EMPLOYEES’ MOTIVATION IN KNOWLEDGE-BASED

ORGANIZATIONS
IN THE IT INDUSTRY

Aurel Mihail TITU

"Lucian Blaga" University of Sibiu, Sibiu, Romania
*
Corresponding author, [email protected]

Madalina Maria PANĂ

University POLITEHNICA of Bucharest, Bucharest, Romania
[email protected]

Abstract. Employees’ motivation is, probably, the biggest and most profound concern of managers today.
Considering the constant changes of the marketplace, along with the attrition rates nowadays, we can easily
understand why this matter is of high importance. But how did the study of motivation evolve throughout
time and what stage has it reached today? From Maslow and the Pyramid of Needs to Herzberg and the
Two-Factor Theory, McGregor and the X and Y Theories or McClelland and his Need for Achievement
Theory, the matter of motivation has long been debated and researched. The present scientific paper aims
to analyze how today's employees in knowledge-based organizations find job satisfaction, what helps them
feel motivated and the way in which the management and the organizations can influence the level of job
satisfaction and motivation for the employees working in the IT industry. Generations evolve and so do their
expectations of what a workplace should look like. For the employees working in the IT industry, the
autonomy, and the learning opportunities they could have while doing their job are at least as important,
or perhaps more important than their level of satisfaction with the financial benefits offered by companies.
The research methodology of the present paper is based on literature review, and the objectives are related
to describing the knowledge-based organizations and how they differ from other types of organizations,
analyze the evolution of motivation theories over time, presenting the IT industry and its specifics for the
motivation of employees in this field.

Keywords: Motivation, Management, Knowledge-based Organizations, IT Industry, Servant Leadership,

Agile Teams

Introduction
The most valuable and at the same time the most complex resource of any organization is the
human resource. The goal of any organization is to maximize the strengths and minimize the
weaknesses of human resources. The purpose of this paper is to study how employees’ motivation
can affect or influence their performance, but also how the IT industry differs from other industries,
in terms of employee motivation methods.
There is no formula for motivation, on the contrary, each person responds differently to
certain motivational factors, however, within organizations, the responsibility regarding the
motivation of each employee is assigned to managers, who must reach the level where they know
their team members very well, so that they manage to know exactly what motivates them. The
human being is the only resource with feelings and emotions, which can think, react, and feel, but
when faced with the lack of motivation, this resource will quickly self-limit.

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 According to authors’ opinion, motivation is not a personality trait independent of the
context in which it is discussed, nor an automatic consequence of "good" management or of an
organization, but results from various economic, organizational, technological, cultural factors and
their interaction with the needs, values, beliefs, and aspirations of each individual.
Motivation is not a fixed, stable process, but constantly varies according to people, their
needs, and the organizations they belong to. PICBE |
The notion of “motivation” is present in our lives since early childhood. Whether we refer PAGE \*
to motivational elements that were passed on to us by our parents, grandparents or relatives with
the aim of causing us to perform various actions that we did not perceive as mandatory or necessary,
such as ”if you don't eat everything, you don't get dessert”, or to certain goals that we longed for
without necessarily seeing them as objectives, but rather as part of everyday life, such as winning
a race with colleagues or friends, or learning a poem in kindergarten – all of these had implicitly a
part related to our motivation, be it external or intrinsic, positive or negative.
As managers, we always seek for the best ways to improve the employees’ experience and
to overcome different obstacles that may appear due to the lack of motivation, and in today’s
dynamic work environment, especially in the IT field, it is highly recommended to prevent rather
than treat any effects of this phenomenon. The present paper aims at validating previous research
and strengthening the existing body of knowledge through the identification of links between
motivation theories and their impact or adaptation in the IT industry.
The paper is structured in three chapters: the first one has the purpose of reviewing the
existing literature related to knowledge-based organizations, the second one analyzes well-known
motivation theories and the third one is focused on a more specific knowledge-based industry: the
IT field and the elements contributing to employees’ motivation in this area.

