Motivating People Getting Beyond Money

The Case Analysis On

Motivating

people- Gettingbeyond money

McKinsey Company Quarterly Case

Motivating people- Getting beyond money Case Analysis

Case # 3

Motivating people: Getting beyond money

MGT501 Management of Organization & Systems

Prepared for

Md. Tamzidul Islam

Senior Lecturer

BRAC Business School

Prepared by

Group Members

SL No ID Name1 14364042 AINUL KAMAL2 14364032 MD. IFTIAR AHMED3 14364047 MD. ARAFAT RAHMAN CHOWDHURY4 12364053 RAKIBUL ISLAM5 12364058 ISHRAT JAHAN KHAN

Semester: Fall 2014, Section: 03, Department: MBA

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Date of Submission: 10th December 2014

Introduction

Motivation is the act of giving somebody a reason or incentive to do

something. It also means giving somebody hope or support to perform

particular tasks. Motivation factor plays a vital role in business

Management. The process of employee motivation in the workplace

creates zeal and interest and commitment; energetic and unflagging

enthusiasm that makes them do something, especially something that

involves hard work and efforts. It thus must be borne in mind that a

highly motivated employee uses his potentials to the optimum level and

makes goal-directed efforts while raising the best level of efficiency

towards the accomplishment of organizational objectives, whereas the

one who’s not motivated does not do so. The impact of total

rewards including financial and non-financial rewards have on

employee motivation was chosen to be studied in this case because

both of the concepts are important; for the employees and for the

employers.

Q1.Based on the information provided and your further understanding, why is it

important to motivate employees with non-financial motivators?

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Still that money is the most important motivational factor and so are

the plans, using money incentives, bonus and the wages linked with

productivity etc. are designed in order that the employees may be

motivated to work more efficiently, yet there are some other

motivational factors that can bring positive results in the personal

development of the employees as well as in the organizational

environment. Numerous studies have concluded that for people with

satisfactory salaries, some nonfinancial motivators are more effective

than extra cash in building long-term employee engagement in most

sectors, job functions, and business contexts. Many financial rewards

mainly generate short-term boosts of energy, which can have damaging

unintended consequences. A sentence that may have commonly been heard

or overheard when a situation erodes the employee morale, “Money is not

everything.” connoting there is something that drops off behind the

situation that the person anticipates other than the money. Hence, it

is necessary for a manager to understand what motivational factors the

employees get contented with while observing both financial and non-

financial motivational factors in the workplace. In terms of a

definition, non-financial recognition can be thought of as: “…a non-cash

award given in recognition of a high level of accomplishment or performance such as

customer care or support to colleagues, which is not dependent on achievement of a pre-

determined target.”(Rose 1998).

A recent McKinsey Quarterly survey underscores the opportunity. The

respondents view three noncash motivators—praise from immediate

managers, leadership attention (for example, one-on-one

conversations), and a chance to lead projects or task forces—as no

less or even more effective motivators than the three highest-rated

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financial incentives: cash bonuses, increased base pay, and stock or

stock options.

The survey’s top three nonfinancial motivators play critical roles in

making employees feel that their companies value them, take their

well-being seriously, and strive to create opportunities for career

growth. These themes recur constantly in most studies on ways to

motivate and engage employees.

There are a number of reasons why it is important to motivate

employees with non-financial motivators. Just to name a few of the

most commonly used non-financial motivators are mentioned herein that

could stand to benefit to everyone concerned. Due to recent economicconditions, organizations and employees are focusing on financial

motivators in terms of salary increment, bonus and commission. “More

than half the employees surveyed by the Society for Human Resources

Management in 2009 said that benefits and compensation are

important ("2009 Employee Job Satisfaction")”. However, to me money is not

everything. If employers are offering financial rewards only and in

return they are expecting high productivity and low turnover rate,

their strategies are not long term. There are many other factors thatplay an important role with money in keeping an employee motivated.

Here are some non-financial motivators that are inevitable for any

organizations employees motivation and also for organization’s

success.

Recognition and Respect

According to a survey conducted by consulting company Mercer in 2011,

employees in Argentina, Brazil, Canada, Mexico and the United States

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all listed “being treated with respect” as the single most important

factor in motivation. Recognition and praise can send employees the

message that the company respects them and values their contribution.

