Alderfer’s ERG Theory – A Study

Alderfer's ERG Theory

An Introduction

The requirements of people vary with their circumstances. A person who has not eaten for days wants food, while a person with no one to accompany him or her wants to communicate with friends and family. In this article, we will discuss about the requirements that people have and the simultaneous existence of different requirements. We will also learn about the fulfillment of such needs with the help of Alderfer's ERG Theory. The article will give an insight into team management and techniques of motivating team members.

An Idea

Alderfer’s ERG Theory states that the needs of an employee may overlap with one another and they can appear simultaneously. The hierarchy of needs stated by Alderfer was as follows.

  • Existence - These needs include physiological and material desires such as air, water, food, safety and clothing.
  • Relatedness - Relatedness envelopes the need to gain social esteem. It is about the relationship an employee shares with his or her co-workers and employers. The needs of relatedness also include feeling attached with a group.
  • Growth - Growth needs consist of self-actualization and self-esteem. These needs make an employee productive.

Alderfer's ERG Theory


In 1943, Abraham Maslow forwarded a psychology theory called Maslow’s hierarchy of needs, in his paper, "A Theory of Human Motivation." This was a study on motivation and speaks about the hierarchical levels of human needs. According to Maslow, in order to experience higher level needs, one must first go through lower level needs. The five stages of need, starting from the bottom are physiological, safety, social-esteem, self-esteem and self-actualization.

In 1969, Clayton Alderfer, a psychologist compressed Maslow’s hierarchy theory and came up with the ERG Theory of motivation. It was published in the article, “An Empirical Test of a New Theory of Human Need." Through his study, he proved that needs may have a simultaneous presence. For example, an employee who wants to be social may also want to do challenging tasks.

Relationship between Maslow’s Theory and ERG Theory

Existence Needs

The needs at the bottom of the framework are existence needs. They correspond to safety and physiological needs of Maslow’s Theory.

Relatedness Needs

The relatedness needs correspond to social needs and to the external section of self-esteem needs. External part of self esteem needs, refer to the feel good effect that a team member goes through because of what others think about them.

Growth Needs

Growth needs are equivalent to the internal part of self-esteem and self-actualization. Personal growth and skill development, to deliver high end job is the essence of these needs.

Alderfer agrees with Maslow’s Theory, that there is an order to go after needs and that one experiences the requirement to pursue higher level needs only after he or she fulfils lower level needs. However, the order he talks about is not as stringent as that in Maslow’s Theory. He stated that the priority of an employee for one category of need may change according to the situation he or she is in.

Relationships among the different categories of ERG Theory

The three different categories of the ERG Theory are related to each other in the following ways.


This means that the needs of an employee progress to a higher level, after the lower level needs are satisfied.

According to Maslow, a team member whose lower order needs have been satisfied, move up the ladder to higher order needs. However, in case of ERG Theory, the movement from relatedness need to growth needs; does not necessarily entail the satisfaction of existence needs.


If higher order needs are not satisfied, a team member will resort to lower order needs that are easier to satisfy.

According to frustration–regression, when a team member cannot satisfy a higher level need, he or she regresses to lower order need, which has already been satisfied. Hence, it can be said that if growth needs fail to motivate an employee, he or she can resort to relatedness needs for motivation.

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The satisfied needs are being satisfied again to make them stronger.

According to this aspect, when higher order needs cannot be accomplished, satisfying a need which has already been satisfied maintains satisfaction or even makes lower order needs stronger.

Difference between ERG Theory and Maslow’s Theory

  • Unlike Maslow’s Theory, the ERG Theory states that people can be motivated by requirements from more than one level. The needs do not essentially progress from lower level to higher level.
  • If a higher level need is not satisfied, a team member will have more intensity to satisfy a lower level need, which is more concrete.
  • The order of the needs may differ from person to person and the situation he or she is in. For example, a team member with low social communication has more relatedness needs than existence needs.

Financial incentives and ERG Theory

Monetary incentives often help in satisfying growth needs and the need to be recognized by others, i.e., the outer part of self esteem. In this theory, monetary incentives can satisfy human needs indirectly, through the value people attach to them. So, in spite of providing monetary incentives, other needs of employees have to be met, so that workers feel motivated.

To wrap up

Managers and team leaders should realize that employees have many requirements that need to be satisfied simultaneously. As far as ERG Theory is concerned, if a manager keeps trying to satisfy one need, it will not be effective in motivating an employee. Moreover, the aspect of frustration-regression also has an effect on workplace motivation. For example, if an employee does not get growth opportunities, he will try to satisfy relatedness needs by socializing.
However, he or she cannot socialize without money, so he or she will try to revert to the need for earning money. The sooner a manager or team leader discovers this, the quicker measures will he or she take to fulfill the needs, which an employee is trying to fulfill, in order to satisfy his or her growth needs.

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