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Motivating people- Getting beyond money Case

Analysis

The Case Analysis On

Motivating people-
Getting beyond
money McKinsey Company Quarterly Case

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Motivating people- Getting beyond money Case
Analysis

Case # 3
Motivating people: Getting beyond money

MGT501 Management of Organization & Systems

Prepared for

Md. Tamzidul Islam

Senior Lecturer

BRAC Business School

Prepared by

Group Members

SL No ID Name
14364042 AINUL KAMAL
1
14364032 MD. IFTIAR AHMED
2
14364047 MD. ARAFAT RAHMAN CHOWDHURY
3
12364053 RAKIBUL ISLAM
4
12364058 ISHRAT JAHAN KHAN
5

Semester: Fall 2014, Section: 03, Department: MBA

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Date of Submission: 10th December 2014

Introduction

Motivation is the act of giving somebody a reason or incentive to do something. It also means giving
somebody hope or support to perform particular tasks. Motivation factor plays a vital role in business
Management. The process of employee motivation in the workplace creates zeal and interest and
commitment; energetic and unflagging enthusiasm that makes them do something, especially something
that involves hard work and efforts. It thus must be borne in mind that a highly motivated employee uses
his potentials to the optimum level and makes goal-directed efforts while raising the best level of
efficiency towards the accomplishment of organizational objectives, whereas the one who’s not motivated
does not do so. The impact of total rewards including financial and non-financial rewards have on
employee motivation was chosen to be studied in this case because both of the concepts are important;
for the employees and for the employers.

Q1. Based on the information provided and your further understanding, why is it important to
motivate employees with non-financial motivators?

Still that money is the most important motivational factor and so are the plans, using money incentives,
bonus and the wages linked with productivity etc. are designed in order that the employees may be
motivated to work more efficiently, yet there are some other motivational factors that can bring positive
results in the personal development of the employees as well as in the organizational environment.
Numerous studies have concluded that for people with satisfactory salaries, some nonfinancial motivators
are more effective than extra cash in building long-term employee engagement in most sectors, job
functions, and business contexts. Many financial rewards mainly generate short-term boosts of energy,
which can have damaging unintended consequences. A sentence that may have commonly been heard or
overheard when a situation erodes the employee morale, “Money is not everything.” connoting there is

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something that drops off behind the situation that the person anticipates other than the money. Hence, it is
necessary for a manager to understand what motivational factors the employees get contented with while
observing both financial and non-financial motivational factors in the workplace. In terms of a definition,
non-financial recognition can be thought of as: “…a non-cash award given in recognition of a high
level of accomplishment or performance such as customer care or support to colleagues, which is not
dependent on achievement of a pre-determined target.”(Rose 1998).
A recent McKinsey Quarterly survey underscores the opportunity. The respondents view three noncash
motivators—praise from immediate managers, leadership attention (for example, one-on-one
conversations), and a chance to lead projects or task forces—as no less or even more effective motivators
than the three highest-rated financial incentives: cash bonuses, increased base pay, and stock or stock
options.
The survey’s top three nonfinancial motivators play critical roles in making employees feel that their
companies value them, take their well-being seriously, and strive to create opportunities for career
growth. These themes recur constantly in most studies on ways to motivate and engage employees.
There are a number of reasons why it is important to motivate employees with non-financial motivators.
Just to name a few of the most commonly used non-financial motivators are mentioned herein that could
stand to benefit to everyone concerned. Due to recent economic conditions, organizations and employees
are focusing on financial motivators in terms of salary increment, bonus and commission. “More than half
the employees surveyed by the Society for Human Resources Management in 2009 said that benefits and
compensation are important ("2009 Employee Job Satisfaction")”. However, to me money is not
everything. If employers are offering financial rewards only and in return they are expecting high
productivity and low turnover rate, their strategies are not long term. There are many other factors that
play an important role with money in keeping an employee motivated. Here are some non-financial
motivators that are inevitable for any organizations employees’ motivation and also for organization’s
success.

