Compensation and the Employee

'Money Matters'! Money is something that definitely attracts the common people. This is definitely true but we really need to evaluate whether or not the monetary stimulus can work for a long time to keep employee motivated.

I think the productivity of the employee depends on how much he or she loves or likes the job individually. This means how much he or she is satisfied with the job. According to my observation the satisfaction comes from three distinct aspects of the job : Compensation, Appreciation and Passion. If either of these three are not satisfied the employee eventually feels dissatisfaction and starts thinking for a new opportunity. Lack of either of these three aspects makes the employee less committed to his or her job and brings down the productivity.

Compensation, it is one but still important factor of the job satisfaction. Very high level of appreciation and passion towards work may not work for a long time if the compensation is typically very low. Compensation is something we can treat as a tangible and countable thing out of these three. Hence the compensation can be measured but not the rest of the two. Again appreciation and work passion becomes more subjective and can change person to person. But compensation is something that helps the employee to satisfy the individual and family needs.

More compensation in turn means many of these needs are satisfied and still there is a room for huge saving. Satisfaction of the basic needs of family and increased saving helps in reducing the worry of basic necessities required for living. This may help the employee to focus more on the work and stop thinking about meeting the both ends.

Definitely it seems that the above stated formula is going to work so far. But the human mind is really difficult. Once the basic needs are met it starts creating new necessities. The employee starts living the better life style after the increased compensation. But this life style once habituated, the employee starts looking forward to more advanced life style and this brings need of more and more money. This is same as the story of two workers. One earns $100 a day and spends the entire amount. Where as the second worker earns $1000 a day and spends the whole $1000 in a day. At the end of the day both of them have balance as ZERO. Just the difference is one has SMALL ZERO and the other has LARGE ZERO. In the same way after some time the employee starts seeking more money to fulfill his/her desire and more ambitious lifestyle. If continued this way the organization might be in a trouble at later point of time.

As we discussed about compensation, in a same way even if there is passion and high compensation paid but if there is lack of appreciation, brings down the employee moral. This phenomenon is typically observed in today's IT organizations and Financial Institutes. In spite of high compensation and passion towards the work the employee complain about the work load and work culture or at least about lack of appreciation about their work. Similar case happens when there is better compensation and appreciation but the individual does not have passion towards the work. The lack of passion means either the employee does not have the enough skill set to perform the job and hence feeling devastated. Or on the other hand the employee does not like the job at all. This again brings down the productivity.

Hence I believe that the right combination of Compensation, Appreciation and Passion towards work will bring the employee satisfaction. And the increased satisfaction would bring the increased productivity.