“Taking Care of Your Most Valuable Asset”

As a fast-growth entrepreneur, you’re a self-starter with ample motivation to succeed. But employees may not share that passion. In fact, surging sales may leave troops overworked, stressed out and disgruntled.

Sure, you update them consistently on the company’s growth and congratulate them for their fine effort. But that’s not enough. True motivation requires more than nice words — take action and recognize employees’ contributions, reward commitment and keep them happy even as their jobs get tougher.

Ignore employee morale, and you’ll pay a price: They may bail out in droves, leaving you to recruit and retrain newcomers. The time and money spent replacing employees will far exceed the investment to motivate and retain them.

Avoid the Money-Entitlement Mess

Be careful. Cash giveaways, bonus programs or other forms of financial compensation are not always the most-effective way to energize employees, for motivation and money do not always go hand in hand.

Case in point: A financial services firm launched a monthly bonus plan in which the top third of employees would earn extra pay for attaining performance and attendance goals. But workers soon grew to expect the bonuses as part of their regular pay. The upshot: In months when they didn’t qualify, top management had to justify not paying the bonus. This triggered ill will. In addition, bonuses can push employee earnings into a higher tax bracket, making cash rewards seem wasteful.

Here are two other traps to avoid when trying to motivate employees:

Giving speeches. Even if you’re a rousing orator, those appeals will fade over time. The more you talk about how much you "value employees," the more you breed cynicism by asking them to work harder and sacrifice for the good of the business.

Solution: For every speech that stresses how much you care about employees, give at least one concrete example of how you have listened to employees and responded to their concerns. Tie lofty pronouncements to specific actions.

Relying on perks. Don’t get caught up in the trend to offer a concierge or referral services to employees. Though it’s fine to arrange for their dry-cleaning pickup and bill paying on occasion, such benevolence is a double-edged sword. Why? Harried employees may conclude you’re just trying to keep them productive for longer periods.

Solution: Scale down the perks that "allow" employees to work more hours free of "personal distractions." Instead, grant them more freedom to manage their time and take care of their errands whenever they want.

How Do Workers Spend Cash Awards? Recently 1,010 workers gave these answers when asked how they spent their last cash reward. What’s more, 63% said their loyalty would increase if they could choose rewards that were personally meaningful. Source: Wirthlin Worldwide, 1999.

Free, Easy Motivation

Motivating employees is surprisingly simple — and inexpensive. Even though big corporations may shell out thousands of dollars for inspirational speakers and concoct elaborate cash-incentive programs, it’s possible to excite your workers’ enthusiasm for free.

Take these simple steps:

Solicit opinions. Meet privately with workers and ask point blank, "What would keep you here, and what would entice you away?" Don’t hint what you expect them to say. Just listen.

Answers might include: more exposure to top clients, more flexible hours or a chance to learn new skills. Give employees what they want — within reason. By responding to suggestions regarding motivation and retention, you set yourself apart from the vast majority of employers who never ask the question.

Note: Even if you fear workers will make demands that can’t be met, ask anyway. If employees want more money and it’s entirely impossible, tell the truth. Open the company’s books so they appreciate the financial constraints of the business.

Use their names. One of the advantages of running a small business is the ability to get to know each employee — or at least remember their names. This is a motivational manager’s secret weapon, because individuals respond more enthusiastically when the boss addresses them in a friendly, personal tone.

Find fresh ways to express appreciation. Motivation begins by acknowledging an employee’s effort by saying "thank you." It’s even better to express gratitude in different ways. Examples: Write a nice note, send an e-mail "thank-you card," or give a small gift or half-day off. The more creatively appreciation is conveyed, the more workers will strive to earn it.

Let them vent. Provide a forum for employees to unleash frustrations in a safe, nonthreatening manner. By making it easy for them to share grievances, you can take steps to fix minor irritations before they escalate into major problems.

Example: Reserve one of your e-mail addresses just for employees. Invite them to send you a one-sentence "rant" message that you, in turn, promise to read and respond to. By restricting it to one sentence, it forces employees to reduce complaints to the essentials. And it takes less of your time to read.

Spice up their jobs. You run a lean business with only limited promotional opportunities. Turn that into a positive. Use the company’s small size and nimble structure to reward employees in other ways:

1. Exploration. Temporary moves to expose employees to other areas of the business.
2. Enrichment. Infusing an employee’s current job with new and varied duties so that the individual has the opportunity to grow in place.
3. Lateral movement. Shifting someone horizontally into a more exciting, satisfying job.

How Would They Like to Spend Cash Rewards? Employees have made it clear that when it comes to rewards, they want a choice. As a motivator for improving work performance, employees stated their preferences for a number of incentives, all touting a $1,000 value. Source: Wirthlin Worldwide, 1999.

Sweep Away Debilitating Signals

Despite efforts to pump up employees, they can be deflated quickly by sending the wrong signals, such as not trusting them or not being genuinely interested in their welfare. They’ll see through attempts to bribe them (such as having them compete for a pot of bonus cash). Such hollow forms of motivation usually produce a short-term payoff at best.

Steer clear of:

Excessive monitoring. If the goal is to train phone representatives to improve customer service, it’s fine to record a sampling of their calls and provide feedback. But by routinely taping employees’ phone calls, reading their e-mail and setting up cameras throughout the building, you risk alienating your workforce.

Solution: Work with employees to develop quality-control procedures that dignify their professionalism. Let them suggest ways that work can be monitored without being overly intrusive.

Example: To address concerns about workers who steal company-owned equipment, workers may propose being held responsible for meeting tight budgets rather than installing cameras.

Constant drudge work. Asking employees to devote eight-plus hours a day to monotonous work may result in burn out. If they’re stuck in an unsatisfying job, it won’t matter how often you take them to lunch and thank them — they’ll grow tired and listless.

Solution: Ask workers for a breakdown of how much of their job is tedious and repetitive vs. stimulating and challenging. For those who claim more than 50% of their days are spent on boring, frustrating tasks, try to break up their routine and introduce them to new skills.

Blindsiding workers with change. Fast-growth entrepreneurs must shift gears rapidly to respond to competitors and market trends. But if employees are repeatedly surprised by sudden organizational changes, they may lose focus and feel increasingly insecure.

Solution: Unclog communication channels so that employees understand the pressures faced by the business. Share corporate goals and identify variables that can affect results. Enlist workers to help track potential threats to the company’s success and stay on top of change.

How Long Do Cash Rewards Work? Exactly how effective is that cash reward in boosting employee performance? Workers note that the extra green did motivate them to improve performance — but the time period may surprise you. Source: Wirthlin Worldwide, 2000.

Words of Wisdom

"It’s not cash, it’s not stock options, it’s not bonuses, and it’s not getting a window office with a view. Sincere appreciation from one’s manager is the thing that makes the biggest difference," says Bob Nelson, president,Nelson Motivation Inc.

Writer: Morey Stettner is a management writer and trainer in Portsmouth, N.H. He is the author of "Skills for New Managers" (McGraw-Hill, 2000) and "The Art of Winning Conversation" (Prentice-Hall, 1995).