Why the profit motive demotivates employees

And if decisions are made not so much on their moral worth but on their potential return on investment, once again it’s fair to conclude it’s a business where profits are the name of the game.

A dilemma that emerges with such a narrow approach is that “policies designed to maximise profits both through cutting costs and increasing revenue impact the experiences of employees whose behaviour is dictated by them”.

That’s the finding of a series of studies published in the Journal of Business Ethics. The research was led by Professor Bidhan Parmar from the University of Virginia. He and his team make the case there’s inherent value – in terms of staff motivation – when businesses are run in a way that benefits all stakeholders, not just shareholders. Some of the scholars’ examples, though, merit questioning.

One of those is Walmart which has as its purpose “to help people save money and live better”, and yet in recent days the mega-corporation has been terminating the employment of 1000 workers, many of whom have a disability and will now struggle to, as per Walmart’s mission, save money and live better.

Google falls short when it comes to tax.

Google falls short when it comes to tax. Credit:Andrew Kelly

Another example given is Google with its objective to “categorise the world’s information”, and yet when it comes to the adequate categorisation of its own taxes, it falls grossly short – in fact, so short it’s paying more in the category of fines than in the category of taxes, at least in the European Union.

Those examples raise the question of authenticity. It’s one thing to develop people-friendly mission statements and world-changing visions; it’s another to genuinely live by those values. The disconnect between the two risks raising employee and consumer cynicism.

In any case, the researchers conducted a total of five studies. In the first, 113 participants were presented with two corporate messages: one that concentrated on stakeholder satisfaction and one on what we could perhaps call shareholder satiation. Staff motivation was found to be between 17 and 33 per cent greater when the corporate message deprioritised profits.


The second study comprised more than 200 employees who’d been employed for at least a year. They were asked to declare whether they believed their organisation “values profits above all else” and whether they “need to focus on increasing profits” to perform their job effectively. The results were similar to those in Study 1 whereby answering in the affirmative greatly diminished staff motivation.

For the third study, almost 300 people were surveyed, for the fourth there were 224, and for the fifth there were 100. Variations of the same research methods were conducted, each time generating near identical results. It’s hard for the conclusions to be any clearer. In the words of the scholars:

“Our results show that language highlighting a focus on profits dehumanises business, decreases self-determination, and could (as a result) foster weakened marketplace performance.”

That’s not to say profit isn’t important – it definitely is – just not at the expense of people.

Follow James Adonis on Twitter.

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Источник: Theage.com.au

Источник: Corruptioner.life


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