Recognition and Respect

According to a survey conducted by consulting company Mercer in 2011, employees in Argentina, Brazil,
Canada, Mexico and the United States all listed “being treated with respect” as the single most important
factor in motivation. Recognition and praise can send employees the message that the company respects
them and values their contribution. Financial incentives and bonuses were number 13 on the list in all five
countries. American employees rated “base pay” fifth on the list, so although financial rewards remain
important they actually have less importance for most employees than respectful treatment and
recognition.

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Encouraging strategic behavior( encourage karo behavior)

Non-financial motivators gives an organization the opportunity to highlight desired actions and behaviors.
In the process, role models are created for other employees. The thinking behind this is that by
recognizing outstanding achievement and certain behaviors, other employees will aim to imitate such
ways of performing. In addition, the whole process of recognition can be used explicitly as a method of
contributing to the achievement of organizational objectives.

Organizational Climate

Organizational climate means the working system within the organization. This includes individual
freedom, receipt of awards, the importance of employees, etc. Every person likes to work in a better
organizational climate. The manager can motivate the employees by providing a better organizational
environment.

Cost efficiency (moral support)

Non-financial motivators can help fulfill organizational objectives at a relatively low cost. This was
supported by a research conducted by Industrial Relations Services (1999):

“One of the key attractions of recognition-based schemes is the cost efficiency. The most obvious benefit
is that awards made under recognition schemes need not be expensive, as it is their symbolic value and
not their cost which is important.”(IRS 1999)

A report by Income Data Services (1999) makes the same point. The awards given under the banner of
non-financial motivation scheme are typically worth a lot less than the value of those in any financial
motivation scheme. But, as the monetary value of the award is less important than the act of recognition
itself, these sort of schemes offer good monetary value. Since their symbolic (as a visible sign that
individual contribution is being acknowledged) is greater than their monetary worth, organizations get a
‘bang for their buck’. Without using financial motivators only non-financial motivators can achieve cost
efficiency for any organization with a full motivated workforce.

Employees Participation:

Employees get encouraged to notice their participation in managerial works. Therefore, they offer their
full cooperation in making successful the policies prepared with their help.

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Employer branding

The thinking behind employer branding is that if an organization has an external brand to attract and
retain customers, then why not do the same internally so that not existing and potential employees can
identify with the brand. Non-financial recognition links with the concept of total reward here, as
organizations can use the whole range of benefits, both financial and non-financial, to make a statement
about the organization and its culture. This can be employed to promote a more positive organizational
image.

Retention & Job Security (adat) (talk)

There is little doubt that focusing solely on financial rewards creates instrumental relationships – “I work
for you just because you pay me”. In such a situation, it becomes easier for competitors to lure away
experienced and important staff – they just have to pay them more money. In terms of retaining key talent,
building affective relationships between employer and employee binds the two more closely together.
This makes the individual less likely to leave and makes it harder for rival organizations to compete.
Non-financial motivators help reinforce affective relationships. And they are more difficult for other
organizations to match compared to extrinsic forms of reward. Job security is an important non-monetary
motivator. Security of job means a feeling of permanence and stability. For example, if an employee has a
sense of fear or insecurity in his mind, that he can be removed from his job any time, he will never work
wholeheartedly and this worry continues troubling him.

On the other hand, if he has a feeling that his job is secure and permanent and he cannot be removed from
his job easily, he will work without any worry and with an easy mind. Consequently, his efficiency
increases. This is the reason why people prefer a permanent job with less salary to a temporary job with
more salary.

Q2. How non-financial motivator does help an organization to motivate its employees?

Motivation is very important for any organization to increase the productivity and the ability of the
employees for that specific organization. The use of non-financial methods of motivation is attempts by
employers, to apply in the workplace the ideas behind the theories of Mayo, Maslow and Hertzberg.
Examination of these theories has shown us that motivation to achieve quality of output is best achieved
through satisfaction of higher needs (Maslow), awareness of the role of groups in the workplace (Mayo),
and the need to provide Motivators (Herzberg). It is not about the money all the time, it can be any other

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things which can enhance the ability of the employee. Non-financial rewards can have an even more
substantial impact on employee satisfaction and motivation than traditional financial rewards. A study by
the Hay Group involving around four million employees found that employees listed work climate, career
development, recognition and other non-financial issues as key reasons for leaving a job. Even well-
compensated employees may leave a company if dissatisfied with these aspects. Companies with
excellent non-financial incentive plans can attract motivate and retain talented people. In the past, many
companies relied on money almost exclusively to motivate their workforce, but employees often rate
other aspects, such as recognition and flexibility as more important. The problem with relying too much
on money as a motivator is that it can encourage employees to focus on whatever will earn an immediate
incentive rather than on finding long-term solutions or creative new approaches. It can also lead
employees to see each other as opponents in a competition rather than working together for mutual
benefit.

