Four Important Psychological Elements in Building Better Company Culture


Employee rewards are difficult things. The main aim is to motivate good work and incentivise team members to perform at their highest levels and thus, generate the best returns for the company. Most companies fall back on financial rewards as their key benefit, which is the easiest and most logical motivator for higher performance – but did you know that financial incentives really don’t work? In the short term they do, sure, if someone tells you they’re going to pay you an extra $100 to get that report done on time, you’d do it, however, the issue with financial incentives is that people acclimate to them very quickly – if someone offered you $100 to finish that report, then didn’t offer you $100 next time, your incentive is already gone. The only way then to maintain that motivation is to increase the reward, which is not sustainable long term. Eventually, all financial incentives run into the same problem and don’t continue to work as a motivating factor.

In addition to this, the only true way to generate real employee engagement is to provide people with a purpose, a reason behind why your staff are doing what they do. When people have a clear understanding of what they’re doing and why they’re doing it, they’re more likely to take emotional ownership of the work, and that’s an important cognitive link, a relevant driver to align with. Everyone wants to feel important everyone wants to feel they’re part of something bigger than themselves – the business that can provide this is the business that wins out, long term. ‘We are all working together to achieve this goal.’ That’s the true key to employee engagement and the true motivator behind any reward system that you might seek to put in place.

Easier said than done, right? It’s all fine to theorise and philosophise but the reality is that building such a culture is hard. But maybe it’s not. Maybe, the biggest challenge is in our own understanding, in realising that financial incentives aren’t the winner we’ve long understood them to be. When we recognise the need for a driving purpose, the role of a rewards program becomes imminently clearer – here are four psychological elements to focus on when developing a rewards system to help build a culture that fosters engagement as opposed to motivating short-term gain.


We all want to feel important, we all crave recognition. A reward that supports this objective is one which provides an employee the opportunity to do more meaningful work. This may be a short term management posting or an opportunity to work in a more senior role or another department – the purpose of this reward is to show your employees the further possibilities of their involvement with the company and to reward them with your trust, with the acknowledgement that they are capable and ready to take on more meaningful work, work that accomplishes something of real value


It may seem like nothing, a minor element that you wouldn’t consider significant, but giving employees the choice of how they accomplish a task can provide a significant reward, in the form of trust and responsibility. By acknowledging and empowering employees to choose how they perform their daily tasks, you’re giving them the power to control their fate and to showcase their knowledge and abilities – maybe they can come up with a whole new way to work, something that changes the way things have traditionally been done.


Recognising the achievements of your employees is always significant. It’s important to always reward those who not only achieve, but those who are competent, who are doing all that’s required in an exemplary way. This can be minor – send them an e-mail acknowledging a detail of their work or an element of their output that has helped in the overall scheme of things. Send them an e-card with a note of thanks, recognising that effort. Done too often, it can lose its effect, but it’s important to recognise the role each team member plays and has played in the larger purpose and aim of the business. Too often we get caught up on only addressing employees when something’s gone wrong – it’s up to you, as a manager, to recognise the elements that have gone into achieving team success.


People want to feel that they’re achieving something that they’re getting better and that they’re moving towards the next stage. Recognising progress as it’s being made is valuable, and can further align staff to the greater goals of the business. It’s like in sports – if you’re trying to coach someone to do something new and they try and get no reward for their efforts, they can get disheartened and give up. It’s important that those individual efforts are recognised and encouraged and that the person knows that what they’re doing is for the greater good.

These four elements can play a significant part in aligning employee efforts to the overall purpose and main objectives of the business. And in these times, where we’re more connected than ever, it’s also more important than ever that employees feel attached to their work, that they have a mental association with the ‘why’ of what they do. These days, word of mouth is amplified significantly more than it ever has been, because people are connected to so many others online. Given that, it’s more important than ever that your employees are aligned with your vision. Because they can speak for you, they can advocate for your services. An engaged employee will help spread your message through social networks, making it more important than ever to build that engagement and support your teams.

The best way to do this is to align staff with your purpose, the ‘why’ of your business. And this is done through recognition and inclusion on a wider scale.

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