If you’re wondering why we’re looking into the impact of motivation on employee performance in the banking sector, it’s rather simple - the banking industry is perfectly organised for the needs of the academic researcher.
They’re so neat and tidy! It’s beautiful, really.
Suffice it to say, banks in India, Palestine, Nigeria, Norway and other countries have provided researchers with perfect environments in which to research the correlation between employee motivation and performance.
Since we highly doubt you’re in the mood to make your way through five academic papers on the topic, we’ve summed up the key takeaways on the impact of motivation on employee performance in the banking sector neatly for your reading pleasure, right here, so you can benefit from this insight in the space of 5 minutes.
Let's get started:
1. Salary is important - but only up to a point
An MIT study funded by the Federal Reserve Bank of the USA found that when it comes to skilled, cognitive work, such as the kind bank employees are required to do on a daily basis, money is indeed a motivator at work, but it doesn't quite work in the way we expect.
Daniel H. Pink, a US author who has written extensively on business and human behaviour, summed it up very well in his TED Talk, The Puzzle of Motivation - definitely worth a watch if you’ve got the time.
In short, you should compensate your employees well enough so that salary is no longer their primary motivator, and they can focus on the intricacies of their jobs instead.
However, once this tipping point has been reached, monetary incentives cease to be as effective as you'd like them to be. This is when you need to start focussing on providing your team with the space to enjoy autonomy, mastery and purpose.
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2. Moral incentives play a big role in the banking industry
According to this study undertaken by Mohammed T Abusharbeh and Hanan Nazzal among the employees of Palestinian banks, a strong focus on moral motives significantly and positively predicted employee performance.
To summarise, the study recommended that Palestinian banks need to adapt and develop their motivation system in order to satisfy all employees' moral needs rather than solely focussing on material and social motivations.
3. Motivation spikes when employee goals are aligned with the organisation’s
This study undertaken in the Nigerian banking sector, sought to identify the motivational factors that directly influence employees’ performance and examine exactly how effective these motivational factors were in doing so.
It found that the simplest way to lay the groundwork for high-octane employee engagement and performance in the workplace is to ensure that employee goals are in alignment with that of the organisation, and that it all starts with hiring for cultural fit from the outset.
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4. Job satisfaction differs from a lack of dissatisfaction
This is one of the coolest takeaways from all these academic papers, in our opinion.
Based on the same study mentioned in the point above, factors that pave the way for job satisfaction are different from those that cause job dissatisfaction.
For example, if you only deal with the factors that cause dissatisfaction (e.g. insufficient pay), you will keep the peace for a while, but you won't necessarily motivate your employees to be their best selves.
Instead, jobs have to be enriched so that workers have opportunities for achievement and recognition, stimulation, responsibility, and advancement.
In short - if you want people to do a good job, give them a good job to do.
5. A sense of purpose is imperative
The Nigerian banking industry study highlighted yet another key insight, namely that employees are much more motivated to bring their A-game if they feel connected to the business based on a sense of shared purpose.
The researcher stated that while adequate financial compensation, public recognition and flexible working conditions were important precursors for motivation and accountability, it was not sufficient in and of itself.
These factors only boosted motivation and performance if the employee felt that he or she was partly responsible for the success and survival of the business in their own capacity, and that this visualisation can only be accomplished through participation.
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6. Punishment does not work as a motivational enforcement tool
This study was undertaken by researchers Andreas Bergström and Mattias Ternehäll among employees in the Swedish banking industry to see if there was a difference between the sexes when it comes to motivation at work.
While they eventually found that the difference between the things that motivate men and women are negligible (we’re going to suppress the urge to say ‘duh’), they did happen upon some interesting data pertaining to punishment as a motivational enforcement tool.
It turns out that workers in the Swedish bank industry, who have been proven to be some of the most motivated employees in all of Sweden, don't care for the notion of punishment as a managerial tool in the workplace at all.
In fact, these clever folks believe that if punishment would be recognised as a motivational factor, bank managers would start to use punishment reinforcements on a regular basis, which the bank workers definitely do not want.
So they simply don't respond to it. Ah, the Swedes. Gotta love that 'not today' vibe they've got going on.
7. Being part of the goal formulation process is great for intrinsic motivation
The same Swedish study mentioned above also found that bank workers are also motivated by being part of the goal formulation process. To work towards specific goals and goals which are hard to reach are also motivational factors but not as strong as being part of formulating the goal. I.e. rope in the troops from the outset when you’re plotting out the route to business domination.
The impact of motivation on employee performance in the banking sector offers great insights into what makes the modern-day employee tick.
Keep an eye on the blog in coming weeks - there’s more where this came from. We’ve got plenty more educational tricks up our collective sleeve.
You CAN build a better workplace and it starts with employee recognition. Your 10-step guide to boosting employee morale is a click away 👇.