Non- Financial Motivators:

Now a day’s companies around the world are cutting back their financial-incentives programs, but few
have used other ways of inspiring talent. Different studies show that for people with satisfactory salaries,
some non-financial motivators are more effective than extra cash in building long-term employee
engagement in most sectors, job functions and business contexts. Non-financial motivators can be
 Job Enlargement
 Job enrichment
 Praise from immediate Manager
 Leadership Attention
 Chance to lead projects
 Empowerment

Praise from immediate Manager

When a person get a praise for the work he or she has done, obviously he or she get motivation or feel
happy to complete that task. For example, you are working in a incentive base company, in where your
bonus is depend on that and if you fill up your target, then you will not get any appraisal from your

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manager. On the other hand if you are working in such organization with good basic salary and there is no
incentives for the work you done, but you are apprised for the work you done. Between these two
Scenarios, employees will choose the second one and that also helps organization to reach its success. The
purpose of performance appraisal is to inform employees that the organization is interested in their
professional development. It signals the message that employees contribution plays significant role in
organizational success. As a result, employees are motivated to contribute more towards the
organizational success because they are given recognition and appreciation for their contribution. The
performance appraisal motivates the competent employees by rewarding them. This is how less
competent employees will get inspiration from competent employees and will be motivated to perform
well.

Leadership Attention

Leadership attention is another type of non-financial motivation in where employees get motivation and
think that they are the important person for the organization. From this article we can see that one-on-one
meetings between staff and leaders are hugely motivational. A HR director from a mining and basic
material company explained it that way- “they make people feel valued during these difficult times”.
Emphasized leadership attention as a way to signal the importance of retaining top talent. When one
global pharma company’s CEO was crafting corporate strategies this year, he convened several focus
groups of talented managers to generate ideas about how to create more value for the business. Besides
that when a person get attention from his or her leader than he or she wants to complete that task more
accurately. It brings a huge motivation and determination to complete the job in the finest way.

Chance to Lead projects

It is another kind of non financial motivators in where employees are encouraged to lead the work done
by them. It increases the will power of the employee to do the job more perfectly. And they think they are
the valuable part of the organization. From this case we can see the scenario that a chance to lead projects
is a motivator that only half of the companies in our survey use frequently, although this is a particularly
powerful way of inspiring employees to make a strong contribution at a challenging time. Such
opportunities also develop their leadership capabilities, with long-term benefits for the organization. One
HR director in the basic-materials industry explained that involvement in special projects “makes people
feel like they’re part of the answer—and part of the company’s future.” A leading company from the

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beverages industry, for example, selected 30 high-potential managers to participate a leadership program
that created a series of projects designed and led by the participants. So it is another great non financial
motivator.

Job Enrichment

This means giving workers more control over the tasks that they complete. Allowing workers to complete
tasks that have a meaning, and are complete in themselves. For example a worker who has a job fitting
the tube to a TV, may have his job enriched by testing that the tube works, and being able to make
adjustments so that the required level of quality is achieved. The ability to do this range of tasks means
that the worker becomes more committed to achieving quality. The cost associated with this method, are
of course, the time spent training the worker to complete these extra tasks. Effective job enrichment
depends upon workers having interesting tasks to complete. Job design is a key part of Herzberg's ideas.

Job Enlargement

Job enlargement means increasing the number of tasks completed by a worker. So a secretary previously
employed to answer calls might now have duties, which include, filling, letter writing etc. This adds
interest to the job, and involves the employee in a more complete role within the business.

Empowerment

This means giving workers the power to control their own jobs, make decisions, and implement their own
ideas. It is often used in an artificial way, for example allowing counter workers in burger bars to decide
the greeting they use when they meet customers. By doing that organization get its work done more
naturally.

