Companies often default to financial strategies to drive desired employee behaviors, whether those behaviors are increased engagement, ownership and initiative, or simply better employee retention. For instance, a manager might promise a promotion and accompanying raise to an employee who succeeds in completing a challenging project. Or an organization might motivate staff through a quarterly or annual bonus program.
Finding Non-Financial Ways to Motivate
But these financial incentives have an obvious drawback: they cost money. Companies don’t have unlimited resources and relying too heavily on financial incentives can prove to be unsustainable in the long run. Fortunately, there are methods that don’t involve opening up the wallet to help motivate staff.
“While financial incentives matter, non-monetary rewards are gaining traction,” says Paola Cecchi-Dimeglio in an article for Forbes. “Opportunities for upskilling, leadership development, and increased autonomy can significantly enhance motivation and contribute to long-term organizational success.”
What Employees Value
For many employees, opportunities for long-term advancement are more meaningful and even potentially more lucrative than one-off bonuses or even salary increases at the employee’s current job level. For example, an entry-level worker might be more interested in taking employer-provided training on employee management and presentation skills than a modest raise if the employee believes the training will open opportunities for career advancement in the long term.
Similarly, many employees value recognition as much as if not more than financial reward. An employer investing time and resources into an employee’s career growth is a clear and tangible indication that the employer recognizes the employee as a top performer and valuable asset the company hopes to retain for the long term.
Fostering a sense of purpose and belonging within the company can also serve as a powerful motivator. When employees feel that their work is meaningful and contributes to the organization’s larger goals, they are often more engaged and committed to their roles.
Offering clear pathways for employees to contribute ideas, participate in decision-making, or take on leadership responsibilities within their teams can cultivate this sense of ownership and purpose. Non-financial perks like flexible work arrangements, opportunities to work on passion projects, and a supportive company culture further enhance employee satisfaction and motivation.
While financial incentives are an effective tool for driving specific behaviors, they shouldn’t be the sole strategy for employee motivation. By combining monetary rewards with non-financial methods such as opportunities for growth, recognition, and meaningful work, companies can create a more sustainable and well-rounded approach to employee engagement and retention.
This balanced approach not only saves financial resources but also fosters a more committed and fulfilled workforce.
Lin Grensing-Pophal is a Contributing Editor at HR Daily Advisor.