What is ERG Theory?

The ERG theory was proposed by Clayton P. Alderfer as a modification to Maslow’s hierarchy of needs. 

Alder grouped human needs into three categories:

• Existence – This includes physiological (air, food, water) and safety needs (protection from negative occurrences).
• Relatedness – This concerns social interaction and requirements for certain aspects of personal esteem.
• Growth – Growth concerns the need for respect, esteem, and personal fulfillment (Self-Actualization)

The major expansion of this theory beyond Maslow’s theory is that, while some needs may be lower-order and higher-order, they are not necessarily hierarchical. They can be present in various extents at the same time. 

Further, Alderfer proposed a frustration-regression hypothesis that individuals may be unable to satisfy or frustrated by one need may gravitate toward different needs. 

As with Maslow’s theory, this theory allows leaders to understand what will motivate subordinates. That may include multiple needs simultaneously.