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How do I keep my staff motivated during a pay freeze?

How do I keep my staff motivated during a pay freeze?

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Many companies face the paradox of needing to cut costs just to stay afloat whilst at the same time maintaining high performance levels amongst staff.

Employees may be feeling relieved that at least they have a job in tough times but just turning up for work does not guarantee an effective performance. As a manager, you play a key role in keeping employees motivated so that organisational objectives are still met in tough times. So, what can managers do to promote employee satisfaction and effective performance?

Much research has been carried out in the field of motivation such as Maslow's (1954) hierarchy of needs and Herzberg's linking of motivational factors to job satisfaction. Herzberg (1959) in particular found that motivational factors such as a sense of achievement, recognition and opportunities for growth and development play a greater role in providing employee satisfaction than extrinsic rewards such as a higher salary.

Some tried and tested for increasing job satisfaction and employee performance include the following tips and techniques

  • Find creative ways to show recognition: celebrate the small as well as the big successes
  • Give praise and thanks for achievements at all times – not just at formal review meetings. A pat on the back and a thank you by the coffee machine can go a long in making a person feel valued
  • Take the team out for lunch after completion of an important milestone. If budgets do not allow for this, find a room onsite for a celebration party and ask everyone to contribute with something; it is the acknowledgement of the achievement that is important not the cost of the reward
  • Personalise routine long service awards – delivering the pen set and writing a personalised note to the employee will enhance feelings of achievement more than if your PA just places it on the desk with the standard company letter

Identify the intrinsic motivation factors for all your team members. You may find that they are motivated by feeling proud, working on something that makes a difference and being recognised for doing a good job. This aligns with theories that people are intrinsically motivated by different things and that individual efforts can be increased by providing rewards which meet individual needs and add meaning and value to the job.

Hackman and Oldham (1980) suggest that combining a variety of skills, creating a sense of identify with the whole task and giving a task significance by explaining why it should be done are all factors that help add meaning to work and thus enhance employee performance. However, if you choose to take the approach of enhancing an individual's role by increasing their responsibilities make sure this is done within the individual's capabilities; this could over-whelm them and create stress if not.

As noted above, despite inevitable cutbacks due to the recession, there are steps that employers can take to ensure staff remain intrinsically motivated and effectively meet organisational targets even without a pay increase. However, do bear in mind that if job responsibilities expand too much with little financial reward then resentment will only brew which could lead to dissatisfaction and poor work performance. It is important to maintain a balance and ensure that other benefits such as flexible working and/or opportunities to work from home are also offered to offset the reduction of financial reward.

In addition, communicating the reasons for cut-backs or pay freezes and placing this within the long-term context of the organisational vision will help employees feel that they are contributing to the future success of the organisation and are a valued member of the whole team.

Deborah Roberts is an independent Learning and Development Consultant with 12 years global project management experience with a blue chip organisation.