1.1 Introduction:-
The ERG Theory of Clayton P. Alderfer is a model that appeared in 1969 in a Psycholo -gical Review article entitled "An Empirical Test of a New Theory of Human Need". In a reaction to the famous Hierarchy of Needs by Maslow, Alderfer distinguishes three categories of human needs that influence worker's behavior; existence, relatedness and growth.
The ERG categories of human needs are
Existence Needs: physiological and safety needs (such as hunger, thirst and sex).
Relatedness Needs: social and external esteem (involvement with family, friends, co-workers and employers).
Growth Needs: internal esteem and self actualization (the desire to be creative, productive and to complete meaningful tasks).
• The ERG theory allows for different levels of needs to be pursued simultaneously.
• The ERG theory allows the order of the needs be different for different people.
• The ERG theory acknowledges that if a higher level need remains unfulfilled, the person may regress to lower level needs that appear easier to satisfy. This is known as the frustration-regression principle.
Thus, while the ERG theory presents a model of progressive needs, the hierarchical aspect is not rigid. This flexibility allows the ERG theory to account for a wider range of observed behaviors. For example, it can explain the “starving artist” who may place growth needs above existence ones.
1.2 Implications of ERG Theory for Management
If the ERG theory holds, then, managers must recognize that an employee has multiple needs to satisfy simultaneously. Furthermore, if growth opportunities are not provided to employees, they may regress to relatedness needs. If the manager is able to recognize this situa ...