If you're a business owner, manager or supervisor, you know how important it is to have workers who are highly motivated. Research has shown that motivated employees tend to be far more productive, better skilled, and willing to learn new skills than unmotivated workers. They also tend to have better attendance records, stay in their jobs longer, and are more likely to seek creative solutions to work problems.

Most employers understand this. When surveyed, 90 percent of business leaders say that having highly engaged, motivated employees is essential to their business's success. They also tend to assume that when their employees quit, it's purely because they've found a job elsewhere that pays more money. But research shows that 75 percent of those who leave a job are quitting their bosses, not their salaries.

A study by the Federal Reserve Bank of Boston found that a whopping 69 percent of employees say they would work harder-and stick around longer-if their bosses gave them more on-the-job recognition for the work they do.

In fact, 78 percent of employees say recognition, not money, is their biggest motivating factor at work.

Low Motivation: Counting the Losses

Organizations with motivated employees achieve 2.5 times the annual net income of competitors with low-engagement employees.

This is probably because motivated employees are at least 50 percent more productive than unmotivated ones.

Yet most companies-75 percent-do not have an employee engagement strategy, and it's costing them: 72 percent of the current workforce consider themselves disengaged-lacking the motivation to focus their full attention and energy on their work.

Defined as "sleepwalking through their workday," disengaged, unmotivated employees do less work and at a lower standard. That lower rate of productivity is estimated to be costing US industry around $370 billion a year.

Employee Motivation: The Components

Many companies try to motivate employees with external benefits. Common perks include stock or stock options, pay increases, and performance-based cash bonuses. Yet these traditional methods rate at the lower end of the scale, in terms of what employees name as the highest motivators.

When surveyed, employees name their biggest motivators as: the opportunity to lead work projects, attention from company leadership, and-the highest-ranking motivator-praise and positive feedback from the boss.

These findings reveal what modern theorists have been saying for decades: that a worker's motivation has less to do with outer financial rewards, and everything to do with the inner rewards of feeling appreciated and recognized.

Twenty-first century workers are asking for more from their work than just financial gain. Dan Pink, author of the bestselling book Drive: The Surprising Truth About What Motivates Us, writes that what employees really want is:

         Autonomy - the chance to be self-directed and independent at work

         Mastery - the chance to be good at what they do, overcoming challenges and finding creative solutions

         Purpose - the chance to feel they are contributing to the greater good-to be driven from within to work toward a larger group goal

The alternative-unmotivated, disengaged workers-can damage an otherwise healthy organization. Negative effects can include:

         Low productivity and poor performance - When products, services and projects are late, uncompleted or poorly produced, your company's bottom line is affected negatively.

         Group dissatisfaction and lowered motivation - Complaints, gossip and negative assumptions about management or a business owner can change happy employees into demotivated ones.

         Poor customer service - Those dealing with customers or clients directly need to the motivation to offer creative solutions, polite answers to questions, consistent service, and follow-through on customer requests.

         Lower revenue levels - Low productivity, high absenteeism and turnover, poor customer service, poor service or products, and poor return on training/recruitment and other employee costs all negatively impact the bottom line. [http://smallbusiness.chron.com/consequences-employee-motivation-41238.html]
 

Real employee motivation is characterized by a high level of commitment and energy. Reaching that level, and keeping valuable, dependable, motivated employees on the job, is much easier if your people feel noticed and appreciated. Having structured programs that offer rewards and recognition, while encouraging independence and individual contribution, can make all the difference.

Employee Motivation: The Top 5 Methods

 
Based on employee surveys-and on the proven methods of top-earning businesses with high employee engagement-here are the top five methods to motivate employees:
 

1.     Create a Mission-Driven Organization

Annie's Homegrown natural foods business is one of the most successful small public companies in the US. CEO John Foraker attributes his employees' strong motivation to the fact that Annie's is "a mission-driven business."

Inspire your people with purpose. From the top down, the company has made its common values and mission clear to every employee and manager. They view their work as pushing the business into areas that go well beyond mere financial goals.

