What Truly Motivates Employees (Besides Money)

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Leaders want motivated employees, but often believe that money is the main motivator. Misunderstanding what really motivates employees can have negative consequences when it comes to engaging employees and motivating higher performance.

For example, researchers Teresa Amabile and Steven Kramer interviewed over 600 managers and uncovered that the widespread majority of managers misunderstood what motivates employees. Managers viewed making money and receiving raises and bonuses as the primary motivators, when in fact, upon analyzing over 12,000 employee diary entries, the number one work motivator was actually emotion and not financial incentives. Positive emotions were linked to increased motivation. Meanwhile, negative emotions were linked to decreased motivation.

The lesson of this study and other research that has focused on employee motivation, is that positive emotions and intrinsic factors play a very important role in motivating employees. Although financial incentives such as performance-based cash bonuses and base pay increases have been found to motivate employees (Source: McKinsey Quarterly), there are many other more powerful motivators to consider besides money, including:

  • Purpose. Tapping into employees' passions and interests is one of the most powerful forces that fuels employee motivation. Learn about what each of your employees cares about and inspire a deeper sense of purpose and meaning beyond day-to-day tasks and objectives. Employees are usually more motivated by a greater cause, the ability to make a difference in others' lives, and the opportunity to pursue their personal passions.
  • Autonomy. Eliminate micromanagement and other management tactics that undermine employees' abilities. Empower employees to work independently and take initiative to solve their own problems. Give them the latitude to make important decisions in their areas of responsibility and complete their job tasks independently.
  • Challenge. When new challenges and projects arise, think of your employees. Challenging employees speaks to how you view them and shows that you have confidence and trust in their skills and capabilities. Most employees greatly desire to contribute more, learn a new skill, and stretch themselves…give them the opportunity to do that.
  • Growth. Employees are often motivated by growth opportunities to expand their role and advance within the organization. The possibility of attaining a higher-level role or one with greater responsibility than their current job is a strong motivator. Candidly talk about these opportunities with employees from time to time so that they see a clear path and develop themselves to reach their goals. Without knowing “what’s next,” employees can lose motivation. 
  • Inclusion. Feeling included in the organization's decisions and strategic initiatives motivates employees. Inclusion makes employees feel important to the business, and as "owners" and contributors to the organization's mission and objectives. Ask employees for advice, ideas, and feedback. Invite them to engage in conversations about how to improve your organization.
  • Belief. Believing and having confidence in employees' potential to grow, advance, lead, and deliver exceptional results, as well as communicating that belief, motivates employees to perform at new and higher levels.
  • Encouragement. Be an encourager and supporter of your employees. Be positive and hopeful in the face of disappointment, obstacles, and even failures. Encourage employees to reach for new heights and take risks. Support them with guidance along the way. Encouragement can help employees achieve new feats.
  • Recognition. Everyone wants praise and recognition, and to feel valued by their organization. Direct praise or personal recognition from a supervisor or a leader in the organization for every exceptional performance and incremental improvement can go a long way in motivating employees if that praise is sincere and well-deserved. Look them in the eyes and sincerely say “thank you.”
  • High expectations. Setting high expectations leads to higher levels of performance and motivates employees to become better. Raise the bar year after year and employees will continue to strive to deliver on your expectations and achieve their personal best. When your expectations stagnate, so will employees. Push them to achieve more than they think they can.

While no leader can directly motivate another person, they can take steps to better understand what motivates each of their employees and create a work environment that increases the likelihood that they will be motivated. And unlike  money, all of these tactics cost your organization nothing but some time and thought.

Additional Resources

Retaining and Engaging Your Talent

ERC provides training on topics such as motivating and engaging employees, empowerment, and other critical soft-skills for managers and leaders to improve motivation in the workplace.

Employee Engagement Surveys

Research shows that high employee engagement leads to increased retention, productivity and business success. ERC's Employee Engagement Survey service assesses employees' level of engagement, identifies the drivers of engagement at your organization, and provides recommendations on practical steps your organization can take to improve employee engagement.