For most, priorities and goals in a career extend far beyond purely financial gain. So what really makes your employees happy and satisfied?
"Pleasure in the job puts perfection in the work," Aristotle famously said.
It is a straightforward approach that still rings true today. Regardless of what environment your staff are in, if they are content in their roles they will not be lazy, apathetic or hostile in their work. They will instead be enthusiastic and motivated, a functioning component in the continued success of your company, dramatically decreasing your employee turnover rate in the process.
The traditional stance on monetary incentives and why these should be abandoned
Traditional businesses often provide monetary incentives as a form of keeping their employees happy, rewarding their hard work with extra cash. The bank HSBC is notable for assessing their employees' work in relation to its long-term corporate objectives at the end of every year and determining performance bonuses if they have met its goals. Other monetary rewards businesses use include stock options and profit sharing plans.
There is a simple reason why financial rewards are favored by the majority of businesses: it can work wonders. Monetary incentives are perfect for a certain type of employee.
Kshpira Shama performed a study of the benefits of both types of rewards on the staff at India's L&T Power. She found that it was most effective on younger employees between the ages of 20 and 30. Shama argued that these younger employees' needs gravitate towards the first two steps on Maslow's hierarchy of needs: the physiological and the want for safety.
Especially in a tough economy where jobs are limited, money is important to young people looking to secure their place in the world, be it moving into their own home or planning for their future family. Such incentives may therefore be considered a valuable motivator for hard, dedicated work.
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However, financial rewards are not always effective. There is not much "pleasure in the job" to be derived from inherently menial work, for instance, that does not leave much room for growth and provides little self-worth for the employees in such as position. Aristotle had never made a living cold calling when he said that aforementioned quote.
Similarly, many people's priorities in a career extend far beyond financial gain but take into account things like gathering new skills or a better work/life balance. What's more, Alfie Kohn argues that the trouble with offering money for good performance is that it, in fact, encourages mediocrity. By motivating your staff to simply meet their KPIs it simultaneously deflates creative thinking, making the job more monotonous for the employee and reducing innovation at the business.
How the growing popularity of non-monetary rewards is good for staff and businesses alike
The alternative to this is non-monetary incentives. These include working from home, employee discounts, free lunches or granting paid leave for volunteer work or study. It is a predominately modern trend seen mostly in youthful businesses.
Google is the most famous example of a company that spearheads this approach. They allow employees a lengthy list of fun non-monetary rewards for the work they put in. Among their many incentives, they encourage travel for their dedicated staff members and give hard-working parents extra time off to share with their children. It not only encourages people to stay with Google but also promotes careers at the company.
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Your method doesn't have to be as big or expensive as Google's (for starters, your business might not be making quite the same income). According to Dr. Bob Nelson, 'The Guru Of Thank You', a painless acknowledgment of an employee's hard work in the form of a written thank you note or sharing positive feedback is just as effective. Nor, despite what was said above, does this have to be integrated into an especially contemporary businesses. The same concept - flexible hours and schedules, for instance - can encourage adult workers with many years of experience at a business to work past retirement age.
Tom McMullen, The Hay Group's North American practice leader, agrees with policies like this. "Career development, organization climate and work/life balance all have greater impact on employee engagement than financial rewards such as base salaries, benefits and monetary incentives," he says. And business owners and managers should take heed. By considering the wants and desires of staff members and giving them an environment where they can enjoy working - "Pleasure in the job puts perfection in the work" - it will create a better working environment for you and for them.