Money, as we all know, is what makes the world go round.
However, admitting this is a business faux pas for both companies and job seekers. Microsoft Corp isn’t wasting any time in making a bold move to lure top talent: come work with us, and you’ll be earning $163,000 as a 22-year-old fresh out of college.
Being so open about remuneration could be troubling for a corporate leader. Doesn’t this mean you’ll attract people who are only interested in the money and don’t care about the company or the job?
This is untrue, according to an economic study. Financial incentives can motivate employees to be more engaged and loyal, not in spite of the money, but because of it.
Money aids in the telling of a person’s tale
Humans have a narrative bias as a result of the cognitive revolution. This means that we tell ourselves stories to make sense of our surroundings. One such tale is about money. Money, beyond its monetary value, helps us to imagine the tale we want our lives to be. It may seem self-evident, yet we all want to make meaning, and elite talent is no exception. The link between intelligence and creativity is added to this instinct. Clever talent may be more naturally creative in their stories, fantasies, and ambitions, and they’ll desire to exercise those muscles.
Microsoft not only provides them with a playground in which to do so, but it’s also likely to be their first exposure to this type of employer compensation, given that it’s aimed at recent grads. Given what we know about the anchoring effect, Microsoft is laying the groundwork for a future of devoted, knowledgeable employees who are enthralled from the start. A formula for success.
People feel safe and secure when they have money
Our survival instinct is our most basic instinct. We examine our environs for immediate and future risks in any undertaking. In our daily lives, this could mean being unable to afford housing, healthcare, or family assistance. We are less cerebral, imaginative, and productive in this survival phase. Cortisol levels are higher in our bodies. We are more stressed and agitated. And doing so for lengthy periods of time causes us to lose our appetites, sleep patterns, and mental wellness. Your firm will suffer if your employees feel this way. Not only will their productivity plummet, but they’ll also abandon your company in search of better opportunities. This can create instability inside your organization and will be more costly in the long run. What is the solution? Simply put, greater remuneration.
A reciprocity bias is triggered by money
Human societies have always been founded on the basis of negotiation. ‘Tit for tat’ cultures developed informal accountability between strangers within society through agreements. This accountability thrived because of a combination of human fears of social isolation and being labeled as a disobedient member of the community. What does this imply for your company?
It means that your staff is in the reputation management industry at the end of the day. You fulfilled your part of the contract by providing generous recompense, and now it’s their turn. They’ll begin to feel more responsible for their task, take more initiative to complete it, and are more likely to align with your company’s current status quo – lest they earn a bad reputation. What’s the end result? Employees who are engaged, productive, and loyal.
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