The Limits of Feedback and Appreciation

Providing employees with specific information on their productivity is one no-to-low-cost way to drive improvements in their performance.  A recent Harvard Business Review Daily Stat (To Boost Workers' Productivity, Tell Them How They Rank) reminds us of this reality, via the story of a German wholesaler that saw an average and apparently sustained jump in average productivity after sharing information about employees' relative performance.  When the conditions are right, most of us will respond positively to feedback that either points directly to actions we can take or triggers an instinct to better our showing relative to our peers.

Appreciation, we all know, can work in a similar way.  Big bang without the big bucks (and without a lot of the baggage that can accompany the delivery of those big bucks).  Having our work recognized, knowing that somebody notices what we do and cares enough to directly acknowledge it -- this is powerful stuff and it can have a tremendous impact on work energy, motivation and performance.

Amid the exciting possibilities of all we can achieve with feedback and appreciation, it can be easy to lose sight of an important fact.  The employment relationship, when you strip away all the bells and whistles, is an economic one at its core.  And the foundation of that economic transation, for most workers, is their cash compensation.  Right or wrong, good or bad, this is what's top of mind for the average worker when they take toll of the "rightness" of the employment exchange.

In my conversations with workers, I find many are particular sensitive to this balance.  Top performers, often acutely so.  They believe that when their efforts create economic value (e.g., profits) for the employer and other stakeholders, that they should reap some of the rewards of that success.  In their minds, this might be through increases to base salary or some type of profit-based incentive award. 

The point?  While feedback, appreciation, and the well-placed "thank you" may deliver motivational impact that a cash award or raise does not, we cannot overlook the importance of the cash package as the baseline of the employment relationship.  We must get cash compensation right - and do the communication and information sharing necessary for employees to understand how this critical baseline of the relationship is set and managed.  If we fail this, if employees believe that there is a fundamental imbalance at the core of employment exchange, chances are good that our efforts to provide sound feedback and express genuine appreciation will fall on deaf (or at least highly skeptical) ears. 

Creative Commons image "Bundle of Dollar Bills" by Images_of_Money

Comments

[Chris]

I agree entirely with the sentiment of your post, but I disagree with one small thing you wrote: that the employment relationship necessarily needs to be economic at its core. While yes many leaders see it as an economic exchange I believe it can be more than that.

Human beings have a natural desire to be a part of something greater, to contribute to a higher purpose and work can satisfy that need. Previously it was institutions such as the Church that filled that role (or even a strong sense of community), but as both of those have waned it created an opportunity for organizations to fill that role. While in generations past work was often dull and repetitive that isn't necessarily true of much of the work done today. At the core of today's exchange between employer and employee we can fulfil not only the low level needs "food, water and shelter" but also higher level needs such as belonging to something bigger and the need to be creatively challenged.

[Ann Bares]

Chris:

Totally agree on our collective inclination and desire to be part of something greater. To some extent, in some organizations, this is a legitimate element of the value proposition offered to employee and it is considered to have "capital" in the same sense that any other part of the package is. On the other hand, the point of my article is to warn organizations to have a care about assuming that they can disregard doing the right thing with base salary just because they are attending to higher level needs.

Thanks for bringing up the point.

Ann

[Chris]

Agreed, you can't do one without the other; it needs to be a concerted effort to address all needs.

[E James (Jim) Brennan]

Just as a high-rise building or mangnificent cathedral cannot be built on quicksand, a solid compensation foundation is required before those higher level employee value propositions can be activated and met. A starving worker cannot be effectively motivated by status, recognition or intrinsic rewards. Pay is necessary but insufficient by itself. Adequate compensation is the precondition for effective application of higher level aspiration goals.

The reminder is important because the increased current emphasis on non-economic reinforcements can lead to neglect of the foundation element.

[Ann Bares]

Jim:

Exactly my purpose and point - and you said it so succinctly. Thanks!

[Web Design]

impact on work energy, motivation and performance. this is powerful stuff and it can have a tremendous