With the Major League Baseball World Series starting tonight with the Texas Rangers appearing for the first time in team history I was reminded that they had the 4th lowest payroll of any major league team, “just” $55 million.
This is in significant contrast to the team they defeated in the American League Championship Series, the New York Yankees, whose payroll was $206 million.
Although this Major League example is a much different scenario than every day business, it provides a poignant, metaphorical example for ordinary business leaders that paying higher salaries and/or bonuses does not necessarily equate to higher performance.
Often times what happens in organizations is that providing an increase in salary or providing a year-end bonus that is not backed up with measurable performance results, usually creates only a higher paid, more wealthy dissatisfied employee.
Studies continue to show that a number of other factors come in front of money as a motivating factor for employees. Other key motivational factors include:
- Interesting/challenging work
- Co-workers and other team member relationships/attitudes
- Relationship with their immediate supervisor
- Recognition, reward and feedback
Usually money comes in #3 or below in surveys such as Gallup or the Wall St. Journal or Fortune Magazine’s “Best Places to Work” surveys.
As long as pay is deemed fair and provides a reasonable standard of living (it meets the fundamental requirements of Maslow’s heirarchy of needs), it is much less important than other environmental factors.
Yet, I find many business leaders who continually try and throw money at employees hoping to make them more motivated and engaged, only to find the enthusiasm and attitudes associated to that salary increase fade rather rapidly, like within 30-60 days.
It’s better for business leaders to focus on environmental factors and providing employees with greater control over their workplace, decision-making, interesting and challenging work, consistent recognition, appreciation and feedback will reap greater benefits than additional salary.
The money issue also becomes a dis-incentive often times when everyone on the staff is provided similar salary adjustments when there is an impression of significant difference in performance and contribution to the organization because of inconsistent and uncertain performance management processes.
If you would like to experience 7 powerful leadership lessons that can help you create a motivating work environment and engaged employees right away, check out “The Leadership Series,” which is on an anniversary special for just a couple of more days.
A few months ago I created “The Employee Motivation Equation” which provides a unique but accurate strategy to tap into the motivational needs of employees.
I encourage you to download “The Employee Motivation Equation” and take its accompanying assessment.
’til next time, make it a great week!