Increasing Employee Motivation for Small Business in a Post-Pandemic World

Review of the Literature Methodology

The aim of the study is to identify strategies for increasing employee motivation among Small and Medium Enterprises (SMEs) in a post-pandemic world. This aim is supported by four objectives, which are designed to identify effective leadership styles, reward systems, techniques, and tools for creating a motivating workplace where employees feel engaged and productive. The current body of literature investigating factors influencing employee motivation has highlighted leadership, reward systems and workplace environment as key factors affecting employee motivation. However, before delving into the details of this analysis, it is important to evaluate the theoretical basis for the current investigation.

Theoretical Foundation

The transformational theory of leadership is the main theoretical foundation for the present study. It is selected for review because small businesses are undergoing a significant period of change, which the COVID-19 pandemic has occasioned. The transformational leadership theory focuses on the nature of the relationship between leaders and their followers by promoting practices that foster understanding and good relations between both parties (Wu, Peng and Estay, 2018). The theory of leadership strives to motivate employees to improve their performance by flaming passions of interest that increase productivity in the workplace. Leaders who motivate their employees this way are expected to demonstrate model practices and behaviors that their employees can follow or emulate.

In a transformational leadership context, there are minimal differences between the conduct of a leader and his or her followers. Based on this framework, several scholars have argued for the use of this leadership style in organizations that promote a democratic workplace environment where employer and employee inputs are valued (Wu, Peng and Estay, 2018). This is the present attitude in most organizational setups because the COVID-19 pandemic has demonstrated that the interests of both parties need to be factored in decision-making processes to promote the welfare of workers and uphold an organization’s goals. However, employers have had varying levels of success due to differences in the implementation of this leadership style and differences in workplace environments.

Given that the present study focuses on understanding ways of increasing employee motivation in a post-pandemic society, it is important to understand how the transformational theory of leadership can be used to foster change in the workplace to help employees better adapt to their new workplace dynamics. Relative to this assertion, Farahnak et al. (2020) explored the role of transformational leadership in effecting organizational change management. They reported that attitudes towards change were important determinants of leadership effectiveness – especially when leaders need to come up with innovative strategies for addressing urgent organizational challenges (Farahnak et al., 2020). In this regard, researchers have established a positive relationship between staff attitudes and implementation success in a corporate setting (Yuan and Zhang, 2017). They also suggested that leadership behaviors were more critical to implementing successful policies than the level of innovation achieved.

Subject to the above statement, the transformational leadership theory has emerged as a conduit for fostering good relationships among organizational stakeholders while promoting change at the same time. Relative to this assertion, Weller et al. (2020) highlight the role of transformational leadership in influencing employee actions by pointing out its role in fostering good relations among employees. The researchers also affirm the link between transformational leadership and employee attitudes, with the latter proposed as an effective way of implementing change in an organization (Weller et al., 2020). A different journal article authored by Peng, Liao and Sun (2020) highlights leadership’s role in strengthening employee affective commitment to their employers. It suggests that the relationship between the two concepts is moderated by employee perceptions of their role in organizational development. Peng, Liao and Sun (2020) also opine that workers’ perception of their impact in an organization is influenced by its administrative setup. Therefore, they acknowledge that the motivational attributes of a company are top-down. This statement suggests that organization-specific factors have an impact on leadership effectiveness.

The above-mentioned articles highlight the role of organization-specific factors in implementing change within an organizational setting. However, other researchers have investigated the role of employee-specific factors in realizing the same objective. For example, Groves (2020) and Erdurmazl (2019) explored the role of employee openness in implementing transformational change within an organization and established that resistance to change was influenced by employee-specific factors. The transformational leadership theory plays a moderating role in understanding employee-specific factors’ effects on an organization’s willingness to adopt such changes (Groves, 2020). Its role in motivating employees has also been explored within the context that such leadership practices instill a sense of motivation in employee input (Edelbroek, Peters and Blomme, 2019). For example, the article by Pradhan and Jena (2019) suggests that transformational leadership is useful in breaking the monotony of work, thereby making employees more interested in their work. In this regard, transformational leadership is critical in fostering team growth.

