A friend mentioned Herzberg’s theory of motivation to me today. Herzberg says there are two kinds of motivational concerns: true motivators and hygiene factors:
Herzberg (1959) constructed a two-dimensional paradigm of factors affecting people’s attitudes about work. He concluded that such factors as company policy, supervision, interpersonal relations, working conditions, and salary are hygiene factors rather than motivators. According to the theory, the absence of hygiene factors can create job dissatisfaction, but their presence does not motivate or create satisfaction.
The key idea here is that dissatisfaction and satisfaction can exist on different scales.
This theory can be extended beyond workplace content. For example, when a venture capitalist is considering an investment, s/he must be assured that the hygiene factors are taken care of — the founders’ resumes are truthful, references give thumbs up, the company is incorporated and able to receive investment, and so forth. If these factors don’t check out, it definitely precludes investment. If these factors do check out, it doesn’t mean the investment is prudent; just possible.
Whether you’re an employer trying to motivate employees, or an investor doing due diligence, it seems important to figure out whether you’re focusing on a hygiene factor or a true driver.
6 comments on “Herzberg: True Motivators vs. Hygiene Factors”
This is a good distinction for VCs in the midst of due diligence. It seems to be that the hygiene factors may lead to return of capital (if you are lucky) and the drivers are where you find the juice. I like your characterization – and will use it (with credit of course) to keep our own process honest.
This is good, very good I like: the founders’ resumes are truthful, references give thumbs up, the company is incorporated and able to receive investment!
Your examples of hygiene factors don’t really illustrate the subtlety of the issue. Issues like status of incorporation and so forth are just reps in the investment agreement – legal diligence stuff.
Better examples are that the management team members’ experience is well-matched to their roles, that their business plan shows a correct understanding of their marketplace and that their strategy fits appropriately within that market; that their financial plan shows an aggressive but feasible revenue ramp and their cost structure is appropriate at each stage and doesn’t neglect any predictable expenditures; that the CEO is articulate and appropriately respectful; etc.
True motivators are much harder to both describe and judge. Things like the passion and chemistry of the management team; the central elements of the market that make this company’s strategy viable; the relationships the management team has with potential customers; the unique appeal and/or value proposition of the product.
Dave, I like your comment, but I think it’s very hard to tease out true motivators versus hygiene factors in business. That’s why I chose easy hygiene examples.
True motivators are hard to assess independently because it’s all so co-mingled. For example, no passion and chemistry in the management team will surely doom a company, but in and of itself it’s not enough to make a company successful. I think that could as easily fall under “hygiene” as “motivator”.
My point was that there are things that some consider true motivators that are actually hygiene factors. No investor is foolish enough to think that just because the resumes are accurate the company will be successful, but some do confuse the other items I mentioned with true success factors.
You are right that true motivators in an investment are almost always a combination of several key factors.
Analyze it a bit, one can arrive at a two tier structure for due diligence prior to investment decision by a VC.
Tier 1 – Motivators – (a) has the market need been clearly identified and how do the founders try to solve it (b) Competence of the team (c) Robustness of the biz model (d) Is it the next good investment for my fund and can I add real value to it. ( There could be others too )
Tier 2 – Hygiene Factors – as you have already stated.
Tier 1 is decision critical and Tier 2 is an enabler.