Entrepreneurship development and Industrial Consultancy

Module.2 Concept and working of entrepreneur

Lesson 8
MOTIVATION AND ENTREPRENEURSHIP DEVELOPMENT

8.1 Introduction

Motive refers to drive and motivation means drive to achieve a goal. Motivation refers to the way in which urges, drives, desires, aspirations, and strivings or needs direct, control or explain the behaviour of human beings.

Motivation is related with human behaviour. Motivation is a complex phenomenon. In general motivation is a psychological phenomenon as it is related to those factors operating within the individual employee which compel him to act or not to act in a certain way. These phenomena have been a subject of research by many people.

8.2 Characteristics of Motivation

1. Motivation is internal feeling of a person.

2. Motivation is a continuous process.

3. Motivation varies with person and time.

4. Motivation may be positive or negative.

What motivates an entrepreneur to undertake risk and start new enterprise? Is it financial scarcity or financial abundance which motivates an individual to start an enterprise? Is it the family, social status or satisfaction from present life that motivates an entrepreneur to start a new enterprise? The answer to such questions lies in the study of motivation.

Motivational factors involve the inner urge within an individual. Due to such an urge an individual is motivated to do something new, unique and perform better than others. :Research studies associated with finding an answer to the most important question as “To what makes an entrepreneur?” reveals the following important points.

1. Entrepreneurship is associated with personality.

2. Personality development is closely associated with early childhood experiences.

3. Economic deprivation also acts as a motivating factor.

4. Family environment plays an important role. In a family where security and non risk bearing situations are given importance, there are less chances of developing entrepreneurs, whereas family environments which foster venturing in to uncertain risky environment, tend to develop entrepreneurs.

5. Entrepreneurial characteristics are results of combination of various social, economic and psychological factors which are developed right from childhood.

8.3 Motivation Theories

Motivation acts as key to enterprise effectiveness. Motivation is originated from the word motive. Motive means want, need, impulse or drive. Motivation is internal to person. It varies from person to person and time to time. Motivation is on going process and may be positive or negative. There are financial and non financial motivation techniques which can be used by entrepreneur for effective functioning of the enterprise. Incentives directly or indirectly related with money are referred to as financial motivations. Money acts as important and most effective source of motivation. Salary and wages, bonus, leave with pay, medical and housing facilities, profit sharing, vehicle allowance etc are some of the examples of financial motivators which should be used by the entrepreneur for the employees of the enterprise. Non financial motivators are psychological in nature. Status, respect, prestige, participation, job enrichment, recognition, safety of job, responsibility, etc are examples of non financial motivators.

 

Many motivation theories have evolved over the passage of time. These theories can be grouped as follows

Table 8.1 Theories of motivation

Content theories	Process theories	Theories related with human nature
Maslow’s need hierarch theory. Herzberg two factor theory. McClelland theory of achievement, affiliation and power. Alderfer’s theory of existence, relatedness and growth.	Vroom’s theory of valence and expectancy. Porter and lower model of motivation. Equity theory.	McGregor theory of X and Y. Ouchi’s theory Z. Contingency approach.

Maslow’s of theory holds that human needs form a hierarchy ranging from lowest order of physiological need, security need, social need, esteem need to highest order need of self actualisation. The theory suggests that various levels are interdependent and overlapping. Each higher level need emerges before the lower level need is completely satisfied. As the need does not disappear when other emerges, all needs tend to be partially satisfied in each area. When the peak of a need is passed, that need does not work as a primary motivator. The next level need then begins to dominate. Even though a need is satisfied it still influences behaviour due to interdependent and overlapping characteristics of need.

Fredrick Herzberg and his associate of case western reserve university has conducted research study by administering survey questions to 200 engineers and accountants in nine different companies in the Pittusberg, U.S.A. Based upon analysis of the information, two independent set of factors affecting human behaviour were found out. One set of factors operate primarily to dissatisfy employees when they are absent, however their presence does not motivate them in a strong way. They are referred to as hygiene factors. Another set of factors are responsible for strong motivation and high job satisfaction. They are referred to as hygiene factors. Hygiene factors found out by Herzberg include company policy and administration, technical supervision, interpersonal relationship with subordinates, salary, job security, personal life, working conditions and status. The motivation factors found out by Herzberg include achievement, recognition, advancement, work itself, possibility of growth and responsibility. The suggestion of Herzberg is to keep hygiene factors constant or higher while increasing motivational factors.

8.3.1 Important guidelines for motivation

1. The enterprise must consider human resources as the most valuable resource from among all the resources and give them respectable and honorable treatments.

2. Good quality working conditions should be maintained at the enterprise / factory place

3. Safety and health should receive topmost priority.

4. Adequate and fair salary structure should be provided to employees so as to maintain good standard of living.

5. Job security and enough opportunities to rise ahead in their careers should be given to employees.

6. Superiors should praise the subordinates when they deserve it.

7. Adequate tools and equipments should be provided to employees so as to perform their task effectively.

8. Proper feedback system should be implemented so that subordinates can come to know about their strengths and weaknesses.

9. The employees should be provided with opportunities to show their skills and creative instincts in work performance through giving them more freedom, encouraging their participation, implementing management by objectives and latest management concepts.

10. Principles of natural justice should be followed in handling grievances of employees. Full freedom should be provided to employees to express their problem.

11. Adequate training should be provided to the employees to develop skills and creative abilities of the employees.

8.4 Entrepreneurship Development Training Programme

Entrepreneurship development is one of the key elements for promotion of MSME sectors. To undertake this task on regular basis, the Ministry has set up three national level institutes. These are 1) National Institute of Micro, Small and Medium Enterprises, Hyderabad; ii) National Institute of Entrepreneurship and small Business Development, Noida; and iii) Indian Institute of Entrepreneurship, Guwahati. All would be entrepreneurs, can avail the multi-faceted training programmes geared for entrepreneurship cult which are tailor-made for their individual needs and application within the country. Various training programmes are organized on regular basis to cultivate the latent qualities in youths by enlightening them on various aspects that are necessary to be considered while setting up micro or small enterprises. These training programmes have attracted the attention of the educated unemployed youths and have created confidence in them which led to the self employment and creation of better employment. The individual MSME-DIs conduct the following training programmes:-

a) Industrial Motivation Campaign

b) Entrepreneur Development Programme

c) Entrepreneurship Skill Development Programme

d) Management Development Programme

e) Skill Development

f) Business Skill Development Programme

Other Specialized programmes like Bio-technology, etc