Foraker notes that "Pay, benefits, and a comfortable work environment are all important, but being bound by a common higher purpose is motivating to our employees." He sees that approach as being the reason why his company seems to naturally draw in "really smart, highly engaged, and highly capable people who care and want to make a difference in the world."

Create clear goals and measure progress. Jason Rhode, CEO of Cirrus, believes that "morale and motivation in the workplace come from having a meaningful and worthwhile goal, a reasonable plan to achieve the goal, and being able to measure yourself making progress on the plan." He believes that making "vision, plan and visibility" clear at both the corporate and individual level "is a tremendously powerful motivator."

Establish a mission everyone will want to support. Wallace E. Boston, CEO of American Public University Systems comments, "Establish a mission that everyone can relate to and rally around. Reinforce that mission with actions from the top down. Be consistent, through good times and bad."

These companies have successfully communicated their goals and objectives to their entire workforce, then empowered and inspired their people to work toward the greater good-one of the bigger internal motivators.

2.     Foster Personal Growth and Career Development 
  

Know what motivates the individual. You need to provide or create motivation tailored to individual workers' needs and interests.

3.     Award Recognition on a Regular Basis

It's important to recognize your employees' individual and team contributions, both publicly and privately. Don't wait till a huge project is finished or another big event happens-make recognition regular monthly and yearly events.

Hold occasional surprise celebrations for teams or individuals. Even if all you offer is pizza, a paid lunch out, or ice cream sundaes, your workers will be motivated by the fact that someone noticed their work and said "thank you."

Let employees know you're hearing great things about them. As soon as you hear positive comments about someone's work-from co-workers, managers or customers-let that employee know, whether in person, by phone or by email. When you forward positive emails or voicemails from others, copy that employee's supervisor.

Say Thank You in writing. Write out a thank-you note or letter by hand, perhaps accompanied by fresh-baked cookies, flowers, fruit basket, gift certificate, or some other gift appropriate to that person's interests. Long after the gift has been used, they'll probably keep that card in their work area, where they can see it every day.

Offer private as well as public recognition. It's vital to speak individually with employees for positive, and not only negative or business-as-usual reasons. Recognize everyday employee contributions and not only huge achievements, with private conversations that are solely pats on the back, with no other issue discussed.

Several times a year, hold a Staff Appreciation Day. Have managers order or bring in the meal, don aprons, and serve the employees themselves. This is a healthy moment of role reversal, and helps employees feel honored and appreciated by those who are usually only requiring things of them.
 

Let workers know that "the company's success is your success." Let your people know that their actions have directly contributed to the organization enjoying a new level of success. In addition to sharing profits, share news of goals achieved and deadlines reached, while publicly giving direct thanks to the teams and individuals who made it possible.

4.     Listen to Employee Comments, Complaints and Ideas
 
Kevin Plank, founder of Under Armour clothing company, says that communication is key to making members of your company's team feel included when big decisions are being made. Encouraging your employees to speak their minds in constructive ways can have numerous benefits.

Let everyone have their say. Whether in a meeting or casual conversation, take employee's comments seriously. Plank listens to everyone's opinions, and finds that "without fail, they'd bring up things I hadn't thought of. More important, my team members knew that they were part of the process and that their voices mattered. Employees are more motivated when they feel needed, appreciated, and valued."

Include employee input in meetings where goals and milestones are set. Most organizations cascade information and direction from the top down. When things are less hierarchical, more ideas, innovation and creative solutions can result, due to the mix of input. And employees feel more self-directed and listened to-which greatly increases their motivation.
 

Install a suggestion box-and use some of those suggestions. If people are shy about signing their name to suggestions, create a suggestion box or intranet forum where they can submit suggestions anonymously. Act on as many of those suggestions as possible, and let employees know exactly what initiatives and changes came about due to employee suggestions and ideas.
Be the coach you'd want to follow. Remember that as owner, supervisor or manager, a big part of your job is to be a coach who inspires. This means being willing to listen to employee complaints, problems and ideas whenever they come up, as well as setting aside a specific time each week or month to hear how everyone is doing. This can be a time to create solutions for problems such as lack of communication or job resources, information silos, lack of challenge, or job dissatisfaction.
 

