How to motivate employees: 7 strategies for small business owners

In the early days of exploring how to start a business, you’re naturally focused on the practicalities — such as writing your business plan, coming up with a name for your business, and figuring out your small business budget.

Now, as your company stabilises or even expands, you might be considering how to hire employees. Perhaps you’ve already got a team in place and are thinking about how to improve your workplace culture. 

It doesn’t matter what kind of business you run or where you’re at in your hiring journey. When it comes to building a team and running a thriving business, there’s one major key to success: employee motivation.

If your employees are motivated, you’ll almost certainly benefit from:

• A more productive and efficient workplace

• A more positive experience for your customers or clients

• Improved employee retention and financial well-being 

Keep reading to learn more about why employee motivation is so important — and uncover seven practical strategies you can use to motivate your team.

Why employee motivation matters

Motivation is all about the energy and enthusiasm we bring to certain tasks. When we feel motivated, we take a genuine interest in the task at hand. We feel driven to get the job done to a good standard, and we feel accountable for the results.

In a workplace setting, that makes a huge impact. Employee motivation helps to:

• Drive productivity, efficiency, and performance. It’s reported that companies whose employees feel motivated and engaged are 43% more productive. That’s a game-changer for both day-to-day operations management and long-term success.

• Create a positive working environment. When employees feel motivated on an individual level, they inspire engagement and motivation in others, too. This helps to boost company-wide morale and contribute to a collaborative and supportive atmosphere.

• Ensure a positive experience for your customers and clients. If your employees aren’t motivated, your customers will be the first to notice. When it comes to providing good customer service and considering how to improve the customer experience, employee motivation has a critical role to play.

• Boost employee retention. Employees who are motivated and engaged are more likely to stay with your company long-term — which is good news for business performance and your bottom line.

• Achieve financial sustainability and profitability. Motivated employees are essential for achieving your business goals, operating in a way that’s efficient, productive, and cost-effective, and ultimately working towards long-term profitability. 

Those are the benefits of motivated employees. Next, let’s consider how you can boost employee motivation at your company.

How to motivate employees: 7 proven strategies

Whether you’re thinking about how to motivate a team or a single employee, these practical strategies will help you. Here are seven ways to motivate employees in any business. 

1. Involve employees in your vision 

If you want your employees to feel motivated, give them a strong sense of purpose.

Don’t just assign tasks and responsibilities without any context. Connect your employees’ work to your overall vision so they feel engaged, invested, and motivated to contribute to the company’s success.

Perhaps you’ve already gone through the process of how to write a mission statement, outlining your mission, goals, purpose, and values. If that’s the case, make sure you communicate and discuss this vision regularly with your employees.

Outline clear goals and objectives for the short and long-term, encourage collaborative decision-making, and ask for regular employee feedback and ideas.

At the same time, be sure to keep your employees in the loop as your business evolves. If you’re weighing up different business growth strategies, for example, involve your employees in the process and allow them to have a hand in how the company moves forward. 

2. Set meaningful goals

It’s hard to stay motivated if you don’t really understand the point of your work or what you’re supposed to achieve. Without meaningful goals, your employees might feel like they’re just plodding along without really making an impact or achieving anything specific.

To avoid this motivational pitfall, set clear goals and objectives that your employees can work towards. This gives each and every team member a sense of direction — and a highly motivating sense of accomplishment once those goals are met.

Let’s say that one of your overarching business goals for the next quarter is to increase customer acquisition. If you’ve got an employee responsible for sales and marketing, you might set individual goals relating to this broader objective — such as sending a certain number of outreach emails per week, identifying new channels and strategies for how to get clients (such as developing a customer referral program), and securing 15 new client accounts by the end of the quarter.

If your goal is to develop and implement an effective marketing strategy for your small business, you might set individual employee goals that focus on growing your audience and boosting engagement across certain platforms.

By setting specific targets, you encourage your employees to channel their efforts and understand the importance and impact of their work. Now that’s incredibly motivating!

3. Create a pleasant working environment

When thinking about what motivates employees, it’s also useful to consider what demotivates them. A physically uncomfortable workspace, toxic company culture, and an unmanageable workload are just some of the many factors that kill employee motivation — and, even worse, may lead to stress and burnout.

If you want to boost employee motivation, make sure you’re invested in how to create a positive working environment — both physically and mentally.

If you run a brick-and-mortar business, ensure that the workplace is clean, comfortable, well-lit, and inviting. Provide a private, quiet space for employees to take breaks, as well as adequate facilities for drinks and refreshments.

At the same time, think about your workplace culture. Do your employees feel emotionally safe and respected? Are you encouraging open communication and constructive feedback? Does everybody feel welcome to share their ideas and voice their concerns?

Create an environment where your employees feel happy, comfortable, and supported, and you’ll automatically boost morale, engagement, and motivation.

4. Foster learning and development 

One of the most effective ways to motivate employees is to keep things interesting. Don’t let your employees stagnate and get bored — provide them with opportunities to learn, grow, and take on new challenges.

You might hold regular workshops or training sessions in-house, focusing on skills and scenarios that are relevant to your business. If you work in the hospitality sector, for example, you could hold workshops dedicated to topics such as how to deal with difficult clients or advanced barista skills (think latte art and pour-over techniques).

And bear in mind that learning doesn’t always have to take place in a formal or structured capacity; it can (and should) also happen organically as part of your company culture. If you’ve got an employee who’s interested in another area of the business, for example — say, HR or accounting — invite them to shadow you (or another team member) to learn about bookkeeping for small businesses or how to do a payroll.

