Driving Productivity: Should You Motivate With Fear or Appreciation?

Are you working harder because you’re scared for your job? Or could you potentially be even more productive if someone simply told you “thanks” for what you do?

Looking across several research reports and economic indicators, the story is quite interesting. Bloomberg Businessweek tells us:

Here’s a depressing thought: America’s productivity is rising on the backs of scared office workers. That’s essentially the explanation offered by Michael Feroli, chief U.S. economist at JPMorgan (JPM), for the 1.6 percent second-quarter gain reported Aug. 8 by the Labor Department.”

Diminishing ROI of U.S. human capital

China Gorman put it another way when discussing the results from PwC Saratoga’s US Human Capital Report:

The revenue per FTE (full-time equivalent) has been declining steadily since 2008 –  by 18 percent — and has only marginally improved over 2006 levels. During the same time period, labor cost per FTE has grown nearly 14 percent.

The bottom line is that while the all-in cost of labor is going up, the revenue produced by that labor is decreasing, thus the diminishing ROI of human capital in the U.S.”

Are these results contradictory? I don’t think so. I do think individual productivity of scared employees is going up, at least marginally, as is somewhat normal during and after a recession. Those employees still holding onto their jobs are often also doing the work of those let go.

The big question is: How long is this sustainable?

People can operate out of a place of fear for only so long. But industry of all stripes has become accustomed to this increased level of productivity. What is to be done?

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Employees WILL work harder – if they’re recognized

More than three quarters of employees (78 percent) say would work harder if efforts were better recognized and appreciated. Translate that into “engagement speak,” and that means the vast majority of employees admit they have more discretionary effort to give if someone would simply acknowledge their efforts and tell them “thank you” for what they do.

Teresa Amabile and Steven Kramer’s seminal research on this, published in The Progress Principle, proved this as well, showing the number one motivator of employees is making progress in their daily work.

More frequent and timely specific recognition for employees, when they do make progress in efforts to achieve BHAGs, is critical to motivating employees and getting them to give a lot more discretionary effort.

You can find more from Derek Irvine on his Recognize This! blog.

Derek Irvine is one of the world’s foremost experts on employee recognition and engagement, helping business leaders set a higher vision and ambition for their company culture. As the Vice President of Client Strategy and Consulting at Globoforce, Derek helps clients — including some of world’s most admired companies such as Proctor and Gamble, Intuit, KPMG, and Thomson Reuters — leverage recognition strategies and best practices to better manage company culture, elevate employee engagement, increase retention, and improve the bottom line. He's also a renowned speaker and co-author of Winning with a Culture of Recognition. Contact him at irvine@globoforce.com.

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