Financial incentives and bonuses were number 13 on the list in all

five countries. American employees rated “base pay” fifth on the list,

so although financial rewards remain important they actually have less

importance for most employees than respectful treatment and

recognition.

Encouraging strategic behavior

Non-financial motivators gives an organization the opportunity to

highlight desired actions and behaviors. In the process, role models

are created for other employees. The thinking behind this is that by

recognizing outstanding achievement and certain behaviors, other

employees will aim to imitate such ways of performing. In addition,

the whole process of recognition can be used explicitly as a method of

contributing to the achievement of organizational objectives.

Organizational Climate

Organizational climate means the working system within the

organization. This includes individual freedom, receipt of awards, the

importance of employees, etc. Every person likes to work in a better

organizational climate. The manager can motivate the employees by

providing a better organizational environment.

Cost efficiency

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Non-financial motivators can help fulfill organizational objectives at

a relatively low cost. This was supported by a research conducted by

Industrial Relations Services (1999):

“One of the key attractions of recognition-based schemes is the cost efficiency. The most obvious

benefit is that awards made under recognition schemes need not be expensive, as it is their

symbolic value and not their cost which is important.”(IRS 1999)

A report by Income Data Services (1999) makes the same point. The

awards given under the banner of non-financial motivation scheme are

typically worth a lot less than the value of those in any financial

motivation scheme. But, as the monetary value of the award is less

important than the act of recognition itself, these sort of schemes

offer good monetary value. Since their symbolic (as a visible sign

that individual contribution is being acknowledged) is greater than

their monetary worth, organizations get a ‘bang for their buck’. Without

using financial motivators only non-financial motivators can achieve

cost efficiency for any organization with a full motivated workforce.

Employees Participation:

Employees get encouraged to notice their participation in managerial

works. Therefore, they offer their full cooperation in making

successful the policies prepared with their help.

Employer branding

The thinking behind employer branding is that if an organization has

an external brand to attract and retain customers, then why not do the

same internally so that not existing and potential employees can

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identify with the brand. Non-financial recognition links with the

concept of total reward here, as organizations can use the whole range

of benefits, both financial and non-financial, to make a statement

about the organization and its culture. This can be employed to

promote a more positive organizational image.

Retention & Job Security

There is little doubt that focusing solely on financial rewards

creates instrumental relationships – “I work for you just because you

pay me”. In such a situation, it becomes easier for competitors to

lure away experienced and important staff – they just have to pay them

more money. In terms of retaining key talent, building affective

relationships between employer and employee binds the two more closely

together. This makes the individual less likely to leave and makes it

harder for rival organizations to compete. Non-financial motivators

help reinforce affective relationships. And they are more difficult

for other organizations to match compared to extrinsic forms of

reward. Job security is an important non-monetary motivator. Security

of job means a feeling of permanence and stability. For example, if an

employee has a sense of fear or insecurity in his mind, that he can be

removed from his job any time, he will never work wholeheartedly and

this worry continues troubling him.

On the other hand, if he has a feeling that his job is secure and

permanent and he cannot be removed from his job easily, he will work

without any worry and with an easy mind. Consequently, his efficiency

increases. This is the reason why people prefer a permanent job with

less salary to a temporary job with more salary.

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Q2.How non-financial motivator does help an organization to motivate its employees?

Motivation is very important for any organization to increase the

productivity and the ability of the employees for that specific

organization. The use of non-financial methods of motivation is

attempts by employers, to apply in the workplace the ideas behind the

theories of Mayo, Maslow and Hertzberg. Examination of these theories

has shown us that motivation to achieve quality of output is best

achieved through satisfaction of higher needs (Maslow), awareness of

the role of groups in the workplace (Mayo), and the need to provide

Motivators (Herzberg). It is not about the money all the time, it can

be any other things which can enhance the ability of the employee.

Non-financial rewards can have an even more substantial impact on

employee satisfaction and motivation than traditional financial

rewards. A study by the Hay Group involving around four million

employees found that employees listed work climate, career

development, recognition and other non-financial issues as key reasons

for leaving a job. Even well-compensated employees may leave a company

if dissatisfied with these aspects. Companies with excellent non-

financial incentive plans can attract motivate and retain talented

people. In the past, many companies relied on money almost exclusively

to motivate their workforce, but employees often rate other aspects,

such as recognition and flexibility as more important. The problem

with relying too much on money as a motivator is that it can encourage

employees to focus on whatever will earn an immediate incentive rather

than on finding long-term solutions or creative new approaches. It can

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also lead employees to see each other as opponents in a competition

rather than working together for mutual benefit.

