The essential Four of a great place to work

How are companies doing with regard to building great and motivating places to work? Overall, not so good. According to a 2016 Gallup survey, only 32% of U.S. employees feel “engaged” with their employer [1]. Only 4% of the companies participating in the same study considered themselves very good at engaging young talents from the age group of “Millennials”. Research has developed a pretty good understanding of what motivates us at work. It’s time to spread the word about the essential ingredients of a great place to work.

In this article I draw on key theories [2] and studies from the work design literature [4, 5, 6, 7, 8] to present a framework that I use (almost) daily to think about questions like How can we design a motivating company culture?, Is our new performance feedback system capturing the essence of what drives us?, or Would a particular job applicant’s expectations fit to the way we nurture the essential four ingredients at our company?. I call them “the essential Four” because they are in some way the essence of what is scientifically backed up and, at the same time, easy enough to include in my daily routines.

The essential Four

To be upfront, research on human motivation is anything but new. One core pillar is the very popular “Self-Determination Theory” (SDT) that is based on close to 50 years of research. Edward Deci first published the founding idea of SDT in his 1971 study on intrinsic motivation [2]. Exactly 40 years later, Daniel H. Pink published “Drive” [3] and made the terms Autonomy, Mastery, and Purpose popular. “Drive” didn’t focus on individuals within organizations and fails to talk about the importance of creating a sense of belonging. Yet, a lot of what Pink describes aligns well with SDT the essential Four.

According to SDT, autonomy, competence, and belonging are three basic needs that have to be satisfied to allow for intrinsic motivation. However, even if these needs are fulfilled, individuals will only be engaged at work if they see alignment between their personal purpose for life and the vision that their employer is pursuing [6]. We have to experience meaning and see purpose in what we do to really thrive. When our needs for autonomy, competence, and belonging are satisfied, purpose is the ultimate motivation booster (what science calls a mediator). So with that we have all the elements of the idea of the essential Four: Autonomy, Competence, Belonging, and Purpose

Purpose

Experiencing meaning at work and having a feeling of purpose is the ultimate motivation booster. Although not one of the three basic needs to experience intrinsic motivation, purpose is deeply rooted in the research of empowerment in the workplace [6]. We can have all the autonomy we want, experience mastery in what we do, and feel at home among our peers. Yet if we miss meaning in what we do daily, our motivation will be short-lived. Ultimately, to be motivated and to experience a great place to work, we want to feel a strong alignment between our own values, beliefs, and behaviors with the tasks our job demands. As the research [7, 8] that Pink quotes told us: Once you get paid enough and money stops being a source of motivation, working on something meaningful becomes far more important than perks or a great office.

To portray purpose, companies need to be extremely good a communicating their vision or mission. Here, smaller companies, like startups, tend to have an advantage. They often start with the goal of creating something new. Bold mission statements can become strong talent magnets if the companies manage to substantiate their claims. In another article, I wrote about the strong effects of firms’ vision on their attractiveness as employers. In his book “Good to Great”, Jim Collins does an excellent job of describing how some companies are successful on the long run because they manage to follow a strong core purpose. Companies often may have a hard time changing the purpose of their operations to make it more meaningful. But in a lot of cases, clearly communicating the purpose of the organization will already help employees to see whether and how their own values and beliefs align with the company and to experience meaning at work. Whether you go as extreme as only hiring employees whose own life goals fit to the company’s purpose (as described in the book “The Big Five for Life” by John Strelecky) or not, ensuring that employees are on board with the company’s vision is a good starting point for creating a great place to work.

Autonomy

We all have an urge to be in control of our own life. For some of us this urge is more elaborated than for others. But, generally, we want to be in the driver seat steering where we go. So, ideally, what we do in our jobs, the way we behave and act daily should be in harmony with how we would like to see ourselves. As example, let’s compare your level of autonomy within in a company to your own dedicated “playground” within a huge park. Once you are assigned your area, you would like to dictate the rules of the game happening on your playground. Most likely your rules will follow some form that is commonly accepted. Let’s say you are hired to organize a soccer tournament, there’s a pretty fixed set of rules that people usually follow during game play. But it would be up to you when the tournament is happening, how the jerseys are designed, or how many teams participate. Depending on your experience, you would ask others for help in organizing the tournament. If the park manager decides to micromanage you with strict rules, you would start to be annoyed.

Employees’ autonomy within companies works similarly. The majority of us do not like to be micromanaged for example. We like to understand the goal of what we are trying to achieve but want to determine the way to reach it ourselves. We want our team manager to tell us that the goal is to cross the river, but want to find the best way to cross the river ourselves within our team. In agile teams, for example, the responsibility of a product owner would be, among others things, to draw a clear vision of where the team should go, but then leave it up to the team to find a way to make this vision happen.

From over 250 scientific studies with way over 200,000 participants in total we know that autonomy highly correlates with a number of motivational factors at work [4]. For example, experiencing meaning in the work we do (i.e., purpose) as well as our job satisfaction are highly related to our experienced level of autonomy. Higher levels of autonomy correlate with lower burn-out risk and lower stress levels. There is also a clear link between our autonomy at work and involvement in the job that we do.