Given its relevance to harnessing factors that are critical in promoting change within an organization, the transformation leadership theory plays a critical role in understanding factors that lead to the success or failure of firms during unpredictable and uncertain times. The COVID-19 pandemic presents such a situation and espouses the need to evaluate motivational factors within this narrow prism of focus. Therefore, issues that affect employee motivation during uncertain periods, such as leadership effectiveness, reward policies, and workplace environment, are conceptualized within this theoretical framework (Ballin, 2020).

Leadership

Leadership plays an important role in influencing employee motivation. Organizations use different leadership styles to achieve this goal. Some of the most commonly mentioned techniques include democratic, autocratic, transformational, and participative leadership styles (Beltrán-Martín and Bou-Llusar, 2018). Depending on the chosen style of leadership, employers choose to exert influence on a person or a group of employees to perform tasks in the manner they wish; different results are likely to suffice (Wu, Peng and Estay, 2018). In this regard, leadership has a direct correlation with employee motivation. Therefore, choosing the right strategy to lead teams in an organization effectively motivates them.

The transactional, behavioral, and trait theories are models for understanding the influence of leadership on employee motivation. They are primarily focused on identifying practices that foster good relations between employers and employees by tweaking aspects of the workplace environment where they interact (Williams and Preston, 2018). In a study authored by Beltrán-Martín and Bou-Llusar (2018), it was established that leadership styles had a significant impact on workplace performance. This view was developed after investigating how leadership factors affected the motivational levels of employees in the workplace. The Abilities, Motivation and Opportunities (AMO) model was introduced to aid in the realization of this objective, with the primary focus of analysis being the availability of employee abilities, motivation, and opportunities for growth as precursors for growth and development. This model assumes a top-down management structure where skills, motivation, and opportunities for career development take center stage in understanding an employee’s motivational levels (Pesch et al., 2017). Results indicate that motivational attributes enhancing one’s skills and opportunities for career growth had the highest impact on motivation (Beltrán-Martín and Bou-Llusar, 2018). Therefore, individualized leadership styles have a more profound impact on motivation compared to group-designed plans.

Leadership training is also one way to boost employee motivation in the workplace. It is linked with improved training opportunities, enhancing leader effectiveness and improving corporate performance (Tafvelin and Stenling, 2021). In this regard, the transfer of leadership training has been associated with improved organizational outcomes in several organizational settings (Tafvelin et al., 2019). Some researchers have delved deeper into this issue by analyzing the context of implementing leadership strategies to determine employees’ perception of a leader and the role it plays in influencing motivation (Ugaddan and Park, 2019; Abasilim, Gberevbie and Osibanjo, 2019). For example, trustful leadership has a more significant role impact on employee motivation compared to untruthful leadership (Men, Qin and Jin, 2021). Similarly, perceptions about organizational justice play a significant role in influencing how effective employers would be at using leadership to enhance motivation.

The character of leaders has also emerged in this analysis as a moderating factor for the impact that leadership has on employee morale. Particularly, responsibility in leadership has been associated with positive motivation outcomes among employees because workers consider employers who take responsibility for their actions to be more trustworthy than those who do not do the same (Lämsä and Keränen, 2020). In the context of this analysis, leaders who are accountable to their subjects are those who demonstrate values of fairness, openness, trust, and care (Ugaddan and Park, 2019). In most firms, these values are espoused in the employer-employee relationship (Williams and Preston, 2018). However, in the context of this analysis, responsible leadership is practiced in various setups based on a firm’s unique circumstances (Lämsä and Keränen, 2020). In certain scenarios, the leader is expected to show the direction to employees; in other contexts, this responsibility is shared (Pesch et al., 2017). The strategy chosen depends on the kind of business or sector a firm operates.

Accountability in leadership draws attention to ethical leadership, which is a new area of leadership management that espouses the promotion of good leadership practices to inspire employees to perform well. Researchers have mentioned the social learning theory in this context of review to examine how ethical leadership behaviors are practiced in the organizational setup (Jin et al., 2019; Osafo, Paros and Yawson, 2021). In this analysis, leaders are often motivated to practice ethical behaviors to set a good example for their juniors to emulate (Kelleher, 2019). The underlying premise of this analysis is that good organizational values stem from ethical leadership (Osafo, Paros and Yawson, 2021). In this environment, leaders and their employees are encouraged to adopt ethical practices as a matter of conviction and not merely to comply with a set of rules or guidelines.