Non- Financial Motivators:

Now a day’s companies around the world are cutting back their

financial-incentives programs, but few have used other ways of

inspiring talent. Different studies show that for people with

satisfactory salaries, some non-financial motivators are more

effective than extra cash in building long-term employee engagement in

most sectors, job functions and business contexts. Non-financial

motivators can be

Job Enlargement

Job enrichment

Praise from immediate Manager

Leadership Attention

Chance to lead projects

Empowerment

Praise from immediate Manager

When a person get a praise for the work he or she has done, obviously

he or she get motivation or feel happy to complete that task. For

example, you are working in a incentive base company, in where your

bonus is depend on that and if you fill up your target, then you will

not get any appraisal from your manager. On the other hand if you are

working in such organization with good basic salary and there is no

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incentives for the work you done, but you are apprised for the work

you done. Between these two

scenarios, employees will choose the second one and that also helps

organization to reach its success. The purpose of performance

appraisal is to inform employees that the organization is interested

in their professional development. It signals the message that

employees contribution plays significant role in organizational

success. As a result, employees are motivated to contribute more

towards the organizational success because they are given recognition

and appreciation for their contribution. The performance appraisal

motivates the competent employees by rewarding them. This is how less

competent employees will get inspiration from competent employees and

will be motivated to perform well.

Leadership Attention

Leadership attention is another type of non-financial motivation in

where employees get motivation and think that they are the important

person for the organization. From this article we can see that one-on-

one meetings between staff and leaders are hugely motivational. A HR

director from a mining and basic material company explained it that

way- “they make people feel valued during these difficult times”.

Emphasized leadership attention as a way to signal the importance of

retaining top talent. When one global pharma company’s CEO was

crafting corporate strategies this year, he convened several focus

groups of talented managers to generate ideas about how to create more

value for the business. Besides that when a person get attention from

his or her leader than he or she wants to complete that task more

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accurately. It brings a huge motivation and determination to complete

the job in the finest way.

Chance to Lead projects

It is another kind of non financial motivators in where employees are

encouraged to lead the work done by them. It increases the will power

of the employee to do the job more perfectly. And they think they are

the valuable part of the organization. From this case we can see the

scenario that a chance to lead projects is a motivator that only half

of the companies in our survey use frequently, although this is a

particularly powerful way of inspiring employees to make a strong

contribution at a challenging time. Such opportunities also develop

their leadership capabilities, with long-term benefits for the

organization. One HR director in the basic-materials industry

explained that involvement in special projects “makes people feel like

they’re part of the answer—and part of the company’s future.” A

leading company from the beverages industry, for example, selected 30

high-potential managers to participate a leadership program that

created a series of projects designed and led by the participants. So

it is another great non financial motivator.

Job Enrichment

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This means giving workers more control over the tasks that they

complete. Allowing workers to complete tasks that have a meaning, and

are complete in themselves. For example a worker who has a job fitting

the tube to a TV, may have his job enriched by testing that the tube

works, and being able to make adjustments so that the required level

of quality is achieved. The ability to do this range of tasks means

that the worker becomes more committed to achieving quality. The cost

associated with this method, are of course, the time spent training

the worker to complete these extra tasks. Effective job enrichment

depends upon workers having interesting tasks to complete. Job design

is a key part of Herzberg's ideas.

Job Enlargement

Job enlargement means increasing the number of tasks completed by a

worker. So a secretary previously employed to answer calls might now

have duties, which include, filling, letter writing etc. This adds

interest to the job, and involves the employee in a more complete role

within the business.

Empowerment

This means giving workers the power to control their own jobs, make

decisions, and implement their own ideas. It is often used in an

artificial way, for example allowing counter workers in burger bars to

decide the greeting they use when they meet customers. By doing that

organization get its work done more naturally.

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Identifying motivational factors of employees in the company, to

increase professional performance;

Aligning individual objectives to general objectives of the

society and establishing the means by which they will be

achieved;

Cultivation of the spirit of cohesion, belonging and shared

responsibility for the success or failure of the team.

