Sunday, June 30, 2013

What Motivates Employees?



CEOs, HR heads and Sales Heads world over have been trying to solve the puzzle as to what motivates the employees in an organization. Most of them opt the route of financial awards. Hike in basic pay, bonus and stock options could be some of the measures. They are great but numerous studies have proved that financial rewards mainly generate short-term motivational bursts of energy, which can even have some damaging consequences sometimes in the long run. Here we definitely assume that the salaries of employees are reasonably satisfactory. The economic downturn has posed a challenge to the corporate world to reduce costs including salaries of employees in good number of companies and even then the morale of the employees should remain high. During difficult times, organizations face the challenge of retaining talented people by motivating them.

Even if the financial position of a company is sound, the efforts are on to reassess the combination of financial and nonfinancial motivational incentives that will serve their companies in the short term as well as long term. Cultivating the sense of ‘Ownership Mentality’ in the minds of the employees can be one of the biggest motivators. If the management has achieved that then the employees become self starters. They don’t need any supervision. They will do everything possible that will increase the productivity and therefore profits for the company. They shall not do anything that brings loss or disgrace or cause downfall of the company. They will work as if it is their own business outfit.

Give your employees the responsibility coupled with authority and see how they perform their tasks beautifully. And this authority will be a great motivator for your managers. They will behave like leaders at their own level in their own domain. Give them the opportunity and support to beat their own targets. Throw new challenges and stretched targets to your high potential performers. Shower liberal appreciation and recognition and remember that this has to be made public throughout the organization and not within the four walls of the cabin of CEO or the concerned manager.  Sincere appreciation from immediate managers works wonders. More and more companies are realizing the importance of ‘recognition’ instead of ‘reward’.

Once you give a chance to your good performers to lead projects or task forces, this will be a more effective motivator than the routine financial incentives like cash bonuses, increased basic pay etc.. This will send a signal to all the employees that the management values them, their knowledge, skills and contribution to the organization. Employees should have the confidence that their management cares about their well-being, career growth and holistic development.

It is unfortunate that attention of senior leadership in most of the companies to motivate talent through non-financial methods is less forthcoming. There are very few who are ready to challenge the traditional managerial wisdom: ‘Money Makes all the Difference’. They still think that bonuses, salary hikes and cash rewards are the dominant incentive for most people.  The problem is that nonfinancial ways to motivate people require more time, involvement and commitment from senior managers. This lack of interaction between managers and their teams actually leads to employee dis-engagement and dis-satisfaction and reduced enthusiasm, energy and morale. The need of the hour is more engagement with the employees. ‘Breakfast with the Boss’ is one popular concept to build better bridges with your teams for better bonding.

Senior leadership can encourage the formation of several focus groups of talented managers to brainstorm ideas about how to create more value for the business and increase productivity and profitability. One-on-one meetings also between staff and leaders are highly motivational. They make people feel important and valued during difficult times.  On the other hand, monthly or quarterly town hall meetings are good from the point of view of communicating en-mass to the whole organization. The messages of changes in strategy, focus of business etc can be communicated by the top leadership very effectively to the organization. They are important but can’t replace the one-to-one focused meetings.


A great CEO is one who can motivate his people to give back more than what they are paid for. And they deserve to be paid as per the industry norms. Great CEOs come with innovative ways to engage and inspire their employees. You are a successful CEO or a manger if your talented people stick on with you even during down times. Some CEOs concentrate on increased number of training sessions during lean periods. This increases the competency of the team, motivates them and helps in keeping the flock together. As a CEO or an HR boss or a manger, if you have achieved all this, give yourself a pat on your back and if not, you need a lot of introspection and change the way your company runs. If you are able to keep your employees motivated all the time; your company has started the journey from a good company to a great company.