The Best Ways to Motivate Employees

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The Best Ways to Motivate Employees

February 17, 2010

It used to be thought that money was the best way to motivate employees. Bonuses were given to employees achieving their objectives, pay raises were given to employees with outstanding performance, and stock options were granted to over-achievers.

But with the difficult economy, many companies are being forced to cut back on financial incentive programs or even put them on hold in order to stay financially viable. So how can companies motivate employees when they are losing the previous ability for financial incentives? And what can employees do to motivate themselves?

A recent McKinsey survey has shown that “employee motivation is sagging throughout the world – morale has fallen at almost half of all companies.” That makes it more important than ever for managers to find ways to retain and motivate top performing employees. It also means employees need to think about ways to keep themselves motivated and improve their morale.

What I found interesting about the McKinsey survey is it showed that three non-cash motivators are “no less or even more effective motivators than the three highest-rated financial incentives”:

Praise from immediate managers
Leadership attention (such as one-on-one conversations)
A chance to lead projects or task forces

What this means for managers:

Be sure you are interacting regularly with your employees and calling attention to outstanding work
Find ways to show top talent that they are important to the company, such as focus groups, one-on-one meetings with senior leadership, or even mentoring programs to promote development
Provide opportunities for high potential talent to continue learning, growing, and developing their skills, such as by leading cross-functional projects

What this means for employees:

If you like where you work and don’t want to leave, then find creative ways to stay happy and motivated at work
Volunteer to lead a new project or to mentor a younger worker
Work with your manager and HR to determine cost effective ways to continue developing your skills so you can add even more value to the company

While the economy is beginning to show signs of recovery, and I’m hopeful companies will begin reinstating monetary rewards in the near future, it’s important for both managers and employees to think about creative, non-financial ways to inspire and motivate. As the McKinsey article states, “A talent strategy that emphasizes the frequent use of the right non-financial motivators would benefit most companies in bleak times and fair. By acting now, they could exit the downturn stronger than they entered it.”

~ Lisa Quast

Source:

McKinsey Article (Motivating people: Getting beyond money): https://www.mckinseyquarterly.com/ghost.aspx?ID=/Motivating_people_Getting_beyond_money_2460