The Google Cafe Dream
When I was completing my MBA, we constantly studied the cutting-edge, market leading companies such as Google and Goldman Sachs to figure out what they are doing and why it was working. How do they achieve such high levels of staff motivation? I have to admit, when learning about the Google cafeteria with free food, bean-bag enclosures, dynamic teams and incredibly flexible working conditions etc. there was something that stirred in me. Maybe it was because I was used to working with not-for-profits (NFPs) where if you can find a tin of Blend 43 that isn’t completely bricked-solid, it’s a lucky day! (#icepick=teaspoon).
NFPs naturally try to cut costs. Most focus on maintaining staff salaries, but everything around the edges is gradually shrinking. This makes sense on some level – delivering service is the most important thing, right? These organisations are generally spending donor or tax-payer money so the the idea of them ‘wasting’ money is certainly bad. But is something like buying lunch for staff a waste?
Dude, Where My Sandwich?
I learnt recently that an organisation I worked with in the past had decided to stop buying lunch for attendees at quarterly Manager Meeting. These meetings involved line and mid-level managers, who spend a whole day at head office, often travelling 2–4 hours each way.
To pay for lunch or not? A few questions come up: should staff expect lunch? Is it an unnecessary luxury and good chance to save a few hundred dollars per quarter? Or is it a missed opportunity to get some high ROI by creating a natural setting for team-building and peer support? Does a lunch platter motivate performance? What does it say about the organisation’s attitude towards its staff?
The Research on Shouting Staff Lunch
In looking over the research, it turns out that….buying lunch is almost certainly a good idea. Organisations that go ‘above and beyond’ to offer staff favourable conditions do see a significantly positive return on investment for these costs. Favuer, McDonald and Taboada (2017) found that:
“more employee-friendly culture adds value via enhanced employee motivation that encourages employees to become more efficient and to innovate more.”
This effect was particularly strong in settings with high labour-force flexibility (i.e. like the Australian NFP sector with high turnover and relative shortage of staff with management training and skills).
Factors for Efficiency and Innovation
So if you would like more efficient staff performance, higher innovation and higher firm value, what are the ingredients? The types of things that high performing organisations provide fall into three categories:
1. Higher levels of compensation
2. More benefits and training
3. Equal opportunities for advancement
Increasing compensation won’t be easy for a not-for-profit. However, numbers 2 and 3 are definitely doable, and might actually be relatively inexpensive to implement. If you’d like ideas for training options that add value to your workplace, check out our recently updated course list on our Professional Training page.
So next time you wonder if you can afford lunch for the meeting, maybe think again and make the decision more in terms of whether the investment is worth the return? If your single metric is saving a few dollars, It’s likely a false-economy and you’re missing out on a lot more value.
Conclusion
Organisations already spend so much on staff salary, doesn’t it make sense to buy the same staff lunch to increase their efficiency and innovation – particularly if these are the leaders within your organisation?
References
Fauver, L., McDonald, M., & Taboada, A. G. (2017). Does it Pay to Treat Employees Well? International Evidence on the Value of Employee-Friendly Culture.