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Does money motivate? The topic of Motivation came up in a discussion


Andy Bassett

.....and another thing, is there a CEO in the whole of America that is paid in respect and self-fulfilment instead of bonuses and stock options.

If these things are valid for the management they must be good for the workers.

Andy B

Laura M

It all relative. You need both. I've seen highly paid workers be very unmotivated due to lack of respect, and minimum wage paid employee be very motivated due to respect and appreciation from upper managers. They'd probably jump to the high paying job quickly for the money, but that won't drive their motivation or dedication to the work. Works the same on the management side.

[This message has been edited by Laura M (edited 23 January 2001).]

Andy Bassett

To be honest i was just being a little pedantic. Of course the right answer probably lies somewhere in the middle, but if i was forced to answer the original question with one word 'is money a motivator' i would have to answer 'yes'.

I seem to remember somewhere in the depths of my economic studies something like a money v motivation curve. The concept was that up to a certain point money creates more motivation, then when a certain point was reached no more motivation was possible (The curve if i remember right actually showed motivation going down after this point, but that i always had problems to understand).

This curve was of course based on 'rational man'. Interestingly i have seen this curve in operation many times here in Germany. The Germans do indeed seem capable of making a rational decision to trade further salary increases for increased leisure or family time. I could be guilty of stereotyping, but i never saw many examples of this in the UK, there people tended to work as long as work was available for fear of ending in a McJob, also in Ireland i tend to notice that people do not seem to make this rational decision so frequently, perhaps because Ireland is a comparatively new economy their thinking seems to be 'Make hay well the sun shines'.

Just some thoughts

Andy B

[This message has been edited by Andy Bassett (edited 21 January 2001).]

John C

Money does not motivate the workers - because Maslow says so and all managers claim to believe it to be true. So, if you want to hire a technician and you say to your boss, 'There's one guy who's really good but he won't come for what we're offering. Can I offer him more?', the answer is always; 'No can do. Anyway, money doesn't motivate'. But, if, at the beer/coke bust on Friday you ask the same guy; 'Why is Mr XYZ, the corporate CEO, getting $1M salary, plus shares and allowances to match?', he'll tell you; 'If you want the best guy for the job, you have to be prepared to pay'.
So, as usual, there's one law for the few and another for the many.
That's life - keep taking the tablets.
rgds, John C

David Mullins

The contracts with engineers at my current employment have a standard clause that they are required to contribute earnings to the minimum value of 3 times there salary. There are bonuses for additional milestones.

The business is currently experiencing a lot of debt recovery problems (10x our debt).

The Managing Director (80% owner) said last Friday, wouldn't it be interesting to see the result of scaling bonuses against payment by engineers customers within 30 days. This would significantly boost the financial situation of the business, and would certainly MOTIVATE the engineers to ensure their customers pay up front or on-time.

This would also provide cost savings in a number of areas.

Money vs Motivation. I'm for a win-win on this front!


[This message has been edited by David Mullins (edited 21 January 2001).]

Andy Bassett

So Kevin - Some interesting comments all in all. What are you going to go back and say to your group?


Andy B

[This message has been edited by Andy Bassett (edited 22 January 2001).]

Kevin Mader

One of THE Original Covers!
Staff member
Great contributions everyone! I didn’t imagine the topic I introduced would strike up so much discussion. I agree with Randy, it is nice to have discussions of this type with several different/similar vantage points. It adds to the learning.

To Randy’s post: item one identifies well with Herzberg’s motivator factor ‘Achievement’. The money is the thing to be recognized, and by our standards, having more correlates with having accomplished something of significance. This is what bother Herzberg. Hitting the lottery doesn’t indicate personal accomplishment, just luck. Yet, without knowing how one acquired wealth, one is quick to assuming that the individual worked hard and deserved it (and the recognition of achievement).

To point two, I am reserving my thoughts on this for the time being.

To Andy’s first post (since my last post): none that I know of. Still, the CEO today is much like the Kings of old. Once you have more, you work to expand your domain and become the King of Kings. More recognition of achievement, deserved or not (i.e. Jack Welch).

To Laura’s post: Your choice to use the term ‘unmotivated’ is interesting. Hezberg uses the Hygiene Factors to represent worker dissatisfaction and Motivational Factors to represent satisfaction. He concludes that job dissatisfaction is NOT the opposite of job satisfaction. Instead, he uses lack of satisfaction or lack of dissatisfaction to be the opposites of satisfaction and dissatisfaction. You choose respect and appreciation (recognition) to express a Motivational Factor. Folks will jump to a new UAW job because of money, but probably because their present work does not fulfil the hygiene factors necessary to retain people. Folks need to satisfied with Motivational Factors as well as being not dissatisfied by Hygiene Factors. This is often why folks are only temporarily satisfied, thinking more money will help them to deal with job frustration, when much more is required. Money in this instance (an in most instances, IMHO) created Movement, not motivation.

To Andy’s second post: Does the answer lie somewhere in the middle? Perhaps. I haven’t seen the curve of money vs. motivation, but this seems to be very reasonable. The Law of Diminishing Returns suggest that the curve flattens out. This might be why some folks at the top need enormous amounts of money to feel any kind of movement (i.e. our over paid sports personalities, top CEOs). Are these rational people? Some would argue NO. But what have they learned over their lifetimes? Unfortunately, they have learned to be recognized as great, you must make more than your neighbor. Sad, I think. Herzberg also suggests that we are on our way to the 6 ½ day weekend. This, while we are being paid the best in history. Many organizations are offering time off and huge rewards in an ever escalating economy. Who pays for all of this? We do, but in more ways than just financially.

