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Practice Management > Building Your Business

When It Comes to Motivating Staff, It Ain't Always About the Money

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Employee happiness and motivation are not driven by compensation but by advancement, respect and trust, as I explained in a recent blog. As is often the case when I voice this belief, I got a flood of emails telling me I’m wrong.

While everyone has a right to their opinion, my position is supported by my experience turning hundreds of unhappy workers into happy employees —without increasing compensation above and beyond normal raises.

It’s not that employees don’t want more money. They do. Or, perhaps, it’s more accurate to say they think they do. The key issues are: why do they want more money, and are they happier when they get it?

Let’s tackle the second issue first.

When employees get a pay raise, most feel happier — for a month or two, six months tops. But then, the slight change in their lifestyle has become routine, and most go back to being just as disgruntled as they were before the raise. The happiness of the raise is fleeting and cannot be maintained over time.

This happens because more money doesn’t address the reasons why most employees are unhappy with their jobs.

Money doesn’t motivate. Instead, it represents what employees believe it means. In other words, getting paid more symbolizes they are important to their firms. The same is true for firm owners. The more the business produces in revenue, the more important firm owners feel their firm is to the world.

But more money doesn’t make an employee feel happier in their job, because they do the job to find more meaningful and sustainable significance in their careers —  they want to feel that what they do matters and makes a difference.

Therefore, firm owners have a choice. They either can buy into the fiction that more money is going to make their employees feel better about their jobs, or they can take some time to determine what makes their employees feel significant working in their firm.

To Be Significant, or Not

In most cases, people simply want to know that they are significant, which can mean different things to different people. I’ve found that with employees, it represents being worthy, appreciated, respected and trusted for showing up each day to do their job.

Therefore, as a firm owner, the more you can make them feel more significant, the happier your employees will be — and the less they will focus on money. When a culture does not focus on the money, the money naturally appears in many ways.

While this often doesn’t come naturally to most owner advisors — as they rarely have much true leadership experience — it’s not too hard to make each employee feel valued and respected.

It starts by making sure that all employees have both the training and the tools necessary to do their jobs well. Nothing makes an employee feel less important than to be poorly trained and equipped; the fear of not “feeling” like they know what they are doing and not having the tools to do their jobs to the best of their ability leads some to ask for more money.

Encouragement goes a long way toward happiness, and in my experience, it is the starting point. It’s not about compliments and praise; it’s about telling your people you believe in and trust them.

Be engaged. Ask them how their job is going, what they need to do a better job and remind them that what they do is important to the firm — and explain why. Let them know they are appreciated.

This level of respect and extra effort goes a long way. As you take such steps, ask employees for suggestions on how their jobs and other areas of your business could be more efficient. Just asking them for feedback will automatically empower them to start making these changes.

Every employee affects your firm and culture from the first day they start work. Your job is to help them to have a positive impact —and to make sure that they know this is your focus and that you are committed to it.

This doesn’t mean you should stop giving employees reasonable raises for advancement or take advantage of them by paying them unreasonably low wages. When you give them trust, support and respect in their jobs, you will be shocked at how quickly your compensation problems tend to disappear. And when those problems disappear, everyone can focus more on making the business better.

Heed my advice. It’s never about the money. It’s always much bigger than money. Money is the symptom, not the problem. Do what you desire and help your people do the same. If you do, the money will follow.


Angie Herbers is Managing Director and Senior Consultant at Herbers & Company, an independent growth consultancy for financial advisory firms. She can be reached at [email protected].


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