executive management Can You Give Good, Inexpensive Rewards? - Some Real Life Answers by Peter Meyer for Business Horizons One of the most common questions we get from managers is: How can we give more and better rewards and spend less money? Forty experienced operations managers and executives from the American division of a major Japanese computer company asked us this, and we asked them to help us work through a good answer. They used their own experience to build a list of more than 30 powerful rewards that delivered better results and cost little or nothing to give. This article describes the process that they used and some of the most interesting results . We started out the discussion by asking the managers what motivated them as individuals. This started a lively identification of the most effective motivational forces and tools. Some of the primary thought on this was done by Abraham Maslow when he described the hierarchy of human needs in the form of a pyramid. To identify the rewards with the most power, the managers rebuilt his pyramid in their own words. The first, and lowest, level of human need is survival. It seems pretty clear that having money or pats on the back is unimportant if we don't have air, food, and water to survive. No motivation works until we get past this. The next level is physical comfort and security, which could be an individual or family issue. People spend a lot of time and money to get physical comfort or security. Moving across the entire state or out of state in order to get more security is not uncommon. Although security is powerful, the managers identified it as a negative motivator. The process continues to work its way from the bottom to the top of the pyramid. You can not move up until you've taken care of the steps below. The next level we identified is social contact. Once a person feels that they have the necessities for survival, and they have security and a sense of comfort, they start looking for people to be with. This is their presence, not their respect. Lack of it is motivating, but for adults it is not a positive motivator. If social contact is just being with people, the next level is peer respect. We used teenagers as an example of how this works. First kids look for groups to be with, just to have the contact. Once that's established, they start looking for ways to get the respect of their peers. We have all seen how much power peer pressure can produce. That's the fourth level. The fifth and most powerful level is self-recognition or self-fulfillment, and this is the level that these managers feel is the most motivating. At this level people are no longer working for "their boss." They become their own boss or manager, they become "self-starters," they become the employees we want working for us. The managers identified a disturbing phenomenon. Most of the rewards that we traditionally use address the middle and less powerful levels of the pyramid. If we offer an employee cash, does it address the strongest motivator? Does a gold pen? A "thanks for a job well done"? The managers started working on a list of rewards that will address the top of the pyramid, and provide the most powerful tools. Some of the More Powerful and Interesting Rewards One of the more powerful rewards that cost next to nothing is to take a letter of commendation and copy it far up the internal chain of command. By habit, the president of this division, as soon as he gets one of these letters, immediately hand writes a note right on the note and sends it back to the employee, copying every manager along the chain. The employee gets a thank you letter seen by everybody, addressing the peer respect level of the pyramid for almost no cost. And that letter often gets posted in the building. There are other rewards that require less work. One branch manager uses Mr. Goodbars (a candy bar) to thank people. He literally throws the candy bars across the room to people in meetings. If Tim has done an especially good job in an installation, Tim gets a loud "Tim gets a Mr. Goodbar for the installation on Acme" and a candy bar flies through the air. If Jane has done an especially good job on a proposal, the same thing happens. Corny? When I walked around the office I found that the Goodbars weren't eaten. They were posted on cubicle walls. People were proud of them and enjoyed the recognition of a Goodbar on the wall. Another variation for a team of problem solvers: A manager has gone to a novelty store and bought a series of little firemen's hats. Why those? Because most people in this group spend their life fighting fires. He hands them out on a monthly basis. You can find them in cubicles, on desks and on walls. The cost? Less than a dollar apiece. The value? Very, very high. The most powerful rewards of all are not physical, but help the employee to focus on the top of the pyramid, on self respect and recognition. One manager gives her employees an opportunity to "bid" for projects that they want. The better they did on the last project, the more chance they have of getting one they want for the next. The result, a happier self motivated employee working on projects he or she is good at The manager and the employee both win. Another manager hands out new tools (such as hand held PCs) and access to new classes as a reward. When an employee does a good job, the manager talks it up, and then says that he will give that employee first access to a tool. The way to earn a tool? Show the manager how you did a great job. The first half addresses the peer recognition, the last step addresses self recognition. The result? A very high powered and enthused core of performers. Another manager gives assignments the same way. He cannot use promotions as rewards, but he can create a "growth path" for things to do. As the employee improves, he or she "earns" another step for themselves. Several managers have simply started adding a single line to praise. They sincerely ask the employee to tell how they pulled it off. The result? An employee motivated at the top of the pyramid, and occasionally a new and powerful idea. These last rewards work on the highest level of value to the employees, they promote and even leverage the ability of the employee to feel good about themselves and their work. Managers who use these rewards report the highest loyalty and productivity. They get more done at a lower cost. This article appeared in similar form in Business Horizons in December, 1994. 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