Directing

Directing is the heart of management function. All other functions of management

such as planning, organizing, and staffing have no importance without
directing. Leadership, motivation, supervision, communication are various aspects of
directing. The process of instructing, guiding, counselling, motivating, and
leading people in an organisation to achieve the organisational goals is known
as Directing.

Directing not only includes order and instructions by a superior to the

subordinates but also includes guiding and inspiring them. It encompassed many
elements like motivation, leadership, supervision, besides communication. It is a
managerial function which is performed throughout the life of an organisation.
In the words of Ernest Dale,” Direction is telling people what to do and seeing
that they do it to the best of their ability”.
In the words of Theo Haimann,” Directing consists of the process and techniques
utilised in issuing instructions and making certain that operations are carried on
as originally planned”.

Characteristics of Directing

 Directing initiates action: The other functions of management, i.e.,

planning, organising, staffing, etc., create conditions for managers to take
appropriate actions, whereas directing function initiates actions in an
organisation. It converts plans into action. It is the key managerial function
performed by the managers.

 Directing is pervasive: It is pervasive as it takes place at every level of

management. It takes place wherever superior-subordinate relations exist.
Every manager has a subordinate who works under him and is responsible
for getting things done.

 Directing is a continuous process: Directing is an ongoing activity. It takes

place throughout the life of an organisation, irrespective of the people in the
organisation. Managers give orders to their subordinates, motivate them, and
guide them on a continuous basis.
  Directing flows from top to bottom: It flows from top to bottom through
the organisational hierarchy. In directing, every manager directs his
subordinates and takes instructions from his immediate boss. It is a function
of a superior, i.e., the superior motivates, guides, and supervises his
subordinates to achieve the organisational goals.

 Directing deals with people: It is concerned with the direction of human

efforts towards organisational goals. It can be said that directing is a delicate
function, as it deals with people, and human behaviour is complex and
highly unpredictable.

Importance of Directing

 Directing Initiates action: Directing sets an organisation into motion, and

helps other managerial functions to initiate and activate. It helps the
managers to supervise, communicate, lead, guide and motivate the
subordinates to achieve the organisational goals. For example, a superior
guides his subordinates and explains the task, which will help the
subordinates to start the work and achieve the goal.

 Directing leads to integrated group activity: The organisational objectives

can be achieved only when individual efforts are integrated. Directing
integrates employees’ efforts in such a way that every individual effort
contributes to organisational performance. For example, a leader can
convince his subordinates that group efforts will help to achieve
organisational goals.

 Directing attempts to get maximum out of individuals: Directing helps

superiors to realise the potential and identify the capabilities of individuals
by motivating and guiding them. By using the elements of directing, i.e.,
supervision, motivation, leadership, and communication, the efficiency of
employees can be raised.

 Directing helps to implement changes: Directing helps to introduce

changes in an organisation. Generally, people in an organisation resist
changes. Effective communication, supervision, motivation and guidance
help to overcome such resistance at the workplace. For example, the
 introduction of a new method of doing a particular task in a factory is
resisted by workers, but when managers explain the purpose, guide and
provide them training and rewards, it can be easily accepted by the workers.

 Directing provides stability and balance in the organisation: Stability

and balance are maintained in an organisation with the help of directing
because it fosters cooperation and commitment amongst employees, and
helps to achieve balance amongst various groups, departments, units, etc.
For example, every individual has personal goals, but the managers integrate
the efforts of all the individuals towards the achievement of organisational
goals through guidance, motivation, supervision and communication.

4 Elements of Directing in Management

 Motivation is necessary at all times as employees have the pressure to fulfil

tasks. It can be offered through many ways – incentives, recognition, etc.

 Supervision helps employees stay on track with their tasks. When the
subordinate faces work challenges, the manager is responsible for helping
overcome them.

 Communication is one of the most important elements of direction that

develops mutual cooperation. Without clear communication, information
and tasks can be misinterpreted.

