Alderfer's theory

Alderfer's ERG theory

Alderfer classifies needs into three categories, also ordered hierarchically:

• growth needs (development of competence and realization of potential)
• relatedness needs (satisfactory relations with others)
• existence needs (physical well-being)

This is very similar to Maslow -- can be seen as just collapsing into three tiers. But maybe a bit more rational. For example, in Alderfer's model, sex does not need to be in the bottom category as it is in Maslow's model, since it is not crucial to (the individual's) existence. (Remember, this about individual motivation, not species' survival.) So by moving sex, this theory does not predict that people have to have sex before they can think about going to school, like Maslow's theory does.
Alderfer believed that as you start satisfying higher needs, they become more intense (e.g., the power you get the more you want power), like an addiction.
Do any of these theories have anything useful to say for managing businesses? Well, if true, they suggest that

• Not everyone is motivated by the same things. It depends where you are in the hierarchy (think of it as a kind of personal development scale) 
• The needs hierarchy probably mirrors the organizational hierarchy to a certain extent: top managers are more likely to motivated by self-actualization/growth needs than existence needs. (but try telling Bill Clinton that top executives are not motivated by sex and cheeseburgers...)