Knowledge-based organizations
In his paper, “The Coming of the New Organization”, Peter Drucker predicts the emergence of
what we know today as “knowledge-based organizations”, also known as “learning organizations”.
This type of organization is represented by the fact that, in comparison to typical
manufacturing organizations known in the 1950s, their workers are mainly specialists in their field,
capable to self-organize and to adjust based on the feedback received. These employees are also
characterized by the desire to continuously learn in an organizational context that will put great
emphasis on empowering them and giving them all the needed means to become successful.
Other important aspects regarding these organizations are their flat structure, with
decentralized structures for decision making, and the fact that that work is not made identically by
all the employees, but they are filled with specialists that have their own unique way of performing
the work when empowered to do so. (Drucker, 1988)
In his book, “The fifth discipline”, Peter Senge describes an organization that is in a
continuous improvement process, that is capable to adapt, innovate and evolve, based on five key
components: Systems Thinking – the capability to see events as part of a complete system, that
interact and have effects on each other, and not only as small, isolated parts; Personal Mastery –
reaching a high level of proficiency through continuous improvement of personal skills and
abilities, developing patience and the capability to see things objectively and keeping a strong
connection between the personal and organizational learning objectives; Mental Models – a
common understanding for all employees of the organization in which they work, the business
environment and all the other factors that may have a big influence. This refers to people being
able to speak up about their understanding of how things work in order for others to have the same
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Proceedings of the 17th International Conference on Business Excellence 2023
understanding; Building Shared Vision – the vision related to the future of the organization, its
goals and direction, that should be shared between the people, because when people work for a
common vision, they are brought together by the same dreams and will work towards
accomplishing them with more interest than they would do if just being told to do so by the
management. This nurtures a commitment feeling and buy-in from employees; Team Learning –
the capability of working together to create more valuable outcomes than individually. Like sports PICBE |
teams, in business, working together and producing amazing results must be trained and learned. PAGE \*
An important contributor to team learning is the team communication (or team dialogue),
encouraging collaboration and teamwork, and creating an environment in which individuals can
learn from one another. (Senge, 2006)

About motivation throughout the time

Over time, motivation has been widely and in various forms debated, and numerous similar theories
about motivation have been stated.
Perhaps one of the most famous theories of this kind is Abraham H. Maslow's Theory of
Human Motivation, in which the American psychologist ranks the basic needs of the human beings
in five categories that dictate human behavior and influence motivation (fig. 1).
The mechanism through which this hierarchy of needs works, according to Maslow, is
progressive, meaning that until one of the needs on an inferior scale is not accomplished, the human
being will be concentrating its resources to the fulfillment of that specific need, not allowing the
evolution towards a superior need. For example, in a hungry person, the most important thing to
obtain is anything that could help to fulfill that physiological feeling of hunger, the entire human
body will work as a system meant to provide what it lacks: in this case, food.
In Maslow’s view, on the lowest rung are the physiological needs, such as the need for
food, water, etc., followed on the next level by the security needs that human beings have. These
two steps represent the basic needs of human beings.
On the third and fourth levels of needs, Maslow places the need for belonging and love, and
the need for esteem and fulfillment, which lead to feelings such as self-confidence, power,
capability, and the ability to be useful to the world - all these being the psychological needs of
human beings.
If all these needs are fulfilled, since the evolution from one step to another depends on the
fulfillment of the needs from the lower levels, the need for self-actualization of the human being
arises, present through the desire to know, and understand and manifested through curiosity,
learning, experimentation, and so on.
These sets of goals are interdependent and, in an evolutionary phase, can create an
environment on which humans develop and reach their maximum potential (Maslow, 1943)
In Maslow's view, not all people are motivated by the same set of needs. Different people
may be motivated by different needs at any given time. It is always the least satisfied (or most
unsatisfied) needs that motivate an individual the most.

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 PICBE |
PAGE \*

Figure 1. Maslow’s pyramid

Source: https://www.stroke.org/en/stroke-connection/stroke-onward/rebuilding-identity--
a-critical-step-in-recovery/ maslows-hierarchy-of-needs