Employee motivation is just one of the many benefits of training employees. As an employer, you’ll also benefit from a more skilled and adaptable team, increased productivity, and better job performance overall. 

5. Offer recognition and appreciation

78% of employees say they feel more motivated when they regularly receive recognition from their managers. This statistic highlights the importance of celebrating your employees’ achievements and showing appreciation for their work.

There are many ways to build recognition and appreciation into your company culture — and you don’t need to make grand gestures or spend a lot of money. You might start your team meeting by celebrating recent achievements and thanking key contributors, for example, or send a simple thank-you message for a job well done.

For bigger milestones such as completing a long-term project or winning an exciting new client, consider treating your employees to something special — like a team dinner or a small gift.

Ultimately, when you show your employees that you value them and appreciate the work they do, they’ll feel even more motivated to continue performing well.

6. Lead with trust, encourage autonomy 

A whopping 92% of employees cite trust in leadership as an important factor for workplace motivation. But trust is a two-way street — if you want your employees to trust you, you also have to trust them.

There’s nothing more demoralising than being micromanaged, or feeling like you can’t be trusted to make decisions and get the job done. The same goes for your employees: if you’re constantly watching over their shoulder or require them to run every decision by you first, you’ll soon find yourself with a very demotivated team.

Trust your employees to take ownership of their work and make their own judgement calls. Provide guidance and support where necessary, but don’t try to manage or oversee every last detail.

The more freedom and autonomy you give your employees, the more confident, competent, and motivated they’ll be. 

7. Empower your employees to succeed 

Even the most intrinsically motivated, driven, and engaged employees will struggle to remain so if you don’t give them the tools and resources they need to succeed.

If you want to keep employee motivation high, set your people up with everything they need to get the job done. This includes any necessary training and onboarding, as well as access to relevant tools, equipment, and technology.

Take the example of running a busy café or restaurant. As part of their job, your employees must process dozens of customer payments each day. Now imagine how frustrating and demotivating it would be if they regularly had to grapple with the card machine not working, or if they didn’t have portable card machines and had to ask each and every customer to queue at the till after their meal.

Those seemingly minor inconveniences and frustrations throughout the working day can actually have a major impact on employee motivation — so don’t let them slide. Set your employees up for success and empower them to do their jobs with as few obstacles as possible.

What to do if you notice that employee motivation is low

If employee motivation seems to be lacking, try to address it as soon as possible. You don’t want frustration, low morale, and disengagement to build to the point of no return. Here’s what you can do to get things back on track:

Open a dialogue 

You might have your own suspicions as to why employee motivation is low, but you won’t know for sure unless you discuss it directly. Open a dialogue with your employees, ideally on a one-to-one basis, and seek to understand their frustrations, concerns, and challenges. 

If you’re worried that people will be reluctant to openly voice their concerns, consider running an anonymous poll or survey. This is especially relevant if you’re looking at how to motivate a team (rather than an individual employee). 

Recognise that motivation can be highly personal — a one-size-fits-all approach may not work

Motivational drivers can vary significantly from one person to the next, depending on their individual values, needs, goals, and circumstances. What drives and energises one employee might not make much difference to another.

As an employer, it’s important to recognise this diversity within your team. Make an effort to get to know your employees on an individual level and understand what factors impact their motivation. This will help you to identify the root causes of low motivation and determine the most effective strategies. 

Take swift action

Gathering feedback and understanding your employees’ perspectives is just the first step. Now imagine how your employees will feel if you simply sit on that feedback and don’t do anything about it. 

Once you’ve identified the root cause, take prompt and meaningful action. Work collaboratively with your employees to come up with effective solutions and implement them as soon as possible. 

This should not only help to quickly eliminate any unnecessary frustrations or barriers; it will also send an important message to your employees that you care about their happiness and well-being. That in itself has a positive impact on employee motivation. 

Key takeaways and next steps

Keeping your employees motivated and engaged is integral to your success. Once you’ve achieved your initial goal of becoming your own boss, you must consider how to become an effective leader for your staff. This includes:

• Involving them in your company vision so they feel connected to the bigger picture

• Setting meaningful goals and celebrating achievements

• Creating a pleasant workplace that’s both physically comfortable and psychologically safe 

• Providing opportunities for your employees to learn and grow

• Trusting your employees to work autonomously; providing support and guidance without micromanaging

• Empowering your employees to succeed by giving them all the tools and resources necessary to do their job 

Whether you’re focusing on online business ideas, a brick-and-mortar venture, or exploring business opportunities in the creative industry: boosting and sustaining employee motivation will help you work more productively and efficiently, provide a better experience for your customers and clients, and set you up for sustainable success. 

Next steps 

We’ve explored why employee motivation is so important, and shared some strategies you can use to motivate your employees. So what next?

• Identify key areas for improvement: Looking back at the strategies we’ve covered, pinpoint those where you see the most potential for improvement within your business. Perhaps recognition and appreciation weren’t on your radar, for example, and you want to start there — or maybe you can already identify some areas for improvement within your physical workspace. Focus first and foremost on what makes sense for your business and your team.

• Check in with your employees regularly: Keeping your employees motivated requires ongoing communication and understanding. Try to check in with your employees regularly to hear their needs and concerns — be it through informal one-to-ones or periodic team surveys. This will enable you to keep a read on motivation levels and quickly address any issues.

• Treat employee motivation as an ongoing endeavour: Bear in mind that employee motivation isn’t a one-time fix. Your employees might be highly motivated and engaged right now, but don’t assume it’ll stay that way indefinitely. Keep employee motivation on your radar and seek to nurture it continuously.