Rewards are designed as a way to show appreciation to employees for a job well done, and whilst extra money such as raises, bonuses, and special one off payments are obvious motivators, it’s often the intangible, non-monetary rewards which have the most impact on staff motivation and engagement. While financial motivation can certainly attract key talent to your organisation, it will not always keep it. Daniel Pink, an author on the science of motivation, states that “money can’t buy you performance” whilst Alfie Kohn, a human behavioural expert, explains, “no controlled scientific study has ever found a long-term enhancement of the quality of work as a result of any financial reward system.”
Another study conducted by Research Gate found that non-monetary compensation was a better motivator for long-term employee engagement and showed that money, while effective, only motivated for a short period of time. Evidence has shown that long-term engagement or the lack of it can significantly impact a company’s bottom line. A study by Perkbox estimates that disengaged employees are costing the UK economy £340 billion every year in lost training and recruitment costs, sick days, productivity, creativity, and innovation. Add to this the additional costs for re-hiring and companies have even more of reason to ensure their employees remain motivated in the long term.
Non-cash rewards have the power to make employees feel valued for their contributions to the workplace and understanding employees’ individual interests and concerns beyond the office walls in turn improves employee engagement and retention rates. These types of awards can also serve to improve your company’s appeal by showing you are attentive to your office culture and care about having happy employees.
Examples of non-monetary rewards
- Recognition and Praise. For many workers, non-monetary motivations, such as a simple “thank you” can be as important if not more than a cash bonus. Employee satisfaction surveys canvassing opinion on reward and benefits ranked high for motivation but recognition from a supervisor or manager ranked the highest.
- Career Development including the opportunity to attend educational events/workshops
- Flexible working arrangements
- Health and wellbeing programs
- Providing a day off (outside of annual leave)
- Offering time out of normal work commitments to work on projects which your staff may be passionate about but are not necessarily related to your core business.
- Providing the opportunity to volunteer - this can offer not only a nice break from the day to day, but also provides increased morale through pursuits that resonate with employees.
- Other effective but non-monetary rewards include bring your pet to work days, celebrating the birthdays of employees, a casual dress policy, providing healthy snacks or recreational areas and activities such as social Fridays.
Know your employees
The list of non-cash-based awards continues to evolve but ultimately, companies need curate rewards that will motivate their employees and culture. If you are dealing with diverse departments a 'one-size fits all' strategy simply will not make an impact. Lots of articles have been written around the importance of understanding your company’s demographic but that is a very one-dimensional view of a much more varied pool of individuals. What is more important is the willingness to truly understand what resonates with your people.
This pandemic has raised questions about our attitude to our environment, our economy, our society, our family life and our general health and wellbeing. Our ways of connecting and working are different now, our financial situation may have changed, our sense of connection with fellow employees may have taken a bit of a hit, our feelings of belonging and sense of value within the company may be dwindling. This is where non-cash rewards have a big part to play in bringing some of that feeling and reassurance back to employees.
Individualising these rewards can make a huge difference and shows employees just how much you care, for example you may have a case that within a department you have someone who is just starting their career or is in the beginning stages of it and another member who is a few short years away from retirement.
In the first example, research has shown that non-monetary benefits such as career development can be a serious motivator. In the latter example, you would argue that more seasoned employees are less in need of non-cash perks and respond better to benefits such as flexible working, sabbaticals, or retirement planning seminars. Equally there is also a danger of making too many assumptions around generational preferences, for example we know that some older workers are engaging in high energy pursuits and generally rebelling against the stereotype of ageing so assuming you know what motivates, potentially runs the risk of alienating your best people. If the employee expects one thing only to receive something unsuitable it could cause more harm than good and a disconnect between the company and a valued employee.
How to introduce non-cash rewards into your organisation
- Establish a recognition taskforce — Identify employees who you trust to promote engagement across the company.
- Establish effective recognition platforms— Give employees the chance to show appreciation for each other via various platforms. This does not necessarily have to be formal platform but using social networks such as company emails, weekly team calls, or company newsletters. Create a monthly or quarterly awards event which showcases the efforts of staff who continually excel in their field.
- Identify positive behaviour and goals to reinforce — Recognition should come from positive behaviours that contribute to the company in some way and achieving recognition should be within reach of all employees.
- Create clear expectations of the program – employees should have complete clarity around how to achieve their goals
- Use non-cash rewards consistently and frequently — A good recognition program will be consistent in how it rewards and praises employees. Employees who receive constant feedback and information about personal performance are not only more motivated but are more focused on where to invest their resources and efforts.
- Tailor your non-cash awards to your company culture and employee demographic. Your company DNA is unique therefore the awards should be part of a sustainable recognition program that fits the personality and needs of your employees. Have you thought about asking your employees if they could choose their top three non-cash rewards what would they be?
If you want to know more about non-financial recognition, then please contact us on +44 (0)20 3457 0894 or email emer.bucukoglu@innecto.com.