To John’s post: The technician is looking for the Bigger Better Deal, or perhaps, just looking to have some of the Hygiene Factors taken care of (salary). The large dollars, yen, pounds paid to CEOs is somewhat puzzling. The risk factors increased, so doesn’t the salary we suppose. But how many of us argued in our own minds, if not aloud, that folks making the most, don’t necessarily contribute the most. Additionally, with golden parachutes, one is forced to wonder what risk do they assume (Ford, Firestone)? They are sheltered, and benefit from the myth that we promote, the higher we go, the more we should make. It is hard to challenge this thought, as all of us are trying to reach that comfort zone of ours. But what is this? Made by us, or made by society? I’ll bet society.

I guess I’ll keep taking the tablets you prescribe, Doctor John (hahaha)!

To David’s post: Your opening line is horrifying to me! This is one enormous misunderstanding of the leadership there. Why did they stop at 3x? Why not 4, 5, or even 10x contributions? I hope you are subject to that thinking. The additional ‘bonuses’ suggest more trouble. They are unaware of what the System yields and are throwing darts to choose targets (or so it appears). I am not surprised about the debt, evidence of mismanagement and lack of leadership. Still, perhaps the 3x directive is an ultimatum, make this or the doors close for good. In that case, I wish everyone the best of luck in achieving that goal! The Managing Director’s interesting suggestion is a cruel hoax. The suggestion is that the engineer has the power and authority to make these things happen. Perhaps they do, but looking from a traditional vantage point, this is not the work of engineers, but that of Accounts Receivable. Additionally, the Managing Director’s suggestion is KITA. Kick the dog, he will move. The dog is not motivated, the kicker is. In this case the Director is motivated and wishes this on the engineer. What does the engineer need? This is what motivates the engineer.

I agree that win-win is the objective, but I am failing to see where the engineer benefits. More money? A hygiene factor. The money will only curb dissatisfaction, not create motivation. What we need is to find the things that motivate folks and build these into their work. The MD at your organization is busy doing other things: destroying an organization he has a 80% interest in.

Andy’s last post: I totally agree. I thank everyone to this point with the contributions that they have made. We have seen the lighter side and the dark side so far. I am pleased with the content of your posts.

What will I say to my group? There is still a bunch of confusion out there, that is to say, if you follow Herzberg’s and Maslow’s interpretations and theories. I myself am still sorting out the issues. This was one of my reasons for posting. I hoped to engage in discussion with Cove participants to learn from you all. I have. Particularly, I am not sure how I perceive the convicts who are after sex (or all of us for that matter, trying to fulfil sensual/REDACTED needs). Herzberg suggests that motivation is based on ‘growth needs” and hygiene factors are caused by ‘environmental factors’. He includes Relationships as a Hygiene factor, and as I mentioned earlier, hygiene factors deal with dissatisfaction and no dissatisfaction. Can sex be a factor of motivation?

I began to develop a theory I call “The Line of Complexity”, which illustrates where needs and wants exist. As life becomes more complex, do our wants become needs. This was prompted from one of my groups discussions where the question was asked, is Love a Need or a Want (Maslow’s first two tiers are considered essential for life)? Pretty good question, creates a good deal of thoughts. Do you need love or companionship (sex?) to sustain life? This is just like “Is money a motivator?” I am sure that I would receive similar responses as above, mixed.

I would like to suggest an article found in the Harvard Business Review, Sept-Oct 1987, entitled “One more time: How do you motivate employees?” by Herzberg. It is an enlightening article, a reprint from 1968. The material is quite relevant today as it was then. In the article, he explains his theories, the differences of Movement vs. Motivation, and the Hygiene-Motivation Factors. I would also suggest reading “Punished by Rewards”, by Alfie Kohn which I think blends nicely with Herzberg’s and Maslow’s work.

Enough said, so back to the group…



Andy Bassett

Can anybody get hold of this article and post it on the sight, i would be interested to see it.


Andy B

David Mullins

One More Time: How do you Motivate Employees

"1. What are the likely implications of Kohn s background on his
perspective on the topic of rewards? "
"2. Is pop-behaviorialism as widely accepted in our schools, businesses
and child-rearing methods as it ever was?
What evidence have you seen of
any trends? "
"3. Is the United States different from other countries in its faith in
reward systems? "
"4. Are there groups or sub-sets of the population that have resisted the
temptation or recovered from dependency on rewards?"

Punished by Rewards? ***Some dead links removed***

"Although many of its claims are unsettling, the arguments are persuasive and the alternatives it offers are useful. It calls us to question not only the way in which we use rewards and praise in the Suzuki method, but the way in which our entire culture unquestioningly marches to the beat of the behaviourist legacy of Skinner and Pavlov."

Last edited by a moderator:


Thanks Andy! IMHO, you cited the best ever written on the subject: One More Time: How Do You Motivate Employees from the Harvard Business Review (September/October) 1987. Thanks you very much.
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