Pushing the employees into action during peak periods or in

critical moments of the company when there is a need for

additional force and the company's budget doesn't allow

additional staff hiring;

Employees determination to get involved in objectives realization

of development of the company and their awareness of the role

they have in it.

Reducing staff turnover in key functions of the company and

increasing loyalty to it.

Competitive business environment by developing staff desire to

Increasing the quality of products / services, especially of

sales, succeed.

Improving the internal and the external image of the company and

building an internal climate of valuing work well done.

Motivational techniques, regardless of how their classification or

their use, is based on the following premise: the greater the feelings

of belonging and involvement in that firm, the greater the

responsibility, recognition, respect or status granted employees.

A sentence that may have commonly been heard or overheard when a

situation erodes the employee morale, “Money is not everything.”

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connoting there is something that drops off behind the situation that

the person anticipates other than the money. Hence, it is necessary

for a manager to understand what motivational factors the employees

get contented with while observing both financial and non-financial

motivational factors in the workplace. Just to name a few of the most

commonly used non-financial motivators are mentioned herein that could

stand to benefit to everyone concerned.

Evidence reveals that the employee morale is a vital element of an

organizational development and success. Having been enhanced to the

extensive extent, it leads to the considerable improvement in

inefficiencies and organizational competencies. It is therefore by

means of boosting employee morale is to get success in terms of

overall organizational development and competence. The higher the

morale, the greater will be success and vice- versa. Considering the

factors affecting employee morale, a manager must come out with

positive and constructive suggestions, ideas and plans which may be

beneficial to both organization as well as the employees. Managers

must adopt such motivational methods as to boost employee morale at

all times.

As regards the employee morale, moving back to see how it is,

connected with quality of work delegated and being considered as one

of the non-financial motivational factor, supportive to both

management as well as employees.

Quality of work is an important factor for the employees who are

qualified and skilled and capable of performing better and challenging

tasks than those that are done every day as a routine - such tasks may

sooner or later become real chore for them. Employees begin to lower

their morale and get frustrated if they are not provided the right

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opportunities and assignments matching with their skills and

professional credentials. What in such situations a manager needs to

do is that he can suggest plans and ideas to benefit those employees.

In order to ensure without any prejudice in the assessment of such

employees, one of the modern methods of performance appraisal, a new

approach to business management, having been termed as Management by

Objectives is very much helpful in this way. It is through the process

of management by objectives that the objective of each employee is set

having been mutually agreed upon and the Key Results areas (KRA) and

Key Performance Indicators (KPI) are indicated accordingly. Not only

does this process help the manager to evaluate the performance of each

employee but also enables him to propose for any further development

of the employee in respect of his designation and the assignments. In

this way, a manager could support those employees, by enhancing their

morale, who are true in their claim that they can handle better

assignments than those that are being carried out currently.

Next in importance comes the good deed of praise and recognition - Who

on earth does not have a wish to win praise? Who does not want that he

be expressed one’s approval and admiration and recognition in the

tasks that are done by the sweat of his brow? Even to smile a small

smile makes a big difference, then, what to speak of the admiration

and recognition? The effect of admiration and recognition in lieu of

the loyal and sincere services of the employees is such that it

becomes a stimulus that sets off a positive behaviour triggering their

minds to work more effectively and efficiently to the extent of their

diligence. At this point, a religious saying is worth mentioning that

could be so interpreted - or the words to that effect: If one cannot

help others with money, then one must help them at least with a

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pleasant smile. It thus suggests how important it is for a manger to

make a smile appear on his face. It may be rightly said that a broad

grin wins the assent of the employees to motivate them towards their

efficient performance. The actions relating to praise and recognition

may thus be demonstrated as and when needed, such as, patting at the

back of the employees, entrusting them advance assignments and

recommending them for promotions.

Mention must be made about the provision of the place and the

furniture as these symbolize the status and the level of authority and

responsibility being associated with the designation of the employees.

Having been provided costly furniture with well-decorated and

furnished office, employees take great pride in their work as this

method of motivation creates the correct level of respect for the

importance and value of their character, efforts and achievements.

