How do we effectively motivate employees? Studies have shown that there are different sources of motivation—internal motivation and external motivation. In this video, I explore how business owners can improve productivity through what research says are effective motivating factors.

And these studies have been unanimous that only one of these two types of motivation can sustain employee productivity.

What motivates people to work?

In a previous video, we discovered that people are influenced to behave in certain ways. And studies have explained that there are two types of motivating factors: extrinsic and intrinsic. It turns out that while extrinsic motivations can influence people to behave in the short term, it can also demotivate people in the long run.

Ted Sapountzis, the Vice President of Simpplr, a communication system for employees, perfectly explained why extrinsic motivations don’t work: He says,

“It isn’t possible to provide rewards for every task that is done well. When good performance is closely linked with rewards, extrinsically motivated employees won’t take on extra responsibility unless they can see a payoff.”

Therefore, if we want to encourage the right employee behavior in your organisation, we should focus on fostering intrinsic motivation.

How do we foster intrinsic motivation?

I would like to share with you three possible avenues for your consideration:

1. Provide employees with a reasonable amount of autonomy

Studies have found that employee autonomy could boost job satisfaction and productivity because it gives employees a feeling of greater responsibility for the quality of their work. One way that business owners can offer autonomy to employees is to allow employees to determine when and where they work.

Note, however, that this requires setting boundaries, because research has also shown that too much autonomy can also backfire. It is also important that you must be comfortable that your employees are able to handle the work, that you have an efficient communication system in place, and that you keep all employees accountable for the quality and effectiveness of their work.

CASE STUDY: Collins SBA, Australia

This financial solutions Australian company cut working hours in half while paying its staff the same salary—as long as the employees got the job done. The results have impressed top executives of the company, particularly since productivity has improved across the organisation. 

By reducing hours, Collins gave their employees the autonomy to decide on how to go about their work. This policy was supported by streamlining communications, specifically discouraging unneccessary face-to-face meetings. This freed time for the employees to focus on the tasks and goals that mattered. This also gave employees some personal time. As a result, employees became less likely to miss out on work and were more focused on being productive.

2. Recognise employees

Most employee recognition programs include external motivators like cash prizes or paid vacation days. However, there are employees who are better motivated by being recognised as a valuable company resource. One good example of this is how Sir Richard Branson recognises employees in his Virgin Group of Companies.

CASE STUDY: Richard Branson and Virgin

Employees of Virgin have shared stories about receiving calls from their boss personally thanking them for their service. In some cases, they have also received a written note of thanks for all that they have done for the company or a letter of recommendation signed personally by him.

People appreciate it when they get recognised for the work that they do. Intrinsically motivated employees have tremendous pride in their work—and they are heartened when their peers, their bosses, and their clients acknowledge how much effort and energy they pour into their work.

3. Provide opportunities for professional development

Intrinsically motivated employees want to develop themselves—and they value personal growth and professional development. You can offer your team a chance to develop or strengthen their skills. For example, if there’s an employee who wants to get into IT support because they are curious about how people interact with networks, help them. Because when business leaders invest in their people, the organisation reaps the rewards, too.

CASE Study: Epik Digital, Australia.

One of the founders of the Australia-based startup, Epik Digital, realised early on that their processes needed to improve. This required a set of leadership skills they acknowledged that the current team did not have. They were taking on bigger and more complex projects—and having improved of management skills would help them move along.

Because of this, the founders decided to enroll their staff in a diploma of leadership and management course. Operations improved soon after. But the trainings did not stop there—they continue to conduct internal training for ALL staff. Ultimately, this paid off because it has, in their words, “improved productivity massively and reduced human error.”

In summary, the best way to motivate employees is to focus on fostering intrinsic motivation. You do this by allowing employees a reasonable amount of autonomy, by recognising employee efforts and their contributions to the company, and by providing them with opportunities to grow and develop through training.

If you are interested to know more about what a business has to go through when facing exponential growth, you can download the first chapter of the book, ”$20K to $20 Million in 2 Years” absolutely free here. The chapter talks about the differences between a good and a great business and puts out questions that make you consider how you can turn your business from good to great.