Ending Soon! Save 33% on All Access

Money Can't Buy Motivation When It Comes to Working Harder or Going to the Gym If you're looking for ways to motivate your employees, think outside of pay incentives.

By Rose Leadem

Opinions expressed by Entrepreneur contributors are their own.

Tom Merton | Getty Images

Many companies use incentives such as bonuses and equity to boost employee engagement and satisfaction. However, this might be the wrong approach, according to a new study.

Related: Money Is Nice, But It's Not Enough to Motivate Employees

A study by The Harvard Business Review examined how incentive pay affects employee well-being, job satisfaction, organizational commitment and more. By interviewing senior managers at companies across the U.K. and gathering data from employees at these companies, the study found that profit-related pay, where employee compensation is related to the profits of the company, did not have positive effects. To the contrary, some employees felt less committed to the company and their work. That's because organization-wide incentives such as profit-related pay can often depend on an employee's status in a company and are not equitably distributed.

Related: Employee Motivation Has to Be More Than 'a Pat on the Back'

Money doesn't motivate people outside the office either. A recent report by Case Western Reserve University studied how often new gym members regularly visited the gym, even when they were given monetary incentives. At the beginning of the study, it was the intention of new members to go to the gym three times a week, but most ended up going an average of 1.5 times per week.

In the six-week study, participants who visited the gym nine times -- approximately 1.5 times per week -- were promised a reward, which would be either an Amazon gift card or an item such as a blender or an item of equal value. At the onset of the study, each participant was told their specific reward. The researchers created a control group, where participants received $30 Amazon gift cards regardless of how often they went to the gym throughout the six weeks.

Related: 3 Methods Science Recommends for Motivating Employees

It turns out, even when people were paid to exercise, they still weren't motivated to hop on the treadmill. In fact, those promised the $60 gift card did not visit the gym much more than those who were simply handed the $30 gift cards (regardless of whether they went to the gym). It wasn't until the final week of the study, when people had their last chance to win a prize, that gym visits increased ever so slightly by a low 0.14 more visits per week.

So how can you motivate your employees? Rather than using pay, more effective ways to motivate employees are providing constructive feedback, fostering a collaborative work environment and connecting with employees to show you care.

Rose Leadem is a freelance writer for Entrepreneur.com. 

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Social Media

How To Start a Youtube Channel: Step-by-Step Guide

YouTube can be a valuable way to grow your audience. If you're ready to create content, read more about starting a business YouTube Channel.

Thought Leaders

How to Become a Successful Social Entrepreneur

It's not the same as being a great business person.

Growing a Business

Want to Expand Your Market Overseas? Here's Everything You Need to Know About Global Logistics in 2024

With rising geopolitical tensions and changing market conditions it can be hard for businesses to navigate supply chain logistics even in a post-pandemic world. Here are three tips from the CEO of an international customs brokerage.

Business Ideas

63 Small Business Ideas to Start in 2024

We put together a list of the best, most profitable small business ideas for entrepreneurs to pursue in 2024.

Business News

Elvis Presley's Granddaughter Fights Graceland Foreclosure, Calls Paperwork 'Forgeries'

The 13.8-acre estate was scheduled to be sold in a public foreclosure auction on Thursday. Presley's granddaughter and heir, Riley Keough, is fighting to save Graceland in court.


What Franchising Can Teach The NFL About The Impact of Private Equity

The NFL is smart to take a thoughtful approach before approving institutional capital's investment in teams.