What does it take to make employees give you their best? Compensation and benefits may take a back seat to a company culture that inspires and involves workers.

In ancient times, it wasn’t hard to motivate workers. A ship’s captain, for example, could stick a crew below deck, chain each man’s hands to an oar, and start cracking the whip—literally. Chances are, the captain got where he wanted to go. Such techniques won’t likely pass muster with your in-house counsel today, and, even if they did, employee turnover rates would go through the roof. So, what’s a modern manager to do?

Make ’em teammates
Well, one option is to stick with the rowing—minus the whips and chains, of course. Peter Grazier, president of Teambuilding, Inc., sends groups of his clients’ employees out onto lakes and rivers, where Dan Lyons, former Olympian and world champion, teaches the novices a thing or two about his sport—and effective teamwork.

“Rowing is a good team-building activity,” Grazier says. “Put eight people in a rowing shell. The boat doesn’t go if they don’t work together.”

Grazier’s Chadds Ford, Pennsylvania-based firm arranges unusual, off-site activities all over the country to foster collaboration among colleagues and impart lessons that are applicable back at the office. Teambuilding, Inc.’s offerings range from elaborate treasure hunts, to gourmet cooking sessions, to rugged outdoor adventures, to role-playing games inspired by Gilligan’s Island and Mission: Impossible. Such unorthodox circumstances, Grazier explains, are more conducive to cultivating a productive group dynamic than are most workplace settings, where presumptions about employees’ roles and abilities tend to be firmly entrenched.

“When you put a secretary on a team with a couple of engineers to find a treasure,” Grazier says, “and the secretary solves clues that the engineers can’t figure out, all of a sudden they see that secretary in a different light.”

Teambuilding, Inc. operates on the premise that camaraderie boosts productivity—a notion supported by research dating back decades. Psychologist and Harvard Business School professor George Elton Mayo conducted a study in the 1920s to gauge how working conditions affected employee output. Mayo brought together six women who built telephone relay devices on an assembly line at Western Electric Hawthorne Works in Chicago. Mayo experimented with shortening the women’s work days, giving them rest breaks, and providing free meals. After each adjustment, the team’s output increased. However, when Mayo removed all his changes, output rose even further. By this time, the women at Hawthorne Works had bonded around a common cause. Their cohesiveness—nurtured by supportive supervision—led them to work harder and improve their performance. The result became known as the “Hawthorne effect.”
Achieving a Hawthorne effect today may require cracking down on team members whose work is less than stellar. High-performing employees tend to get frustrated when their momentum is bogged down by low-performing co-workers, says Roxanne Emmerich, a Minneapolis-based management consultant and author of Thank God It’s Monday: How to Build a Motivating Workplace. In 1999, Fortune magazine’s “Why CEOs Fail” cited lack of control over poor performers as the number-one reason business leaders lose their jobs. Yet, Emmerich says, many managers do little to curb workplace dysfunction.

“They think they can manage everything with a process or some training or an Excel spreadsheet,” Emmerich says, “instead of getting their fingers dirty and dealing with difficult behaviors.”

Give ’em a vision
High performers are also moved by inspiring missions, Emmerich says. She urges businesses to craft concise, evocative vision statements that lay out precise, important goals.

“I’m not talking about a 20 percent return on equity,” Emmerich says. “That’s not motivating. And you can’t say things like ’empower our people’ or ‘world-class.’ That watered-down language means, ‘We can’t measure it, and, therefore, we don’t mean it.’ When Bill Gates says, ‘a computer on every desktop,’ or John F. Kennedy says, ‘a man on the moon by the end of the decade,’ those are clear pictures of end results.” Gates’s statement doesn’t say anything about customer service, productivity, profitability, quality, or creativity, Emmerich notes. “But when he presents a clear picture of the end result, all those things are implied.”

An effective vision statement, Emmerich says, inspires employees to pursue more than profits. Alan Robinson, a professor at the University of Massachusetts-Amherst, Isenberg School of Management, agrees. “Really savvy managers give people the opportunity to feel that they’re part of something bigger than themselves,” Robinson says. “President Kennedy had the best scientists in the world working for him for half to a third of what they could have made in private industry. But they were going to the moon in 10 years. So they worked overtime, round the clock.”