Concerns have arisen about the emergence of leadership styles that undermine employee well-being because ineffective leadership styles have a detrimental impact on employee motivational levels in the same magnitude as effective ones do (Kaltiainen and Hakanen, 2022). Consequently, the need to review job designs and leadership models that employers use to exert control in the workplace has been proposed as a precursor to the implementation of sound leadership practices. Sarmah et al. (2022) say that this analysis has led to new discussions around the resources provided to employees to complete their tasks, the demands imposed on them by their employers to fulfill their contractual agreements, and the effect that such arrangements have on their wellbeing. Relative to these concerns, it was established that leadership styles promoting worker autonomy generated the highest levels of job satisfaction among employees (Sarmah et al., 2022). Comparatively, leadership styles that promoted excess control from the employer-led to exhaustion and unrealistic job demands, which worsened motivation levels among employees.

Leadership traits that promote excessive control of employee conduct have been defined as destructive leadership behaviors. They have also been linked to employee silence due to the high-stress levels it causes them (Wu, Peng and Estay, 2018). Work complexity has been identified as a moderating variable impacting motivation, but employee silence is primarily linked to the avoidance of role conflicts, which also affects workers’ enthusiasm (Frazier and Tupper, 2018). Role ambiguity and job overloads have also been mentioned in this context to cause low levels of job satisfaction (Wang et al., 2022). These findings suggest that organization-specific factors may create leadership challenges if unchecked.

Based on the above assertion, a level of care is required when choosing the best leadership style to adopt in an organization subject to the corporate or institutional setting. For example, in an Indian-based study, schools were mentioned as “emotionally fragile” organizations where the capability of leaders to demonstrate empathy-shared leadership was paramount to achieving high levels of motivation (Roy, 2020). In such settings, leadership has also been highlighted as an important driver of creativity among employees (Donkor, Dongmei and Sekyere, 2021). Indeed, in this framework of review, shared feelings of belongingness are identified as a key driver for innovation and motivation among workers (Kim, Baik and Kim, 2019). Therefore, creativity is an antecedent of positive thinking and high energy that leaders are expected to demonstrate (Lewis, Ricard and Klijn, 2018; Kim, Baik and Kim, 2019). This is another piece of evidence showing that institutional contexts and the nature of business play an important role in determining the effectiveness of leadership approaches in influencing motivation levels.

Rewards Systems

A company’s reward system refers to employees’ benefits for performing a set of tasks or duties. Researchers suggest that rewarding employees help to create strong bonds between employers and workers, thereby boosting motivation (Asseburg and Homberg, 2020). Recent ground-breaking work in this research area suggests that a company’s reward system helps employers to make value-based decisions that affect employee motivation (Verharen, Adan and Vanderschuren, 2020). In other words, value-based decision-making helps to ascertain the cost and benefits of pursuing certain actions at the expense of others. In this setup, employers provide monetary and non-monetary rewards to realize optimum productivity from their workers (Asseburg and Homberg, 2020). Non-monetary rewards may include employee recognition programs, scholarships to further studies, career promotion opportunities, and an improved workplace environment.

The role of rewards in boosting employee performance is responsible for varying levels of performance among different sectors. For example, Asseburg and Homberg (2020) say that public sector organizations have lost their appeal to employees because they do not offer attractive rewards like private sector firms. Zheng et al. (2021), Köbis, Soraperra and Shalvi (2021) support the same finding after identifying significant differences in motivation levels for employees working on the public and private sectors in China. Differences in turnover intention among different groups of workers were also evident in the analysis (Pieper et al., 2019; Zheng et al., 2021). The reason for the varying levels of attractiveness for the two groups of employers has been attributed to perceptual factors relating to an employer’s character (Asseburg and Homberg, 2020). Based on this understanding, the employer knowledge model was introduced to evaluate a firm’s characteristics based on three fundamental issues.

The first relates to how they treat workers and their preferences for the kind of employees they wish to have. The second issue is the employer information aspect, which evaluates varied characteristics of a firm, such as the level of centralization adopted in an organization and the values they espouse in them (Zheng et al., 2021). The third criterion for evaluating an employee’s profile relates to job-specific duties, such as a definition of tasks that need to be completed, the amount of money paid to employees, and the availability of career growth opportunities (Blom et al., 2020). Collectively, these issues are pertinent in understanding the attractiveness of an organization to prospective employees.