Another theory that deepened the subject of motivation is Frederick Herzberg's Dual Factor
Theory (fig. 2). According to Herzberg, there are certain factors that result in satisfaction in the
workplace and there are also other factors that aim to prevent dissatisfaction.
According to Herzberg, the opposite of "Satisfaction" is "non-Satisfaction", and of
"Dissatisfaction" is "non-Dissatisfaction". (Herzberg, 1964)
Herzberg classified these factors into two categories: hygiene factors and motivational
factors.
Hygiene factors represent those factors that are essential for the existence of motivation at
work. They do not lead to positive long-term satisfaction, but if these factors do not exist in the
workplace, they will lead to dissatisfaction. In other words, hygiene factors are those factors,
which, once reasonable in a workplace, tend to “pacify” employees, and keep them away from
dissatisfaction. These factors are extrinsic to work and are also called “maintenance factors”, as
they are necessary to avoid dissatisfaction. These factors describe the work environment and
symbolize the psychological needs that individuals expect to be met. (DeShields, et al., 2005)
Hygiene factors include the salary or the wages, which must be appropriate for the work
performed and must be equal and competitive with those operating in the same industry or field;
company policies and administrative policies, which must be clear and fair; fringe benefits:
employees should be offered employee assistance programs, family benefits, health care plans,
etc.; physical working conditions: work must be carried out in safe, clean and hygienic conditions,
work equipment should be well-maintained and comply with the latest standards; interpersonal
relationships: employees’ relationships with colleagues, superiors and subordinates must be
appropriate and acceptable, there should be no conflicts or humiliating elements; occupational
safety: the organization must ensure occupational safety for all employees. (study.com, 2022)
According to Herzberg, hygiene factors cannot be seen as motivational factors.
Motivational factors are those that give positive satisfaction. These factors are intrinsic to work
and motivate employees to achieve a higher position. They are involved in doing the actual work,
and employees find them satisfying. Motivators symbolize psychological needs that have been
perceived as an additional benefit. These include recognition, a sense of accomplishment,
opportunities for growth and advancement, and the importance of work.

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 PICBE |
PAGE \*
Figure 2. Herzberg’s Two Factor Theory
Source: https://www.linkedin.com/pulse/herzbergs-two-factor-theory-motivation-ahmed-sayed-
deriaa-pmp

A third view on motivation is found in two theories that can be seen, equally as an analysis
of motivation, but also as a comparison between two different management styles: Douglas
McGregor's Theory X and Theory Y (fig.3).

Figure 3. Management styles, theories X and Y

Source: https://research-methodology.net/theory-x-and-theory-y

In these two theories, McGregor draws a parallel between the egocentric man, who is
indifferent to organizational goals, who lacks ambition, dislikes responsibility, and prefers to be
led in his organizational work. This is the typical employee described in Theory X and is by its
nature indolent, chooses to work as little as possible, resistant to change, naive and easily fooled.
There is a clear division between management and workers, with managers having a strong
control over the employees, managers being expected to make all decisions and employees simply
to follow instructions.
In terms of motivation, this employee constantly needs actions from the outside, his activity
is often guided by the management - without which he would be indifferent, even resistant
regarding organizational activity. This type of employee must be constantly convinced and
rewarded, sometimes even punished in cases where it is considered necessary. The approach
associated with this theory can, in practice, lead to low morale, high turnover, and a lack of

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motivation in the workplace, especially since punishment can be used as a form to motivate
employees to work, if deemed necessary.
On the opposite side to the negative view of the Theory X employee, the typical Theory Y
employee is neither passive nor resistant to the needs of the organization he belongs to, more than
that, he is naturally motivated to engage in work-related activities, with potential for development,
having the ability to assume responsibility and with a strong desire to participate to the goals of the PICBE |
organization he belongs to as a member This employee is not led by the management, but has a PAGE \*
sense of ownership and accountability, taking the initiative whenever necessary. The management
has the role of building an organizational culture that supports the employees’ growth needs, giving
them the possibility to make important decisions, recognizing their merits and supporting their
development and evolution.
In this scenario, employees that are trusted and empowered, with a constant feeling of
accomplishment will be more motivated and, thus, more creative, and productive. (McGregor,
1960)

Motivating employees in knowledge-based organizations in the IT industry

IT, or Information Technology is the term used to cover under a single umbrella all the technologies
that are used in order to collect, convert and transmit information. The occurrence of the IT industry
and its tools has contributed significantly to the evolution of the knowledge society as we know it
today, offering people the context to expand and share their knowledge without being limited by
time, distance, or high costs. (Ogun et al., 2020)
With the help of computers, storage, and all the infrastructure used to collect, process and
spread data, the IT industry has played an important role in the development of most of the other
industries: business development has been significantly improved, production monitoring is more
performant with the use of technology, the security and governance of internal application in many
companies has improved, and many more examples can be given related to the Information
technology components and their functions (fig.4). (Tech Target, 2022)