The seniority of an employee in itself encompasses an additional

implied meaning that extolls the employees’ loyalty, patience,

truthfulness and trustworthiness, sense of responsibility and

steadiness. When an individual makes a start his career wishing for

his professional progress and becomes a part of an organization,

brings along him a bundle of hopes and ambitions and commitments. In

order that he could take care of his family members satisfactorily, he

regards the means his livelihood as valuable to fulfil his

responsibilities and personal goals. Such employees are responsive and

meticulous in doing their duties. Hence, in view of the aforementioned

facts, the assurance of job security with economic measures within the

organization plays a significant role while motivating them to

continue extending their earnest services.

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Now looking to the other side of the coin, evidence suggests that non-

financial motivational technique has a favourable effect on the

process of job enrichment or job enlargement entitling those employees

who are desirous. They would rather want professional development than

adhere to the routine job activities. To them job enrichment or

professional success in terms of higher positions is more important

than maintaining seniority level with the same nature of job. Yet

again, there is a need of a fair assessment so that the employees who

deserve may be benefited.

As a final point, motivation should not be taken in isolation. It is

integral to the success of a business. Motivation is solely a

psychological process being originated from the needs and drives and

actions of the employees. There are various factors to be construed in

the process of motivation. It is thus necessary for a business or

Human Resource Management to understand the situations consenting to

give encouraging response while offering financial or non-financial

incentives that the employees can be gratified and take pride in being

associated with the organization.

Q3.Explain the challenges to implement non-financial motivators in an organization.

Explanation

The relationship between the employer and the employee is a maximum

motivation factor for the employee. Motivational methods used by a

manager, through which the managers shows that he cares about his

employees are the following (without limiting only to financial

motivators): Page 17 of 31


Effective communication: an active listening of the manager to

messages sent by the caller, followed by a clear feedback from

him;

Positive Feedback: "praise in public and correct in private";

Extension/enrichment of the job: potential noting from the

manager of each employee and encourage their development;

Management by objectives: joint participation in setting goals,

achieving them and evaluation of performances of each employee;

Quality circles: the manager proposes to employees to form teams

to provide solutions in solving a problem which considers product

quality;

Clarity of the tasks: the manager must provide sufficient

information on the tasks assigned to employees to understand what

is desired of them;

Brainstorming: a group specific technique designed to generate a

range of ideas to solve problems;

Delegation: the manager can empower a person / group of

persons,time-bound execution, supervision or an organization of a

project.

Results of implementing:

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In the current economic context, the optimal solution for a certain

class of problems arising in the work of an organization.

At the organizational level the practical application of non-financial

motivation can bring the following results:

Identifying motivational factors of employees in the company, to

increase professional performance;

Aligning individual objectivs to general objectivs of the

society and establishing the means by which they will be

achieved;

Cultivation of the spirit of cohesion, belonging and shared

responsibility for the success or failure of the team;

"Pushing" the staff into action during peak periods or in

critical moments of the company when there is a need for

additional force and the company's buget doesn't allow

additional staff hiring;

Employees determination to get involved in objectives

realisation of development of the company and their awareness of

the role they have in it;

Reducing staff turnover in key functions of the company and

increasing loyalty to it;

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Competitive business environment by developing staff desire to

succeed;

Increasing the quality of products / services, especially of

sales,without the need for additional production costs and

marketing expenses;

Improving the internal and the external image of the company and

building an internal climate of valuing work well done.

Motivational techniques, regardless of how their classification

or their use, is based on the following premise: the greater the

feelings of belonging and involvement in that firm, the greater

the responsibility, recognition, respect or status granted

staff. Non-financial motivation Policy should stimulate

recognition not only vertically but also horizontally (manager-

employee and employee-employee).employees in creating the

evaluation grid, after which staff will be rewarded,

acknowledging their employees their importance within the team

and organization.

Non-financial motivation versus financial motivation

Considering that every person is motivated by different things,

according to individual circumstances and the situation it's in at a

certain moment, managers must be able to identify motivational factors

which to accommodate their wishes and needs.

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It is clear that, in an organization which wants performance, we can't

have just a single type of motivation, but comparing with financial

motivation, the non-financial one represents a series of benefits:

Low costs;

It has a stronger effect and remains longer embedded in the mind

of the employee as it appeals in its emotional state;

Can be applied to a longer period of time;

If it's interrupted it doesn't generate resentments among those

targeted;

Promotes membership in that team;

Raises the employee's fidelity for the organization.