Get ’em involved
On its own, a lofty mission might not be enough to motivate employees. Most people also want to know that their contributions toward that mission count for something. Grazier founded Teambuilding, Inc. after he worked as a civil engineer and saw what happened when he started soliciting more input from employees on his business decisions. Absenteeism and turnover rates—both typically about 10 percent in the construction industry—shrank to 1 or 2 percent.

“People felt like coming to work,” Grazier says. “Why? Because they were valued. They were listened to. They were involved.”

Grazier’s experience reflects famous mid-20th-century findings by Abraham Maslow, Frederick Herzberg, and Douglas McGregor, all of which are required reading in many business schools today. (See sidebar on page 9 for more about this research.) These pioneers in the study of employee motivation concluded that people yearn to fulfill their potential, participate in decision-making, and make a difference. Grazier keeps these needs in mind when he’s hired as a consultant to help clients boost productivity. He recalls a tool-and-dye operation, for example, where one mechanic’s poor attitude was dragging down the entire company.

“We put him on a team that was trying to figure out new ways of making machine changeover times faster,” Grazier says. “Within six months, he was totally pumped. He was energized. The human resources vice president told me, ‘This guy has been a problem for our organization for 20 years. All of a sudden, he’s done a major turnaround.’ Well, for 20 years, the organization wasn’t listening to him, wasn’t involving him, wasn’t making him part of the team. He was just a worker coming there every day, doing what he was told to do. He was highly creative, highly intelligent, and he had ideas for making things better, yet nobody ever asked him.”

As it turns out, tapping employees’ creative juices may be more important now than ever before. “With the rise of China and India and developing nations, not just as manufacturers, but as purveyors of intellectual property, the distinguishing factor between businesses is going to be the ability of an organization to innovate and create,” Grazier says. “So, if a worker has an idea in the shower this morning to make some part of his job better, easier, or faster, what’s motivating him to tell somebody about it when he gets to work?”

Don’t show ’em the money
Some companies assume a little extra cash will do the trick. Many firms install incentive programs that promise employees a percentage of the profits or savings their ideas generate. This may seem like a win-win proposition, but such programs often backfire. For one thing, the reward arrangement can lead to unexpected—and incredibly expensive—outcomes. During research for Ideas Are Free, a book Robinson co-wrote with Valparaiso University professor Dean Schroeder, the authors learned that French carmaker Renault once implemented an idea by one of its workers that prevented damage to unfinished vehicles during assembly. The employee’s suggestion—a minor process change—saved Renault a fortune, putting the firm in an awkward position. “The company basically owed him millions,” Robinson says.

Incentive programs present other problems, too. Sometimes, they’re simply too tempting. Robinson cites many examples of people lying, cheating, and stealing to defraud employers out of cash awards. Incentive programs can also foster unproductive competition and resentment among colleagues. “In an organization, an idea involves lots of people who evaluate it, market it, implement it, and budget it,” Robinson points out. “If only the originator of the idea gets the reward, it completely undermines teamwork.” Also, if rewards are based solely on an idea’s direct financial implications, there’s nothing driving employees to improve such outcomes as customer loyalty and customer satisfaction. “You can’t measure the effects of most ideas,” Robinson says. “So, if your incentive system is linked to revenue, most of the best ideas get ignored.”

The most powerful—and perhaps most surprising—argument against financial incentive programs is that money isn’t even an effective motivator. Yes, workers require payment, but their tendencies to perform at their highest levels are more likely influenced by intrinsic motivation—the desire to do something based on the enjoyment or personal fulfillment that comes from completing a task. The problem with extrinsic motivation—desire that’s created by external factors, such as the promise of money—is that it makes a person feel controlled by an outside force rather than inspired from within. Psychologist Edward Deci examined the differences between intrinsic and extrinsic motivation in a famous study published in 1971. He presented a series of puzzles to two groups of college students. Members of one group were paid for their efforts; the other students were not. When observers left the room, study participants receiving payment stopped working on the puzzles, while their unpaid counterparts carried on. This experiment—and many others that have shown similar results—demonstrates that people are more likely to become engaged in an activity if their motivation is intrinsic, rather than extrinsic.