 Leadership nurtures trust among employees and persuades subordinates to

accomplish tasks and grow professionally in their respective roles
 Motivation
An efficient manager is responsible for supervising, leading, and motivating
employees using effective communication skills. This also helps him ensure that the
employees work towards achieving the organization’s objectives.

Motivating Employees

Motivation is derived from the word ‘motive’ which means need, drive, or want of
an individual. Motivating employees means stimulating the employee to
accomplish his/her goals along with the company goals. Talk about goals, some
psychological factors that stimulate people at work are the desire for money,
success, recognition, job satisfaction, etc. Motivating employees is an important
function of the management which can help create willingness among the
employees for optimum performance. Therefore, a manager must arouse interest in
the employee’s mind about his performance. Typically, the process of motivating
people has three stages:

 A need or drive

 A stimulus which arouses the needs

 Satisfaction or accomplishment of goals

Hence, motivation is a psychological phenomenon which managers use to tackle

the needs and wants of their subordinates.

Features of Motivation

 Motivation is an internal feeling: It is a psychological concept and it

cannot be forced on the employees. It is an internal feeling, generated within
an individual, which compels him to behave in a particular manner. Feelings
like needs, desires, urges, etc., influence human behaviour to act in a
particular manner.

 Motivation produces goal-directed behaviour: Employees’ behaviour is

influenced by motivation in such a way that they can achieve their goals.
Motivation helps to achieve both organisational as well as individual
 goals. For example, if a person wants to get a promotion, then he will work
harder to achieve the goals effectively and efficiently.

 Motivation can be either negative or positive: Motivation can be either

positive in form of rewards, like additional pay, incentives, promotion,
recognition, etc., or negative in the form of force, like punishment, threat of
demotion, etc. Positive motivation provides incentives to an individual to
achieve the goal, whereas negative motivation creates fear in the mind of
individuals in order to influence their behaviour to act in a desired manner.

 Motivation is a complex process: Humans are heterogeneous in their

expectations, perceptions and reactions. A particular type of motivation may
not have the same effect on all individuals as it is difficult to predict their
behaviours. Therefore, motivation is a complex task.

 Continuous process: As human needs are unlimited, completion of one

need gives rise to another, and it goes on. Therefore, motivation is a
continuous process, and it does not end with the satisfaction of a particular
need.

Importance of Motivation

 Motivation helps to improve performance level: Motivation helps in

satisfying needs of the employees and providing them satisfaction.
Performance of the employees is improved with the help of motivation as it
bridges the gap between the capacity to work and willingness to work. As a
result, employees work with full dedication and make full use of their
abilities to raise the existing level of efficiency.

 Motivation helps in changing negative attitude to positive

attitude: Positive attitude towards the organisation helps to achieve
organisational goals easily. Sometimes, employees have a negative attitude
towards the organisation or work. Motivation helps to change this negative
attitude to a positive attitude through suitable rewards, positive
encouragement and praise for good work. When the workers are motivated
they work positively towards the organisational goals.
 Motivation helps to reduce employee turnover: Lack of motivation is the
main cause behind employee turnover. Employees do not think of leaving
the job when they are motivated by financial and non-financial incentives.
Reduction in employee turnover saves a lot of money as direct
expenses(recruitment and selection costs) and indirect expenses(labour
dissatisfaction) are reduced. The organisations also benefit because the skill
and competence of employees continue to be available to the organisation.

 Motivation helps to reduce absenteeism: Some of the reasons behind

absenteeism are improper work environment, inadequate rewards, lack of
recognition, etc., and these can be overcome or reduced if the employees are
motivated properly. Proper motivation makes the work a source of pleasure,
and workers do not refrain from work unless it is unavoidable.

 Motivation helps to introduce changes smoothly: An organisation can

survive and grow only when it adapts itself to the dynamic environment.
Changes are generally resisted by the employees because of fear of adverse
effects on their employment. This resistance can be overcome by proper
motivation. Motivation helps to convince employees that proposed changes
will bring additional rewards to them. As a result, they readily accept these
changes.
 Maslow's Hierarchy of Needs Theory
Maslow’s Hierarchy of Needs Theory is regarded as one of the most popular
theories on motivation. It is a theory of psychology that explains that humans are
highly motivated in order to fulfill their needs, which is based on hierarchical
order.