Application of non-financial motivation

The relationship between the employer and the employee is a maximum

motivation factor for the employee. Motivational methods used by a

manager, through which the managers shows that he cares about his

employees are the following (without limiting only to those):

Effective communication: an active listening of the manager to

messages sent by the caller, followed by a clear feedback from

him;

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Positive Feedback: "praise in public and correct in private";

Extension/enrichment of the job: potential noting from the

manager of each employee and encourage their development;

Management by objectives: joint participation in setting goals,

achieving them and evaluation of performances of each employee;

Quality circles: the manager proposes to employees to form teams

to provide solutions in solving a problem which considers product

quality;

Clarity of the tasks: the manager must provide sufficient

information on the tasks assigned to employees to understand what

is desired of them;

Brainstorming: a group specific technique designed to generate a

range of ideas to solve problems;

Delegation: the manager can empower a person / group of persons,

time-bound execution, supervision or an organization of a

project.

Motivational techniques, regardless of how their classification or

their use, is based on the following premise: the greater the feelings

of belonging and involvement in that firm, the greater the

responsibility, recognition, respect or status granted staff. Non-

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financial motivation Policy should stimulate recognition not only

vertically but also horizontally (manager-employee and employee -

employee).

“The heart of motivation is to give people what they really want most from work". --

Twyla Dell

Sustainability of the motivation is very important and to sustain its

high level organizations are required to establish reliable and

comprehensive systems, policies and processes in the workplace. Long-

term motivation of your employees will take you to the desired

organizational outcomes such as high level of productivity, high sales

and low turnover rate.

The employee's motivation depends on the influence behavior. Once

aware of this, the chance of achieving better results at both

organizational and individual levels. Managers cannot order their

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employees to be motivated, what they can do instead, is to create an

atmosphere through which to cultivate accountability, dedication and

improvement at work. Some managers choose a shorter path, but not

effective- they try to motivate trough fear. This method, however,

quickly loses the effect. True managers motivate trough their

personality and authority, not trough fear.

To use the full potential of employees and managers modern managers

and organization changed their approach from "giving orders and

control" to” consult and support" as effective ways for employee

motivation. This change of attitude began when managers understood

that recognizing achievements or recognizing the good performance is

more effective than punishment for poor performance.

Non-financial motivation is the integration of a system of reward and

recognitions (Rewards and Recognition - R & R), which doesn't involve

giving money directly to the employee. Motivational policies,

financial and non-financial, should not be designed in isolation but

in line with the organization's other policies and objectives.

Analysis of their implementation will not be limited to a short period

of time, but will take into account the effects of these on a longer

time horizon.

Q4. Can you suggest how potentially an organization can overcome these

challenges?

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Motivation is very important for any organization to increase the

productivity and the ability of the employees for that specific

organization Motivation is the act of giving somebody a reason or

incentive to do something. It also means giving somebody hope or

support to perform particular tasks. Motivation is the act of giving

somebody a reason or incentive to do something. It also means giving

somebody hope or support to perform particular tasks. The rewards can

be financial and nonfinancial. But this is very challenging for an

organization to overcome these challenge. If the employees are only

driven by money and nothing else in that case non-financial motivators

will not create any positive impact regarding their motivation level

or performance.

The most basic way is to give a verbal compliment to the

employee. This could be an acknowledgement of job well done, a

good sale, or a particular action that the employee did that

benefitted the organization. The compliment could be done in

public or in private. This gives the employee reassurance that

they are doing what their managers are looking for and that they

are paying attention to the work being done.

The manager could send the employee an E-mail that explains the

appreciation of the employee.

A manager can also publically acknowledge an employee in front of

their peers at a meeting, presentation, in the office, etc.

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To make them rationalized with non-financial motivations

organization need to have a long term plan.

The manager must provide sufficient information on the tasks

assigned to employees to understand what is desired of them;

The manager can empower a person / group of persons, time-bound

execution, supervision or an organization of a project.

The strategy can be initiated through some informal survey like

whether the employees are craving for a picnic or they prefer a

better recognition for their work. If the employees are standing

for the first one then an annual picnic with company’s cost can

make them motivated a lot. On the other hand, if the employees

are feeling that they are not acknowledged then the Management

will have to work a bit. For instance, a long term service award

(may be a gold medal) can be introduced who are serving the

organization for more than 15 years, a letter of appreciation by

the Managing Director for those who have not taken any casual

leave for 01 year, a dinner with the Managing Director for the

sales team who have exceeded their target sales etc.