 Identifying motivational factors of employees in the company, to increase professional


performance;

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 Aligning individual objectives to general objectives of the society and establishing the means by
which they will be achieved;
 Cultivation of the spirit of cohesion, belonging and shared responsibility for the success or failure
of the team.
 Pushing the employees into action during peak periods or in critical moments of the company
when there is a need for additional force and the company's budget doesn't allow additional staff
hiring;
 Employees determination to get involved in objectives realization of development of the
company and their awareness of the role they have in it.
 Reducing staff turnover in key functions of the company and increasing loyalty to it.
 Competitive business environment by developing staff desire to Increasing the quality of products
/ services, especially of sales, succeed.
 Improving the internal and the external image of the company and building an internal climate of
valuing work well done.

Motivational techniques, regardless of how their classification or their use, is based on the following
premise: the greater the feelings of belonging and involvement in that firm, the greater the responsibility,
recognition, respect or status granted employees.
A sentence that may have commonly been heard or overheard when a situation erodes the employee
morale, “Money is not everything.” connoting there is something that drops off behind the situation that
the person anticipates other than the money. Hence, it is necessary for a manager to understand what
motivational factors the employees get contented with while observing both financial and non-financial
motivational factors in the workplace. Just to name a few of the most commonly used non-financial
motivators are mentioned herein that could stand to benefit to everyone concerned.
Evidence reveals that the employee morale is a vital element of an organizational development and
success. Having been enhanced to the extensive extent, it leads to the considerable improvement in
inefficiencies and organizational competencies. It is therefore by means of boosting employee morale is to
get success in terms of overall organizational development and competence. The higher the morale, the
greater will be success and vice- versa. Considering the factors affecting employee morale, a manager
must come out with positive and constructive suggestions, ideas and plans which may be beneficial to
both organization as well as the employees. Managers must adopt such motivational methods as to boost
employee morale at all times.

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As regards the employee morale, moving back to see how it is, connected with quality of work delegated
and being considered as one of the non-financial motivational factor, supportive to both management as
well as employees.
Quality of work is an important factor for the employees who are qualified and skilled and capable of
performing better and challenging tasks than those that are done every day as a routine - such tasks may
sooner or later become real chore for them. Employees begin to lower their morale and get frustrated if
they are not provided the right opportunities and assignments matching with their skills and professional
credentials. What in such situations a manager needs to do is that he can suggest plans and ideas to benefit
those employees. In order to ensure without any prejudice in the assessment of such employees, one of
the modern methods of performance appraisal, a new approach to business management, having been
termed as Management by Objectives is very much helpful in this way. It is through the process of
management by objectives that the objective of each employee is set having been mutually agreed upon
and the Key Results areas (KRA) and Key Performance Indicators (KPI) are indicated accordingly. Not
only does this process help the manager to evaluate the performance of each employee but also enables
him to propose for any further development of the employee in respect of his designation and the
assignments. In this way, a manager could support those employees, by enhancing their morale, who are
true in their claim that they can handle better assignments than those that are being carried out currently.
Next in importance comes the good deed of praise and recognition - Who on earth does not have a wish to
win praise? Who does not want that he be expressed one’s approval and admiration and recognition in the
tasks that are done by the sweat of his brow? Even to smile a small smile makes a big difference, then,
what to speak of the admiration and recognition? The effect of admiration and recognition in lieu of the
loyal and sincere services of the employees is such that it becomes a stimulus that sets off a positive
behaviour triggering their minds to work more effectively and efficiently to the extent of their diligence.
At this point, a religious saying is worth mentioning that could be so interpreted - or the words to that
effect: If one cannot help others with money, then one must help them at least with a pleasant smile. It
thus suggests how important it is for a manger to make a smile appear on his face. It may be rightly said
that a broad grin wins the assent of the employees to motivate them towards their efficient performance.
The actions relating to praise and recognition may thus be demonstrated as and when needed, such as,
patting at the back of the employees, entrusting them advance assignments and recommending them for
promotions.
Mention must be made about the provision of the place and the furniture as these symbolize the status and
the level of authority and responsibility being associated with the designation of the employees. Having
been provided costly furniture with well-decorated and furnished office, employees take great pride in

