We operate in a worldwide Capitalist paradigm that looks unlikely to be shifted to Communism anytime soon (much to Karl Marx’s chagrin) and in this paradigm we believe that everyone is motivated my money.
This is particularly true of sales incentives and financial target based bonuses but we are all operating in this paradigm and I guess that 95% of us are not actually motivated by the money alone. We value so much more in our employ that we group together to call ‘job satisfaction’.
“Men and women want to do a good job, and if they are provided the proper environment, they will do so.” – William Hewlett
Hewlett Packard as a company was an early adopter into the theory that recognising effort and involving your people in what was going on was a greater motivator than just the money alone. Even before Hewlett, Franklin Roosevelt commented “Happiness lies in the joy of achievement and the thrill of creative effort.”
Creative, involved interaction recognised for the role and the success that comes from it motivates way beyond money. The work done by a group of behavioural economists including Stephen Levitt (Freakonomics) and Dan Ariely (Predictably Irrational) looks into this. Ariery has carried out experiments on the efficacy of money motivation that make great reading and watching (TED Talks or Youtube).
What’s the answer?
Probably a combination of reward and recognition and not just all of one or the other. Great to have financial rewards for success but recognition, involvement, feedback and contributing to creative effort go along way to creating ‘motivated’ employees.
If profit in business is an indicator of our success then bonus and commission are also a reflection of our success – to make us successful help us, guide us, coach and involve us not pay us or threaten us for failure.
In our own endeavours we are often in place looking at a business as a whole and during this process something that comes up again and again from the ranks is a ‘lack of communication’ – translated this is actually a lack of involvement. All of these organisations have newsletters, intranets, memo’s, stand-up-meetings etc but the end result was not the desired outcome, they want to be involved in ‘creative effort’.
As managers, leaders and business owners somewhere in our psyche we believe that we are the only ones to have ideas and strategy. Our experience is that so much comes from down the line.
Last month at the Audi factory in Ingolstadt, it was explained that across Audi there were 45,000 suggestions for improvement of which 35,000 were put in place. I am certain that Management alone would not have seen 1,000 ideas let alone 45,000.
Involving the team as important for motivation as bonus and commission schemes and can be far more productive – what the balance is I don’t know.
It is really all about your business, what you do and why?