the theories of motivation, according to this theory at the workplace there are three major needs of employees which are a need for achievement, need for power and need for affiliation. Adams equity theory of motivation by wole olasanoye on prezi. Equity theory proposes that peoples motivation, performance and satisfaction depend on their subjective evaluation of the relationships between their effortreward ratio and the effort reward of others in similar situations. The pros and cons associated with the equity theory the. As one can see from the above that equity theory of motivation has advantages as well as disadvantages and that is the reason why any company thinking of taking action on the basis of above theory should carefully read above points and then only should take the decision.
Toward a resolution of the negativeinputs controversy article pdf available in personality and social psychology bulletin 32. Download as doc, pdf, txt or read online from scribd. Everyone takes up a job as they are motivated by some factor or the other. The theory makes managers realize that equity motivate tends to be one of the most important motives of the people in the organization. Yet, an even more pertinent issue is whether the theory as suggested by adams 1965 really holds.
Stacy adams, a workplace and behavioral psychologist, who asserted that. Equity theory and employee motivation motivation self. The adams equity theory was developed by the american psychologist john stacey adams in 1963. To further illustrate equity theory considerations, a. If the employee is able to find his or her right balance it would lead to a more productive relationship with the management. Cons it may lead to under rewarding and these members. Applying adams equity theory to employee engagement.
Pdf equity theory and interpersonal attraction researchgate. Equity theory, as developed by adams 1965, considers motivation and job satisfaction as the result of a comparison of a workers perceived. Outputs are everything you get in return, like your salary, bonuses, raises and promotions. Miles university of georgia equity theory proposes that individuals who perceive themselves as either underrewarded or overrewarded will experience distress, and that this distress leads to efforts to restore equity. Conversely, an individual will be demotivated if they perceive unfairness. Jan 09, 2018 developed by the behavioral and workplace psychologist, john stacy adams, equity theory of motivation is one of the justice theories explaining the correlation between input and outcome of performance of employee at a job with hisher perception of equitable or inequitable behavior from the employers. This paper proposes equity theory as a guiding aid in ph. Equity theory is used in parlance of human resource management.
Governments and institutions, perhaps even more than markets, determine who gets what in our society. So motivation is one of the vital factors for development of an or ganization. It is unclear whether theory z will have a lasting impact on management. Department of accounting, chaoyang university of technology. Higher is individuals perception of fairness, greater is the motivation level and vice versa. Equity theory proposes that individuals who perceive themselves as either underrewarded or overrewarded will experience distress, and that this distress leads to efforts to restore equity. The behavioral psychologist, john stacey adams, developed a useful model for explaining why employee perceptions about fairness matters. Over the period leading up to the economic crisis, western liberal democracies adopted market based economic policies that allowed disparities between the income and. Criticism of the equity theory of motivation since every organization has some structure, so it is not easy for the managers to have equity in the whole organization. Looking back over our series, adams equity theory ties in closely with those of maslow and herzberg. The theory proposes that the employee evaluates the outcomes from the job i. Equity theory, popularly known as adams equity theory, aims to strike a balance between an employees input and output in a workplace. Managerial accountants, the equity theory, job satisfaction, and.
Enter your mobile number or email address below and well send you a link to download the free kindle app. According to equity theory, it is the perception of equitability and inequitability. The core of the equity theory is the principle of balance or equity. Over the past several decades, equity theory adams, 1963, 1965which predicts that members of organizations will strive to be rewarded equi tably, rather than under or overrewardedhas established itself as a foundational theory in organizational behavior and management. Pdf a laboratory experiment was conducted to test referent cognitions theory, which. Developed by the behavioral and workplace psychologist, john stacy adams, equity theory of motivation is one of the justice theories explaining the correlation between input and outcome of performance of employee at a job with hisher perception of equitable or inequitable behavior from the employers. An employee compares his or her jobs inputs with an outcomes ratio. Motivation can change the profit figure of the or ganization such as its improving produc tivity. I will examine the research on equity theory in regard to pay since it is assumed to be one of the. Equity theory and its effect on performance outcome sultan gashgari. Stacy adams in 1963 and fully developed in a chapter published 2 years later, equity theory draws on earlier social psychological concepts inspired by fritz heiders balance. This project work seeks to investigate the impact of the application of equity theory in sustaining organizational productivity using guinness nigeria plc as.
