Why motivation matters
- Motivated staff work harder, are more productive, give better customer service, have lower absenteeism and are less likely to leave (lower staff turnover).
Financial methods
- Remuneration includes wages (usually paid by the hour or week), salaries (a fixed yearly amount, usually paid monthly), commission (a percentage of sales), bonuses, profit sharing and fringe benefits, such as a company car, staff discounts or a pension.
Non-financial methods
- Praise and recognition, more responsibility, training and development, job rotation (moving between tasks), job enrichment (more challenging tasks), autonomy (freedom to make decisions), team working, flexible hours and a good working environment.
Choosing methods
- Financial rewards can motivate, but they cost money and their effect may not last. Non-financial methods are often cheaper and can build long-term motivation. Many businesses combine both.
Key terms
- Motivation
- The desire to work hard and do a job well.
- Remuneration
- The payment and rewards employees receive for their work.
- Wage
- Pay usually calculated by the hour or week.
- Salary
- A fixed yearly amount of pay, usually paid monthly.
- Commission
- Pay based on a percentage of the sales made.
- Fringe benefits
- Extra rewards, such as a company car or staff discount.
- Job rotation
- Moving workers between different tasks.
- Job enrichment
- Giving workers more challenging and interesting tasks.
- Autonomy
- Freedom to make your own decisions at work.