Charity may trump self-interest in motivating employees
- Thu, September 01 2011
- Filed under: Marketing essentials
Here’s a fascinating question: Which of the following is more motivating?
a. A bonus you spend on yourself
b. A bonus you spend on someone else
And the answer is…. b, according to several studies profiled in this Washington Post piece.
The behavioral economist Dan Ariely cites some yet-to-be-published research that shows employees might be more satisfied with their jobs when given the chance to help others:
In the first experiment, the researchers gave charity vouchers worth $25 or $50 to Australian bank employees and asked them to donate the money to a charity of their choice. Compared to people who did not receive the charity vouchers, those who donated $50 (but not $25) claimed to be happier and more satisfied with their jobs.
The second experiment took the concept of prosocial incentives a step further by directly comparing people who were asked to spend money on themselves (a personal incentive) with those who were asked to purchase a gift for a teammate (a prosocial incentive). This experiment took place in two different settings — with sales and sports teams — and looked at a broader range of outcomes. It not only examined employee satisfaction, but also the other side – benefits to the organization in terms of employee performance and return on investment. While neither sales nor sports teams improved when people were given money to spend on themselves, Norton and his colleagues found vast improvements for those who engaged in prosocial spending. While they were purchasing a gift for a teammate, they also became more interested in their teammate and were happier to help them further in multiple other ways.
If we compare these experiments, we can also see that while a gift of $25 did not make a difference when it was donated to a faceless and impersonal charity, a gift of $20 provided numerous positive outcomes when it was given in the form of helping out a teammate. Thus, it appears that we can reap the greatest benefits when we spend money on others, and even more when we spend money on close others.
Nonprofit marketing friends: This is great fodder for corporate partnership pitches. Show that volunteer days or donations to your organization are a great way for companies to build employee morale and loyalty!
You can gain added credibility by citing Daniel Pink, who has shown a “purpose motive” is a one of the most powerful forces for employee satisfaction and creativity in companies. As he notes in his book, Drive: “Traditional businesses have long considered purpose ornamental, but that’s changing, thanks in part to the rising tide of aging baby boomers reckoning with their own mortality– Within organizations, this new ‘purpose motive’ is expressing itself – in goals that use profit to reach purpose. This move to accompany profit maximization with purpose maximization has the potential to rejuvenate our businesses and remake our world.”
The bottom line? Charity sometimes trumps self-interest. Purpose can motivate more than profit. And good causes = happy employees.