how businesses can improve productivity

How small businesses can incentivise to increase productivity and improve team performance

Posted on 30th June 2023 by

Effective productivity and performance are vital components for an ambitious business with aspirations for growth to achieve its targets. Incentivising teams can help organisations motivate staff and build high performing teams.

At times when the economy is struggling and sales are more difficult to generate, it is important for internal teams to be effective. This can be difficult to maintain if morale is low and motivation is beginning to wane, which poses a real challenge for managers and business owners.

Everyone is busy in their daily job roles by nature of the everyday demands that their roles ask of them. However, many workers are bogged down by admin and other business as usual tasks. As a result, how many workers are as effective as they could be in their roles?

It is important for your staff to be effective if your business really wants to achieve its growth plans and develop ongoing success.

When people returned to work after the pandemic, working practices changed. Many companies now offer hybrid working and even fully remote roles. Both of these modern working practices have added to the difficulties that managers face when communicating with, and motivating, their teams.

In this blog we look at ways that businesses of all sizes can motivate their staff to increase productivity and improve performance and thus create high performing teams.

high performing team

Why is effective productivity important for small businesses?

Running your own small business can be challenging. Unlike some of the larger competitors in your marketplace, you will likely be doing everything with little backing and limited resources.

That means you need to make every minute of each day count.

In a small business there is no place to hide if you are not effective in your role, regardless of whether you are the business owner or one of the employees. So, it is crucial to make sure you’re working smarter, not harder, which why it is important to streamline your workflows and look for efficiencies in everything you do.


What is a high performing team and why is it important?

Small companies, as defined by s382(2) of the Companies Act (2006), have between 10 and 49 employees on their books, so they too can create effective teams just as medium to large enterprises can.

It can be argued that teams in small businesses must be higher performing and more effective due to a shortage of resources in comparison with larger organisations. However, this can also mean one person has to wear many hats, rather than be a specialist on just one role, which is typically less effective.

While creating a high performing team is important it’s important to remember that every team has the potential for disconnection. This depends highly on how the team is managed.

High performing teams are typically characterised by unity of purpose, strong and consistent communication and great collaboration. However, all these qualities can be at risk if an employee feels their skills are underutilised, or if employees do not feel valued or involved.

Disconnection can also arise if communication is poor, or worse, if over communication in the form of micro-management takes place. As a result of these actions some attitudes within a team can become inconsistent and not meet the required levels to meet objectives.


Why is teamwork so important?

Organisational success is reliant on cohesive teamwork. A group of individual specialists working on a project will always lose out to a diverse, cohesive team.

Individuals have a limited set of skills and a finite knowledge base, no matter how much experience each of them has. Everyone needs the help of others and their unique perspectives to solve difficult problems and to see beyond their own blind spots. It’s the asking for help that is the key difficulty for many people. This issue in itself can be a root cause of ineffectiveness, and it’s up to managers to ensure the working environment allows for people to feel comfortable and supported so they can ask for help without any comeback.

Teamwork can also improve employee relationships and cement deeper levels of respect for each other. Team members can lift each other and hold each other accountable. They can motivate each other, which can make others feel supported.

Working in teams can also provide learning points for both inexperienced and experienced members of staff. An experienced member of staff can as on best practice knowledge to a junior, while a junior who is a digital native can pass on their technical skills to an older member of staff. This type of knowledge sharing can yield great benefits for any business.


Overcoming the obstacles to greater productivity

There are many obstacles to overcome to achieve greater productivity and efficacy from your teams. Fortunately, there have been many methods developed through trial and error that can help to overcome these obstacles.

There are many blockers to overcome to achieve genuine collaborative teamwork, such as:

