Is Money Always the best Way to Reward Employees?

Employees love to be rewarded. Heck, we all do! It makes us feel good and appreciated for the things we do. But, believe it or not, money may not be the best way to reward employees. That’s because there is too much “routine” involved in giving money as a reward.

You know the routine – like it being time to give out the Christmas bonus again. What was it last year, an extra two weeks of pay? This year, you better match it, even if you can’t afford to, because, well, you have set the precedent. From the employees’ standpoint, money is nice, but when it comes to routine, it isn’t so much ‘nice’ as it is ‘expected.’ And when you don’t deliver on that expectation, well, people get upset and disappointed.

Change It Up
So here is the first lesson: Whatever you do, don’t reward employees the same way every time. Don’t always give them the same $100 or the same pat on the back. You need to be careful about setting an expectation where the reward is perceived as simply being part of their “normal compensation.”

But here is the biggest thing that employers miss – money is a very short high. When you get money, it is exciting for maybe 10 minutes. Then it dies off. The reason is because money isn’t tangible. I mean, really. You get it on a small piece of paper (like a check) or a few bills, and then it disappears.

Lasting Options
There is a better way to reward employees on many occasions, and that is with a thoughtful gift. Why? Because a gift is tangible and has lasting power. That gift will come up in their thoughts again and again. The employees will get to use the gift again and again – providing that you gave them something they will actually use and that is an appropriate recognition for their efforts.

Here is what you can do to make sure you give them a gift they will truly appreciate:
– As you work with your employees, and personal conversations happen, make a note of the things they like or want.
– Write those things down because, when it comes time to get a gift, you will not be able to remember, as hard as you try.
– Build a list of these things to reward the employee with, when the time is right. You will also need to make sure that the gifts are appropriate.

Here is an example of how I did this with an intern who worked in my office last summer. He was working for free, to build his resume and gain some experience in the field. One day, he mentioned how he loved the Xbox and wanted one. It caught my attention, and I asked him what kinds of games he liked, and how many people he likes to play the game with. After the conversation ended, I quickly jotted down the details.

With that accomplished, I bought the Xbox, games and controllers. One vital tip you need to understand is that, if you give a gift, give the full function of the gift. An Xbox is useless without games and controllers. So giving just the Xbox would have been a burden on him, not a gift.

Making It Special
What an amazing day it was, when I gave him the gift! The total gift cost around $650, but the experience was priceless. On the last day of his internship, I walked him into the conference room, where I had the gift wrapped up in 7 different boxes. It was like Christmas morning for him! I told him how much we valued his help, and our hope for his future success, and then I told him to tear into the gifts.

I can’t tell you how thrilled he was! He jumped up and down, shouted, even hugged me. He called all his friends to share the news and announce a game night, that night at his house. He was absolutely thrilled! And, as a little extra surprise, I told him he had the rest of the day off so that he could set up for his game night.

The Payback
What we got back in return from that gesture was huge! He sent a nice thank you card and a voice mail, saying he couldn’t believe the generosity of the company, and that all his friends wanted to work there. Over a year later, I interviewed an exceptional guy who seemed eager to do anything, just to work for us. After we hired him, I asked why he wanted to work with us so badly. He explained, “Everyone does. Everyone knows you guys care about your people like family.” As it turned out, he had heard about us from the intern, when he stopped by his house and asked, “Where did you get the Xbox?”

So giving thoughtful gifts works! But one note – don’t think that giving money to an employee so they can get the gift is the same. They will have the momentary excitement over the money, but it will be quickly forgotten. And when they buy the gift themselves, it won’t make them think of you, it will only make them remember what they picked out for themselves.


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