How to Make Money a Non-Issue For Your Employees​

Even though there are many ways to motivate people in our organisations, one motivator tends to be used over and over again above all others — the If-Then reward.

Here’s how it works: IF you do this, THEN I’ll give you that. It’s simple and intuitive, but it’s also limited.

Over the last 50 years, social researchers found that If-Then motivators are great for simple and short-term work, but mostly ineffective for complex, long-term work.

In the 19th and 20th Centuries, If-Then motivators were incredibly effective because of the nature of the work. Most of these jobs required employees to follow repeatable procedures in their day-to-day work (assembly lines, data processing, etc.), but today’s professional landscape is quite a bit different.

Even though modern companies require employees to be creative and conceptual on a daily basis, they primarily rely on If-Then rewards to motivate people. This might explain why 70% of the workforce is disengaged with their work.

We desperately need to update the way we motivate, but if If-Then rewards don’t get the job done, what does?

What can effectively motivate your employees to become engaged in the complicated, creative, and conceptual work you hired them to do?

FACT: Money Is A Motivator

Crucial Conversations, Crucial Accountability, and Influencer talk a lot about the power of intrinsic and internal motivation. Crucial Learning has poured thousands upon thousands of hours into studying how to make companies more innovative, efficient, and effective — with great success.

And as powerful as our tools and techniques are, don’t get the wrong idea. There are some basic principles that shouldn’t be ignored.

Some CEOs learn what Crucial Learning can do and think, “Oh my! This stuff is fantastic. If these intrinsic motivators are the pathway to high performance then I can scrimp on people’s pay.”

That’s a terrible idea. The truth is, money is a motivator.

Do you want your workers to be motivated? Do you want your employees to be engaged?

If so, then you have to pay them enough — plain and simple.

The Norm of Fairness

Human beings — especially in the workplace —  are exquisitely attuned to the norm of fairness. If you violate the norm of fairness, you lose.

What does this mean?

Let’s say you hire two people to do comparable work and pay one less than the other. If that person ever finds out they’re making less to do the same job, you’ll have a big motivation problem.

Or, if you pay your employees $40K, but your competitor — a similar company doing similar work in the same labor market — pays its employees $50K, you’ll have a motivation problem.

The notion of fairness is violated.

How to Make Money a Non-Issue

There’s a really interesting paradox that happens once we establish fair pay.

We have this notion that if we raise the importance of money and get people to focus on their compensation, they’ll do better at their jobs. Research shows it’s is true IF people are doing simple, short-term tasks.

But if your employees are responsible for creative, conceptual, or complex work, what do you want them to focus on?

You want them to focus on the work itself — not the money.

Money matters a lot, but the best way to use money as a motivator is to pay people enough to take the issue of money off the table.

When you pay employees fairly and adequately, they’ll stop focusing on money and start focusing on their work. Then you can move on to higher-level motivators to increase engagement and performance in your organisation.

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