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Theory of Motivating Employees

This article explores the relevance and application of Principles and Strategies discussed in the 3rd Century BC treatise, Kautilya’s Arthashastra, in Today’s Corporate World.

Human resource departments of modern corporations are focused on how to ‘motivate’ the employees or how to egg them on to perform better and increase productivity. Kautilya uses motivational techniques in various departments of the State. Many of the methods can today be applied in the corporate world for handling employees.

Using his deep understanding of human nature, Kautilya developed a system of motivation which worked with the carrot, the stick, and much more. The application of his theory of motivation - Sama, Dana, Danda and Bheda are unlimited.


This is the first step that should be taken whenever it appears that an employee is not working properly – listen to him. Have a clear insight to his side of the story. Senior managers get information from various sources. They will come to know the full picture if they listen directly from the person.

One can discuss and suggest various alternatives to solve the particular problem. If it runs deep, external experts could help.


Employees work for wages and salaries. That is the key motivating factor for them to be in the organisation. The next thing is ‘honour’. Without these two kinds of encouragements no employee will have any reason, to continue working in that particular company.

Therefore, Kautilya suggests rewarding employees sufficiently in order to get work done. The reward could be in the form of incentives, paid vacations, bonuses or promotions. Another way of rewarding employees is by giving awards such as ‘best employee award’ or ‘most productive person award’, a common practice in several companies today.


Many employees may not show any signs of improvement in spite of constant prodding and various other efforts. Neither rewards nor incentives will bring them out of their lethargic state. That it is a serious situation. If not corrected, a sense of complacency can spread through the whole organization.

Therefore, Kautilya recommends a stronger step – Punishments. A rap can be subtle or gross, depending on the person as well as the situation that warranted it. It can be a warning, a suspension, a cut in pay or even demotion.


Though this is not encouraged at all, it is the final step. When none of the other methods work, it is concluded that the organization and the employee cannot go together any further. It is best to part ways for the benefit of both.

If it is a large organisation that can bare the financial expenses of that particular employee, he can perhaps be transferred to a department where his productivity will not be a major issue. In smaller firms or employee-productivity- oriented organisations he must be asked to leave.

Contributed by  - Radhakrishnan Pillai

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