Money and Motivation

Maslow has presented his Hierarchy of needs at the early 50’s, ever since it is understood that money motivates people when they are at the base of this pyramid. Nevertheless, it is quite common to hear the following two claims:

  1. Sales people (and not only they within organizations) claiming that their customers only (main) consideration in buying is price
  2. Managers claiming that the only way to motivate people is through paying them more (or on the other side of the same claim – that they are paying too much and therefore the people cannot be further motivated).

I find it always a bit disturbing. Why, in spite, of the knowledge and understanding, these beliefs are still so common? Why smart people that are highly aware that the above statements are not true about themselves, are using them to explain their difficulty in doing a better job?

Naturally, when we face challenging situations such as; unsatisfactory sales growth and unsatisfactory people performance in spite of our efforts to increase sales and improve performance we need to have an explanation for these realities. As in many other cases, there are always two ways to explain:

  1. It is not our fault, it is out of our ability to influence and thus “customer care only about price” and “employees only care about their payment”
  2. It is within our ability to change and thus the problem is in our behavior

Unfortunately (for all parties; the people making the claim, the company and the entities being blamed that they care only about money) the easy choice is to pass the responsibility to others and to stay “clean”. Accepting these claims also means that there is almost nothing that can be done (other the reducing prices for increasing sales, paying more to employees, or replacing the over paid ones) to change the reality and improve performance.

Accepting responsibility requires courage, the courage to say “I am the reason for the situation”. However, if you can make this brave step, you stand a chance of finding a breakthrough solution without lowering prices, paying higher salaries or replacing those who already are paid high salaries.

Understanding that money is important, but motivation to act is rarely triggered by it will put the pressure on us to ask “what do we need to change in the way we behave and act so that the behaviors of our customers and our employees will change in a favorable way?”

If we want to motivate customers and prospect to buy from us, and to buy more it is critical to understand what value can tilt their preference to us? Is it speed of delivery? Reliability? Warranty? Options? Business model? and then align our operations, marketing and sales to that value. It is more common that it seems that we, the buyers, are even willing to pay premium prices for the appropriate value.

If we want to motivate our employees it is critical to understand what drives people motivation, commitment and loyalty. It starts with fulfilling their safety needs – job security, knowing it is safe to make errors, to make suggestions. It then goes to being a part of, belonging to something bigger, being heard it is then important for people to feel that they can contribute, that their ideas are considered, that they have a voice and then it goes to being recognized and knowing that their contribution is appreciated and rewarded. In managing people there are three rules for enhancing motivation – R3 – Respect, Recognize, Reward. These are just general guidelines, there is more than one way to operate in their light and they result with enhanced and growing commitment, loyalty and motivation of the employees.

After all, for your company to thrive what is critically needed is highly motivated employees that are dedicated to having more and more customers that want to buy more and more of your products and services.

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