Figure 4. Information Technologies components and functions

Source: https://www.techtarget.com/searchdatacenter/definition/IT

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 The IT industry is, by excellence, the industry of innovation, research, and technological
evolution. How is this reflected in terms of the motivation of employees in the IT industry and what
are the strategies for motivating and increasing the engagement of employees in this industry? How
does Agile project management help the development of employee motivation in the IT industry?
What is Servant Leadership and how does it contribute to employee motivation? All these are topics PICBE |
that will be addressed in the following. PAGE \*
Agile management represents an iterative project management or software development
approach, which is based on the ideas stated in the Agile Manifesto: “We are uncovering better
ways of developing software by doing it and helping others do it. Through this work we have come
to value: Individuals and interactions over processes and tools. Working software over
comprehensive documentation. Customer collaboration over contract negotiation. Responding to
change over following a plan. That is, while there is value in the items on the right, we value the
items on the left more.” (Beck et al., 2001)
As it appears from the Agile manifesto, individuals, and the interactions between them are
more important than cumbersome processes and tools, this having a direct impact on people and
their motivation.
Agile management is based on 12 principles, which are the basis of the Agile Manifesto,
among them the explicit mentioning of the motivation of Agile team members (”Build projects
around motivated individuals./ Give them the environment and support they need,/and trust them
to get the job done.”), but also elements that show the autonomy and trust given to these teams,
something that will result in the self-confidence and psychological balance of the members of these
(”At regular intervals, the team reflects on how/ to become more effective, then tunes and adjusts/
its behavior accordingly.”). Agile teams are self-managing teams, having the ability to build a
functional product by themselves and to have complete autonomy over the activity performed.
(Beck, et al., 2001)
As stated by Malik, Sarwar and Orr, the Agile way of working stimulates psychological
empowerment, autonomy, and easy communication and, at the same time, the innovation capacity
of IT teams increases their performance and motivation. This is closely related to the way in which
employees feel the pressure of the organization and the way in which the Agile way of working
participates in this vision, in close connection with the fact that in Agile teams the development is
done incrementally, and the work is organized in such a way that the deadlines are nothing but
moments of evaluation and feedback, allowing the gradual improvement of the work and leaving
room for change. (Malik et al, 2021)
The concept of empowerment has multiple facets: from structural empowerment, which
represents the “official” or formalized power offered by the organization to a person, to
psychological empowerment, represented by the vision of each employee regarding his work and
the ability to carry out and control it.
According to B. Tessem, the two are interdependent, and psychological empowerment is
the very source of workplace performance, employee satisfaction and motivation.
In the IT industry, especially in Agile teams, the context is favorable to psychological
empowerment: the different practices that occur on a daily basis, such as the daily meetings,
retrospective, iteration reviews, offer the teams the possibility to work and adjust their outcomes
based on frequent feedback and direct involvement in the life-cycle of the product built, their
participation being the most valuable element in order to shape the final product or software. More
than that, using different practices, such as pair programming or shared code ownership, Agile

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Software Development teams work collaboratively with shared responsibility and have the
possibility to give each-other real-time feedback and create an environment of trust and nurture the
feeling that they can always count on each other. (Tessem, 2014)
In addition to Agile used for software project management, the notion of “agility” goes
further, up until the representation of a strategic characteristic of those organizations that are able
to remain flexible, open and always ready to adapt to new ideas, adjust taking into account new PICBE |
technologies, embrace all the socio-economic aspects and their impact, any new norms and values PAGE \*
that are deemed useful, and which incorporate flexibility, without losing efficiency.
In other terms, agility can represent anything related to keeping up with new trends, being
in a continuous change, if that change is trusted to be beneficial for the organization, all this while
also coaching and training their employees to act agile, to embrace change as part of their
evolutionary path and support them to the adoption of this new mindset, while also empowering
them sufficiently so that they could manage to carry out important tasks. Of course, this type of
transformation doesn’t come in a day and needs to have the buy-in of several actors with big
influence in the organization, such as top-management or stakeholders and the constant coaching
and follow-up from actors with extensive experience and knowledge about Agile teams and the
different frameworks, such as the Scrum Masters or the Agile Coach, in order to make sure that the
mindset is equally understood and the practices are used similarly throughout the organization.
(Eilers et al., 2022)
This change and transition towards agility in organizations led, naturally, to a transition in
the management style, thus allowing the development of the servant leader or the servant manager.
The concept of servant leadership appeared for the first time in Robert K. Greenleaf's
essays: “The Servant as a Leader” (1970), “The Institution as Servant” and “Trustees as Servants”
(1972), who stated that servant leadership is not just another technique, or another style of
management and is based on the principle according to which servant leadership is a lifestyle that
comes to life when a manager first of all wants to serve. (Greenleaf, 1970; Greenleaf 1972a;
Greenleaf 1972b)
Leadership is often described as a social influence process that is behind many success
storis from different fields of activity: from politics to NGOs or organizations, all their success
stories have had inspirational and successful leaders that contributed. In addition to that, the servant
leadership brings to the table something new: the ability of leaders to serve others, to contribute to
the evolution of employees thus eliminating the conservative beliefs that ideas coming from people
having less experience are less valuable.
Nowadays, this concept of servant leadership has continued to be analyzed and has evolved
along with organizations, but theories about it find such behaviors since ancient times: from Jesus
Christ, to Confucius, Martin Luther King Jr., or Mother Teresa, all these historical characters had
behaviors that were precursors to the concept we know today as “servant leadership”.
Servant leadership can be found in many types of organizations, from non-profit
organizations to profit-oriented organizations, regardless of the field of activity. (Parris et al., 2013)
In this paper, we are only addressing the impact of servant leadership on the motivation of
employees in the IT industry.
Today's working environment has led to the emergence of what is called the "liquid
workforce", which refers to employees who can be assigned to various projects at any time and
whose knowledge makes them flexible and easy to adapt to any technological demands.

