How to Motivate Employees – Actionable Advice

by Daniel Hannig

How to motivate employees is a topic that is becoming more and more relevant as companies embrace business models that require a high degree of self-management. Remote work and the policy of flat hierarchies in general are built on the premise that employees have a high degree of self-motivation. But employee motivation has also been an important issue for another reason. Richard Branson once said the following:

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What Is Employee Motivation and Which Factors Influence Motivation

Employee motivation deals with the level of commitment, energy, and enthusiasm a person brings to work. It is also reflective of the employee’s level of engagement and how empowered he or she feels at work. It is therefore important to have an in-depth understanding of everyday life at work in order to identify what factors motivate employees and which factors possibly deprive them of their motivation.

This may sound very classic and maybe a tad bit conservative, but the main driver for people to work is to provide for themselves and for their family. Only if this general condition is given, we can look to other aspects of how to motivate employees to give their best at work every day. On the one hand, there are factors that lie within the sphere of the company, such as paying an appropriate salary, the general management style or the cooperation with colleagues. On the other hand, there are factors that come from the employee’s private sphere: family, friends, sufficient leisure time, amongst others.

The well-known concept of “work-life balance” is key in this context. An unbalanced lifestyle in this regard will affect your employee’s performance in the long run and sap their motivation. If an employee’s motivation to work decreases over a longer period of time and finally stagnates at a minimum level, he or she will mentally give up on his or her job sooner or later.

Employees provide the company with their time, skills and education, which we will categorize as input. What they expect from the company in return are, for example, adequate pay, other non-monetary benefits and recognition for their work from both employer and colleagues, which we will call outcome. Input and outcome are put into comparison by each individual employee. The relationship is compared by using a benchmark, e.g. another colleague in a similar position or similar work situation. A mismatch between input and outcome leads to decreasing work motivation of the employees which makes them consider how they can redress the balance. This can take the form, for example, of working less, coming to work later, leaving work earlier or by distracting co-workers, because of perceived underpayment. Other scenarios include devaluing the performance of other colleagues, which can lead to tensions within the team. And finally, termination by the employee can be the end-result.

Methods on How to Motivate Employees at Your Company

The two most effective ways to motivate employees are through intrinsic and extrinsic motivation. Intrinsic motivation is the effort based on the employees level of personal drive, while extrinsic motivation is the effort that employees put into their job due to outside influences.

How to Motivate Employees Extrinsically

When it comes to extrinsic motivation there are two surefire ways to increase motivation: cold hard cash and benefits.

1. Financial Incentives

Financial incentives boil down to having clear objectives and a transparent reward system in place. In other words, which goals have to be reached and what can be expected once those goals have been achieved?

Be sure to set challenging, but realistic goals. If the respective goal has been achieved, bonuses and incentives are common monetary rewards that are given in addition to a fixed salary. To this end, appraisal systems are implemented to measure employee performance. Consider which groups are, due to the nature of their work, suitable to receive such monetary rewards, a classic example for this would be the sales department. A classic example of departments that are unsuitable for rewards such as bonuses are controlling or the legal department, which is why employees in these departments may often have higher fixed salaries.

2. Provide Good Benefits

While cold, hard cash may be a convincing argument to many people, today’s workforce is looking for more. Providing good benefits not only shows your employees that you are willing to spend money on them, it also shows that you are willing to take the time and the effort to make them feel good. Especially in Germany, where a spot at a good daycare centre is harder to find than a mafia movie without Joe Pesci, employers who provide daycare benefits have exceptional chances of pulling and retaining top talent. You can read all about authentic benefits in this article

How To Motivate Employees Intrinsically

Candid communication and trust are the drivers of intrinsic motivation. Especially in today’s business world, where home office and remote work are becoming more and more popular, it has become increasingly important to be able to further the self-management skills of the employees. There are several key areas that you can address at this point.

1. Talk to Your Employees

Don’t be afraid to ask your employees how things are going in private. In the course of time, many things in their lives can change, which can have a direct or indirect influence on their motivation for work. If you know the personal situation of your employees, you can better understand their behavior at work. Seek a dialogue with them from time to time or encourage them to seek a dialogue with you. Many employees find it difficult to talk about problems that stem from their family or work environment. You should therefore create a trusting atmosphere in your company were these problems can be discussed and resolved.

2. Appropriate Appraisal and Constructive Criticism

Everyone strives for recognition, so giving praise where praise is due is not only a way of communicating gratefulness, but also a way to motivate the recipient to continue doing a good job.

Criticism is also a form of appreciation as long as it is expressed in private and not in front of other colleagues. If the supervisor explains with the appropriate choice of words and tone what was done wrong and what the employee has to pay attention to in the future, this will be interpreted as an incentive to do better next time.

3. More Freedom in Decision-Making Processes

“Forget praise. Forget punishment. Forget cash. You need to make their jobs more interesting.”

What the American psychologist Frederick Herzberg said in the 1960s still holds relevance today. We’re not saying that you should go ahead and forget everything we said earlier, but rather take into account that motivation is sparked by interest, and interest derives from the freedom to try out new things and the possibility to develop oneself. Understandably, this is only possible within a limited framework when you are on the job, but once you have clearly defined and communicated to your employees how far that framework goes, give them the freedom to act freely within it and also try to involve them in the daily decision-making process as much as possible. An unnecessarily predetermined process is the killer of creative solutions. By giving your employees freedom, you also give them a way to acquire skills that will be helpful in solving similar problems. This will lead to growth of self confidence and autonomy which will, at the end of day, also relieve you of work and responsibility.

How To Motivate Employees – At One Glance

Employers are therefore well advised to observe their employees’ behaviour – not by monitoring, but by closely following changes and anomalies in the behaviour of the team and to address them quickly and find a solution for them. If a company has only a few employees, a personal conversation between the boss and employee is always the best choice, as unspoken problems can otherwise develop into serious conflicts through daily interaction. However, as the number of employees increases, a personal conversation with the boss becomes more and more difficult. But luckily, there are other methods to still voice your opinion. If you are concerned about your employee motivation and the improvement of work productivity, start tracking employee satisfaction with

regular feedback talks and surveys. This should be done anonymously, as your employees should not have to fear punishment for their opinions and attitudes.

Continue reading by downloading the complete Employee Motivation Ebook

Editorial note: The original German article was published in a collaborative effort by Honestly’s editorial team on June 11, 2018. The translated and edited version was uploaded by Daniel Hannig on January 16, 2020.


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