Employee characteristics also have an impact on the effect that rewards have on motivation. Particularly, the ages of workers have a direct relationship with the effectiveness of a company’s reward system on employees (Rael, 2017). Consequently, there are increased calls for employers to adopt targeted motivation strategies to achieve high levels of motivation (Alhmoud and Rjoub, 2020). Relative to this analysis, there are two groups of rewards for different generations of workers – extrinsic and intrinsic.

Extrinsic rewards are those that have a tangible benefit to employees. They may include increased pay, expansion of career growth opportunities, promotion opportunities, and the workload allocated to one worker or a team (Alhmoud and Rjoub, 2019). Comparatively, intrinsic factors are those which have a non-monetary value attached (Bouwmans et al., 2019). They may include extra support provided to an employee to complete a task by his or her workers and the meaningfulness of one’s task to their personal or professional lives.

Extrinsic rewards are more effectively used among Generation X workers, while intrinsic rewards are associated with generation Y employees. Comparatively, new studies have tried to explore the best leadership style to use on Millennials who are set to fully dominate the workplace by 2025 (Gabriel, Alcantara and Alvarez, 2020). However, the best leadership style to use for this group of employees is unclear because of changing workplace dynamics and rapid technological changes (Kemp, 2018). These issues have been compounded by the entry of Millennials into the workplace in a relatively short time and their role in overseeing operations that are partly supported by older workers (Gabriel, Alcantara and Alvarez, 2020). Therefore, generational differences play a key role in determining the best leadership style to use in workplaces.

Cultural differences are also other factors affecting employee motivation in the modern workplace. Particularly, values and beliefs affect how well employees perceive or understand motivational strategies adopted in an organization (Management Association, Information Resources, 2018). In a study to understand the impact that extrinsic, intrinsic, and social factors have on employee motivation, it was established that all three of them had a significant impact on employee motivation levels (Manohar et al., 2017; Gabriel, Alcantara and Alvarez, 2020). In the Middle East context, it was observed that social rewards had the highest impact on motivation levels (Alhmoud and Rjoub, 2019). This finding is important in understanding how companies can retain talent and, by extension, improve the productivity of their workers (Bell et al., 2018). Broadly, these findings show that the presence of rewards in an organization increases employees’ motivational rigor. In turn, it increases the subjective benefits available to workers and amplifies differences in performance between two scenarios- when employees are rewarded and when they are not rewarded.

Workplace Environment

The environment where employees work could directly impact their motivation levels in the same manner as rewards do. Herzberg’s Hygiene factor theory is among the most commonly cited models explaining this statement (Zhang, Jinpeng and Khan, 2020). In some pieces of literature, the theory is referred to as the two-factor model, which suggests that the main issues causing employee motivation are not the same ones that cause dissatisfaction (Singh and Bhattacharjee, 2020). Hygiene factors are associated with workplace rules and policies that may have an impact on productivity. The relationship workers have with their supervisors, the administrative styles adopted in their organizations, and the technical supervisory rules they are supposed to comply with are some of the factors that characterize an organization’s “hygiene” (Zhang, Jinpeng and Khan, 2020). It is predicted that employee motivation will decline when these hygiene factors are not fulfilled or are only being partly addressed.

Recently, scholarly attention on workplace environments’ role on employee motivation has shifted from brick and mortar workplace environments to virtual ones. This process has been accelerated by the ongoing digital revolution in the global marketplace and the development of modern communication techniques (Köbis, Soraperra and Shalvi, 2021). Zhang, Jinpeng and Khan (2020) say that social media is perhaps the most impactful force affecting workplace performance in the last decade. It allows workers to share knowledge instantly, leading to motivation fluctuations (Hutchins, 2019). The same researchers have pointed out that the lack of social media could weaken motivation levels in the workplace because employees may not feel inclined to share knowledge if such a platform does not exist (Makrides, Vrontis and Christofi, 2020; Zhang, Jinpeng and Khan, 2020). The impact that social media has on workplace motivation is covert in the sense that it creates a mediating effect promoting self-efficacy. This process could lead to varying levels of motivation in the workplace.

