The Relevance of McClelland’s Motivation Theory in Understanding Compensation and Employee Outcomes

DOI

10.2991/978-2-38476-595-9_14How to use a DOI?

Keywords

McClelland’s Theory; Compensation; Work Motivation; Employee Performance; SEM-PLS

Abstract

This study aims to re-examine McClelland’s motivation theory in the contemporary organizational context by investigating the dominant factors influencing employee performance. While McClelland emphasized the need for achievement as the most critical driver of work motivation, the findings from this research conducted at PT Tomo Food Industri indicate otherwise. The results show that direct, indirect, and non-financial compensation all have a significant positive impact on work motivation, with indirect compensation emerging as the most influential factor. Furthermore, work motivation significantly enhances employee performance and acts as an effective mediator between all forms of compensation and performance outcomes. The research employed a quantitative approach using a saturated sample of 95 employees. Data were collected through Likert-scale questionnaires (1–5) and analyzed using validity and reliability testing, ordinal-to-interval transformation via the Method of Successive Interval (MSI), and coefficient of determination. Statistical data processing applied Structural Equation Modelling (SEM) and path analysis with SmartPLS 4. The findings contribute to the theoretical discourse by challenging McClelland’s proposition and highlighting compensation, particularly indirect benefits, as a pivotal determinant of motivation and performance in today’s organizational setting.

Copyright

© 2026 The Author(s)

Open Access

Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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TY  - CONF
AU  - Rafi Rahadian Izza
AU  - Ina Ratnamiasih
PY  - 2026
DA  - 2026/07/08
TI  - The Relevance of McClelland’s Motivation Theory in Understanding Compensation and Employee Outcomes
BT  - Proceedings of the  International Conference on Contemporary Risk Studies (ICONIC-RS 2025)
PB  - Atlantis Press
SP  - 176
EP  - 188
SN  - 2352-5428
UR  - https://doi.org/10.2991/978-2-38476-595-9_14
DO  - 10.2991/978-2-38476-595-9_14
ID  - Izza2026
ER  -