What is the role of motivation in employee retention?

The Great Resignation seems unstoppable. Two years on, over 4 million* people are still resigning from their jobs every month.

So, quick fixes like one-off bonuses won’t keep dissatisfied staff at their jobs forever. You need long-term retention strategies that strengthen your organization’s relationship with its employees and make it a genuinely great place to work. It’s essential to look at what motivates your team and makes them feel content in their professional lives.

Let’s explore the role motivation plays in maintaining high retention rates and discuss seven effective ways to inspire your people.

‍*US Bureau of Labor Statistics, 2022
‍

The impact of motivation on employee retention

Motivation is the driving force behind everything your people do. Learning each employee’s key motivators and using them for encouragement can greatly increase job satisfaction. And when staff feels happier in their jobs, they’re more likely to stay. Research backs this up — a recent Indeed study analyzed thousands of employee reviews and found people who felt motivated were less likely to resign.

But that’s not all. Motivation also positively impacts: 

• Performance — Driven employees complete their tasks more efficiently, have better focus, and find effective ways to improve workflows. They’re also more likely to exceed targets and finish projects before the deadline.
  ‍
  
• Productivity — When staff performs well, they get better results. One basic example is that a motivated sales team tends to land more clients and bring in more revenue. You may create a positive feedback loop if your company uses extra profits to offer people more interesting incentives.
  ‍
  
• Engagement — Engagement and motivation overlap. When employees are motivated, they often feel a deeper emotional connection to their work. Studies also show engaged staff members are at lower risk of leaving their jobs.
  ‍
  
• Culture — Psychological studies prove that people become more motivated when surrounded by driven colleagues. Once you start working on employee motivation, you may notice it has an accumulative, positive effect on the overall work environment. 

And because these factors increase job satisfaction and, therefore, employee retention, motivating your people can improve turnover directly and indirectly.
‍

💥 Spark your team’s enthusiasm

Leapsome lets you build transparent compensation, promotion, and development processes to incentivize your people. 

👉 Book a demo

7 ways to increase employee motivation

Here’s a list of popular methods employers use to motivate their people, boost job satisfaction, and retain employees.
‍

💡 Remember that each team member is unique, and learning what drives them creates the most effective retention strategies.

One of the main benefits of employee engagement surveys is that they help uncover hidden motivators, so consider running one before trying the ideas below.

1. Celebrate accomplishments

It’s only human to want praise. After all, approval confirms you and your business care about your people and their achievements. In fact, recognizing employees is such a powerful motivator that companies with a culture of recognition find their team is 56% less likely to be actively job hunting.

So, if you don’t have any rewards and recognition (R&R) initiatives or think they may be lackluster, design a new staff R&R program. Simple tactics like a #wins channel on Slack or a praise wall can make employees feel valued.
‍

🤩 Leapsome never underestimates the power of praise

Motivate your people by empowering them to give and receive instant feedback.

👉 Learn more 

2. Offer incentives

Salaries and perks are the two biggest drivers of retention. But money might not be the core issue: Even if it’s not intentional, compensation also reflects how much your organization values your employees, affecting their pride and motivation.

When introducing new incentives, prioritize keeping your approach to compensation management fair, consistent, and transparent. Make it clear why some team members earned rewards and others didn’t, or you’ll risk inadvertently causing resentment. Plus, focus on offering staff what they actually want and need, or you won’t incentivize them at all.
‍

“Ensure any incentives offered are seen as valuable and significant by staff. If you’re unsure what will work, why not ask your team?

One of our clients achieved a fantastic response to their incentive plan by offering successful team members an extra paid vacation day. Time is precious, so this reward was seen by the whole team as a really valuable prize. The result? A team that was highly motivated, engaged, and ready to go the extra mile.”

— Natasha Maddock, co-founder at Events Made Simple

3. Create clear paths for career growth

Career development can motivate staff in different ways. For some, it’s a way to hone their expertise and feel more secure in their qualifications. Others enjoy mastering new skills and feeling more independent. And some employees want to use development to work toward a promotion or a different position within the company.

