McKinsey Quarterly

Chart Focus Newsletter
May 2010

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Motivating employees when budgets are tight

Respondents to a McKinsey survey think that three noncash motivators—praise from immediate managers, attention from leaders, and a chance to direct projects—are at least as effective as the three most highly rated monetary ones. These nonfinancial incentives make employees feel that their companies value them, want to foster their professional development, and take their well-being seriously. Most studies on motivating employees emphasize these three principles.

Companies need cost-effective ways to manage talent, especially at a time when many of them have cut their remuneration bill by 15 percent or more. To learn how they can decide which combination of financial and nonfinancial incentives will serve them best during and after the downturn, read “Motivating people: Getting beyond money” (November 2009).
Also of Interest

January 2008
Making talent a strategic priority
The War for Talent never ended. Executives must constantly rethink the way their companies attract, motivate, and retain employees. [includes audio]

June 2006
An executive perspective on employee benefits: A McKinsey Survey
Although executives say that employee benefits are a competitive advantage, many companies don’t know which benefits their employees prefer.
(Premium Membership required)

May 2006
The people problem in talent management
Unless managers think it’s important to develop their employees, talent-management processes can’t work.

May 2006
Making a market in talent
A 21st-century company should put as much effort into developing its talented employees as it puts into recruiting them.
(Premium Membership required)

Did you miss last month’s Chart Focus?

“Executive views on the global economy—a multiyear interactive”
Since 2004, McKinsey has surveyed a global panel of executives about economic conditions in their countries, industries, and companies, as well as how they expect those conditions to change in the next half-year. In 2008, we added questions about the global recession’s impact. Now we’re presenting this remarkable ongoing record of executive opinion in a regularly updated interactive exhibit.