It was first introduced by Abraham Maslow in 1943 for his paper titled Theory of
Motivation and is based on a hierarchy of needs, which starts with the most basic
needs and subsequently moves on to higher levels. The main goal of this need
hierarchy theory is to attain the highest position or the last of the needs, i.e need for
self actualization. In business studies, it is used as a part of organisational
behaviour and also regularly used in psychology lectures.

Levels of Hierarchy

The levels of hierarchy in Maslow’s need hierarchy theory appear in the shape of a
pyramid, where the most basic need is placed at the bottom while the most
advanced level of hierarchy is at the top of the pyramid. Maslow was of the view
that a person can only move to the subsequent level only after fulfilling the needs
of the current level. The needs at the bottom of the pyramid are those which are
very basic and the most complex needs are placed on the top of the pyramid. Let us
read in detail about the various steps in Maslow’s hierarchy of needs theory.
1. Physiological needs: The physiological needs are regarded as the most basic of
the needs that humans have. These are needs that are very crucial for our survival.
The examples of physiological needs are food, shelter, warmth, health,
homeostasis and water, etc. In addition to all the above needs, Abraham Maslow
also included sexual reproduction as one of the most common needs as it is
essential for the survival of the species.

2. Safety Needs: Once the basic needs of food, shelter, water, etc are fulfilled,
there is an innate desire to move to the next level. The next level is known as the
safety needs. Here the primary concern of the individual is related to safety and
security. Safety and security can be regarding many things like a stable source of
income that provides financial security, personal security from any kind of
unnatural events, attacks by animals and emotional security and physical safety
which is safety to health. The various actions taken by an individual in ensuring
safety and security are finding a job, getting an insurance policy, choosing a secure
neighborhood for staying with family, etc.

3. Social Needs (Also known as Love and Belonging Needs): This is the third
level in the need hierarchy theory. It is that stage where an individual having
fulfilled his physiological needs as well as safety needs seeks acceptance from
others in the form of love, belongingness. In this stage, human behaviour is driven
by emotions and the need for making emotional relationships is dominant here.
The following examples can satisfy this need:

1. Friendship

2. Family

3. Intimacy

4. Social Groups

When an individual is deprived of the above needs, he/she feels lonely and
depressed.

4. Esteem needs: This is considered as the fourth level of the hierarchy of needs
theory. It is related to the need of a person being recognised in the society. It deals
with getting recognition, self respect in the society. The need for recognition and
acceptance arises when a person has fulfilled their need for love and
belongingness. In addition to recognition from others, there is a need for the person
to develop self esteem and personal worth.

5. Self-actualization needs: This is the final level of the theory of hierarchy of

needs as proposed by Maslow. It is the highest level of needs and is known as the
self-actualization needs. It relates to the need of an individual to attain or realise
the full potential of their ability or potential. At this stage, all individuals try to
become the best version of themselves. In other words, self actualisation is the
journey of personal growth and development.

Herzberg’s two-factor theory

Herzberg’s two-factor theory is a well-known concept in the field of human
resource management and organizational behavior. This concept puts forward two
factors that motivate employees: job satisfaction and job dissatisfaction.

While these might seem like opposites, they work together in a cycle. For example,
when an employee is unhappy with their job, they may exhibit low performance or
consider quitting the company. On the other hand, satisfied employees feel content
with their work, perform better, and stick with the company for longer.
Understanding this theory can help managers create a positive work environment
and improve employee performance.

What is the two-factor theory?