Good leaders understand the level of autonomy that each individual employee needs to be motivated at work. Some need more support, others need less. There are frameworks (e.g., Objectives and Key Results, short OKRs) that help companies to set goals that are aligned across the company and that come with ways to measure whether teams are on the right track. Fundamentally, however, they usually share the same principle: Define a clear goal or vision and then give the individual employee the support and freedom to give her/his best shot at trying to make it happen.

Competence

According to SDT, a second essential ingredient for intrinsic motivation is experiencing mastery of something. We all crave for feedback on our performance. Research tells us that feedback on our job and our job satisfaction are highly correlated [4]. Knowing whether something we worked on is considered great work or needs improvement is fundamental to advancing our personal and professional skill set. At the same time, we are also motivated by tasks that let us make use of something that we consider ourselves good at. Feeling competent at completing a task and knowing that others value our skills is a powerful source of motivation.

We often link an individual’s need for continuous growth, learning and mastery to career advancement. It makes sense at first glance: When you climb up the corporate ladder you continue to learn new skills. However, does career advancement really always lead to the mastery of new skills? Do we also continue to learn when we are promoted? And, most importantly, does career advancement really help us to feel competent?

Our need for competence and learning is not automatically fulfilled by being promoted to a new position. Companies have to make sure that every employee progresses along her/ his personal learning path. Personal development OKRs, for example, are a meaningful way to ensure continuous learning on a short term. On a longer term, companies are well-advised to established different career paths, such as having dedicated leadership and expert tracks. Fostering a culture of continuous feedback by peers and superiors, both as part of a formal performance evaluation process as well as given informally during coffee breaks, is key to fulfilling employees’ need for competence.

Belonging

Being surrounded by people that we love to work with and enjoy spending time with is a third important ingredient of motivation at the work place. Creating a sense of belonging among colleagues is essential. Without a sense of belonging we lack the trust required to give honest and open feedback. Without feedback, we lack a feeling of learning and mastery. Without a sense of belonging, autonomy creates loneliness. Yes, since Dan Pink, most of us have heard of Autonomy, Competence and Purpose. But belonging is what makes us to go to work every day: There is enough sound scientific evidence that to say that support by peers and interpersonal interaction are important predictors of motivation and performance [5]. Sure, every company has some form of a company culture. Often, it simply evolves. We take it for granted without thinking about it while in fact we should.

Forging a strong company culture is an art. It is not built based on perks or company retreats (but they can help). A great culture requires building a team of individuals that like to spend time together because they share a common set of values. A good start is knowing that your peers embark on the same, unknown journey and all aim to reach the same (company) vision. Paying really close attention to “person-organization fit” during recruiting and being absolutely strict about “in case of doubt, no hire” are key to creating a strong sense of belonging. Peers interviews and independent (founder) interviews that evaluate potential hires against a defined set of company values and operating principles are some of the proven methods to ensure a culture fit during the recruiting phase. Once people are on board, it is essential to measure their behavior against a defined set of company values and to be absolutely rigorous about employees that do not fit. A professional performance evaluation and feedback system can help to ensure a striving organization without organizational “slack”.

Make the “essential Four” part of your daily routine

So what do you think? Do the essential Four resonate with what you experience every day? What I personally love most about these four essential ingredients of a great place to work is that they can easily be incorporated in your daily (working) life. Over the years, I started to ask myself questions like “does my current job rank high in all of the four criteria?”. I started to evaluate the leadership styles of the people that I work with. I started to challenge myself with regards to my ability to portray purpose in what we are doing as a team at work. I started to give feedback on these four categories. But what I enjoy most is thinking of new ways to foster any of the four aspects the companies I work with. If this article inspired you or you were able to relate some of the things you do to improve the working life at your company to this article, I would love to hear your ideas.

Part of “Scientific thoughts about company development”
This article is part of a series of articles that express some of my thoughts on a variety of topics in the realm of company development. Since my background is in academia at the intersection of entrepreneurship, organization, and psychology, I back things up with scientific findings where ever they are available.

In case you missed it, check out my other work, such as “Small, but attractive — What attracts talent to startups?”

Sources:
[1] Gallup, How Millennials Want to Work and Live, November 2016
[2] Deci, E. L. (1971). “Effects of externally mediated rewards on intrinsic motivation”. Journal of Personality and Social Psychology. 18: 105–115.
[3] Pink, D. H. (2011). Drive: The surprising truth about what motivates us. Penguin.
[4] Humphrey, S. E., Nahrgang, J. D., & Morgeson, F. P. (2007). Integrating motivational, social, and contextual work design features: a meta-analytic summary and theoretical extension of the work design literature. Journal of Applied Psychology, 92(5), 1332.
[5] Grant, A. M., & Parker, S. K. (2009). Redesigning work design theories: the rise of relational and proactive perspectives. Academy of Management Annals, 3(1), 317–375.
[6] Spreitzer, G. M. (1995). Psychological empowerment in the workplace: Dimensions, measurement, and validation. Academy of Management Journal, 38(5), 1442–1465.
[7] Deci, E. L., Koestner, R., & Ryan, R. M. (2001). Extrinsic rewards and intrinsic motivation in education: Reconsidered once again. Review of educational research, 71(1), 1–27.
[8] Amabile, T. M. (1996). Creativity in context: Update to the social psychology of creativity. Hachette UK.