Fixing Employee Morale

By Bob Nelson

Dec. 1, 2009

In a recent survey of 1,400 CFOs from U.S. companies with 20 or more employees, the staffing company Accountemps asked: “Which of the following has the most negative impact on employee morale?” The results:

• Lack of honest communication: 33 percent

• Failure to recognize employee achievement: 19 percent

• Micromanaging employees : 17 percent

• Excessive workloads for extended periods: 16 percent

• Fear of job loss: 14 percent

The survey then asked for the best remedy for low morale. The executives said:

• Communication: 48 percent

• Recognition programs: 19 percent

• Monetary rewards for exceptional performance: 13 percent

• Unexpected rewards: 11 percent

• Team-building events or meetings: 3 percent

• Additional days off: 3 percent

Here are my ideas for how each of the elements cited by the respondents can be more readily implemented in your workplace:

1. Communication: The single most important tool for improving employee morale and motivation is perhaps the simplest: honest communication. Employees need information about their jobs, but they also want to know more, such as what’s going on in the organization, or what the latest sales strategies are. These times also demand more and better communication on a personal level from managers, such as asking employees for their ideas for improving processes or saving money. Best Buy recently set up online surveys to solicit ideas from its employees for cutting costs. Result: In just the first three weeks, some 900 ideas were submitted, which have led to significant cost savings for the company.

2. Recognition programs: Companies need to make a concerted effort to raise awareness on the part of managers as to why employee recognition is more critical now than ever. They need to understand why employees expect to be recognized for having done good work, how that recognition can further drive the goals of the organization and what their roles are in making recognition happen. Even a well-intentioned manager will not meet recognition goals if he or she is not sure how to do it well. For example, good recognition needs to be specific. Don’t say, “Everyone is doing a good job—keep it up,” but rather “Before we start our meeting agenda, let’s name five things that are going well for us right now.” This is a strategy a manager from Disney recently shared with me. She uses it with her team.

3. Monetary awards for exceptional performance: Yes, money is still important, perhaps even more so if there has been a salary freeze or cutback. Employees want to see their salaries grow again as the finances of the organization improve, and they want financial awards that are aligned with performance. For example, even though Home Depot has had to close some locations, it realigned its goals and showed how employee efforts can make an impact on them. As a result, the company recently distributed a record number of frontline bonuses to staff.

4. Unexpected rewards: It pays to be spontaneous. Most people think spontaneity means acting without planning, yet it is very possible to lay the groundwork for spontaneity. For example, have the resources ready for spontaneous recognition: e-cards for Starbucks or Amazon, party supplies, confetti and balloons. On short notice, celebrate a milestone or group success by hosting an ice cream social, a pancake breakfast or a barbeque. You could also bring in pizza or host a potluck lunch. Have management make or serve the food, and use some of the time together to celebrate the success and identify and acknowledge individual efforts that made it possible.

If yours is a more formal workplace, create a “Jeans Day” or give people time off for good performance. Boston-based Greenough Communications started “Winter Fridays,” in which high-performing employees are rewarded by being able to leave at 3 p.m. on Fridays.

5. Team-building events or meetings: A sure way to build morale is to spend time together, getting to know one another on a personal basis while doing some type of nonwork activity. Doing a group activity that is fun—a field trip, attending a trade show together or getting “behind the scenes” passes to entertainment events can all go a long way. When possible, try to link these events to some element of success the team has achieved and, ideally, let the group members decide what they would find motivating. If your group doesn’t respond well to doing a team activity, it’s a sure sign that the ones you’ve done in the past must have been pretty boring. Start afresh and challenge the group to come up with something fun and creative.

6. Additional days off: Don’t overlook the use of time itself as a form of reward. This is an excellent option when more costly forms of recognition and reward are less available due to budget constraints. For example, Los Angeles–based JS Communications recently gave employees two free “I Don’t Want to Get Out of Bed” days in the current year. Any employee can “call in well” and say they are taking a “mental health” day off. They’re the ones who know best when they really need it.

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