Motivating Workers without Breaking the Bank

These days, employee apathy is a worldwide problem.
After years of being asked to do more with fewer wage increases, incentives or rewards, many employees have lost motivation to do their best at work. "Twenty-seven percent of the workforce, which is a fairly significant apathetic group out there, are saying they've checked out mentally, but they haven't checked out physically. They're probably not the most productive," says Pete Foley, a principal at New York-based Mercer and an employee research consultant. "We're at an inflection point."

"Twenty-seven percent of the workforce, which is a fairly significant apathetic group out there, are saying they've checked out mentally, but they haven't checked out physically."

– Pete Foley,


While employers are grappling with what to do, growing numbers of workers are contemplating saying goodbye to their jobs. In the United States, nearly one-third of all workers say they are seriously considering leaving their present employer, up from 23 percent in 2005, and another 21 percent are disengaged, according to Mercer's 2011 What's Working survey of 2,400 U.S. employees and 30,000 worldwide.

That spells trouble for retail executives who need to get the most from their workers to stay competitive. "There's an old principle that says to accomplish great things in this life, you need to engage other people," says Stuart Orr, president of Vision2Execution, a training and coaching firm in Southern California. "Being able to motivate employees is critical to accomplishing great things," he says.


Yet at many companies, budgets for merit increases have been slashed to the bone and employers have eliminated the perks of more robust times, such as corporate cars, expense account meals and lavish fitness or game rooms. Often, when the perks go, so does the recognition. And that's a problem, Orr says. "Everyone in this world wants to be appreciated, wants to feel their time is well spent," he says. Yet new research shows non-financial factors can be more important motivators than money. "If employees love working for the company, they may be willing to work for a buck less than the competition," Orr says.

"Everyone in this world wants to be appreciated, wants to feel their time is well spent."

– Stuart Orr,


What do workers want? Respect is the top request, according to Mercer research. Other leading factors include work/life balance, type of work, quality of co-workers and quality of leadership. "They want challenge, and they want freedom, or autonomy," Orr says.

"A lot of big names out there, where they're a known employment brand, have done a really good job not necessarily on the monetary picture, but in [cultivating] an environment of respect and trust and open communication," Foley says.

At Woodland, Calif.-based Nugget Market Inc., managers use a servant leadership approach that turns the traditional corporate hierarchy on its head. "If you turn a standard organizational chart upside down, you have an inverted pyramid with the executive team at the bottom tier. The store directors and department managers then support associates at the top, who ultimately create our exceptional guest experience, which is our No. 1 goal," said Eric Stille, chief executive and president, in a news release. "It is this mindset that helps us deliver outstanding service and support to our associates, as well as our guests."

Employees also want to feel successful. Focusing on successes instead of problems or failures increases motivation, says Stephen Balzac, president of 7 Steps Ahead in Stow, Mass. "Motivation is not something we do once and forget about. In the end, fear of job loss can keep people doing the minimum, but if you want your employees to excel, you need to continuously provide constant, positive motivation," Balzac says.

One way is to recognize performance with a symbolic award. For example, John Brubaker, a performance consultant based in Maine, helped one beverage company create a symbolic award called the golden spike. The spike was awarded to sales representatives who went above and beyond, and a silver bat was given to the sales rep "who took the most swings." "My philosophy is that which gets rewarded gets repeated," Brubaker says.

To motivate workers without busting your budget, consider naming an employee or team of the month, highlighting an employee in a company newsletter, or providing high-performers with prizes, such as gift cards or tickets to movies, plays or sporting events, says consultant David Zahn of Zahn Consulting LLC in Wallingford, Conn.

More flexible hours, telecommuting options or job sharing also can be motivating factors. Nugget Market Inc., for example, offers job security through its 85-year history of no layoffs, while managers emphasize work-life balance.


By recognizing high performers, managers can encourage other workers to improve their attitude or skills, Orr says. Recognition can take many forms, such as selecting high-performers for special assignments, highlighting their skills or asking them to lead others. Providing access to the CEO through a lunch or dinner meeting or participation in a Chairman's Council or President's Club is another no-cost option, Zahn says.

"During this time of tightness of budget, look for ways to be as inclusive as possible in any changes coming down the pike."

– Lisa Giruzzi,

author of "Bringing Out the Best in Your Employees."

Giving workers a say costs nothing and can benefit the company as well. "During this time of tightness of budget, look for ways to be as inclusive as possible in any changes coming down the pike," suggests Lisa Giruzzi, author of "Bringing Out the Best in Your Employees." She recommends that companies use employee surveys, focus groups or town hall meetings to solicit input from workers. Employees are more likely to buy in to a change if they understand it and feel they were part of the decision-making process, she says.

Workers also want to feel they are making a difference. Among U.S. workers, the opportunity to serve others ranks high and can be a motivating factor, according to Mercer research. "If I work for a company that is doing good, then I feel better about how I spend my time," Orr says.

Health food grocery stores, such as Whole Foods Market, tend to excel at communicating this. "They're there to provide people with good quality food and correct injustices in growing markets" by purchasing Fair Trade or other sustainable products, Orr says.

In general, professionals are motivated when they feel they are making progress in meaningful work, whatever it may be, research suggests. "Many managers view large bonuses and merit increases as the best way to motivate people to continuously deliver great performance. My research team and I came to a strikingly different conclusion," says Teresa Amabile, professor of business administration at Harvard Business School. "Morale and productivity depend on people perceiving that they are making progress in meaningful work – that is, work where they feel they are contributing to something they value," she says.

Amabile and a research team collected about 12,000 responses from 238 professionals who were asked to complete diary forms to briefly describe a workday event that stood out in their minds. Few wrote about pay, monetary bonuses or raises, but many discussed their progress in what they considered important work. "In fact, of all the events that could get people deeply, happily engaged in their work, the single most prominent was simply making progress in meaningful work," Amabile says.

She calls the phenomenon "the progress principle" and notes that "the biggest de-motivator was experiencing a setback – feeling blocked or stalled in the work."

As a result of the findings, Amabile suggests employers can motivate workers simply by removing roadblocks. For example, managers can ensure that employees have sufficient resources to get the job done. And they should encourage employees to learn from past problems.

Just letting employees know that you care about them also can be motivating, Orr says. Executives often focus on customers or financial performance, overlooking the connection between motivated employees and a successful operation. "Especially in retail where you have this massive distribution network, you can't control the experience customers have. One of the few things you can control is the experience your employees have," Orr says.

At Wegmans Food Markets, which has been honored as one of the 100 best places to work by Fortune magazine, the company demonstrates its concern for employees with an on-site health fair. The fair offers health screens, flu shots and nutrition challenges, such as one that encouraged employees to eat fruits and vegetables and walk as many as 10,000 steps a day for eight months.


When employees are happy in their jobs and feel empowered, they can positively influence the customer experience. Orr describes a "dignity principle" where employees are treated as adults who are capable of creating their own solutions to problems. Employees feel empowered when they are given latitude in deciding the best way to meet a goal, Orr says. For example, Nordstrom has a flexible return policy that allows employees to exercise their judgment in coming up with solutions to problems. "You're not following a rigid set of rules. There's some flexibility there, which allows the employee to be the good guy," Orr says.

Often retailers take a stair-step approach to empowering workers to ensure they're ready for the responsibility, Orr says. "You give them leeway in one thing, and if it works, you give them more," he says. "As a leader, it's test and verify."

Freelance journalist Ann Meyer is senior editor of Retail Leader, editor of SmallBusinessExecutive ( and chief executive of L3C Chicago, L3C.