Three ideas for motivating small business staff

If business owners want to motivate staff and increase productivity, they should try being more transparent about the company’s finances and offering the odd beer for hitting targets.

February is a prime month for low levels of motivation, as ambitious “new year, new you” resolutions are replaced by the dawning realisation of another 10 months of hard graft ahead.

So how, as a small business owner, can you motivate your team? Here, two companies explain how they’re encouraging staff to be more productive.

Focus on the bigger picture

Sidonie Warren, co-founder of stationary store, Papersmiths, has an interesting approach to motivating staff – she presents the company’s finances, warts and all, to her 12-strong team. The aim is to show visually (via tables and graphs) the impact that employees have on the business as a whole.

“By sharing how much of each £1,000 that comes into the business goes towards salaries, operating expenses and so on, the motivation is that if staff aren’t productive and don't meet their targets, it impacts
on the company’s fortunes and people could lose their jobs,” says Ms Warren.

If an individual spends too much time on a task, they're holding the whole company back and everyone else has to work a little harder. Communicating this and encouraging employees to think in this way forces them to become more accountable and responsible, she adds. Staff are able to see themselves as part of the bigger picture.

Offer bonus beers

For John Armstrong and Andrew Dark, co-managing directors of printwear and branding company, Custom Planet, introducing a bonus structure based on its 12 employees reaching key performance indicators (KPIs) has proved effective.

KPIs are related to specialisms, so production staff have targets based on efficiency, while commercial staff have sales-related goals.

Andrew Dark, Custom Planet

Don’t, however, set a KPI without carefully thinking about the reasons why. “In terms of production, we looked at the data behind how many items of clothing were being produced in a day. Wastage was proving an issue, so we set a KPI around reducing waste, offering staff a reward for reaching that,” explains Mr Dark.

But what counts as an attractive and cost-effective reward? Think small, but be thoughtful, he says. “Most people like the idea of some holiday time with their kids, while a team might be happy with a crate of beer at the end of the week.”

When staff go above and beyond, offer something extra special. For exceeding expectations last year, Papersmiths gave employees an extra three days’ annual leave and a 12-month gym and fitness class membership with Move GB.

Face-to-face meetings

One-to-one meetings with employees can also help drive them, explains Mr Armstrong, who suggests catch-ups once a month to address areas of improvement for the individual. It’s about motivating people to develop their skills and grow their expertise.

Focusing on what might be perceived as negatives can be awkward when you have a close-knit group of staff, he admits. So set the tone at the beginning of the meeting by recognising the employee’s contribution and explaining how their personal development could lead to future career opportunities.