  • Ineffective leadership – Great leaders empower their team members to make decisions and to ensure they feel involved and valued, they create new leaders in their teams. If staff are siloed, or if they feel disconnected and isolated, they can become demotivated which can have a negative effect on their morale and their output.
  • Micromanagement – Managers who fail to place their trust in their staff can fall into the trap of micro-management. This is not leadership and does not help to create future leaders who are comfortable with responsibility and accountability, it does the opposite and only ever creates followers who wait to be told what to do.
  • Confusion about objectives and timeframes – Make sure you have a very clear plan that has short-term and long-term objectives, and ensure you communicate your plans to your team.
  • Unclear and inconsistent communication – You must ensure you convey your plans clearly to your teams, because you are relying on them to implement your plans for you. Unclear communication can result is missed objectives and a lack of respect for managers.
  • Lack of trust – Trust within teams is crucial for success. Trust is built over time, it is not a given. Lack of trust can stem from poor communication, constant push-back from team members, and in some cases just how people talk to each other. It can also stem from imbalance in the workloads of team members, which can result in important project deadlines being missed, and in-turn mean that business objectives are missed.
  • Conflict – Internal barriers, such as pushbacks on requests and resentment over workload imbalances, can breed conflicts within departments. If senior managers are not able to find amicable resolutions, it can stifle workflows and cause rifts within teams.
  • Unbalanced decision-making responsibilities – Ensure everyone has a voice and that it is heard and their everyone’s suggestions are considered. Staff members can lose motivation if they feel their viewpoints are not considered.
  • Team size – Small teams can be tighter knit than larger teams and work more collaboratively, but they can also be subject to greater workloads which can result in busy staff that are not as effective as they could be and can suffer from mental stresses and even burnout. Finding the right balance of a collaborative team that is not overworked can take time, but should be a priority.
  • Lack of accountability – Assigning responsibility throughout a team can help to nurture leadership and greater accountability. Indeed, Harvey S Firestone Snr, the founder of the Firestone Tire and Rubber Company, is quoted as saying “the growth and development of people is the highest calling of leadership.” (1)

When assigning tasks, managers need to be aware of those in a team that might need more help than others and make themselves available to offer guidance and mentorship.

  • Mismanagement of workflows – Sometimes a project can feel as though it is never going to reach completion. This can be down to losing sight of the project’s main objectives and ‘moving goalposts’. Assigning a project leader can help to provide a clear cut-off point for a project. There are many time management tools that can help, such as Asana, Monday and Trello.
  • Physical and mental separation – Hybrid working models and remote working have provided freedom, but have undoubtedly made things more complex for leaders and business owners. Regular catch-up meetings can help to retain and strengthen the connection between team members, these can be face-to-face or via digital communication channels such as Microsoft Teams.
  • Lack of incentives – Incentivising teams can yield great returns for organisations. The easiest way to incentivise someone is to praise them for their work and their efforts. Simply, pat them on the back regularly and say thanks.

Businesses can offer monetary bonuses, vouchers, paid time off, and team social outings if staff meet and exceed objectives within agreed timescales.

Whatever you do as a leader, don’t stay silent and only focus on negatives in your meetings. Think positive, be positive.


How leaders can motivate staff to maximise productivity and efficiency

There is a fine line between effective leadership that nurtures skills and that empowers staff to develop as responsible leaders, and micro-management that stifles team members and can make staff feel unvalued.

In the new age of working where many employees work to a hybrid model – such as two days in the office and three days at home – managers and business owners need to be increasingly intelligent in the way they can maximise productivity.

Managers will undoubtedly find it easier to manage output when staff all work together in the same location. When your team is working from multiple  different locations, how your staff are motivated can make all the difference between a successful team and one which is falling behind its targets.

The relationship between productivity and employee motivation is well known, what is difficult is knowing how to encourage staff so they are more engaged and so they buy into your business and its plans.

Some key points that can help you keep your team motivated include:

  • Measure performance –Performance measurement should be used as a motivator and a way of helping to keep team members’ focused on primary objectives.

While it is important for leaders to measure employee performance on an ongoing basis, it is crucial for leaders to get that message across so staff do not feel unnecessarily pressured and so any 1 to 1 meetings are an open dialogue.

  • Focus on personal development – In your regular staff catch-ups, highlight how much team members have developed . Instilling confidence in your team can help leaders to set new goals for staff to work towards.
  • Focus on company culture from the outset – If an organisation has a strong culture, then it is important to recruit staff who fit the ethos. If an employee fits the company’s culture, they are more likely to be proactive and motivated and quicker at connecting with their team and their work.

However, it’s vital to remember that one size does not fit all. If an employee’s experience within an organisation has not been pleasant, then they can view the culture as a weapon. Leaders need to reassure employees that the organisation’s culture is for the benefit of the employees, which in-turn will be for the benefit of the customers.

Culture is an ongoing education piece which leaders need to handle with sensitivity.

