Employees are the foundation and driving wheels of any organization. Therefore, it’s vital to give them a reason to stay with you for a long time. Even though they are compensated financially for their contributions, the benefits of non-financial motivation go beyond what money buys. The cognitive bond between the organization and the employees cannot be constructed in strictly monetary ways. Even if done so, it is probably not sustainable. 

When you think about a way to appreciate your employees, what strikes your mind first?

A gift? A Reward? Instantly, do you think about monetary incentives? 

As per the study by IMA (Incentive Marketing Association), 65% of the employees actually prefer incentives that are not in monetary form.

As you see, there are numerous ways to incentivize and make your employees feel recognized within your organization.

This article explores why it is important to have employee incentives, and the advantages organizations can reap from them. Despite the many options for the same, we will probe into non-financial motivation that can help employees develop a sense of belonging within the organization. Finally, we will arrive at a few efficient ways of establishing non-financial motivation for employees.

Non-Monetary Incentive – Crucial to Employee Motivation

We all have varying needs, and not everyone has the same priority for certain needs. A person’s need can be more than just monetary. Let’s say person one works in Company A, which provides monetary incentives when they achieve their targets or on completion of their project. 

Person two works in Company B, which provides their employees monetary benefits and offers them a paid family vacation annually. So, which company do you think will look more appealing for an employee?  It all depends on what the employees seek from their organization.

One’s expectations may indeed change depending upon their life situation. But a few fulfilled needs can leave them with long-lasting motivation and satisfaction. For example, a feeling of belonging within the organization, recognition of one’s work, opportunities for personal growth, and a journey toward self-actualization are a few ways to deliver positive, long-lasting impressions on your employees. This is the reason why the benefits of non-financial motivation are powerful. When you meet your employees’ expectations through non-financial means, you help them reach a state of satisfaction that would be hard to achieve with money alone.

Impact of acknowledging employees;
Source: WebpageFX

According to Kuvaas et al. (2018), intrinsic motivation helps employees achieve wellness across various domains. Generation Z and millennials are more inclined toward jobs that challenge their abilities. Skill development and self-growth opportunities drive their employment choices rather than simply pay or incentives. Hence, organizations must revisit their employee motivation strategy.

Image by Lisa Fasol © The Balance 2019
Image by Lisa Fasol © The Balance 2019 

The best insider experience is to ask someone who works at Google! They are known for their contemporary ways of engaging employees. Besides competitive financial rewards and motivational media, they also incentivize them by creating a comfortable workplace. Here are a few interesting ways how Google uses non-monetary incentives to engage its employees. 

Source: Lazlo Bock Work Rules - Insights from Google
Source: Lazlo Bock Work Rules – Insights from Google

Posting Thank You notes his team received on a “Wall of Happy.” 

Let’s go deeper into the topic, 

Benefits of Non-Financial Motivation-

Now, given the explanation of why non-financial incentives are important to your employees, you must know what benefits they bring to the organization. Below are some of its advantages,

  1. Increased Productivity – A satisfied employee is self-motivated, as they are naturally driven to work harder to reach an organizational goal. They will be more productive when given the power to make decisions.
  2. Improved Employee Retention – A self-motivated employee is an asset to an organization and hence worth investing in. When you have a motivated staff, they are more likely to stick around trusting your process.
  3. Increased Engagement – Motivated employees feel more engaged in their work and invested in the company’s success. They are also more likely to open ideas and be creative problem solvers.
  4. Improved Customer Satisfaction – A motivated employee is the best brand ambassador; they are more likely to provide excellent customer service. You can create happy customers and higher customer satisfaction scores.
  5. Higher Quality Work – Driven employees strive to come up with their best and align their interests to the organization’s vision. They will eventually produce higher-quality products or services.

To know better about the non-monetary benefits, you should see both sides of the coin. It will also help you know when you need to apply the same. 

S. No Advantages of Non-Monetary IncentivesDisadvantages of Non-Monetary Incentives
1Attractive for millennials and hence easy to attract new talents.It may become the wrong investment if it wasn’t the right incentive and didn’t fetch results. 
2They follow market trends and will give a competitive edge to an organization in the market. Making the employees participate may be tricky.
3They are more cost-efficient than the monetary benefits.You will need a solid HR organizational structure to make it work.

So now, how do you establish the benefits of non-financial motivation inside your organization? Well, we have compiled a list of how-tos for you below!

Non-Financial Motivation: 13 ways to do it

An HRM strategy can be efficiently weaved when you can connect it with Maslow’s Hierarchy of Needs. When you touch on the needs of safety and physiology, you establish a base of trust. This trust can lead to higher satisfaction only when renewed continually. We have compiled five Maslow-inspired ways to provide non-financial motivation in the workplace:

Ensure job security:

To ensure job security, you should do things that can make employees believe that they can rely on the organization for the long term. You can,

When employees feel safe in their roles, they can give their best.

For example, let’s take a look at Indeed here.