At last we have to be pragmatic in a sense to get a clear and

accurate insight about the mind set up of the employees. Because

this is the only way through which the organization can

strategize its policy regarding the non-financial motivation. The

organization will have to read the mind first and then it will

gratify them as par their (the employees) taste and preference.

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Motivation is a complex concept and can help or harm an organization

depending on how it is used within an organization. If a manager takes

the time to understand the needs of his/her employees, then the

recognition can be extremely useful. Managers are not the only ones

who can recognize others in the workplace. Employees can recognize

each other as well. It has been proven to that one cannot directly

motivate someone else, but they can give them the tools they need to

motivate themselves. Managers are the resources for employees and they

should make sure that their work environment is pleasant and

desirable. By this way organization can overcome these challenges.

Conclusion:

Economic downturns can make for difficult human resource situations.

Apathy, reductions in workforce and high turnover can have a far

reaching impact that can spiral out of control. Business performance

can suffer because employees feel underappreciated and are worried

about whether their position will be eliminated, or whether sweeping

organizational changes will result in a loss of job status.Even

through economic turmoil, there are two types of factors thatPage 27 of 31


influence employee motivation and satisfaction – nonfinancial factors

and financial factors. Balancing these factors can be tricky, but

there is a science to improving employee morale when weighing factors

that motivate employees.For today’s organizations, the problem of how

to effectively motivate staff is becoming an increasingly important

issue. However, despite over 50 years organizational research that

demonstrates that employees are motivated by more than just money

alone, many organizations continue to rely solely on financial

rewards. It is perhaps understandable for organizations to make

simplistic assumptions about the ability of financial rewards to

influence employee motivation. Financial rewards are important as a

mechanism to aid recruit and retain talent, and as a means of

providing tangible recognition of effort or contribution. And after

all, people generally want more money, don’t they? Yet the consequence

of such an assumption has been to overemphasize the importance of

financial reward. Motivating employees is an important factor to urge

them work harder and have higher productivity. However, if use money

to motivate only, it is difficult to fair to each employee. Therefore,

employers should use non – financial motivators. Non – financial

rewards are more important than money. It is clear that there are

several factors why motivating employees. In spite of giving wages and

salaries, non – financial rewards also need to be given. As this case

study analysis will illustrate, there are a whole host of non-

financial motivators that can act to influence employee behaviour and

enhance employee motivation. As many organizations are beginning to

realise competitive difference may ultimately be made by non-financial

motivators.

Page 28 of 31


References

Works Cited

8 Helpful Factors for Motivating the Employees with Non-financial

Rewards

by Saritha Pujari

http://www.yourarticlelibrary.com/business-communication/8-

helpful-factors-for-motivating-the-employees-with-non-financial-

rewards/1008/

The Importance of Non-financial Rewards for the Organization

by Scott Thompson, Demand Media

http://smallbusiness.chron.com/importance-nonfinancial-rewards-

organization-45146.html

Burton , K. (2012). A Study of Motivation: How to Get Your

Employees Moving. PEA Honors Thesis Spring 2012 Indiana

University.

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http://smallbusiness.chron.com/importance-nonfinancial-rewards-organization-45146.html

http://smallbusiness.chron.com/importance-nonfinancial-rewards-organization-45146.html


Laakso, L. (2012). FINANCIAL AND NONFINANCIAL REWARDS ON EMPLOYEE

MOTIVATION. Bachelor’s Thesis (Turku University of Applied

Sciences).

NEAGU, A. C. (2014). Non Financial Motivation of Staff Challenges

and Solutions. University of Bucharest.

Siddiqui, F. (2014, July 6). https://www.linkedin.com/today.

Retrieved August 1, 2014, from www.linkedin.com:

https://www.linkedin.com/today/post/article/20140706140050-

59817714-non-financial-motivation-factors-how-non-financial-

motivational-factors-are-important-to-business-management

Silverman, M. (2006). Non-Financial Recognition (The Most

Effective of rewards?) Institute of Employment Studies.

http://www.employment-studies.co.uk/pdflibrary/mp4.pdf

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