  • Give staff responsibilities – If staff have to check with management for every task they undertake, it can discourage them and lower their belief in their own abilities.

Leaders should consider assigning tasks across their teams to nurture leadership and build confidence and encourage accountability. Doing this can also help improve workflows and shorten project timescales.


Incentivise and reward your staff

Staff incentives are nothing new, but were historically the reserve of sales teams. In the modern world, incentives and rewards are offered as part of the overall salary and benefits package. Candidates are looking for, and expect, incentives in job descriptions. If a business is not forthcoming about what they are prepared to offer, then they risk missing out on recruiting the best talent available and being resigned to employing mediocrity.

Incentives that candidates look for when they applying for jobs includes:

  • A good employer pension contribution (percentage of salary).
  • Health insurance, which could include eye tests, subsidised lenses and frames, private dental care and health care.
  • Bonus schemes based on set targets.
  • Office perks such as free fruit, subsidised gym memberships, cycle to work scheme, and team social events.

Rewards can also include ad-hoc internal initiatives that could be based around seasonal trends or specific sales campaigns, such as employee of the month or quarterly sales leader.

Rewards of this type typically take the form of a voucher for a popular retailer or restaurant, or even an extra paid day off.

There are many ways in which organisations can motivate their employees, with incentives being just one of many options, but by far the best (and the least expensive) is to simply pat someone on the back and say “thanks and well done” for their efforts. Simply because making your staff feel valued reaps its own rewards in the long-run.


How to identify a leader from a manager

Leaders will go out of their way for their team and will empower their team to become leaders themselves. They talk in terms of “we.”. A manager or boss will tell their team what to do, which only serves to create subservient followers. In the main they talk in terms of “I.”

LeaderVsManager / Boss
Empowers staffTakes advantage of staff
Fixes the problem not the blamePoints the finger of blame
Motivates and encouragesGives orders
Says “We”Says ”I”
Makes themselves available for their team to rely onIntimidates as a form of control
Shows how something is done properlyExpects you to know how it is done
Gives creditTakes credit
Involves team members in planningKeeps plans secret on a need to know basis


Key points to creating a high performing team

  1. Communicate clearly and regularly with your team.
  2. Create and maintain a strong connection between team members.
  3. Measure everything and provide genuine support.
  4. Assign responsibility to create accountability among your team.
  5. Incentivise your team members and reward performance. Remember, even a pat on the back can go a long way towards motivating your staff whilst instilling their trust in you as a business leader.


How can employers protect their teams?

Health and safety should be taken seriously by your organisation, especially for those workers in roles where manual handling is common. This can be achieved by clear and consistent messages and ongoing training.

The two key business insurance policies that protect your business and your employees from injury are employers’ liability insurance and occupational personal accident insurance.

Employers’ liability insurance 

If you have staff, you are responsible for their welfare whilst they are in your employ. What is not always clear to business owners is that you can also be responsible for the welfare of your previous employees. An example could be if an ex-member of staff falls ill because of work they did for you, which results in them making a claim against you, even though they have moved on.

Employers’ liability insurance is one of only two UK insurances that is mandatory by law. If you employ staff, you must carry an EL policy with a minimum of £5 million of cover, as per the Employers’ Liability (Compulsory Insurance) Act 1969. Employers’ liability insurance will cover the cost of defending or settling a claim from an employee who has suffered injury or disease because of the work they have done for you. Cover can include legal costs in defending a claim, medical costs, loss of income, and other related damages.

For each day you do not hold employers’ liability insurance you can be fined up to £2,500. If you do not have an EL insurance certificate that is accessible to view, or if you refuse to make your certificate available to Health and Safety Executive (HSE) inspectors when they ask for it you can be fined up to £1,000.

Occupational personal accident insurance 

Personal accident insurance can provide cover for loss of earnings while a member of your team is unable to work due to a work-related accident or illness caused by their work.

Typically this policy is ideal for self-employed workers in manual roles, but can be added to your business insurance portfolio.

Contact us on 0333 321 1403 to find out how your business could benefit from added occupational personal accident insurance to its portfolio of protection.


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Disclaimer: This article does not constitute advice and is provided for information purposes only. The information should not be relied upon in making, or refraining from making, any decision. You should always seek expert/professional advice, before using any information published by us or if you have any queries or concerns.





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