Motivation refers to a process of stimulating and inspiring people at the work to contribute to the best of their capability for the achievement of organisational objectives.
In order to motivate employees, management has to have knowledge of various types of human needs and the incentives which may be used to satisfy these needs. A.H. Maslow had classified all human needs into different categories. In the order of their priority, these were arranged by him. This arrangement is known as the Hierarchy of Needs.
1. Physiological needs: These needs are essential for human survival and include need for food, air, shelter, water, sleep, etc.
2. Security or safety needs: These are the needs for physical safety as well as economic security which include safety of person and property.
3. Social needs: These are needs for belongingness, friendship, love, affection, attention and social acceptance.
4. Esteem needs: Esteem needs of an employee refer to those needs, satisfaction of which leads to self-confidence and prestige. These needs include self-respect, autonomy, status, recognition, etc.
5. Self actualisation needs: This is the need to be what one is capable of becoming, when a person has realised his full potential, his perception of his own self has been transformed into reality.