“Intrinsic motivation is the single, most important factor associated with innovation, creativity, and problem solving,” Robinson says. “That’s where the action is. Unfortunately, that’s where most managers spend very little time.”

So, how do you stir up intrinsic motivation within your workforce? Remember the work of George Elton Mayo, Abraham Maslow, Frederick Herzberg, and Douglas McGregor—or, for that matter, of Peter Grazier, Roxanne Emmerich, and Alan Robinson. Employees want effective teams, inspiring visions, opportunities to provide input, and assurances that their input is valuable to an organization. When you ensure such elements are present in a professional setting, your employees are likely to work, not just because they have to, but because they want to.

“Let’s say a secretary can type 15 letters in a day, but the organization will accept 10,” Grazier says. “The difference between 10 and 15 is discretionary effort. What that secretary does between the minimum the organization will accept and the maximum he/she can do is totally up to the individual. So, what motivates a person to produce above the minimum?”

Answer that question correctly, Robinson says, and you reap financial rewards—for your company and your employees alike.

“It’s a virtuous cycle,” he explains. “If you get your people intrinsically motivated, they generate more revenue for you, and you can share more with them.”

Motivation Master Class: Three Big Ideas

Plenty of people have offered insights about employee motivation, but the following theories are among those most widely embraced by business educators. All support the notion that people need more than money and a dental plan to give you their best. Employees thrive when given opportunities to succeed, take responsibility, and participate in decision-making and problem-solving processes.

Abraham Maslow: Hierarchy of Needs
Maslow’s “A Theory of Human Motivation,” published in Psychological Review in 1943, presents a hierarchy of five universal human needs: physiological, safety, love (or belongingness), esteem, and self-actualization.

Maslow believes people attempt to satisfy these needs in a specific order. A person will meet physiological needs (for food, sleep, etc.) before addressing needs for safety, love, and so forth. Moreover, Maslow considers the first four needs in his hierarchy “deficiency needs,” which stop providing motivation once they are satisfied. However, the hierarchy’s final need—self-actualization—is a “being” or “growth” need that drives behavior throughout a person’s life. Therefore, if a business continually gives its employees opportunities to meet this high-level need, the company can expect a well-motivated workforce.

Frederick Herzberg: Motivation-Hygiene Theory
In his 1959 book The Motivation to Work, Herzberg arranged a set of workplace factors into two categories: motivation and hygiene.

People expect positive hygiene factors in their workplaces, Herzberg says. When present, these factors can prevent employees from feeling dissatisfied with their jobs, but they don’t necessarily push people to achieve greater productivity. Motivation factors aren’t necessarily expected, but when they’re in place, Herzberg believes they produce feelings of satisfaction and drive employees to succeed. Like Maslow’s needs hierarchy, Herzberg’s motivation-hygiene theory suggests that a business must satisfy one set of needs—in this case, hygiene factors—before more powerful employee-motivating factors take effect.

Douglas McGregor: Theories X and Y
McGregor’s 1960 book The Human Side of Enterprise formulates two models of workplace behavior:
Theory X and Theory Y.

Theory X assumes:
• People inherently dislike work.
• People must be coerced or controlled to perform work and be productive.
• People would rather be directed than take responsibility.

Theory Y assumes:
• People are drawn to work as naturally as they are drawn to play or rest.
• People will direct themselves if they are committed to an
organization’s goals.
• People can learn to seek and take responsibility.
• Many people can use imagination, creativity, and ingenuity to solve business problems.
• Businesses typically only tap a portion of their employees’ intellectual potential.

A business operating under Theory X uses rewards and punishments, close supervision, inflexible direction, and strict rules to manage employees. A business operating under Theory Y encourages employee involvement when making decisions and solving problems. This approach allows a business to better capitalize on the ideas and abilities its workforce possesses.

Article written by Scott A. Briggs, a Minneapolis-based freelance writer, for Effect magazine, a publication of Larson, Allen, Weishair, & Co., LLP, Fall, 2006.