WHEN IT COMES to motivating your employees, monetary incentives might be the obvious choice. However, motivation is less about the reward and more about the emotional journey.
Some years ago, Dan Ariely, a psychologist and behavioural economist at Duke University, conducted a study on motivation at Intel’s semi-conductor plant in Israel.
Workers received either a $30 bonus, a voucher for pizza or a complimentary text message from their boss at the end of the first workday as an incentive to meet work targets.
On day one, pizza was the clear winner but as the week unfolded, the complimentary text message had the best effect – even better than the cash incentive.
Ariely discovered that when people receive money as a bonus, they seem interested in the work, but it doesn’t secure long-term commitment or increase the motivation of employees.
A small bonus, such as a complimentary text message from the boss commenting on job performance, changes how employees think about their job and their relationship with the company.
How to inhibit motivation
Ariely describes in his book, Payoff: The Hidden Logic That Shapes Our Motivations, how it is possible to inhibit motivation.
He writes: “Imagine, for example, that you worked for me and I asked you to stay late three times over the next week to help complete a project ahead of deadline. At the end of the week, you will have not seen your family but will have come close to a caffeine overdose.
“As an expression of my gratitude, I present you with one of two rewards. In option one, I tell you how much your extra hard work meant to me. I give you a warm and sincere hug and invite you and your family to dinner.
“In option two, I tell you that I have calculated your marginal contribution to the company’s bottom line, it totalled $27,800, and I tell you that I will give you a bonus of 5% of this amount ($1,390). Which scenario is more likely to maximise your goodwill toward the company and me, not just on that day, but moving forward?”
In the book, Ariely asks which of the two options would inspire you to push extra hard when it came to meeting the next deadline? Citing the compliment condition at Intel and other experiments on social norms, he says “my thanks, hug, and our family dinner would make all the difference in your feelings of current and future engagement”.
“The bonus, however, would put a numerical value on something that wasn’t countable to begin with: your commitment. And while you might appreciate the cash, the next time I ask you to help me with a deadline, you will most likely ask: ‘How much?’”
Very often, we assume that money is a primary motivator for employees. For some, it will be, depending on age and stage, but research tells us that it is the relationship between employees and the company that is most important.
People rarely work in isolation in organisations. We need to be able to draw on relationships and trust our colleagues, particularly when work is difficult and stressful. No amount of cash bonuses will encourage that type of motivation or commitment.
The challenge for today’s managers is to motivate staff while avoiding the traps that inhibit motivation. Ariely’s research tells us that, in a lot of cases, money is a disincentive.
Motivation is an emotional process and it is connected to our sense of belonging and self-worth. The best thing employers can do is remind themselves how valued and valuable their employees are, and then let their employees know.
Dr Annette Clancy researches emotions in organisations and is assistant professor at UCD school of Art History and Cultural Policy.
A version of this article first appeared in the April 2019 issue of Accountancy Ireland.