Think of Money as the Bottom Line

I ran across an excellent blog post by Chris Edmonds recently that defines a leader’s contribution as the amount of discretionary energy expended by his or her team. 

Discretionary energy is applied toward higher performance when employees are:

• Doing great work and helping others.
• Wowing customers.
• Proactively solving problems.

I think that’s a good list but what I found really interesting is how managers can inspire this high level of performance:

• Clarify vision, strategy and values for the team.
• Clearly communicate team and individual goals.
• Coach and respect team members.

I find this list interesting because there’s no mention whatsoever of money.  Nada.  Nix.

Which makes sense because money is really the bottom line when it comes to engagement at work, i.e., it’s an important part of the mix but doesn’t create engagement on its own.

If we try to draw the relationship between money and engagement – without a team of graphic designers - it might look like this:

 
Right above the 'bottom line' are the people who show up and perform well enough to keep their jobs in exchange for a salary.  They’re right on the money, so to speak.  They may be competent but they knock off punctually and have no skin in the game.

To motivate employees, companies may offer a bonus on top of salary.  Motivated employees will work harder to earn that bonus but with a narrow focus on what it takes to get the money. 

On the highest rung are engaged employees, who spend their discretionary energy doing their jobs and love what they’re doing.  They like money as much as the next person but aren't in it for the money: They’re in it for the sense of shared purpose and feeling of unique contribution that you only get with good management. 

The takeaway?  Money is a key ingredient for engagement to be present but if it’s all you offer you may be confusing engagement with motivation.

Or worse, with showing up.

Picture courtesy of positivesharing.com.

Laura Schroeder is a Compensation Strategist at Workday, headquartered in Pleasanton, CA.  She has nearly fifteen years of experience designing, developing, implementing and evangelizing global Human Capital Management (HCM) solutions and holds a certificate in Strategic Human Resources Practices from Cornell University.  Her articles and interviews on HCM topics have been published in the US, Europe and Asia.  She lives in Munich, Germany and enjoys cooking, reading, writing, kick boxing and spending time with friends and family. If you want to read more from Laura, check out her talent management blog Working Girl or follow her on Twitter @WorkGal.

Comments

[Ross]

I like the way you distinguished between motivated and engaged employees. Compensation people tend to believe that their job is over once they have the bonus plan in place and that people can take it or leave at that point. They tend to think that people are in it only for the money. They use the "homo economicus" model of human behavior.

It threatens them to hear that engaged employees will outperform the motived ones, do what's best for the company instead of themselves, even stay with the firm when the money is tight, and not have their hand out every time they do something well.

They overreact to any threat to their world, like Dan Pink's Drive, and reports that teacher performance doesn't improve with merit pay. Their source of expertise on employee performance---some consultant whose livelihood depends on selling money-based incentive plans. Their source for teacher pay expertise---the Cato Institute.

Posted by: Ross |

[Dave Ryan]

Great Post Laura - I am partial to those who are "on the money."

[Laura Schroeder]

Thank you for commenting, Ross and Dave - sometimes motivation or even just showing up enough but are not the same thing as engagement.