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their work as this method of motivation creates the correct level of respect for the importance and value
of their character, efforts and achievements.
The seniority of an employee in itself encompasses an additional implied meaning that extolls the
employees’ loyalty, patience, truthfulness and trustworthiness, sense of responsibility and steadiness.
When an individual makes a start his career wishing for his professional progress and becomes a part of
an organization, brings along him a bundle of hopes and ambitions and commitments. In order that he
could take care of his family members satisfactorily, he regards the means his livelihood as valuable to
fulfil his responsibilities and personal goals. Such employees are responsive and meticulous in doing their
duties. Hence, in view of the aforementioned facts, the assurance of job security with economic measures
within the organization plays a significant role while motivating them to continue extending their earnest
services.
Now looking to the other side of the coin, evidence suggests that non-financial motivational technique has
a favourable effect on the process of job enrichment or job enlargement entitling those employees who are
desirous. They would rather want professional development than adhere to the routine job activities. To
them job enrichment or professional success in terms of higher positions is more important than
maintaining seniority level with the same nature of job. Yet again, there is a need of a fair assessment so
that the employees who deserve may be benefited.
As a final point, motivation should not be taken in isolation. It is integral to the success of a business.
Motivation is solely a psychological process being originated from the needs and drives and actions of the
employees. There are various factors to be construed in the process of motivation. It is thus necessary for
a business or Human Resource Management to understand the situations consenting to give encouraging
response while offering financial or non-financial incentives that the employees can be gratified and take
pride in being associated with the organization.

Q3. Explain the challenges to implement non-financial motivators in an organization.

Explanation
The relationship between the employer and the employee is a maximum motivation factor for the
employee. Motivational methods used by a manager, through which the managers shows that he cares
about his employees are the following (without limiting only to financial motivators):

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 Effective communication: an active listening of the manager to messages sent by the caller,
followed by a clear feedback from him;
 Positive Feedback: "praise in public and correct in private";

 Extension/enrichment of the job: potential noting from the manager of each employee and
encourage their development;

 Management by objectives: joint participation in setting goals, achieving them and evaluation of
performances of each employee;

 Quality circles: the manager proposes to employees to form teams to provide solutions in solving
a problem which considers product quality;

 Clarity of the tasks: the manager must provide sufficient information on the tasks assigned to
employees to understand what is desired of them;

 Brainstorming: a group specific technique designed to generate a range of ideas to solve


problems;

 Delegation: the manager can empower a person / group of persons,time-bound execution,


supervision or an organization of a project.

Results of implementing:
In the current economic context, the optimal solution for a certain class of problems arising in the work of
an organization.
At the organizational level the practical application of non-financial motivation can bring the following
results:

 Identifying motivational factors of employees in the company, to increase professional


performance;

 Aligning individual objectivs to general objectivs of the society and establishing the means by
which they will be achieved;

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 Cultivation of the spirit of cohesion, belonging and shared responsibility for the success or
failure of the team;

 "Pushing" the staff into action during peak periods or in critical moments of the company when
there is a need for additional force and the company's buget doesn't allow additional staff hiring;

 Employees determination to get involved in objectives realisation of development of the


company and their awareness of the role they have in it;

 Reducing staff turnover in key functions of the company and increasing loyalty to it;

 Competitive business environment by developing staff desire to succeed;

 Increasing the quality of products / services, especially of sales,without the need for additional
production costs and marketing expenses;

 Improving the internal and the external image of the company and building an internal climate of
valuing work well done. Motivational techniques, regardless of how their classification or their
use, is based on the following premise: the greater the feelings of belonging and involvement in
that firm, the greater the responsibility, recognition, respect or status granted staff. Non-financial
motivation Policy should stimulate recognition not only vertically but also horizontally
(manager-employee and employee-employee).employees in creating the evaluation grid, after
which staff will be rewarded, acknowledging their employees their importance within the team
and organization.

Non-financial motivation versus financial motivation

Considering that every person is motivated by different things, according to individual circumstances and
the situation it's in at a certain moment, managers must be able to identify motivational factors which to
accommodate their wishes and needs.