The two-factor theory is a concept that states the factors that affect an individual's
satisfaction and motivation level. These two factors are:

 Job satisfaction (affective/hygiene)

 Job dissatisfaction (motivational)

When American psychologist Frederick Irving Herzberg developed this theory in
1968, it quickly became the most requested article in the Harvard Business
Review. Herzberg believed that these two factors impacted employees'
performance in different ways. Both effective and motivational factors tend to
influence people differently. Even as an individual is satisfied with their role, they
may not be motivated enough to work towards their goals.

According to Herzberg’s two-factor theory, this can be fixed by considering what

motivates the team members. Simply put, people will act out when they feel like
something is missing (i.e., dissatisfaction) or when they feel good about
themselves (i.e., recognition). If we want this hypothetical team member to stop
acting out, then it may be time to look at how well their needs are being met by the
company.

 Hygiene factors:-Hygiene factors are the elements of a job that satisfy basic
needs: security, pay, fairness, and working conditions. When these needs are
met, employees feel comfortable and satisfied with their roles. Here are
some examples of hygiene factors:

 Salary and benefits: How well an employee's basic needs are met, such as
pay and insurance
 Job security: The amount of control the employer has over keeping the
position filled

 Work environment: The amount of stress and travel required, as well as the
office environment (temperature, cleanliness, basic hygiene)

 Job policies: How an employee's day-to-day activities are controlled

 Supervisory practices: How well the employees are managed

 Company policies and administration: The way policies are set up in the
organization

 Company reputation: The reputation of an organization outside of the

company walls, such as with suppliers and business partners

 Herzberg motivators:-Motivational factors are the key job elements that

motivate people to stay and grow in a role. When these needs are not
fulfilled, the project team may become dissatisfied with their jobs. They may
want more challenging roles that allow them to grow professionally, learn
new skills, or manage greater responsibilities. Here are a few examples of
motivators as per Herzberg’s two-factor theory:

 Achievement: The sense of accomplishment at the end of a project or task

 Recognition for accomplishments: Being acknowledged for their work or

contributions to the organization that go above and beyond their job duties,
whether that’s through a raise, promotion, or important assignment

 Advancement: The opportunity to be promoted within the organization

 Creativity: The ability to think outside the box to solve problems or come
up with new ideas

 Variety: A change in work assignments, projects, or duties

 Independence: The ability to make their own decisions

 Interesting work: Tasks are stimulating and keep them interested

  Responsibility: The opportunity to take on bigger project roles, more duties,
and higher levels of confidentiality

 Accomplishment: The ability to accomplish a given task within the set

deadline

 Personal development: The opportunity to upskill by learning new skills,

improving existing ones, and attaining certifications

 Interpersonal relationships: The ability to interact with other employees or

clients positively and build long-term relationships

 Status: Being seen as a leader in the organization, giving orders, and seeing
those orders carried out

Equity Theory
Adam’s Equity Theory, also known as the Equity Theory of Motivation, was
developed in 1963 by John Stacey Adams, a workplace behavioral psychologist.
Equity Theory is based on the idea that individuals are motivated by fairness. In
simple terms, equity theory states that if an individual identifies an inequity
between themselves and a peer, they will adjust the work they do to make the
situation fair in their eyes. As an example of equity theory, if an employee learns
that a peer doing exactly the same job as them is earning more money, then they
may choose to do less work, thus creating fairness in their eyes.

Extrapolating from this, Adam’s Equity Theory tells us that the higher an
individual’s perception of equity (fairness), then the more motivated they will be.
Conversely, an individual will be demotivated if they perceive unfairness.

Understanding Equity:-To understand Adam’s Equity Theory in full, we need to

first define inputs and outputs.

Inputs:- Inputs are defined as those things that an individual does in order to
receive an output. They are the contribution the individual makes to the
organization.
  The number of hours worked (effort).

 The commitment shown.

 The enthusiasm shown.

 The experience brought to the role.

 Any personal sacrifices made.

 The responsibilities and duties of the individual in the role.

 The loyalty the individual has demonstrated to superiors or the organization.

 The flexibility shown by the individual, for example, by accepting

assignments at very short notice or with very tight deadlines.

