McKinsey Survey: Top Nonmonetary Incentives that Motivate and Retain Employees – Leadership and Learning Opportunities
Nov 09, 2009
The economic slump offers business leaders a chance to more effectively reward talented employees by emphasizing nonfinancial motivators rather than bonuses. A recent McKinsey survey indicates that executives find some nonmonetary rewards motivate employees better than cash bonuses do. In particular, the survey identified that a chance to lead projects and participate in leadership and learning opportunities as top motivators and a powerful ways of inspiring employees to make a strong contribution at a challenging time. Such opportunities also develop the employees leadership capabilities, with long-term benefits for the organization. One HR director in the basic-materials industry explained that involvement in special projects “makes people feel like they’re part of the answer – and part of the company’s future.” A leading company from the beverages industry, for example, selected 30 high-potential managers to participate in a leadership program that created a series of projects designed and led by the participants. “Now is the time to swim upstream and invest in our high potentials,” said the HR director, when launching the program this year.
The survey concluded that while monetary rewards certainly have an important role to play, business leaders would do well to consider the lessons of the crisis and think broadly about the best ways to engage and inspire employees. A talent strategy that emphasizes the frequent use of the right nonfinancial motivators would benefit most companies in bleak times and fair. By acting now, they could exit the downturn stronger than they entered it.