5.     Encourage Employees to be Self-Directed

Abraham Maslow's hierarchy of needs shows us that when people already have the basic needs of food and shelter, they aren't motivated by material gain so much as the higher needs of personal fulfillment and creativity.

Companies such as Google Inc., Wholefoods Inc. and Cisco Inc. are actively putting this principle to work. Their nonhierarchical work models stress individual freedoms and empowerment, respect for individual and team contribution, and rewards that encourage employees to be self-motivated. Their attention is on their employees' whole lives, and not only their financial situations.

Encourage creativity, brainstorming, and self-directed teams and individuals. Increasing an employee's levels of self-direction and independence can be highly motivating. For example, giving workers the choice of what tasks to do and what team to work with. This encourages them to master different skill sets and tasks, which in turn increases their productivity, motivation and expertise.

In 2009, Google-the world's first $100 billion brand-was ranked by Fortune magazine as the best place to work in the US. Despite its huge success, the company's leaders manage to retain the same working structure it had as a startup: teams of people collaborating on projects and working toward a common goal. This model has turned out to be a breeding ground for motivation, as well as innovation.

Avoid the strict hierarchy. Google founders Larry Page and Sergey Brin have deliberately steered clear of the traditional 1980s corporate culture of greed, dissatisfied employees and extreme control. Rather than discourage individual diversity, they encourage it, along a completely flexible working style.

In addition to solid external benefits such as free health and dental benefits, tuition reimbursement, flex spending accounts, 401K plans, and vacation packages, the company provides numerous perks that speak to the whole person. These include on-site gourmet lunch and dinner, all-day free snacks, fitness centers, on-sit massage, haircuts, carwashes, dry cleaning, and laundry rooms, and buses that bring employees in from San Francisco. People also bring their pets to work, and dress however they wish.

The company also offers maternity benefits of up to 18 weeks off at approximately 100 percent pay, reimbursement of up to $5,000 towards legal expenses for child adoption, and reimbursement of up to $5,000 for buying a hybrid car.

But Google's best move, in terms of increasing employee motivation-and employee productivity and innovation-was to offer the intangible but crucial rewards of:

         No obvious hierarchy
 

         Small, independent work groups overseen by a committee or project manager
 

         Plenty of time and resources to explore new, creative ideas
 

         Complete commitment to innovation
 

         Encouragement for employees to spend up to 20 percent of their work time on their own projects
 

         A purposeful culture with clear-cut goals and mission regarding how the company affects the outer world
 

         Peer-to-peer feedback, instead of manager-to-peer feedback
 

This innovative structure does more than help the company hold onto its original entrepreneurial culture. It's also highly motivating, giving employees all the freedom they need to come up with workable, innovative ideas to expand Google even further.

In 2008, Google, Inc. saw nearly $210,000 in profit per employee-more than any of the other large technology companies, including Microsoft, Intel and Apple. The company has grasped the reality that highly motivated, highly capable workers who have a common vision don't need to be micro-managed. They simply need the time, resources and permission to innovate and produce to the best of their ability.

* * * * * *

When it comes to motivating employees, external financial rewards are now only part of the equation. Employees need regular personal and team recognition for a job well done, and the support of bosses who actually listen to their problems and ideas.

They need job duties that encourage their personal growth and career development. Whenever possible, they need to work in an open, self-directed, independent way. And they need to feel that they are contributing to a larger organizational mission-a shared vision.

The resulting increase in job satisfaction and inner motivation can greatly improve morale, retention rates, productivity-and the bottom line.

Your company's profitability is largely based on employee innovation, problem-solving, productivity, commitment and loyalty. Finding the motivational methods that work best for your employees is vital for ensuring that your company's most important resource fulfills its greatest potential.