Outputs:-Outputs (sometimes referred to as outcomes) are the result an individual

receives as a result of their inputs to the organization. Some of these benefits will
be tangible, such as salary, but others will be intangible, such as recognition.

 Salary

 Bonus

 Pension

 Annual holiday allowance

 Company car

 Stock options

 Recognition

 Promotion

 Performance appraisals

 Flexibility of work arrangements

 Sense of achievement

 Learning
Now that we understand inputs and outputs, we’re in a position to define equity.
Equity is defined as an individual’s outputs divided by that same person’s inputs.

How We Compare: Referent Groups

A referent group is simply a collection of people a person uses for the purposes of
comparison. For Adam’s Equity Theory of Motivation, there are four referent
groups people compare themselves with:

1. Self-inside: the individual’s experience within their current organization.

2. Self-outside: the individual’s experience with other organizations.

3. Others-inside: others within the individual’s current organization.

4. Others-outside: others outside of the individual organization.

McGregor’s Theory X and Theory Y

The idea that a manager’s attitude has an impact on employee motivation was
originally proposed by Douglas McGregor, a management professor at the
Massachusetts Institute of Technology during the 1950s and 1960s. In his 1960
book, The Human Side of Enterprise, McGregor proposed two theories by which
managers perceive and address employee motivation. He referred to these
opposing motivational methods as Theory X and Theory Y management. Each
assumes that the manager’s role is to organize resources, including people, to best
benefit the company. However, beyond this commonality, the attitudes and
assumptions they embody are quite different.

Theory X

 Work is inherently distasteful to most people, and they will attempt to avoid
work whenever possible.

 Most people are not ambitious, have little desire for responsibility, and
prefer to be directed.
  Most people have little aptitude for creativity in solving organizational
problems.

 Motivation occurs only at the physiological and security levels of Maslow’s

hierarchy of needs.

 Most people are self-centered. As a result, they must be closely controlled

and often coerced to achieve organizational objectives.

 Most people resist change.

 Most people are gullible and unintelligent.

Theory Y

 Work can be as natural as play if the conditions are favorable.

 People will be self-directed and creative to meet their work and

organizational objectives if they are committed to them.

 People will be committed to their quality and productivity objectives if

rewards are in place that address higher needs such as self-fulfillment.

 The capacity for creativity spreads throughout organizations.

  Most people can handle responsibility because creativity and ingenuity are
common in the population.

 Under these conditions, people will seek responsibility.

Types of Financial Incentives

Incentives
The incentive is a positive motivational influence on a person that helps improve
his performance. Thus, it can be said that all the measures taken by the
management to improve the performance of its employees are incentives. The
incentives can be broadly classified as financial incentives and non-financial
incentives.

Financial Incentives:-In today’s socio-economic condition money has become a

very important part of our lives. We need money to satisfy almost all our needs as
it has purchasing power. Thus, financial incentives refer to those incentives which
are in direct monetary form i.e. money or can be measured in monetary terms.
Financial incentives can be provided on an individual or group basis and satisfy the
monetary and future security needs of individuals. The most commonly used
financial incentives are:

(a) Pay and Allowances:-Salary is the basic incentive for every employee to work
efficiently for an organization. Salary includes basic pay, dearness allowance,
house rent allowance, and similar other allowances. Under the salary system,
employees are given increments in basic pay every year and also an increase in
their allowances from time-to-time. Sometimes these increments are based on the
performance of the employee during the year.

(b) Bonus:-It is a sum of money offered to an employee over and above the salary
or wages as a reward for his good performance.

(c) Productivity linked Wage Incentives:-Many wage incentives are linked with
the increase in productivity at individual or group level. For example, a worker is
paid 50 rupees per piece if he produces 50 pieces a day but if he produces more
than 50 pieces a day, he is paid 5 rupees extra per piece. Thus, on the 51st piece, he
will be paid 55 rupees.
(d) Profit-Sharing:-Sometimes the employees are given a share in the profits of
the organization. This motivates them to perform efficiently and give their best to
increase the profits of the organization.

