10 Strategies to Motivate Employees and Keep them Engaged
People are your company’s biggest asset. But how do you build a culture such that employees feel both valued and productive? Below you’ll find a combination of personal maxims and principles from prominent Stanford GSB alumni, faculty, and guests that may guide you in building a company that employees love working for.
Which strategies resonate with you? Tweet us @StanfordBiz.
1. Hire People with the Right Attitude
Ensure that your hiring process is set up to catch employees who share your values - and to let go of those who don’t. 2016 was Four Seasons Hotels and Resorts’ 19th consecutive year on Fortune magazine's list of the 100 Best Companies to work for, and founder Isadore Sharp says this is a product of the firm’s hiring process. "Competence we can teach; attitude is ingrained."
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2. Make Your Company a Community
Build a culture where employees are encouraged to participate. Kent Thiry, CEO of DaVita HealthCare Partners, is known to don a Three Musketeers costume at company meetings and lead employees in chants of “All for one and one for all.” He also uses voting as a way to spark a discussion - but notes that as CEO, you should retain the right to overrule. "It’s the discussion that matters,” he says.
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3. Recognize that Stock Options Don’t Always Work
Contrary to popular belief, financial incentives like stock options or commissions aren't effective motivators, says Stanford GSB Professor Jeffrey Pfeffer. Management often see these incentives as a quick fix to worker morale, but what needs to be changed is much deeper - organizational culture, employee mindsets, or company values. Incentives should be used not to drive behavior but instead to provide recognition and to share the company's success with its employees.
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4. Create a Compliment:Critic Ratio
Management and psychological research shows there might be an ideal ratio between complementing and correcting, such as 3-to-1 or 5-to-1. At a panel discussion moderated by Mandy O’Neill, (PhD ’05), organizational scholar Kim Cameron noted that there has to be some room for negative feedback, but the important thing is that the ratio to be skewed to the compassionate. Negative feedback, when doled out in a constructive way and in appropriate proportions, is important for building an environment in which employees can thrive.
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5. Emphasize Equality
Early-stage companies must find ways to balance giving workers a voice with organizational needs for greater structure and hierarchy. With increased formalities comes the risk that employees feel lost or unimportant. Good leaders find a respectful way to communicate their position while preserving the spirit of equality, advises Professor Lindred Greer. Be open to feedback and, most importantly, act on the feedback you receive. Founders who maintain a humble management style and share credit for successes will empower employees.
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6. Challenge Employees to Disagree with You
Leaders can create an environment where their teams feel comfortable challenging ideas and having a constructive conversation that betters the overall project. For example, before Tyra Banks hires someone, she tells them, “You will not stay in this position if you continue to say yes to me for every single thing. I need you to change my mind 70% of the time. There will be 30% of the time that I will say, ‘No, we’re going to do it this way because this is what I want to do,’ but I need you to be more clever than me 70% of the time.”
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7. Define, Discuss and Reinforce Roles
When high-powered people work with teammates who are a potential threat, the high-powered people lash out. Companies that ignore these power struggles eventually pay the price through loss of potential, disgruntled employees, and outright conflict. Firms can mitigate this with increased clarity, for example announcing successor for outgoing executives. Teams in which people's perceptions of their own power match their teammates' perceptions of it, perform better.
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8. Cultivate and Reward Your Top Performers
Although General Electric's "20-70-10" system — which methodically manages out the bottom 10 percent and promotes the top 20 percent of employees each year— has been controversial, former CEO Jack Welch emphatically defended it at a talk at Stanford GSB. "You should take the top 20 percent of your employees and make them feel loved," Welch advised. "Take the middle 70 percent and tell them what they need to do to get into the top 20 percent." Give your company's top performers the right combination of rewards and recognition by hosting small celebrations or inviting them to trainings.
Watch the video here: stanford.io/1VXMkUq
9. "You Catch More Flies with Honey."
Andy Dunn, founding CEO of Bonobos, models his leadership style after this piece of advice he received from Professor Joel Peterson. “You condition people to embody the very qualities you are praising,” he says. "When I started to do this, it created an environment where it is OK for people to offer recognition to their direct reports. Slowly, the culture began to flourish."
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10. Use Big Data to Track, Measure, and Assess Employees
Thanks to the widespread adoption of software and database systems, companies can manage and reward talent, assess employee productivity, and evaluate HR programs better than ever before. Google’s People Science team, for instance, has quantitatively analyzed what makes some Googlers better managers and what types of pay (salary vs. bonus) employees value most. Leader who are early adopters of these tools can use them to make their workplaces more efficient, writes Professor Harikesh Nair.
Read more here: stanford.io/1Ypn1Ld
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Anna von Wendorff is a Social Media Intern at the Stanford GSB. She helps analyze and develop Stanford GSB social media.