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It is clear that, in an organization which wants performance, we can't have just a single type of
motivation, but comparing with financial motivation, the non-financial one represents a series of benefits:
 Low costs;
 It has a stronger effect and remains longer embedded in the mind of the employee as it appeals in
its emotional state;
 Can be applied to a longer period of time;
 If it's interrupted it doesn't generate resentments among those targeted;
 Promotes membership in that team;
 Raises the employee's fidelity for the organization.

Application of non-financial motivation

The relationship between the employer and the employee is a maximum motivation factor for the
employee. Motivational methods used by a manager, through which the managers shows that he cares
about his employees are the following (without limiting only to those):

 Effective communication: an active listening of the manager to messages sent by the caller,
followed by a clear feedback from him;

 Positive Feedback: "praise in public and correct in private";

 Extension/enrichment of the job: potential noting from the manager of each employee and
encourage their development;

 Management by objectives: joint participation in setting goals, achieving them and evaluation of
performances of each employee;

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 Quality circles: the manager proposes to employees to form teams to provide solutions in solving
a problem which considers product quality;

 Clarity of the tasks: the manager must provide sufficient information on the tasks assigned to
employees to understand what is desired of them;

 Brainstorming: a group specific technique designed to generate a range of ideas to solve


problems;

 Delegation: the manager can empower a person / group of persons, time-bound execution,
supervision or an organization of a project.

Motivational techniques, regardless of how their classification or their use, is based on the following
premise: the greater the feelings of belonging and involvement in that firm, the greater the responsibility,
recognition, respect or status granted staff. Non-financial motivation Policy should stimulate recognition
not only vertically but also horizontally (manager-employee and employee - employee).

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“The heart of motivation is to give people what they really want most from work". --Twyla Dell

Sustainability of the motivation is very important and to sustain its high level organizations are required
to establish reliable and comprehensive systems, policies and processes in the workplace. Long-term
motivation of your employees will take you to the desired organizational outcomes such as high level of
productivity, high sales and low turnover rate.

The employee's motivation depends on the influence behavior. Once aware of this, the chance of
achieving better results at both organizational and individual levels. Managers cannot order their
employees to be motivated, what they can do instead, is to create an atmosphere through which to
cultivate accountability, dedication and improvement at work. Some managers choose a shorter path, but
not effective- they try to motivate trough fear. This method, however, quickly loses the effect. True
managers motivate trough their personality and authority, not trough fear.

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To use the full potential of employees and managers modern managers and organization changed their
approach from "giving orders and control" to” consult and support" as effective ways for employee
motivation. This change of attitude began when managers understood that recognizing achievements or
recognizing the good performance is more effective than punishment for poor performance.

Non-financial motivation is the integration of a system of reward and recognitions (Rewards and
Recognition - R & R), which doesn't involve giving money directly to the employee. Motivational
policies, financial and non-financial, should not be designed in isolation but in line with the organization's
other policies and objectives.
Analysis of their implementation will not be limited to a short period of time, but will take into account
the effects of these on a longer time horizon.

Q4. Can you suggest how potentially an organization can overcome these challenges?

Motivation is very important for any organization to increase the productivity and the ability of the
employees for that specific organization Motivation is the act of giving somebody a reason or incentive to
do something. It also means giving somebody hope or support to perform particular tasks. Motivation is
the act of giving somebody a reason or incentive to do something. It also means giving somebody hope or
support to perform particular tasks. The rewards can be financial and nonfinancial. But this is very
challenging for an organization to overcome these challenge. If the employees are only driven by money
and nothing else in that case non-financial motivators will not create any positive impact regarding their
motivation level or performance.

 The most basic way is to give a verbal compliment to the employee. This could be an
acknowledgement of job well done, a good sale, or a particular action that the employee did that
benefitted the organization. The compliment could be done in public or in private. This gives the
employee reassurance that they are doing what their managers are looking for and that they are
paying attention to the work being done.

 The manager could send the employee an E-mail that explains the appreciation of the employee.

 A manager can also publically acknowledge an employee in front of their peers at a meeting,
presentation, in the office, etc.

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 To make them rationalized with non-financial motivations organization need to have a long term
plan.

 The manager must provide sufficient information on the tasks assigned to employees to
understand what is desired of them;
 The manager can empower a person / group of persons, time-bound execution, supervision or an
organization of a project.

