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How (and why) to improve employee morale at your company

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Drew Millington

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7 minute read

Everyone from executives to managers to HR needs to get a handle on employee loyalty, satisfaction and morale. Is your workforce committed to the organization and are they content with the way of things? Companies have to make sure that morale is high among the workers, as it is a precondition for increased productivity, quality and customer service.

Although compensation and benefits are crucial, increasing employee satisfaction is not all about offering elaborate gestures or expensive incentives, it’s about understanding what motivates employees and how to create the right conditions for success. An employee morale program is one of the best ways to boost satisfaction and loyalty at your company. According to the Workplace Foundation Institute, employee morale programs increase revenue by $2400/year per employee. In this article, we’re going to look at the consequences of poor morale and the building blocks of high morale.


Consequences of poor morale


Employees with low morale significantly impact the company; they are disengaged, less collaborative, show increased absenteeism, and are more likely to turnover. All of these issues greatly impact the bottom line of your company.

Although it can be difficult to measure how engaged an employee might be, Business2Community determined that organizations with high engagement outperform those with low employee engagement by 202%.

Absenteeism is more measurable in terms of cost and according to "Absenteeism: The Bottom-Line Killer", a study published by the workforce solution company Circadian, unplanned absenteeism costs U.S. employers approximately $3,600 per year for each hourly worker and $2,650 per year for salaried employees. Worse yet, attrition can be very costly. For each employee lost, the cost to the company could be 50%–250% of his/her annual salary according to the Society of Human Resource Management. The financial impact of low morale can’t be ignored.


How to improve employee morale at your company


Building trust takes time, and it’s not something that can be done overnight. Offices should ensure leaders approach their roles with integrity and consistency. You wouldn’t want your manager to be unpredictable all the time, even if they are easy to get along with. A Harvard Business Review survey showed that 58% or people say they trust strangers more than their own boss. Shocking, eh?

The way companies and its leaders address problems will set the tone for building trusting relationships. Company leaders should be inspiring to their teams, and they should do so in a consistent manner.

Hosting round table discussions or “open houses” where employees are encouraged to ask questions of their management about anything from new company initiatives, ideas for work perks, or even issues they might be experiencing that aren’t directly covered by HR.

Implement company-wide memos about upcoming changes or decisions that a company may be making. Even if employees aren’t involved in the decision-making process, letting them in on what lies ahead can have a profound effect on their respect for the business.


Communicate openly and honestly


Communication is critical to ensuring the success of any organized group of people. When offices communicate consistently and honestly, it makes employees feel more valued, involved and secure, which ultimately leads to higher employee morale. When teams fail to communicate effectively, the results are detrimental to the business. In fact, research by US firm Gartner shows a whopping 70% of business mistakes are due to poor communication. Letting employees know they can communicate with you openly will allow them to feel valued and that they have a voice in the company.

Communication tactics
1. A suggestion box, or anonymous monthly survey, where inquiries are publicly addressed will make employees more forthcoming about their honest opinions. It will also foster a feeling that their voices are being heard by the brass, even if they are a little shy themselves.

2. Implementing an office messaging service such as Slack or Chanty, will improve team performance on tasks and allow them to make closer connections to each other and with management.


Seek Involvement


Involving employees in planning and decision-making helps keep them motivated and obtains their latent approval so that they can follow through on the outcomes they have helped create. Achieving employee involvement can be done by asking employees for ideas, suggestions, and including employees in discussions regarding specific areas of work and the company. A Salesforce study found that employees who feel their voice is heard at work are 4.6 times more likely to feel empowered to perform their best work.

When employee involvement isn’t possible, establish employee buy-in. You can do this by openly and honestly communicating to them the reasons for the decision and how it will impact them. Making sure employees feel involved and that their consent is considered will allow them to feel motivated and more engaged with the company and its goals.

Involvement tactics
1. If your company utilizes social media, then consider adding photos and activities of your employees to show you are proud of their inclusion.

2. Adding a team page on your website that they can submit a photo and a brief bio will build that sense of community that they can show off to their peers.


Provide Growth Opportunities


Maslow’s Hierarchy of needs says all human beings have a need for growth and self-actualization. In fact, when individuals look for job opportunities, the ability to grow and move within a company is a significant driving force. In short, to ensure employee morale is high, companies must provide its employees with the opportunity for vertical growth and development. As one of the top three non-financial motivators, 76% of employees want opportunities for career growth.

Growth Tactics
1. Reach out to other professionals in your city and organize mentorships or other learning opportunities for employees to improve their skills.

2. Start by making internal hiring a priority at your office. You can also make a company-wide announcement that vertical growth is now a part of your business strategy so that employees think about their tenure in the long-term.


Celebrate Success


Recognizing hard work and success is one of the most effective ways of motivating and keeping employees engaged and excited to improve.

When employees are rewarded for their hard work, it helps reassure them that their efforts do not go unnoticed and that the company appreciates their work. When employees are working on long projects or assignments, review their progress regularly and provide praise or positive feedback during the interim. Celebrate milestones along with some day-to-day accomplishments. According to the OC Tanner Learning Group, 79% of employees who quit their jobs cite a lack of appreciation as a key reason for leaving.

Celebratory success tactics
1. Recognizing good work and providing rewards does not have to be expensive. Rewards can be as little as a public shout-out, office snacks, or gift cards. These can go a long way in motivating employees to go that extra mile.

2. For larger successes, consider providing extra vacation days, concert or sports tickets, or sending them to a conference to learn related skills (expenses-paid), to show that their successes and the company’s are one and the same.



Employee morale has vast implications for the success of a company and its ability to reach its goals and objectives. Ensuring employees are motivated, have good job satisfaction, and are empowered in their workplace should be the center-point in every company’s corporate culture.

As we have seen, fostering high employee morale is a continuous task, and companies must create the right conditions and culture for employee morale to flourish. It requires care and attention from workplace leaders who can provide employees with the right tools to succeed.

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Drew Millington
Drew is one of Humi's Co-Founders and loves to spend time reading about HR, people, and strategy.


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