(e) Retirement Benefits:-Retirement benefits like gratuity, pension, provident

fund, leave encashment, etc. provide financial security to the employees post their
retirement. Thus, they work properly when they are in service.

(f) Stock Options or Co-partnership:-Under the Employees Stock Option Plan,

the employee is offered the ordinary shares of the company at a price lower than its
market price for a specified period of time. These are non-standardized offers and
shares are issued as a private contract between the employer and employee. These
are generally offered to management as a part of their managerial
compensation package. Allotment of shares induces a feeling of ownership in the
employees and they give their best to the company. Infosys, GoDaddy and The
Cheesecake Factory are some of the companies that have implemented the scheme
of the stock option.

(g) Commission:-Some organizations offer a commission in addition to the salary

to employees for fulfilling the targets extremely well. This incentive encourages
the employees to increase the client base of the organization.

(h) Perquisites:-Several organizations offer perquisites and fringe benefits such as

accommodation, car allowance, medical facilities, education facilities, recreational
facilities, etc. in addition to the salary and allowances to its employees. These
incentives also motivate the employees to work efficiently.

Non-Financial Incentives:-Apart from the monetary and future security needs, an

individual also has psychological, social and emotional needs. Satisfying these
needs also plays an important role in their motivation. Non-financial incentives
focus mainly on the fulfillment of these needs and thus cannot be measured in
terms of money. However, there are chances that a particular non-financial
incentive may also involve the financial incentive as well. For example, when a
person is promoted his psychological needs are fulfilled as he gets more authority,
his status increases but at the same time, he has benefitted monetarily also as he
gets a rise in salary. The most common non-financial incentives are:
(a) Status:-With reference to an organization, status refers to the position in the
hierarchy of the organizational chart. The level of authority, responsibility,
recognition, salary, perks, etc. determine the status of an employee in the
organization. A person at the top level management has more authority,
responsibility, recognition and salary and vice-versa. Status satisfies the self-
esteem and psychological needs of an individual and in turn, motivates him to
work hard.

(b) Organizational Climate:-Organizational climate refers to the environmental

characteristics of an organization that are perceived by its employees about the
organization and have a major influence on their behavior. Each organization has a
different organizational climate that distinguishes it from other organizations.
Some of the factors that influence the organizational climate of an enterprise are
organizational structure, individual responsibility, rewards, risk and risk-taking,
warmth and support and tolerance and conflict. When the organizational climate is
positive employees tend to be more motivated.

(c) Career Advancement Opportunity:-It is very important for an organization to

have an appropriate skill development program and a sound promotion policy for
its employees which works as a booster for them to perform well and get
promoted. Every employee desires growth in an organization and when he gets
promotion as an appreciation of his work he is motivated to work better.

(d) Job Enrichment:-It refers to the designing of jobs in such a way that it
involves a higher level of knowledge and skill, a variety of work content, more
autonomy and responsibility of employees, meaningful work experience and more
opportunities of growth. When the job is interesting, it itself serves as a source of
motivation.

(e) Job Security:-Job security provides future stability and a sense of security
among the employees. The employees are not worried about the future and thus
work with more enthusiasm. Owing to the unemployment problem in our country,
job security works as a great incentive for the employees. However, there is also a
negative aspect of this incentive that employees tend to take their job for granted
and not work efficiently.
(f) Employee Recognition Programmes:-Recognition means acknowledgment
and appreciation of work done by employees. Recognition in the organization
boosts their self-esteem and they feel motivated. For example, declaring the best
performer of the week or month, displaying their names on the notice board and
giving them rewards, fall under the Employee recognition program.

(g) Employee Participation:-Involving the employees in decision making

regarding the issues related to them such as canteen committees, work committees,
etc. also helps in motivating them and inducing a sense of belongingness in them.

(h) Employee Empowerment:-Giving more autonomy and powers to

subordinates also make them feel that they are important to the organization and in
turn they serve the organization better.