Finding motivation

Growing recognition that expensive prize- and money-giving incentive schemes are not necessarily good at motivating staff is forcing a rethink of how to make employees happy and productive. By Steve Hemsley

Chelsea FC manager Jose Mourinho says motivation is arguably more important than ability when it comes to creating a winning team. The man given the task of spending Roman Abramovich’s millions and stealing the Premiership crown from London rivals Arsenal says it is not enough to have players who can do the job – they must also want to do it.

This theory served him well at European champions Porto last season. It is a hypothesis to which employers in any UK business can relate when faced with the dilemma of how to keep staff motivated without spending increasing sums on incentive schemes.

When internal competitions are launched and rewards are distributed, there can be an impressive improvement in employee performance and morale. Yet once the initial excitement has died down, the enthusiasm built up in the workforce can soon wear off.

Richard Denny is a descendant of Elizabethan explorer Sir Walter Raleigh, but he is probably more famous in business circles for his speeches on the subject of staff motivation. He says there are a number of rules companies should follow if workers are to remain stimulated.

“Short-term incentive schemes are all very well, but employees will only stay interested if they have a realistic objective to strive for. They must also enjoy their job, feel that their work is recognised and appreciated, and see evidence that their employer is investing in their future, which usually means being offered regular training,” he says.

Denny claims that the schemes with cash prizes are often the least effective at generating long-term motivation, while even tangible rewards such as vouchers or bottles of wine can fail to have the desired effect. “The best solutions for keeping employees happy can cost the business very little. Why not let someone who has performed well leave work a couple of hours early or, if they cannot be spared, give them permission to use one of the directors’ parking spaces for a week? Recognising a person’s performance in this way, or by giving them a new job title, can be a more effective motivator than money and will increase their loyalty to the company,” he says.

Morale booster

Non-financial rewards can be effective when even the most motivated employee’s inspiration begins to fade. A normally happy worker can become upset at having to work harder than usual if the business is struggling or if vacancies in his or her department have remained unfilled for a long time.

Denny’s alternative way of rewarding people can also inspire those cynical, long-serving members of staff who regard any incentive scheme as just another fluffy initiative to come out of the marketing department and something they have seen many times before.

Capital Incentives & Motivation managing director Graham Povey says companies must think more about what he calls “motivational decline”, which is costing businesses millions of pounds a year because their greatest asset – their staff – is underperforming.

“Businesses must invest in remotivation and pick up the momentum of their employees if it is flagging. Sometimes a profit-share scheme is just not enough,” he says.

The marketing department does have a responsibility to try to revive excitement about an incentive scheme if interest has begun to wane. “The most successful schemes include clever communication techniques that remind participants of the rewards available. These might involve the sending of teaser e-mails, which provide a taste of what can be won if targets or goals are met, or posting regular updates of how individuals are performing around the office,” says Povey.

There are many reasons why a scheme can stagnate. The most common is a lack of imagination among senior managers, who recycle the same mechanics year after year and wonder why employees fail to get excited. Other explanations include resentment among staff who are not asked for their input into what type of scheme or rewards they would like; and prizes that are issued so infrequently that people simply cannot be bothered to take part. Getting feedback before an incentive scheme is launched can save the company money and generate better results.

Senior managers have a vital role to play in ensuring that any initiative delivers continuing benefits. They must be clear about what a contest is trying to achieve. Is the aim to generate immediate sales growth or to make staff feel happier about where they work?

In the picture

A scheme has more chance of achieving long-lasting benefits if the workforce is fully briefed and managers can answer questions raised by staff or their trade union. It is also advisable to run a pilot scheme to test if an idea is suitable for a particular type of business and workforce. Once a scheme has been launched, its effect on motivation must be monitored regularly so that adjustments can be made if things are not going to plan.

Again, it is important to ask staff for their comments and discover whether – and why – some employees are reluctant to get involved. Maybe the incentives – membership of a golf club, for instance – discriminate against some staff and this has created bad feeling, or perhaps some individuals feel that their own chances of winning a prize are too slim?

Denny’s view that tangible prizes are not always necessary, and that people often respond better to simply being recognised for a job well done, has widespread support.

Toby Farrance, account director at The Grass Roots Group, which provides performance improvement campaigns for more than 1,000 business clients at any one time, agrees this policy works well, but only if a person’s actions are acknowledged promptly. “If someone has stayed late they should get recognition from their line managers within a couple of days, so the impact is not lost,” he says.

“At the same time, the level of contribution required to earn recognition is raised as staff get a better understanding of how their short-term actions are helping a company to achieve its longer-term aims. The bar is raised as employees become more comfortable with what they need to do.”

Innovative reward schemes

One of Grass Roots’ clients is global accountancy firm Ernst & Young, which has implemented an employee branding strategy to keep its 110,000 staff motivated. The company is using an incentive programme called Exceed to encourage employees to live up to Ernst & Young’s brand values of “integrity, respect, energy, enthusiasm, teaming and courage”.

Employees can nominate colleagues whose actions typify the company’s values. Nominees approved by the management receive Exceed Points worth &£50. These can be redeemed for goods and services on a website. There are 300 nominations a month and about 75 per cent of employees have received at least one nomination.

“At their worst, brand value statements are just hollow words, far too ambiguous to mean much to anyone. Add to this the fact that many statements are crafted by senior managers in isolation and it is no wonder that many programmes fail to deliver change. We give employees a chance to recognise and thank each other,” says Ernst & Young head of regional communication Lee Smith.

Many companies could implement this type of scheme, but it will only be successful if everyone believes the brand values apply to them. One way to achieve this is to hold internal workshops, enabling individuals to interpret how values, such as integrity and enthusiasm, relate to their everyday jobs.

The point of having an incentive scheme is to create a motivated and satisfied workforce, which should translate into a more profitable business. The theory goes that contented employees will convey positive feelings about the company and its brands to existing and potential customers.

Claire Owen, managing director of marketing recruitment agency Stopgap, says the key to having a motivated staff is to appoint the right people. “The workplace is like a bus. You need the right people on the bus. People want to sit next to people they get along with because they will be motivated by those around them,” she says. “To get the best out of people you need to listen to staff and understand them. Most people do not need vouchers or to be put on a pedestal, they just need to know that their line manager is happy with their performance.”

Expect plenty of back-slapping from the Chelsea dressing room this season.

The Total Motivation Show

The Total Motivation Show runs

September 21 to 22 at London’s Olympia. This new event showcases the products, services and experiences that motivate people, whether you are aiming to reward employees or incentivise customers.

The event has more than 70 big industry name exhibitors and a conference programme that answers the major questions facing incentive managers today. The programme is split into two streams, one focusing on staff motivation and one on customers. Expertise is on hand from leading companies, including Barclays Bank, InterContinental Hotels Group and Tesco.

As well as conference sessions, visitors can attend a free Voucher Association panel discussion looking at ‘Motivation in the modern working environment’.

For more information, go to

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