That’s why it’s such a popular motivator, with 57% of workers saying they’d be ‘extremely interested’ in upskilling. So, consider investing more in your learning and development (L&D) programs to meet your team’s needs. To spark interest, use a competency framework like Leapsome’s to create a roadmap for each employee and show them what they can achieve with your company.
‍

4. Support managers in inspiring their reports

Management can make or break your turnover rates. According to Gallup, it takes a 20% pay raise to convince employees to leave an effective manager. 

Managers motivate their reports on different levels:

• Personal — When people like their leaders, they’re more likely to want to impress them and feel accountable for their work.
  ‍
• Professional  — Effective managers model what good performance looks like to their teams. As a result, employees may feel inspired to emulate them.
  ‍
• Organizational — Leaders are most often responsible for introducing and promoting L&D opportunities and carrying out motivation initiatives. 

Train managers on how to coach their team at each level. For example, support a team lead about to hold a development talk with the best questions to ask. It’s also useful for management to understand how to measure motivation levels and recognize signs of discouraged employees so they can intervene.
‍

5. Foster a sense of community

People spend around a third of their lives at work, so it’s natural for them to build close connections and friendships with colleagues. These relationships may even be key to retaining employees. Gallup studies show professionals with a best friend at the office are over twice as satisfied as those without.

Of course, you can’t force work friendships as a strategy, but you can create an environment that encourages them. Introduce initiatives like:

• Informal get-togethers to welcome new hires
• Team-building events like sports days, company-wide lunches, or scavenger hunts
• Small celebrations for holidays or special occasions like birthdays, retirements, or work anniversaries
  ‍

6. Make space for clear communication & feedback

Much of the employee experience relies on honest, respectful communication and feedback. Here are some of the most impactful ways you can use them as motivators: 

• Give constructive criticism — Feedback can help team members learn about their strengths and areas of improvement. If you take the time to discuss what they need to do to perform better, they’ll feel more motivated to do so. Also, explore how to give feedback that resonates with different team members. For example, many people shy away from public feedback, whether good or bad.
  ‍
  
• Encourage a feedback culture — Employees appreciate exchanging feedback with their co-workers. Consider initiatives like 360° performance reviews where colleagues comment on each other’s work.
  ‍
  
• Promote your company’s mission and values — When you explain your business goals and specify how employees’ day-to-day work helps achieve them, it can give them a greater sense of purpose.
  ‍

“Feedback can be a brilliant source of motivation for people, as long as it’s done correctly — and correctly, in this case, means giving it in a way that underlines people’s good behaviors (not results) and makes them feel independent and competent. 

[This] drives the person’s intrinsic motivation, a much more powerful type of motivation with stronger implications for trust in the company and long-term retention.”

— Edoardo Binda Zane, Founder at EBZ Coaching

7. Provide career advancement opportunities

Promotion is a powerful driver of employee motivation. LinkedIn found companies with excellent internal promotion schemes had staff members who stayed up to 5.4 years on average — twice as long as those who didn’t.

People need to see their next possible steps with their employer and what actions to take to achieve them. Otherwise, the motivation to pursue opportunities outside the organization may become too strong and cause them to leave.
‍

Uncover what drives your people with Leapsome

Motivation is crucial in boosting employee retention or maintaining a stable turnover rate. But there isn’t a one-size-fits-all approach to motivating your team — you need to identify people’s specific motivators and find incentives that work for your whole company — good HR tools can help with that.

Our platform can assist you in creating retention strategies that benefit your entire organization without losing sight of its individuals. Use our Surveys module to discover what drives your people. Then, use our Competency Framework and Compensation module to manage different employee incentive schemes. And because all those features interconnect, it’s easy to get a clear overview of each individual’s progress.

Leapsome can help you uncover people’s motivators, use them to boost job satisfaction, and create a positive, nurturing workplace where everyone wants to stay.
‍

👏 Get your team excited about what you do

Leapsome combines tools for compensation, promotion, and development to help you combat high employee turnover.

👉 Book a demo