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 These employees can easily adapt to any type of economy, any industry in which the
application of their knowledge is needed and to any geographical area. Of course, this type of
employees can be found in any industry, but their presence is significantly higher in the IT industry.
For this type of employees, the agility and adaptability of the employers are essential
elements in terms of taking the decisions to collaborate with one company or another, thereby
ensuring that they will constantly remain open to the opportunities of the labor market, and also to PICBE |
their needs regarding the constantly increase of their knowledge and the ways to adapt it, in order PAGE \*
to build their own career paths. (Marjanovic et al., 2022)
In the theories related to Agile teams, the issue of motivation does not appear as such in
terms of factors with a direct impact on the team's efficiency, or on the project's success, but what
is considered in the analysis of such teams is the morale of the team, which may be influenced by
various factors. Morale refers to the feelings and emotions that employees feel towards the
organization or its members, while motivation refers to the intrinsic force that drives employees to
achieve results or to reach objectives.
Motivation is an internal factor, rather oriented towards objectives or goals, which has more
to do with the internal state of the employees, but its influence on the success of the project or the
organization cannot be denied.
Servant leadership has a very important role regarding the motivation of employees in the
IT industry. By empowering them, motivating them to reach their goals, discovering and improving
their skills, giving them the necessary autonomy in carrying out their daily activities and granting
them with a high level of confidence and trust by their leaders and by the organization itself, these
employees reach a high level of motivation and satisfaction at the workplace. (Ellahi et al., 2022)

Conclusions
Over time, the issue of motivation has been long discussed and debated. Understanding the
motivational factors’ impact on employees’ lives and workplace habits has been for many years
subject to many studies and theories.
There is no key to guessing what external or internal factors motivate everyone, exactly as
there are no secret tools that could help managers find out what the sources of the absence of
motivation are, without clear communication, constant feedback, and support towards their
employees. Of course, there are many factors that can contribute to changes in motivation, but its
complexity is also what gives its beauty.
Along with technological evolution, the organizations have also evolved, being followed
(or even anticipated) by the evolution of the employees.
The purpose of the learning organizations is to constantly encourage and support systems
in which these employees can learn, develop new skills, grow professionally, accept new tasks and
challenges, and adapt to all the business environment changes, technological advances or any other
factors. These organizations must provide learning means, promote cross-functional collaboration,
and regularly provide feedback to their employees, so that they feel motivated and satisfied with
their work and be able to evolve, gather existing knowledge, understand and interpret it, transmit
it to others, with the final purpose of creating new knowledge.
The IT industry is, by excellence, an industry of evolution and innovation, both
technologically and regarding the evolution of people, which must constantly keep pace with
technology, risking that the knowledge that is in vogue today will become obsolete in a short time.

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 Employee motivation in IT industry is a very important factor, that can have a major impact
not only in the organization in which people work but can also impact the quality and success of
the products created by these people and further on, to the lives of, maybe, millions of users.
In order to keep up with this evolution, organizations have also evolved towards agile
working methods that provide autonomy and ownership, constant feedback that demands also for
flexibility and adaptability, clear goals and objectives and a collaborative work environment in PICBE |
which people share responsibility, but also learn from each other constantly. PAGE \*
The IT industry will continue to evolve, and so will the people working in this specific field,
along with their needs as employees and their objectives related to lifelong learning, therefore it
may prove useful to continue analyzing the constant changes that may appear and their impact both
on the motivational factors overall, but also on the evolution and expansion of the IT industry even
in areas that are not analyzed in depth nowadays and how this expansion will reflect in the way in
which the workplaces we know today will look like tomorrow.

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