Your employees play a significant role in the success of your company. You know that, and as an entrepreneur with a never-ending list of tasks, you likely feel never-ending gratitude for the men and women who take things off your plate. As we enter the season of giving thanks, there are many ways you can show your employees how much you care about them. Some methods are better than others, though. Here are three science-backed ways to you can effectively show your employees that they're valued.
1. Choose prizes, not cash.
In a recently aired NPR podcast, Nobel prize winner and behavioral economist Richard Thaler explained why employers should choose to reward employees with gifts or experiences rather than cash. For example, rather than giving them a $500 bonus, he suggests giving them a $500 vacation. When people receive the vacation, they report being significantly more happy than when receiving the cash. This is because when we receive cash, we are torn between saving and spending it. With a vacation, however, we can enjoy the gift without any guilt.
Whether its a gift or a team outing, spend extra effort identifying a non-cash way to show your employees that you care. Though it seems counterintuitive, they will be happier for it.
2. Say "thank you."
According to psychology professor Robert Emmons, giving thanks at work is mandatory. In addition to strengthening teams and corporate culture, gratitude actually motivates employees more than money. In one study, GlassDoor researchers found that 70% of employees would feel better about the effort they put in if they were thanked more regularly by their boss. In another Wharton experiment, researchers found that when fundraisers were given a pep talk by a director who thanked them for their efforts, they made 50% more fundraising calls than those who did not receive a pep talk.
There are number of ways you can thank your employees for the same effect. Simply thank them in the hall or write them a personal thank-you card. At a larger scale, you might thank specific individuals in a company meeting or email.
3. Give compliments.
In an experiment on employee motivation, behavioral economist Dan Ariely and colleagues compared how different incentives affected employee performance. On the first day of the experiment, workers were given either $30, a voucher for a pizza, or a "Well Done!" compliment from their boss. The voucher and compliment were equally effective in increasing performance, while the cash was less successful. As the week went on, the monetary reward actually led to a decrease in a performance. It had a worse effect than giving employees no incentive at all.
Find a meaningful way to acknowledge your employees' work. One way might be an employee recognition program where you spotlight specific employees and the work they've done. Another way might be to invite individuals to demo their work to your or small teams at the company who might find it helpful.
Your employees are the lifeblood of your company. This holiday season, show your thanks in a way that is authentic to you, and also meaningful and motivating for them.