After reading this article you will learn about the ERG theory of motivation.

In response to various criticisms, Clayton Alderfer (1972) has proposed called an alternative to Maslow’s Theory in an effort to simplify it and give it some empirical support. It is calculate ERG Theory of Motivation. He speculates that some features of Maslow’s theory are very reasonable.

However, he develops some new features that consistently take into consideration the issue of inter-individual differences. He developed a theory consistent with the view that operates according to the logic of an open-system and to bridge “the gap between those views of man which tend to view him primarily in reactive, tension-producing ways and those orientations which tend to focus on his proactive, stimulus-seeking qualities.”

Alderfer argues that three need categories akin to Maslow’s needs are sufficient to describe adult desires:


(1) Existence(E),

(2) Relatedness(R), and

(3) Growth(G).

The ERG theory classifies the need hierarchy developed by Maslow into three levels:


1. Existence Needs:

Existence needs include all types of material and physiological desires that are both work and non work related. Pay, fringe-benefits and physical working conditions are work-related reflection of such needs. These are the needs for physical well-being.

It may be noted that this category includes all of the various physiological and safety-ma­terial categories described in Maslow’s first two categories. Being tangible, such needs can be divided among people in such a way that competition for them often forms a zero-sum game, i.e., the loss of one person is the gain of the other (one person gains exactly what the other loses).

2. Relatedness Needs:


These needs pertain to the need for satisfactory relationship with others who are significant, including family members, co-workers, supervisors, friends, and even people one intensely dislikes. Unlike existence needs, their satisfaction depends on sharing mutual understanding and interactive influence. The defining characteristic of relatedness need gratification is the sharing of thoughts and feelings.

3. Growth Needs:

Such needs are almost equivalent to Maslow’s esteem and self-actualisation needs. These focus on the development of human potential and the desire for personal growth and increased competence. Such needs are the result of active involvement of persons in their various environmental settings, such as home, job, and recreational activi­ties.

As B. Scanlon and B. Keys argue:


“Satisfaction of growth needs comes through a person’s encountering problems in these settings that call upon their full capacities and that may involve the development of additional capacities — thus, the idea of growth.”

Alderfer’s theory is based on the assumption that these three categories are inherent in all human beings, although they differ in strength for each person.

He summarises the way in which the three categories operate as follows:

Each of the three basic needs in ERG theory was defined in terms of a target toward which efforts at gratification were aimed and in terms of a process through which satisfaction could be obtained. For existence needs the targets were material substances, and the process quickly became a ‘win-loss’, and one person’s gain is correlated with another’s loss.


For relatedness needs, the targets were significant others (persons or groups), and the process was mutual sharing of thoughts and feelings. For growth needs, the targets were environmental setting, and there were joint processes of a person becoming more differentiated and integrated as a human being.

Scalon and Keys have summarised the following seven major propositions which emerge from ERG Theory:

P1. The less existence needs satisfied, the more they will be desired.

P2. The less relatedness needs are satisfied, the more existence needs will be desired.


P3. The more existence needs are satisfied, the more they will be needed.

P4. The less relatedness needs are satisfied, the more they will be desired.

P5. The less growth-needs are satisfied, the more relatedness needs will be desired.

P6. The more relatedness needs are satisfied, the more growth needs will be desired.


P7. The more growth needs are satisfied, the more they will be desired.

When organisational members gratify existence needs, they are less competitive with one another over scarce resources, thus allowing them to focus on the gratification of their relatedness needs.

Likewise, the relative gratification of relatedness needs allows individuals possessing strong growth needs to emphasise the gratification of such needs. Thus Alderfer apparently agrees with Maslow that, at least on certain occasions, individuals do tend to move up the hierarchy.

Thus ERG model and Maslow’s hierarchy of needs theory are similar because both are in hierarchical from and presume that individuals move up the hierarchy one step at a time. However, Alderfer reduced the number of need categories to three and proposed that movement up the hierarchy is more complex, reflecting a frustration-regression principle, namely, that frustration of needs at one level motivates individuals to move down the hierarchy to satisfy an already fulfilled lower-order need.

Thus, a worker who is unable to fulfill a need for personal growth may revert to a lower order social need and redirect his (her) efforts toward making a lot of money. In effect, gratification of existence needs can serve as a rationalization for failing to satisfy high level needs.

The EGR model, therefore, is less rigid than Maslow’s need hierarchy, suggesting that individuals may move down as well as up the hierarchy — depending on their ability to satisfy needs.


A simple example may clarify the above point. Maslow’s theory explains, at least partly, why sales organisations in recent years have shifted from commissions to straight salaries for compen­sating the sales force. Commissions put the emphasis on making money to meet safety and physiological needs but expose sales people to high risk during economic recession. Fixed salaries guarantee that basic needs will be met, thus freeing individuals to pursue work activities that will fulfill high-level belongingness or esteem needs.

Alderfer also believes that all organisational members are similar to one another because they possess some desires in each need category that they seek to satisfy at the same time, thus weakening but not entirely destroying the concept of the hierarchy of needs.

He also believes that organisational members differ from one another in terms of relative strengths of their needs or the degree to which they seek to satisfy various needs, at least in part because of the early developmental experiences they have undergone.

To sum up: three major points of ERG theory are the following:

1. Need strength varies among individuals.

2. An individual can attempt to fulfill needs at different levels of the hierarchy simultaneously.


3. An individual can move up or down the hierarchy.


In short, the ERG theory is relatively new compared with Maslow’s need hierarchy. But empirical findings indicate that it may be a more valid account of motivation in organisation. And, our main production here is that managers should not rely too heavily on any one particular perspective to guide their thinking about employee motivation. What then is the practical utility of the need hierarchy view?

The answer is simple.

As Griffin has put it:

“Perhaps the key insights to be gleaned from the need hierarchy view are that some needs may be more important than others and that people may change their behaviour after any particular set of needs has been satisfied”.