Heera Training and Management Consultancy

eNewsletter January 2012

Dear Everyone,

Hi! And how are you all? Happy New Year and I do hope 2012 will bring all of you lots of success, good health and abundant happiness. It was a great month of December as I had lots of time to ‘wind down’. And I did this by going off on holidays with the family which included our annual sojourn to Penang. The chendol and assam laksa on Penang road I believe is the best in the world!! Another great thing about December was to see my latest book, 'Inspiring Anecdotes on Management' climb up to number 2 on the best seller list!!

I want to kick off 2012 by talking about one of the biggest fallacies in motivation i.e. incentives. Do you realize that most organisations seem to have this belief that employees are withholding a certain amount of effort that must be bribed from them by means of various incentives and rewards? Hence the common practice in most organizations of offering rewards in order to motivate them to be more ‘productive’.

But the question asked is, “Do incentives and rewards work?” Do incentives make people more efficient and effective? My view is that it does, but only for short term periods. It produces temporary compliance. As long as there is an incentive, the productivity will improve. Take away the incentives and the productivity also wanes. And even more dangerous is the fact that once incentives are handed out for a certain period of time, it tends to be taken for granted, and therefore loses its motivational value. So the question asked is, “why are organisations still offering incentives”?

My answer to this is that, most organisations want short term, easy solutions to problems. For example, it is very easy to temporarily motivate a sales department to achieve an increase of sales by 30%, by promising them some incentives. Due to the incentives, the target is achieved and the sales personnel get their rewards. This would seem like an excellent win-win solution, right? Not necessarily, because what happens later is that the company has passed a clear message to employees; we pay you a salary for “normal” performance, and if we want better performance we will have to pay extra for it. Here I would like to state that I am not at all advocating that incentives and rewards are dispensed with. I am only advocating that incentives must not be considered the ultimate solution to all productivity problems.

So what can be done to dispense with rewards and incentives and at the same time motivate employees? There are no clear cut answers to this question. I would suggest that perhaps managers' time would be effectively spent doing some of the following.

  • Firstly, as far as rewards are concerned, organisations must pay employees well and fairly, and then do everything possible to help them forget about money.
  • Managers and organisations should do all they can to create a harmonious, happy and caring working environment. This will have better long term motivational value as compared to incentives and rewards.
  • There must be a serious attempt to remove the factors that de-motivate in the organisation. This can range from offensive individuals to ineffective systems, to unfair rules and regulations.
  • Managers should always look for opportunities to praise and recognise their employees. Just like rewards, the more praise and recognition employees get, the harder they work to get even more. When done properly, this is a small investment which brings in huge dividends.

I am under no illusions that the above will solve the problems of employee motivation in organizations. I believe however that in the long term the above suggestions would contribute more effectively to employee productivity as compared to rewards and incentives.

Thank you for taking the time to read this. I would like to wish all of you a Happy New Year and may 2012 be a great year for all of you. Take care.

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Heera Singh
Principal Consultant
HEERA Training and Management Consultancy
HP 0126083708