Does more pay lead to more performance?

Your team’s satisfaction isn’t driven by pay alone. Challenge, recognition, and sense of achievement keep them motivated. Great leaders get the table stakes right then focus on what truly motivates their people.

As a leader, your team’s motivation can be a powerful force for good. Motivation energises, directs, and sustains behaviour — and drives performance. So, how can you create motivation? Does more pay lead to more performance? And if not, what does? To answer these questions, we begin with a new way to think about motivation at work.

A Theory of Motivation

The traditional view of job motivation goes like this: greater satisfaction leads to greater motivation, which leads to greater performance. If you give people more of what they want, you’ll create the conditions for high performance. More salary, a better relationship with your boss, and more hours working from home should all produce more satisfaction at work. But in practice, something different happens.

You might know people who earn impressive salaries yet struggle to get to work each morning. Conversely, you may know someone who earns modestly yet brims with energy and motivation for their work. If salary — or any number of similar factors — were all that mattered to job satisfaction, we’d have a simple (if expensive) solution for high performance. Instead, our needs at work fall into two categories. The difference between these categories tells us a lot about how to motivate our teams. I’ll label these two groups of factors maintainers and motivators.

Maintainers: The Table Stakes for Motivation

Maintainers satisfy our security needs and keep us from being dissatisfied. Like food and water, we need enough of these to survive. They’re table stakes. However, past a certain point, they have no impact on our condition. Salary, job security, and the relationship with your boss fall into this category. Maintainers are defined by two aspects:

  • You can’t replace them with other factors. A fun work environment is no substitute for a terrible commute.
  • Each factor has a threshold that must be met. Below this point, you are dissatisfied, yet increases beyond the threshold provide only marginal returns to motivation.

Hate your boss? No additional job security will counteract that dissatisfaction. Love the work-from-home policy? That keeps you from being unhappy, but I doubt it’s what gets you excited about work. Nor can this factor be increased indefinitely.

Here are some common maintainers:

  • Your relationship with your manager
  • Work conditions (hours worked, location)
  • Company policies
  • Salary

If you have a good enough boss, work reasonable hours in a convenient location, feel secure in your job, and are paid well compared to your industry, you’re less likely to be dissatisfied at work. You can give all this to your employees. Yet despite this, they may not be motivated. This is where motivators matter.

Motivators: The Drivers of Commitment

Motivators, on the other hand, satisfy our needs for growth and self-actualisation. Unlike maintainers, more is always better when it comes to motivators. These are the intrinsic motivators that make work enjoyable. These are often a sense of achievement, recognition, and the challenge of the work itself. Motivators have these qualities:

  • The more of a motivator you have, the more satisfied you become.
  • Motivators cannot compensate for maintainers.

The top intrinsic motivators, in order of impact on job satisfaction, are as follows:

  • Achievement
  • Recognition
  • Responsibility
  • Challenge
  • Growth

You’ll notice these are more abstract than the maintainers. That’s because motivators address the higher levels of Maslow’s hierarchy of needs. While we all need a certain level of income to survive, the feeling of achievement you get from completing a project is entirely subjective and specific to both the individual and the situation. If you want another way to think about maintainers and motivators, consider the following metaphor.

The Metaphor of a Raft

Picture yourself floating on a raft in the ocean. The frame is built from logs tied together; these logs are your maintainers. When you have a solid enough frame, you don’t notice it; you take it for granted.

You can get by on just a raft. But you’ll float around the ocean, not going anywhere. This is the situation of your compliant but not committed employees — they have no motivation to move. That’s what motivation is: that which energises, directs and sustains behaviour.

For you to be motivated and move through the ocean, you need a sail. This sail is built from intrinsic motivators. Now that you no longer need to worry about the raft beneath your feet, you can focus on achievement, taking greater responsibility, and your growth and advancement. With a bigger sail, you’ll go further and move faster. So it is with motivators — that a greater sense of achievement leads to greater satisfaction.

The Performance Quadrants

What are the practical implications of these maintainers and motivators? Different combinations lead to different levels of motivation and performance from your team. There are four possible behavioural outcomes:

  • Poor maintainers + poor motivators = Attrition
  • Poor maintainers + good motivators = Uncertainty
  • Good maintainers + poor motivators = Compliance
  • Good maintainers + good motivators = Commitment

Attrition results from poor maintainers & poor motivators

When there’s nothing to motivate you and nothing to maintain you, there’s nothing to keep you there. Employees in this environment will be looking for a way out. Focus on satisfying the maintainers first — improve working conditions, build stronger relationships, and pay a fair salary.

Uncertainty results from poor maintainers & good motivators

When the highs are high, but the lows are low, you don’t know what to expect from your team. Without the security of maintainers, they cannot sustain motivation. Spend time on getting the basics right.

Compliance results from good maintainers & poor motivators

The work is stable yet uninspiring. People show up to work, but they’re not motivated to give their all. To produce superior motivation and performance, give your team reasons to love the work itself.

Commitment results from good maintainers & good motivators

When you take care of people, they take care of you. Your team is committed to doing great work. They feel intrinsic motivation to improve, to take ownership, and to do what needs to be done.

The Performance Quadrant: what to expect for each combination of maintainers and motivators.
The Performance Quadrant: What to expect for each combination of maintainers and motivators

Does more pay lead to more performance?

The short answer: No. Salary, like many other factors, is a maintainer rather than a motivator. Provide your team with enough to satisfy their security needs, then focus on intrinsic motivation.

The long answer…

Pay leads to more performance up to a point. An employee who feels they’re unfairly treated or think they can get a better deal elsewhere will be looking for a way out. Yet, while low pay may lead to attrition, high pay doesn’t lead to commitment. To produce sustained motivation, you need to provide the right maintainers and as many motivators as you can find.

1) Diagnose the problem

Are you seeing attrition, uncertainty, commitment, or compliance? Which maintainer hasn’t reached its threshold? Find where you should be spending your time and resources.

2) Get the table stakes right

Focus on maintainers, so your team doesn’t have to. Pay them well, change frustrating policies, and build a good working relationship. Do this well enough to keep those issues off the table. If your employees’ security needs aren’t met, no amount of recognition and growth opportunities will keep them from dissatisfaction. What table stakes do need still need to meet?

3) Provide motivating factors

Motivated employees are higher performing and more satisfied. A sense of achievement is one of the strongest motivators, followed by recognition, then responsibility and the work itself. Wrote Antoine de Saint-Exupéry, “If you want to build a ship, don’t drum up the men to gather wood, divide the work, and give orders. Instead, teach them to yearn for the vast and endless sea.” How you can enrich your team’s roles to provide this intrinsic motivation?

The Bottom Line for pay and performance

Motivation isn’t about giving more of everything, but giving more of what matters. Ensure your team’s security needs are met, then focus on what truly drives them—achievement, recognition, and growth. This is the key to sustained motivation and high performance.