Equity theory is frequently identified as a vital theory for understanding employee motivation. For instance, gill and stone 2010 analyze how considerations of equity influence behavior in strategic settings in which people compete and. The equity theory of motivation how to keep your team. Most studies are unable to answer this question as this requires the theory to. Motivational theories a critical analysis 67 efforttoperformance expectancy is the starting point in the implementation of the expectancy theory. The theory of equity has been highlighted in the literature after the seminal work by.
Equity theory and employee motivation free download as word doc. It does not make allowance for employees who need a feeling of selffulfillment. However, equity theory takes a less straightforward and more fluid approach than previous models. Their criticisms of the theory were based upon the expectancy model being too simplistic in nature.
The theory is capable of contributing to both theory and practice of motivation. Perception is a relative term and differs from person to person. The principal object of any system is equity or fairness. The critical factor that determines a workers sense of. These limitations of the equity theory include the following. When an individual feels that he or she has been treated unfairly compared to others, the individual will be motivated to remove the discomfort and would develop some sort equity to the. The widest accepted explanation of the motivation was given by victor vroom 1964 with the theory most commonly known as the expectationvalue theory that tries to merge together the various elements of previous theories. Faisal almadi department of business administration, the hashemite university, jordan abstract this paper will focus on examining equity theory, its propositions and underlying assumptions. Equity theory has received more attention lately from human resource professionals especially regarding the fairness of outcomes.
Adams equity theory of motivation inequity negative inequity positive inequity organizational justice strength of equity theory predicts the effects of negative and positive inequity distributive justice procedural justice interactional justice equity theory equity theory holds. Most criticisms on equity theory concern the artificial laboratory conditions in which the theory has been tested. Process theories of motivation equity theory business essay. Equity theory is a concept of human relations based on utility, or the amount of happiness and satisfaction one gets out of any given relationship. Considered one of the justice theories, equity theory was first developed in the 1960s by j. Group analyses were estimated by combining these individual contrasts in. Some of the critics of the expectancy model were graen 1969 lawler 1971, lawler and porter 1967, and porter and lawler 1968. The relevance of scientific management and equity theory.
It combines perception aspects of the equity theory with the behavioral aspects of other theories. 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 goaloriented behavior. The relevance of scientific management and equity theory in everyday managerial communication situations reginald l. The views presented in this paper are those of the author and do not necessarily represent the views of odi. Equity theory is a study of human perception in terms of proportionate equivalence of the ratio of one persons inputs to the results. If managers will keep workplace equity, then it means that there will be no distinction among employees and everything will be same. Equity theory is a theory of justice related to the ratio between the output eg, reward and input contribution as compared with the ratio of someone else. Abstract this study examines the concept of equity theory, its intention, and core hypothesis. If the employee perceives inequality, he or she he will act to correct the inequity. As per this motivation theory, an individuals motivation level is correlated to his perception of equity, fairness and justice practiced by the management.
The members will be rewarded according to their effort, which will be fair. Equity theory predicts that ones inputs and outcomes are evalu ated in relation to the inputs. This paper describes a new construct, equity sensitivity, and proposes that reactions to. It is centered around a costbenefit analysis of any given relationship. The pros and cons associated with the equity theory the equity theory is always dependent on the basis of that the group members should be rewarded on the basis of the contribution that they make to the group. Equity theory of motivation in the equity theory of motivation, employees motivation depends on their perception of how fair is the compensation and treatment for their work input. Perceptions of equity and justice and their implications on. Sep 25, 2016 equity theory proposes that a persons motivation is based on what he or she considers to be fair when compared to others redmond, 2010. The equity theory of motivation deals with the way people compare the value of themselves to others in similar work situations based on their inputs and outputs.
Equity theory based strategies for students on overcoming. While equity theory is a significant step forward, the theory itself needs further specification. Adam theory is the theory underlying the development of theories further. The biggest challenge for any company is to constantly motivate its employees so that employees work hard which in turn will help the company in achieving its objectives. Behavioral economics has recently started to apply game theory to the study of equity theory. Equity theory focuses on determining whether the distribution of resources is fair to both relational partners. Understanding employee motivation and organizational. Lee 2009, by combining the transaction cost and the theory of social change. Frameworks for equity helen hodgson in the wake of the global economic crisis of 200809 public concern has focused on inequities within society. Equity theory proposes that peoples motivation, performance and satisfaction depend on their subjective evaluation of the relationships between their effortreward. Equity theory will help hrd explain employees behavior and provide them with the possible factors that might decrease efficiency and performance.
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