McClelland's Theory of Needs

In late 1960s Edwin Locke determined that the best motivator is to work towards attaining specific goals. Exactly determined goals tell a person what is he/she required to do and what effort he/she needs to achieve that goal. According to the goal-setting theory specific and difficult goals which are supported by feed-back give productively and effectively done work. Self-Efficacy Theory Self-efficacy theory is directed to the individual's belief that he/she is capable to fulfill a task of some level of difficulty.

A person with higher self-efficacy is more self-convinced.

The person convinced in his/her abilities and capabilities does not "give up" easily and keeps on working to the finishing of the task. Equity Theory According to the equity theory individuals compare the efforts they give and results they get to the efforts and results of others. As a result of this comparison an organization can get three possible states of its employee: undervaluing, equity, overvaluing.

Any inequity causes relevant reaction and activity from the individual.

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The result of the inequity is a demotivated employee. Expectancy Theory Victor Vroom expectancy theory - the behavior of the individual depends on what he/she expects as a result of this behavior and how attractive the expected result (this expectance) is for him/her. This dependence is well seen graphically. Above discussed theories are focused generally on nonmaterial motivators, material motivators (such as salary, wage, bonuses, and etc.) are also very important. To say briefly, money is a very effective and simple (but short-term) source of motivation.

Situation Analyses As already mentioned, to determine motivation level and motivators used in the banking sector a questioner based on the above discussed theory was prepared. The questioner was determined for the employees of the banks operating in Georgia, but because of the ongoing crisis management of almost all banks refrained from conducting such type of survey.

To generate a general overview on this subject other methods became necessary to be used. These were: interviews with the HR department employees and direct observation on bank employees during the working process. Based on interviews we found that almost every bank operating on Georgian market uses nearly the same motivational methods and approaches. The motivators in the banks are presented generally by the material motivators, such as: salary, wages, premium, bonuses, salary increase and etc.

Some kinds of nonmaterial motivators - oral or written thank are also used sometimes. But nonmaterial motivators are not paid big attention and they are not perceived important. The crisis, that arose in Georgia as a result of different reasons, had a negative influence as directly on operating business associations (and besides of course banks) so naturally on motivational systems too. The negative influence on motivation and motivators was once again enforced by the fact that banks were generally depending on material motivators.

To save financial results the new financial and calendar year almost all banks annulled such kind of motivators (bonuses, premiums, salary increase), and some banks had to take more fierce steps - stop paying salary (or to give some employees not paid vacation) or just fire them (staff reduction). Taking into consideration the fact that the banks have almost no motivation system (as mentioned above there are no more material motivators and nonmaterial motivators lost their weigh - and just did not exist), it would be logical to get a high level of demotivation and dissatisfaction among banking sector employees.

But the reality turned to be entirely contrary: bank employees are quite motivated and do their job effectively and with high quality. This paradoxical result can be explained as follows: simultaneously with annulling the material motivators, there appeared new "motivator" - fear of losing a job. The majority of bank employees work better as they used to not to appear in a list of staff reduction.

To my mind, such kind of "motivator" cannot be useful for a company and entails serious dangers, more specifically in such situation there may be formed a not healthy competition among employees and there is a threat that an employee thinking about possible firing can be harmful for a bank. In some case he/she can put under danger material and intellectual property of the bank. The extremely negative result may be a crime, such as: he/she may transmit intellectual property, valuable information to competitor companies, may damage or stole company property.

The high level of the possibility of raising these dangers is linked to the motivation system functioning before the crisis. As the banks have not been using nonmaterial motivators, after reduction of material motivators, there was left practically no source to motivate employees. During informal conversation employees explained that they would be glad to move other company and the only reason of staying in the same company was sharp reduction on job market. Situation Analyses and Theoretical Framework

To find relationship between the above mentioned theories and the present situation is somehow difficult. In other words the banks do not use these motivational tools. The main motivation system was based on material motivators, more specifically - money. To improve motivation level, employee effectiveness and satisfaction and respectively the whole company effectiveness and quality, it would be useful if the companies (banks) at least partially use the well-known and probated motivation methods.

To better understand these theories and to tailor it to the Georgian reality and the present situation it would be wise to discuss them separately. McClelland's Theory of Needs Persons striven by need for achievement does the job better than it was done before them. Their reward is the job itself and the pleasure got by doing the job. Such types of individuals are self-motivated. Individuals with high desire of achievement prefer situations were they have responsibility (are empowered), feedback on the work done and the average level of risk.

The need for power is performed by the desire of having influence over other, controlling other. Individuals with high need of power get pleasure by being in charge of something, prefer status-oriented positions and are more concerned by prestige and influence over others, then effective and quality work. Individuals with the need for affiliation avoid conflict and competitive situations. They focus on relationships and not on achievements.