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Is Money an Effective Motivator at Work


Do you often smile during the day-to-day routine of making money? Or, would you ever bet that a person earning $60,000 a year is much happier than someone who’s making a mere $30,000 in comparison? Indeed, most of us erroneously share the most conventional view that money is on top of those ultimate motivators making us work, and more than that, bringing everyone happiness. Though, contrary to popular belief, researches in various social areas evidence that money, as a trivial form of reward, is placed on the plane with main de-motivators for workforce.

Despite the fact that most of the world works for the sake of financial reward, the need for money only obliges us to undertake certain sort of work, but doesn’t motivate in actual fact. For example, one of the theories of human motivation - ‘Money as a motivator theory’ is grounded on the belief that the need for money primarily motivates all workers (“Theories of Human,” 2004).

Nonetheless, such a statement is true just to a limited extent, to say the least. Although the very word “money” (which in final outcome aims to ensure greater happiness) would be the most common reply to the question of whatever causes us to work, in its own right it lags behind the variety of other human values. “A simple pay raise, naturally not identified as part of the corporate culture, would be defined as an external motivator. Pay is expected, needed, and required - it is not necessarily an identifier of either corporate or personal identity” (Grossman, n.d., A brief pause section, para. 2). “Psychologists have been finding that rewards can lower performance levels, especially when the performance involves creativity” (Kohn, n.d., Introduction section, para. 2).

Furthermore, “if a reward - money, awards, praise, or winning a contest - comes to be seen as the reason one is engaging in an activity, that activity will be viewed as less enjoyable in its own right” (Kohn, n.d., Introduction section, para. 3).

Fortunately, there are factors that motivate people more than money. Money’s just a tool to increase purchase capability and standards of living, eliminate the burden of deficiency and avoid poverty. According to Grossman (2005) “Psychologists call money a ‘deficiency need’. Money motivates people only when they feel deficient in it - when they feel they do not have enough” (The Payoff section, para. 1). There are many categories of people that manage their lives well without money (e.g. volunteers, tribe people, monks etc) and are often much happier than those who like machines (in essential conversation widely known as ‘workaholics’) go through set routines on daily basis. Right, with money you feel OK in the supermarket, pub, or restaurant. However in the church, for example, you realize that something has to be changed before it’s too late, of course, to make your life different and your family’s future bright.

According to Frederick Hertzberg's ‘Dual Factor theory’, the so-called group of ‘hygiene factors’, including working conditions, pay, and job security, don’t motivate employees as such (“Theories of Human,” 2004). On the contrary, he puts achievement, career progression and learning in the ‘motivation factors’ category, which apparently shows that the reply provided by the average employee is false in light of genuine motivation. Another proof of this is Frederick Hertzberg’s division of work issues into two categories: dissatisfiers - including salaries, interpersonal relationships, work conditions, company policy, supervision and security; and motivators - including achievement, recognition, interesting work, challenging work, responsibility and growth (Bradney, n.d.).

Hence, money is just a part of formal inter-relationship between employers and employees, which has nothing to do with the motivation at workplace as such. But wait a minute! Opponents would reasonably argue at this point, having claimed that earning money and consequential rise in salary naturally satisfy basic socio-economic needs and ensure wealth. Worse than that, the lack of money normally leads to poverty, frustration, higher levels of stress, or even marital breakdowns, to name a few. Such is the conventional feedback our mind produces in due respect.

But what if we look at the issue from a different angle and quit using the very word for say a week; would the world become a better place? Certainly, since constant subconscious ‘money-dependence’ is what results in moral slavery and makes us forget about sharing genuine values. To this extent, money may be perceived as an integral part of Abraham Maslow’s ‘hierarchy of needs’ (Gawel, 1997) on definite level though not major incentive we are living our short lives for.

What is more, the quest for money often provokes negative feelings of jealousy, greed and envy among personnel. Constant comparison between how much you earn and the salary of your workmates certainly lead to destruction of jointly acquired human qualities of friendship, mutual support, sympathy and care. Richard Layard, Co-Director of the Centre for Economic Performance at the London School of Economics, replies to the psychologists survey, asking people questions such as "would you rather earn $50,000 in a world where others earn half of that, or earn $100,000 in a world where others earn double of that?” stating that “most people would [rather] prefer higher relative income to higher absolute income” (Kling, n.d., The Evidence section, para. 1).

Another reason why money is playing the de-motivating role in the world of work is that there is subconscious perception that no matter how much you earn, you’ll never be completely contented, or at least your internal satisfaction in this respect will last for a fortnight at best. In this respect, Grossman (2005) states, “in fact, research demonstrates that after a pay raise, employees' performance only improves for two weeks before returning to baseline” (A Brief Pause section, para. 2).

In the late 60s, Elvis sang ‘money-honey’, although money as an external motivator, is not worth the attention devoted to it; neither can it ever substitute true values shared by mankind for centuries. To this end, it is crucial that we reconsider the part played by the financial factor in our lives, especially at workplaces where we spend most of the time. And just simply forgetting about money for a while, I’m certain, could make substantial contribution towards overcoming inner pragmatism.


Review or comment on Is Money an Effective Motivator at Work -





Companies reward employees for exceptional work by giving them extra money. Is this a good way of encouraging employees to work hard?

You need at least three or four ideas to support whatever point of view you come up

Money awards are effective:
- Money motivates people, and extra money motivates people to work extra.
- Employees compete to raise productivity or standards. 
- It is not always possible to promote people, so money is a simple way to reward
Money is not acceptable to all workers:
- Some may not appreciate a particular present, or some gifts may be insulting.
- Money is only sometimes effective, or sometimes does not work.
- If employees are highly paid, money may not be sufficient. They may prefer other
benefits, such as an award ceremony or dinner, a club membership, a travel ticket, a
car, a window office, etc.
- Money may set employees against each other, leading to conflict in the office.
- It may be difficult to determine the standard or basis for the decision to award the
- Employees may feel forced to compete.
Money is not effective:
- Employees work for a salary - they do not want to perform like circus animals if
paid more.
- Money trivializes work, which for many professional employees should be its own
- The amount may not bear relation to what the employee does.
If the employer finds it motivating to award money, perhaps the salaries are too low
There are many other ways to motivate employees.
What do you want to do now?

Siti Nuruldiayana Mat Sehat  8/21/10

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