I was participating in a discussion in Beirut in one of the most popular yearly held exhibitions. The group came up with the conclusion that: "Customer satisfaction is directly related to employee satisfaction, and that this last relies on their pay. Finally, employers need to increase their employee salaries to increase customer satisfaction".

I personally agree with the first part of this conclusion. Employee satisfaction does indeed impact positively on customer satisfaction level. However I totally disagree with the second half; Money isn’t really the one fit all tool that HR professionals should consider to increase employee satisfaction.

If we look deeper at the ‘motivation iceberg’ as explained by Joshua Freedman, we will find two main factors that motivate people: Extrinsic and intrinsic. According to Freedman, money goes under the extrinsic factors, which are the observable tip of the iceberg, that make employees come and leave on time, apply policies and procedures and complete assigned tasks.

On the other hand, what will happen when an employee doesn’t get an increment the year after? Should this lead him to stop performing as a star? Should this decrease his job satisfaction? Wouldn’t that increase turnover rate?

The mistake that most organizations fall into is that they completely count on the fact that money is the first universal motivator. They always tend to increase the salary when they feel the risk of loosing one of their employees; thus, this will remain a short-term solution until the employee feels demotivated again. 

HR professionals should work more on other long-term factors to motivate employees and drive performance. This is where talent management comes in:
- Each employee should have a career development path, which reflects his values and ambition rather than driven by money.
- Managers should engage more with employees and involve them in decision making processes to boost their confidence and show respect to their opinions and ideas.
- Managers should take the time to sit and coach their team members. They need to find out what are the issues that their team members face at work and try to solve it together through training or other learning styles.
- Managers should work on creating a secured fun environment for employees and support them when they need to to increase loyalty to the company.
- Managers should acknowledge and credit achievement every time the employees go the extra mile and reward them accordingly.
- Manager should keep feeding back on performances and show commitment to the development of their employees, which will lead to an acquired promotion and a better income.

All above intrinsic best practices will lead to a long-term employee motivation rather than for the short term. I would finally like to invite all HR people to consider employee engagement, career development and talent management options before opting for money as a tool for motivation.

Diana Mouamar