Forget money. Load on the praise! (Rewarding Employees).

• Author: Nelson, Bob

Do you think money is the best reward? Many people do. After a recent presentation to a management group, I received some interesting feedback. I was discussing what motivates employees today. After the session, the person who had invited me to speak pulled me aside. He claimed several people didn't agree with what I had said about money: They believed it's the top motivator for their people.

My experience has shown that money isn't the main reason people work. Why is it so difficult for managers and business owners to believe this? Certainly the research is convincing. In studies dating back to the 1940s, employees have always ranked other items--such as full appreciation for work done, feeling "in" on things and having interesting work--as being more important to them than their salaries.

Money has its place

I'm not saying money isn't important--clearly it is. We need money to pay our bills and live the standard of living to which we are accustomed. I'm also not saying money has no motivational value. It does, and the strength of that motivation will grow throughout a person's life. If you're about to buy a new home, have unexpected medical bills or have children in college, you're going to be more keenly aware of your monetary needs.

But for most of us, once we are able to meet our monthly expenses, our attention turns to factors that have much greater significance in our work lives:

* Feeling we are making a contribution.

* Having a manager that tells us when we do a good job.

* Having the respect of our peers and colleagues.

* Being involved and informed about what is going on in the company.

* Having meaningful, interesting work.

According to management consultant Rosabeth Moss Kanter, based in Cambridge, Mass.: "To the rest of the organization, recognition creates role models and heroes--and communicates the standards: These are the kinds of things that constitute great performance around here."

The money that employees are paid is compensation, which should be a function of your company's...