Challenges of Small Businesses in a Pandemic Period

The COVID-19 pandemic is a public health crisis first reported in 2019 in Wuhan, China. Since the World Health Organization (WHO) declared it a pandemic in March 2020, businesses have suffered depleted revenues, as some of them were forced to close down to control infection spread (Kumari and Eguruze, 2022). Researchers have noted a difference in how firms responded to the crisis, with large Multinational Companies (MNCs) having a better experience managing the crisis than their smaller counterparts (Miklian and Hoelscher, 2021). Given that the COVID-19 pandemic is a public health challenge, a significant mental, physical, and psychosocial burden was imposed on employees who had to constantly grapple with the fear of contracting the disease in their normal course of doing their work (Ertel, 2021). In this regard, the COVID-19 pandemic has emerged as an occupational health hazard for most employees.

As part of the measures taken to counter the spread of the COVID-19 pandemic in the workplace, such as social distancing and wearing of masks, employers have forced some of their employees to work from home. This change in the workplace environment has led to significant mental health issues among employees who are not accustomed to staying indoors for long hours (Assefa, 2021) ‘. Others have complained of experiencing a difficult time working from home when their children or family members constantly distract them (Harel, 2021; Assefa, 2021). Collectively, these changes have had a negative impact on motivation levels. Heightened levels of worry or uncertainty about the pandemic and the future of some employment positions have exacerbated these concerns (Vidal et al., 2017).

Given the challenges brought by the COVID-19 pandemic on businesses, employers are having a difficult time keeping their employees engaged. Others are having an equally difficult time retaining their employees because the pandemic has forced people to rethink their career and life decisions.

Methodology

Primary data were collected using questionnaires administered to employees working in the same organization as the researcher. The interviews were semi-structured to provide standardized responses. Interviews were chosen as the most appropriate data collection technique because they can collect reliable data from a small sample of respondents. Furthermore, given that small businesses have few employees, it was not appropriate to undertake a survey because they are associated with the collection of data from a large group of respondents.

Secondary data were obtained from credible websites, industry reports, and government publications. Additional information was obtained from peer-reviewed journals and books because they are reliable sources of data in academic research. The secondary data used in the research were obtained with permission from the authors. The sources of information collected in this manner were published materials from the last five years.

For purposes of data analysis, thematic and coding methods were used to analyze the qualitative findings gathered from the respondents. This technique works by identifying recurring themes from a set of responses. The themes are then coded using a numerical indicator such as “1” or “2” for ease of data analysis. These codes were later used to represent one aspect of the analysis, after which the researcher collectively merged them to produce a holistic set of findings for review. Broadly, the thematic and coding methods were implemented in six stages, with the first one being the familiarization of data. In this stage of the analysis, the researcher reviewed the overall set of findings derived from the investigation without attributing the data to any particular research issue. This action was left to the second stage of the data analysis process, which was the allocation of codes to the relevant themes. These codes were used for reference purposes, and they represented each research issue under investigation. The third stage of the data analysis method involved the generation of themes that emerged from the data collected.

These themes were associated with each four research questions underpinning the investigation. Therefore, they were used to answer various aspects of the research topic. The fourth step of the data analysis process involved a review of the themes to establish their synchronicity with the research objectives. This action led to the fifth stage of data analysis, which was defining and naming themes. As alluded to above, the themes were defined by their contribution toward the realization of the research objectives. This analysis was further coupled with the need to relate the objectives of the study with the research questions underpinning it. The last stage of the data analysis process involved the final write-up of the research findings. In this stage of the data analysis, the themes identified were merged to create a holistic narrative of the research findings. The aim of the research was attained in this stage of the review.

Summary

This section of the study has shown that motivation factors are those that can nurture a sense of satisfaction in the kind of work employees do. They bring a sense of accomplishment to workers and allow them to get recognition or acknowledgment for the work they do. This literature review has indicated that leadership, rewards systems, and workplace environments significantly affect employee levels of communication. However, a gap in the literature exists, which fails to highlight how these issues relate to small businesses or the COVID-19 pandemic. The present study seeks to establish the link with a focus on understanding how workers can be better motivated to improve productivity in a post-pandemic society.

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