What really motivates employees?

Employees are the most crucial asset of today’s organizations, and employee satisfaction is one of the most important drivers of continuous workforce improvement. Some companies are faced with a mammoth challenge to keep their people motivated, especially in environments that fail to make employee satisfaction a part of their core business strategy. So here’s the question: What really motivates employees to produce? Is it money? Recognition? Job satisfaction? Benefits? Opportunities? If you think you know the answer, you may be surprised by the facts.

Are we motivated by money?

Ask the average American worker, and I’ll bet that you’ll hear a resounding “Of course! Everybody knows that.” However, there is a great deal of disconnect between what business does and what science knows. The fact is the old 20th century “carrot and stick” extrinsic motivation won’t work on the modern workforce, and the research behind this science is strong. A paper Large Stakes and Big Mistakes, by D. Ariely, U. Gneezy, G. Lowenstein, and N. Mazar for the Federal Reserve Bank of Boston, stated that “as long as the task involves only mechanical skill, financial rewards worked as they would be expected: the higher the pay, the better the performance. But once the task called for even rudimentary cognitive skill, a larger reward led to poorer performance.” So unless you’re looking to hire people who are only expected to do robotic tasks that don’t require thinking and good judgment, motivating people with money won’t work. The London School of Economics went even further: “We find that financial incentives can result in a negative impact on overall performance.”

Most people are motivated by purpose and desire to make a connection to something good that is bigger than themselves

The science of human motivation shows that people genuinely want to have a lasting impact on their work—they just don’t know how. If an employee can first identify the impact that a project will have on the company, his or her team, and career, then that project will become much more meaningful than just busy work. Companies that figure out how to bridge this gap not only will have a workforce that knows how to impact the bottom line, but will also be more engaged in the long run.

Career analyst Daniel Pink, who delivered a TED Talk on the puzzle of motivation, outlines key factors necessary to engage and motivate our 21st-century American workforce. Daniel states, “People are motivated by the desire to do things because they matter, because we like it, because they are interesting, because they are part of something that is important.” Employers who incorporate purpose-driven strategies will create more engaged, motivated, and happy employees.