Indeed, on Ensuring job security

When employees feel valued, heard, and secure, they are set in their comfort zone, and their mind works at peace, leading to better results. As you can see, Indeed provides multiple benefits employees enjoy and feel motivated to contribute more to the company.

Understanding what your employees want and offering the same can benefit your employees and your company significantly.

Laud them When They Earn it:

When the organization and managers reach out to their employees to praise them, it can reap tremendous results. When they know they are recognized, they will likely give their best. Try to give credit where it is due and let your employees know that you see their value.

In the image below, Deloitte does a great job of showcasing its non-financial benefits right from the start to motivate its employees right from the first step of applying for a career. They help make their employees feel comfortable.

Delloite on Non Financial Motivation for employees

Welcome suggestions and deploy them:

When you go beyond recognition, it can be the best form of motivation. Your employees’ suggestions might just be a game-changer for the company. It will encourage participation from the employees. 

Giving a platform for self-growth:

When you give employees a chance to grow, they will have an opportunity to progress in their careers. 

Pietential helps companies use a Life Balance Population Wellbeing Realization System to help organizations attain data visualization on where an individual stands on the wellness scale across a diverse workgroup. 

Pietential, allow your employees to visualise their growth potential

 Set a Career Path:

When employees know there is light at the end of the tunnel, it will help them stay on track. 

Lumen focusses on being an employee friendly place

Check out how much employees love working at Lumen. The company’s strategy motivates employees to look at work as their own and stay excited, boosting their performance.

Skill enhancement

Learning in and of itself is a way to motivate people inside an organization. It gives them confidence that they are continuously growing and grooming themselves. It will also allow them to be confident in facing the demands of promotions. Both on-job and off-job training can give employees a vision for their growth, increase motivation, and foster loyalty. 

Intel's tution reimbursement program to motivate employees

Intel (INTC) has a generous tuition reimbursement program for its employees. It reimburses $50,000 in expenses per program with no annual limit. It also offers free tutoring, showing employees that the organization cares about their overall personal growth.

 Flexible Work-Life 

The one thing that the pandemic taught all of us is the importance of work-life balance and the possibility of offering flexibility in work. Instead of sticking to norms, if you are result-driven, then you are likely to get higher productivity from your team. Zippia’s report says that currently 74% of people are in a hybrid work model or at least planning for it. It is clearly not a choice but a mandatory feature for your organization in 2022.

Zippia report on how Work life hybrid model is important

Extra time off

Employees can always use the spare time they can get to relax and destress. The pandemic still has lingering effects on people; giving employees time off for mental wellness can be highly effective. Even an extended lunch hour on a specific day of the week, an early off on Fridays, or extra time off for family can be highly beneficial for employee motivation. 

See how Sean works six weeks and takes off every seventh week. He follows this personally and applies this process to all of his employees. This allows them to take some time off to rest their minds and feel more connected to the company intrinsically.

Seanwes and his seven week sabbaticals to motivate employees

 Offering volunteering time

Many people have higher satisfaction in life when they can give back to their community. Supporting your employees in contributing to a greater cause can create a deep bond where employees see that you respect their choices and desires. 

Nvidia promotes non financial motivation by promoting education

In the picture above, Nvidia sees great benefits from employees by allowing them to volunteer and give K-12 students the tools they need to succeed in learning.

Meet them in person

When executives or the team leader find an employee worth appreciating, the best way is to do it through face-to-face interaction. Taking them to dinner as a means of appreciation is an effective method. It is applicable even in teams, where the team leader or the manager can treat all members to a meal. It will etch the feeling of personal appreciation for the employees, greatly influencing productivity. 

Employees with frequent interaction are highly engaged

Let them pursue passion

Google allows its employees to work on their own projects, which is an excellent way to motivate people as they get to pursue their passion. The same enthusiasm gets reflected in the efforts towards organizational growth. 

Google allows employees to choose projects

Opportunity for self-improvement

Programs like peer learning and mentoring are simple, cheap, yet efficient ways to motivate your employees. It ensures the continuous progress of employees inside the organization. It can also create better bonding between employees leading to better organizational culture. 

The picture below shows how VMWare recruited several employees to join the team for three-month assignments via the Take3 program. Take3 empowers VMware employees to dedicate three months to a project outside their day-to-day roles.

VMware programs for sself improvement

Create leadership opportunities

When you allow your employees to step up, they know they have a chance to grow inside the organization. The opportunity can help them analyze their strengths and weaknesses and develop problem-solving skills. 

Siemens strategy for employee growth and development

Here’s a case study of how Siemens applied employee opportunities as a growth strategy. 

The above are the best ways in which you can have the benefits of non-financial motivation. But all these are deployed more effectively when you can personally connect with your employees. 

If you are facing issues with applying these at your organization, you can reach out to us to better understand the differences in the needs of your people. Maybe it’s time to look at these issues in the strategic HRM of your organization and keep your employees closer to you.


Kuvaas, B., Buch, R. and Dysvik, A., 2018, August. Individual variable pay for performance, incentive effects, and employee motivation. At the annual meeting of the Academy of Management, Chicago, USA.