Money: What is Its Role in Motivation?

Money plays an important role in the life of absolutely any person, it serves to determine the social status of a person, affect the formation of his personality, affect his lifestyle, his relationships, one might say, everything – the vision of the world, in general. Money can satisfy many needs. Their presence gives rise to a sense of security and confidence in oneself and in the future.

So, what is the role of money in motivation?

Everyone perceives differently the presence or, conversely, the lack of money, but their unexpected loss or appearance can greatly affect a person: some even develop certain forms of monetary disorders, psychological trauma occurs, which can manifest itself in a passion for gambling, sometimes even for theft.

At the same time, money can’t be ignored, since in the modern world it is an indispensable tool for everyone who strives to make a career and achieve success, live comfortably, for their own pleasure. Also, money helps in self-realization and self-expression, but the productivity of this process naturally depends on the person himself.

It takes a lot of motivation to make a lot of money. But it is important to develop the right attitude to money, and not be dependent on its amount. Wealth goes to someone who knows how to handle money, skillfully prioritizes, is able to manage cash flows and control costs.

“Nothing can be as unfair as the same reward for unequal workers” – The American authors of the popular manual on management, B. Nelson and P. Economy, so focus on the fairness of wages and incentives. Money reinforces any activity at any given time, making it a universal motivational tool.

Conditions for the effectiveness of material incentives

According to the results of many studies, money occupies from 3rd to 7th place in the hierarchy of motives that induce personnel to productive work.

Practitioners agree that money is a strong enough motivator – everyone needs it. The influence of the system of material incentives operating in the organization on the motivation and work behavior of personnel is explained by how fair it is perceived by employees, how directly, in their opinion, wages are related to the results of work.

The attractiveness of money as a way of stimulating is limited, because it can be ineffective if it is used frequently and ineptly.

Exclusively motivating a person or even staff with money cannot be used as the only option for stimulation, since it, in the end, may lose its effectiveness, because employees will begin to think that money is valued more than anything else.

One American firm rewarded its managers for ideas that did not succeed – they reinforced the tendency to generate ideas and the courage to implement them, because, as we would have been accustomed to, we would be punished for an oversight, perhaps even deprived of a bonus or something. this spirit.

At the end of the year, another firm handed out substantial material rewards to the best mentors and assistants, thus generating the desire of employees to help their colleagues. This, of course, affects competitiveness, stimulating an increase in the level of efficiency, and, accordingly, new projects in the company, new ideas.

The use of money as a means of motivation can be hindered by insufficient elaboration of mechanisms and forms of material incentives.

The system of material incentives should be structured, well-coordinated and well-developed: in addition to salaries and bonuses, bonuses, it can include retirement material savings, receiving a share of the company’s profit, that is, a certain percentage of the company’s earnings, payment for training (an employee or his family members – children, spouse, for example), interest-free or concessional loans for the acquisition of property, payment for meals or travel for employees, or discounts for them; payment for their rest, vouchers, health centers, personal gifts and the like.

What about rich people – after getting everything they want, their motivation decreases, they use the money they earn, which brings them regular passive income, because now the money they earn is working for their owners. It’s like an ICO holder where you can increase your earnings by investing in cryptocurrency – the exchange rate can give you motivation to earn more.

Conclusion

Recognizing the important role of material reward, it must be considered in the context of all motivating factors, and taking into account all aspects of the impact of monetary payments on the professional motivation of a particular person / employee.

With their help, you can stimulate the performance of work, its quantity, loyalty, quality, informal aspects of activity, creativity, and therefore the creation of something new.

However, do not get hung up on it and think only about it all the time, because it is just a tool that expands our capabilities. Motivation is not money as such.

Most wealthy people treat money as a common, everyday instrument of payment. The most important and most significant reason everyone wants to achieve exceptional success is that very powerful driving factor.

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