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UNIT-2 Entrepreneurship Motivation Theories: Concept

This document discusses motivation theories relevant to entrepreneurship. It outlines Maslow's Hierarchy of Needs Theory which posits that people are motivated to fulfill a series of needs from basic physiological needs to needs for esteem and self-actualization. It also describes McClelland's Acquired Needs Theory which identifies needs for affiliation, power, and achievement as key motivators. Motivating factors for entrepreneurs can be internal, like a desire for something new, or external, such as government assistance programs.

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3K views5 pages

UNIT-2 Entrepreneurship Motivation Theories: Concept

This document discusses motivation theories relevant to entrepreneurship. It outlines Maslow's Hierarchy of Needs Theory which posits that people are motivated to fulfill a series of needs from basic physiological needs to needs for esteem and self-actualization. It also describes McClelland's Acquired Needs Theory which identifies needs for affiliation, power, and achievement as key motivators. Motivating factors for entrepreneurs can be internal, like a desire for something new, or external, such as government assistance programs.

Uploaded by

notes.mcpu
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UNIT-2 Entrepreneurship Motivation Theories

The Concept
Motivating Factors
Motivation Theories
Maslows Needs Hierarchy Theory
Mc Cleland's Acquired Needs Theory

Concept:
Motivating the potential entrepreneur to undertake
entrepreneurial activities are an important task in
accelerating the pace of economic development.
It is the force that initiates, directs and sustains
entrepreneurial behavior.
Motive may be defined as an inner state of our mind
that moves or activates or energizes and directs our
behavior towards our goals.
Motives are expressions of a persons goals or needs.
Motivation may be defined as the process that
motivates a person into action and induces him to
continue the course of action for the achievement of
goals.
Motives are indications of an individuals need.
Motivation may be defined as the willingness to exert
high levels of effort to reach organizational goals
conditioned by the efforts ability to satisfy individual
need.
It is the force that moves individuals to work for
higher performance.
Motivation refers to the way in which urges, drives,
desires, striving, aspirations or needs direct, control or
explain the behavior of human being Dalton EML
Farland
Motivation consists of three elements like motive,
behavior and goal.

Assumptions
The urges, drives, desires, aspirations, striving or needs
of human being influence human behavior.
The factors which influence human behavior are
psychological, sociological, economic and managerial.
The efficiency of such behavior may be tested by the
resultant action, whether this behavior has directed,
controlled or implemented the desired action.

Steps in Motivation
Recognizing a need;
Selecting ways to satisfy that need;
Engaging in behavior with the goal of satisfying the
need;
Assessing the outcome and reward of the chosen
behavior.

Contemporary approaches to motivation explain three


dimensions:
i. Need theories examine the internal needs that drive
people to take action;
ii. Process theories consider the thought process that
people use when deciding how to act rather than the
needs that stimulate action;
iii. Reinforcement theories are concerned with how and
why rewards and punishments influence behaviour.

Maslows Hierarchy of Needs Theory


This theory is governed by the fact that people are
universally motivated to satisfy a sequence of five
categories of needs.
They start by addressing the basic needs and then
they advance up the hierarchy as they seek to satisfy
each progressively higher need.

i) Physiological Needs:
These needs are basic to human life and include food,
clothing, shelter, air, water and other necessities of
life.
They exert tremendous influence on human
behaviour.
Entrepreneur also being a man needs to meet his
physiological needs for survival.
Hence, he/she is motivated to work in the enterprise
to have economic rewards to meet the basic needs.

ii) Safety and Security Needs:


After satisfying the physiological needs, the next
needs felt are called safety and security needs.
These needs find expression in such desires as
economic security and protection from physical
dangers.
Meeting these needs requires more money and hence,
the entrepreneur is prompted to work more in his/her
enterprise.
Like physiological needs, these become inactive once
they are satisfied.

iii) Social Needs:


Man is a social factor. So, societal recognition is most
important to impart individual intuition of the people.
These needs, therefore, refer to belongingness.
All individuals want to be recognized and accepted by
others.
Likewise, an entrepreneur is motivated to interact
with fellow entrepreneurs, his employees & others.

iv) Esteem Needs:


These needs refer to self-esteem and self-respect.
They include such needs which indicate self-
confidence, achievement, competence, knowledge
and independence.
In case of entrepreneurs, the ownership and self-
control over enterprise satisfies their esteem needs by
providing them status, respect, reputation and
independence.

v) Self-Actualization:
The final step under the need hierarchy model is the
need for self-actualization.
This refers to self-fulfillment.
The term self-actualization was coined by Kurt
Goldstein and means to become actualized in what
one is potentially good at.

McClellands Acquired Needs Theory


i) Need for Affiliation: These refer to needs to establish
and maintain friendly and warm relations with others.
ii) Need for Power: These mean the ones desire to
dominate and influence others by using physical
objects and actions.
iii) Need for Achievement: This refers to ones desire to
accomplish something with own efforts. The implies
ones will to excel in his/her efforts.

Motivating Factors
1. Internal Factors:
i) Desire to do something new
ii) Educational background
iii) Occupational background or experience

2. External Factors:
i) Government assistance and support
ii) Availability of labor and raw material
iii) Encouragement from big business houses
iv) Promising demand for the product.

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