Motivate Like A Master... Without Spending A Cent!

By James Adonis

No matter which industry you're in, motivated and engaged employees are critical to your success. So how do you motivate your employees to achieve more? Most leaders turn to monetary or tangible rewards. After all, money is a great employee motivator, right? Wrong.

While it is important that your compensation plan helps to attract and retain employees, numerous studies show that recognition is a much better retention tool and performance motivator than money.

A study of over 2000 employees by the Gallup Organisation has found that 69% of employees prefer praise and recognition from their managers over and above money. Therefore, the key to developing - and maintaining - a highly engaged and motivated team is to use intrinsic motivators, not extrinsic motivators.

What's the difference? Extrinsic motivation is a reward: a pay rise, a cash bonus, a gift... in other words, a tangible reward for performance given to the employee. (While it sounds harsh, I often think of extrinsic motivators as bribery). The major problem with most extrinsic motivation programs is that the programs have to be continuously repeated, and any motivation they initially produce wears off. And it gets worse: if overused, what at first seemed like a great reward quickly becomes an expectation, with the result that the effectiveness of the incentive - and employee performance - flattens out. To make a bad situation even worse, if the program is discontinued - as it should be if it's not producing results - employees may see the cancellation as a "take-away" and lose interest in their jobs.

There's a better, and cheaper, way to motivate your employees. It's called intrinsic motivation.

Intrinsic motivation comes from inside a person: it's the sense of achievement, responsibility, job satisfaction, purpose, involvement, empowerment, ownership... all the things that make an employee feel that what they're doing makes a big difference in their lives and to the organisation itself. If employees feel that what they're doing is insignificant, they'll feel insignificant; if they feel their work is valued, they in turn feel valued.

The easiest way to provide intrinsic motivation is to say "thank you". Recognising your employees with comments like "well done" or "great job" creates a greater and longer-term effect on employee motivation than providing a cheap reward that's quickly forgotten. Best of all, in most cases intrinsic motivation doesn't cost a cent.

Edward Deci, a Professor from the University of Rochester, is a pioneer of research on intrinsic motivation. In a major study, he offered money to a group of students as a motivator for them to solve certain problems. He also got another group of students to solve the problems without any extrinsic reward. He found that the unpaid students were more willing than the paid students to keep working on the problems even after the study had finished.

What are the benefits of recognising employees through intrinsic motivation? I've worked with so many companies in the last few years, and in each case effective intrinsic motivation produced these results:

• Improved morale, both at the employee level and at the team level.
• Increased productivity: Employees who feel good about their jobs and their performance tend to perform at an even higher level.
• Lower absenteeism: Employees who feel they're important to the organisation look forward to coming to work.
• Higher retention rates..
• Improved bottom-line results.

In their ground-breaking work on intrinsic motivation, researchers Thomas Malone and Mark Lepper found that there are seven factors which promote intrinsic motivation:

1. Challenge: Goals need to be set that involve a certain amount of difficulty.
2. Curiosity: An activity that stimulates an employee's attention.
3. Control: Allowing employees to have a choice in what happens.
4. Fantasy: Using imagination and games to promote learning in the workplace.
5. Competition: Comparing the performance of one employee to another.
6. Cooperation: Encouraging employees to help each other to achieve goals.
7. Recognition: Appreciating your employees' accomplishments.

So how do you motivate like a master without spending a cent? Here are simple and effective ways to recognise and engage your employees:

• Praise: Recognise your employees for a job well done. Catch them doing something well - and tell them how well they did. When possible, make your praise public; gather your team together for a moment and celebrate an accomplishment. Spend your day looking for and recognising great performance.
• Development: Consistently train your employees, increase their skill base, prepare them to fill in at the next level, or make temporary assginments to different departments.
• Promote from within: An internal promotion not only recognises the employee involved, it also ensures that others know that advancement is possible. Make sure you provide them with the resources to gain those skills.
• Create informal leadership roles: Empower your employees to lead a small project, to train new employees, give facility tours to visitors, or share experiences from a training seminar or inter-departmental assignment with the rest of the team.
• Track - and post - key performance metrics: Make sure employees know how they - and the department - are performing. Post results, discuss improvement trends, and most importantly, celebrate accomplishments.
• Communicate: Employees in almost every company I've worked with say they don't receive enough communication. Your employees want to hear what's going on - and just as importantly, they want to share their ideas, suggestions, and concerns. Most managers feel they're communicating enough; most employees disagree.

And that's just a start. (There are numerous ways to motivate and engage your team; I've included hundreds in my book, Love Your Team). It's likely you already have a few reward and recognition programs. Before you make any changes, gather your management team and list all of the extrinsic and intrinsic motivators you have in place; not only will they have great ideas, they'll also feel more engaged.

If yours is like most organisations, chances are your list of extrinsic motivators will be longer. If so, institute more intrinsic motivators so that there is at least a balance between the two. Better yet, put more intrinsic motivators in place; you'll reduce your costs and create higher-performing work teams.

Once you've developed your ideas as a management team, discuss them with your employees - they're truly motivated when they work towards goals that mean something personally to them, and that they had a hand in creating.

Remember, don't just reward your employees; recognise them for their achievements, for their contributions, and for their role in the team.

And most importantly, say "thank you" as often as you can. You - and your bottom line - will be glad you did.

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