Studies have shown that for people with satisfactory salaries, some nonfinancial motivators are more effective than extra cash in building long-term employee engagement.
Financial rewards alone often generate short-term boosts of energy, which can have damaging unintended consequences.
A postrecession survey by McKinsey Quarterly found that several noncash motivators can be more effective than financial incentives such as cash bonuses and increased base pay. Rated highest among survey respondents were:
Praise from immediate managers. Recognition and appreciation are key. Saying thank you, in an appropriate way, is easy to do but can often be forgotten or considered unimportant.
Attention from leadership signals the importance of retaining top talent. One-on-one meetings between staff and leaders make people feel valued, particularly during difficult times.
A chance to lead projects or task forces is a powerful way of inspiring employees to make strong contributions. Such opportunities also develop leadership capabilities, with long-term benefits for the organization.
These nonfinancial motivators play critical roles in making employees feel their companies value them, take their well-being seriously, and strive to create opportunities for career growth.
Ironically, 70% of organizations adjusted their reward and motivation programs during the recession—but relatively few have gone beyond cost management, according to McKinsey.
Experts suggest many executives fail to make use of cost-effective nonfinancial motivators—even when cash is hard to find—because they are:
Hesitant to challenge the traditional managerial wisdom: Money is what really counts.
Unwilling to commit the time and effort to interact with staff at various levels.
Small CU advantage
Managers at smaller credit unions have advantages over corporate bosses when it comes to motivating staff. Small firms frequently can offer staff rewarding and interesting jobs even if they can’t match the benefits that larger companies might provide.
Small firms—as opposed to the average global corporation— offer employees the opportunity to be more involved in the development of the business, according to Small Business Update. Managers and executives can ask for employee input and feedback on decisions in ways that big companies might find difficult.
Credit unions typically feature minimal hierarchy, so communication is often good and employees feel involved. Management frequently has the flexibility to tailor roles to individuals, helping to improve job satisfaction.
CUNA’s inaugural Fair Lending Workshop took place last week in Denver, leading to valuable discussions on compliance with the Equal Credit Opportunity Act, the Fair Housing Act, the Home Mortgage Disclosure Act and more.