Increasing employee motivation: from the job wheel to participation

Article by the German member of InterSearch Worldwide, InterSearch Executive Consultants.

Increasing employee motivation and tightening staff loyalty are essential in times of a shortage of skilled workers. But what methods are there for this? And which ones can a company afford in times of recession?

Cuts in benefits on the rise

Whether companies currently invest in employee benefits depends on their financial situation and their view of the future. A survey by LinkedIn and YouGov last year showed that three quarters of German companies are cutting back in this area or plan to do so. This is despite the fact that almost three quarters of the managers surveyed (73 per cent) fear that such savings could have a negative impact on employee motivation. “One in two companies (48 per cent) has already made cuts in this area, and another quarter (26 per cent) plans to do so. With 74 per cent of companies that (want to) cut their benefits, Germany is not only above the international average (66 per cent), but even reaches the second highest value in Europe behind Sweden (80 per cent),” according to the study results.

Specifically, savings are being made on the costs of technical equipment, on the general subsidy for the home office and also on additional days off. “Cutting back on the home office seems shortsighted to me,” says Alexander Wilhelm, Managing Partner at InterSearch Executive Consultants in Frankfurt. “In interviews with candidates, we hear again and again how immensely important remote working has become to people.” Those who cut corners in this area lose employees in the long term instead of retaining them.

On the other hand, workation, flexitime or annual working time accounts and a four-day week are very good ways to increase employee motivation, explains Wilhelm. The willingness to approve sabbaticals or to release employees for voluntary work is also a successful measure.

“However, it is important to consider what each company can afford,” Wilhelm explains. Particularly in smaller companies, time off is not always possible because every employee is needed. “Smaller companies can often score points with short communication channels and room for maneuver.

Increasing employee motivation: various models of participation

Participation in the company’s profits, for example, in the form of a one-time bonus or shares or stock options, can also be used to increase motivation among skilled workers. Participation should lead to employees benefit more or less directly from their good performance or that of their team. Other alternatives are employee credits or loans. In this case, the bonus is not paid out, but ends up in an account and earns interest. In the case of a loan, “the employee grants the company a loan from his or her own assets, on which the company pays interest as in any other loan agreement,” writes Paula Wernecke, lawyer and CHRO of the international business law firm CMS in her overview article on this topic.

According to her, virtual shareholdings are another viable way to increase employee motivation. They are understood as “contracts under the law of obligations between the employer and the employees, in which the parties determine the conditions of the program. The participation program thus has no effect under company law.”

More motivation thanks to a company car, job bike, and co.

Many companies offer a company car from a certain career level. As the recent example of SAP shows, alternatives such as a mobility budget are increasingly being considered. Here, employees are allocated a fixed sum per month, which they can use flexibly for bus, train, bicycle, rental car/car sharing, or e-scooters. “For SAP, this is a good way to make itself more attractive, especially for young talent. Because for this generation it is no longer so important to own a car themselves,” says Wilhelm.

Microsoft is now going so far as to offer employees a car subscription in cooperation with Sixt. This offers maximum flexibility and is also more sustainable, as only electric or hybrid vehicles can be selected. Other companies grant frequent drivers a rail card, sometimes including private use.

About InterSearch Executive Consultants

InterSearch Executive Consultants is one of the leading personnel consultancies and specializes in the recruitment of executives (Executive Search) and systematic analyses of executive potential (Management Audit / Executive Diagnostic). Founded in 1985 under the name “MR Personalberatung”, the company is now represented in Germany with three offices in Hamburg, Frankfurt, and Cologne and was a founding partner of InterSearch Worldwide in 1989. Today, InterSearch operates worldwide in the field of executive search with over 600 consultants in more than 50 countries with more than 90 locations.