Alderfer compacted the five levels of needs (physiological, safety and security, social or love, self-esteem and self-actualisation), proposed by Maslow, into three. The three are existence needs (covering Maslow’s physiological and safety and security needs), relatedness needs (corresponding to Maslow’s social or love needs) and growth needs (which embody Maslow’s self-esteem and self-actualisation needs).
The abbreviation ERG in ERG theory comes from the first letter in each of the three words existence, relatedness and growth, which are the need categories proposed by Alderfer.
The ERG theory and Maslow’s hierarchy of needs theory have both agreements and disagreements.
Where the ERG Theory and Maslow’s Hierarchy of Needs Theory Agree and Disagree
Alderfer, like Maslow, arranges needs in a hierarchy: the lowest (and thus strongest) is existence and the highest (and weakest) is growth. Relatedness needs are between existence and growth needs and are therefore the second strongest, or second weakest. Alderfer, however, sees the hierarchy more as a continuum (Mullins 1999: 420) than a grading of needs.
According to Alderfer, there can be more than one need stimulating an individual at one time. This is in contrast with Maslow’s theory which states that a new need begins to motivate only when the next lower one has been significantly satisfied. So then, in accordance with Alderfer’s proposition, it is possible for both relatedness and growth needs to start motivating; continue to be active; and even get fulfilled at the same time.
Alderfer, like Maslow, recognises that a need that is fulfilled ceases to significantly motivate. However, unlike Maslow, Alderfer argues that there is need-frustration regression. This, argues Alderfer, means that when meeting a higher need encounters barriers, an individual works even harder at ensuring that the lower need is satisfied.
Management Implications of ERG Theory
As in Maslow’s hierarchy theory, the responsibility of the manager is to improve organisational performance through taking advantage of the active needs of an individual.
The manager must identify the needs of a sub-ordinate at a given time and provide the opportunities that lead to meeting the needs. In an effort to satisfy the needs, an individual is likely, according to the theory, to perform better.
What, Specifically, Does it Take to Motivate an Employee?
Solutions at work to existence needs include a life-sustaining pay and a work environment free of danger.
By building good working relationships and comradeship at the work-place, the manager would be providing one way of satisfying relationship needs.
Encouraging employee innovativeness and creativity would be an opportunity to satisfy employee growth needs.
Stoner and Freeman (1989: 433-434) appear to suggest that one challenge of the ERG theory is that its benefits as regards organisational pursuits, for example, are not easy to verify.
