What motivates employees, and how do businesses apply it?
Theories of motivation including Taylor, Maslow, Herzberg and McGregor, and the financial and non-financial methods firms use to motivate employees, including piece rate, commission, bonuses, job enrichment, empowerment and teamworking.
A focused answer to the OCR A-Level Business human-resources theme on motivation, covering the theories of Taylor, Maslow, Herzberg and McGregor, and the financial and non-financial methods firms use to motivate, with their benefits and limitations.
Reviewed by: AI editorial process; not yet individually human-reviewed
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What this theme is asking
OCR wants you to explain the main motivation theories and to apply them to the financial and non-financial methods firms use to motivate staff, judging which works best in a given context. Motivation is a frequent topic for high-mark evaluation questions in Components 1 and 2.
Why motivation matters
Motivated employees work harder, produce more and better-quality output, stay longer (lowering turnover) and need less supervision. So motivation directly affects productivity, quality, cost and the customer experience. The theories below offer different explanations of what drives effort, and each points to different methods.
The motivation theories
The theories are not rivals so much as complementary lenses. Taylor explains routine, output-based work; Maslow and Herzberg explain why pay alone often fails to motivate skilled staff; McGregor explains how a manager's assumptions shape their style.
Financial methods of motivation
Financial methods can lift short-term productivity (Taylor) but have limits (Herzberg): once pay is "enough", more money adds little lasting motivation, and incentives like piece rate can damage quality (rushing) and teamwork (competing). They suit routine, measurable output work better than creative or collaborative roles.
Non-financial methods of motivation
Non-financial methods can produce deeper, longer-lasting motivation and suit skilled, creative roles, but they require a supportive culture and capable, willing staff, and they do not remove the need for fair pay (Herzberg's hygiene factor).
Examples in context
Sales teams are often paid commission, a financial method that fits measurable output, in line with Taylor. Google is famous for non-financial motivation, autonomy, interesting projects and recognition, fitting Maslow's higher needs and Herzberg's motivators for skilled staff. A factory paying piece rate may lift output but risk quality, illustrating the limits of financial incentives.
Try this
Q1. State the difference between a hygiene factor and a motivator in Herzberg's theory. [2 marks]
- Cue. Hygiene factors (pay, conditions) prevent dissatisfaction but do not motivate; motivators (achievement, recognition, responsibility) create genuine motivation.
Q2. Analyse one reason why a firm might use non-financial rather than financial methods to motivate skilled staff. [6 marks]
- Cue. Skilled staff are often motivated by the work itself (Herzberg's motivators), so enrichment or empowerment can build deeper, lasting motivation than pay, developed as a chain in context.
Exam-style practice questions
Practice questions written in the style of OCR exam questions on this dot point, with worked answer explainers. The year tag is the paper they imitate, not the source.
OCR H431/01 20194 marksExplain one non-financial method a business could use to motivate its employees. (4)Show worked answer →
A Component 1 "Explain" rewards one developed point in context. Choose one method, for example job enrichment. Define it as giving employees more challenging, varied and responsible work. Build the chain: enriched jobs satisfy higher-level needs for achievement and recognition (Herzberg's motivators), so employees feel more engaged and committed, which raises effort, productivity and retention. Therefore the firm motivates without raising pay. Markers reward the link from a specific non-financial method to the motivational effect and a business benefit, ideally referencing a theory such as Herzberg or Maslow.
OCR H431/02 202116 marksEvaluate whether financial methods are the most effective way for a UK business to motivate its workforce. (16)Show worked answer →
A 16-mark evaluation on a four-level grid. For financial methods (piece rate, commission, bonuses): they directly reward effort and output, can lift short-term productivity and are simple to understand, and Taylor argued money is the main motivator. Chain: a piece-rate scheme ties pay to output, so workers produce more to earn more. Against: Herzberg argued pay is a hygiene factor that prevents dissatisfaction but does not create lasting motivation, which comes from the work itself (recognition, responsibility, achievement); financial incentives can also damage quality and teamwork. Evaluation: the most effective approach depends on the type of work and worker, for example financial incentives suit routine output work, while non-financial methods suit skilled, creative roles; most firms blend both. A judged conclusion reaches the top band.
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Sources & how we know this
- OCR A-Level Business (H431) specification — OCR (2015)