Total rewards and motivation
The human resources concept of total rewards understands that cash is a necessary, but incomplete, component of compensation. The baseline relationship of employer and employee is a contract: cash in the form of salary, benefits, and bonuses, in return for performing the tasks specified in the employee’s job description. On both sides of that contract there is a lot of variability in performance. Some employees regularly go beyond their job descriptions; some workplaces are rich with intangible rewards. Every employer wants a workforce made up of such employees, and employees respond to employers who go beyond the minimum compensation.
The goal of total rewards is to achieve the highest return on investment (ROI) with the optimal mix of rewards. In practice, managers use rewards to attract, motivate, engage, and retain employees individually. That leads directly to improved performance and business results. What businesses are also starting to recognise is that noncash factors, like work-life balance, a sense of mission, and manager appreciation, are far more flexible and adaptable methods of motivating employees than adding an extra £100 in the monthly pay cheque.
A non monetary gift associated with an employer’s ‘thanks’ is ultimately much more engaging, personal, and meaningful – and it is directly associated with engagement. If it’s done right, the award is publicly connected with a behaviour specifically linked to a company value. If it’s done exceptionally, the award is a clear indication of the kind of behaviour that management appreciates – and rewards. An award with just £100 in gift value thus produces many other forms of value and appeals to the intrinsic motivators of pride and gratification at the manager’s genuine expression of gratitude.