 The strategy can be initiated through some informal survey like whether the employees are
craving for a picnic or they prefer a better recognition for their work. If the employees are
standing for the first one then an annual picnic with company’s cost can make them motivated a
lot. On the other hand, if the employees are feeling that they are not acknowledged then the
Management will have to work a bit. For instance, a long term service award (may be a gold
medal) can be introduced who are serving the organization for more than 15 years, a letter of
appreciation by the Managing Director for those who have not taken any casual leave for 01 year,
a dinner with the Managing Director for the sales team who have exceeded their target sales etc.

 At last we have to be pragmatic in a sense to get a clear and accurate insight about the mind set
up of the employees. Because this is the only way through which the organization can strategize
its policy regarding the non-financial motivation. The organization will have to read the mind first
and then it will gratify them as par their (the employees) taste and preference.

Motivation is a complex concept and can help or harm an organization depending on how it is used within
an organization. If a manager takes the time to understand the needs of his/her employees, then the
recognition can be extremely useful. Managers are not the only ones who can recognize others in the
workplace. Employees can recognize each other as well. It has been proven to that one cannot directly
motivate someone else, but they can give them the tools they need to motivate themselves. Managers are
the resources for employees and they should make sure that their work environment is pleasant and
desirable. By this way organization can overcome these challenges.

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Conclusion:

Economic downturns can make for difficult human resource situations. Apathy, reductions in workforce
and high turnover can have a far reaching impact that can spiral out of control. Business performance can
suffer because employees feel underappreciated and are worried about whether their position will be
eliminated, or whether sweeping organizational changes will result in a loss of job status.Even through
economic turmoil, there are two types of factors that influence employee motivation and satisfaction –
nonfinancial factors and financial factors. Balancing these factors can be tricky, but there is a science to
improving employee morale when weighing factors that motivate employees.For today’s organizations,
the problem of how to effectively motivate staff is becoming an increasingly important issue. However,
despite over 50 years organizational research that demonstrates that employees are motivated by more
than just money alone, many organizations continue to rely solely on financial rewards. It is perhaps
understandable for organizations to make simplistic assumptions about the ability of financial rewards to
influence employee motivation. Financial rewards are important as a mechanism to aid recruit and retain
talent, and as a means of providing tangible recognition of effort or contribution. And after all, people
generally want more money, don’t they? Yet the consequence of such an assumption has been to
overemphasize the importance of financial reward. Motivating employees is an important factor to urge
them work harder and have higher productivity. However, if use money to motivate only, it is difficult to
fair to each employee. Therefore, employers should use non – financial motivators. Non – financial
rewards are more important than money. It is clear that there are several factors why motivating
employees. In spite of giving wages and salaries, non – financial rewards also need to be given. As this
case study analysis will illustrate, there are a whole host of non-financial motivators that can act to
influence employee behaviour and enhance employee motivation. As many organizations are beginning to
realise competitive difference may ultimately be made by non-financial motivators.

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References

Works Cited
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employees-with-non-financial-rewards/1008/

The Importance of Non-financial Rewards for the Organization


by Scott Thompson, Demand Media
http://smallbusiness.chron.com/importance-nonfinancial-rewards-organization-45146.html

Burton , K. (2012). A Study of Motivation: How to Get Your Employees Moving. PEA Honors
Thesis Spring 2012 Indiana University.

Laakso, L. (2012). FINANCIAL AND NONFINANCIAL REWARDS ON EMPLOYEE


MOTIVATION. Bachelor’s Thesis (Turku University of Applied Sciences).

NEAGU, A. C. (2014). Non Financial Motivation of Staff Challenges and Solutions.


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Siddiqui, F. (2014, July 6). https://www.linkedin.com/today. Retrieved August 1, 2014, from


www.linkedin.com: https://www.linkedin.com/today/post/article/20140706140050-
59817714-non-financial-motivation-factors-how-non-financial-motivational-factors-
are-important-to-business-management

Silverman, M. (2006). Non-Financial Recognition (The Most Effective of rewards?) Institute


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http://www.employment-studies.co.uk/pdflibrary/mp4.pdf

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