10 Ways to Boost Company Morale

How to boost and maintain employee morale

If your team’s morale is dipping, it’s time to make some changes. You can implement several strategies to boost and maintain employee morale. Instead of considering these methods as one-time solutions, integrate them into your company culture permanently.

We spoke with business leaders to identify 10 ways to boost and maintain employee morale. Here’s what they advised.

1. Align your employees with your company values.

Although many business owners subscribe to the false notion that employee morale is based on gifts, free food, Ping-Pong tables and happy hours, Rachel Lanham, a fractional CMO who advises early-stage startups, said the most important consideration is ensuring your team fits with your company’s values and goals. Clear communication is the only way to genuinely align your employees with your company’s mission.

“First, you must clearly articulate the company’s mission, vision, values and goals,” Lanham advised. “Then, it’s critical to continually and transparently communicate and reinforce this information while sharing progress (and setbacks) along the way.”

When employees understand and care about your organization’s direction, they are more likely to be invested in its success.

2. Create an open line of communication.

Your company must facilitate and encourage communication. Effective employee communication should be a two-way street. Employees should feel comfortable asking questions, speaking up during meetings and collaborating with managers and colleagues. And leadership should set clear expectations for employees so that all team members know what’s expected of them. 

“Have managers organize one-on-one catchups with each employee to make sure that communication channels remain open for employees to voice out problems they are facing or provide ideas,” suggested Kevin Lee, director at JourneyPure. “Provide managers and employees with guidelines so that employees can discuss private issues without fear of reprisal.”

3. Encourage employee feedback.

Alongside open communication, your company should foster a culture that encourages honest employee feedback and elicits input on how the company could improve. You can do this through one-on-one or companywide meetings and internal employee surveys.

“Organize town halls and meetings to update employees on company strategy and plans and invite them to provide feedback and have a discussion,” advised Edgar Arroyo, president of SJD Taxi. “Getting buy-in from employees can help you gain new ideas and make employees more invested in the company.

4. Build a culture of positive thinking – from the top down.

If you want a positive and encouraging culture, it must start with company leaders. Employees look to leaders to see how to act within a company. If you lead by example, it will create an enjoyable work environment and boost company morale.

“Positive thinking really starts with the top management of a company,” noted Monroe Gang, CEO of Atlantic Partners. “If the CEO’s mentality isn’t positive, then it will trickle down throughout the rest of the tiers within the company. As a leader, it is your responsibility to remain optimistic in the face of adversity, as well as serve as a role model for everyone else in all situations – no matter how challenging or frustrating they may be.”

5. Organize team-building activities.

Positive morale is closely tied to how employees feel about their team members. For this reason, it’s essential to host team-building activities to bring employees closer. If your team works in an office together, you can host team lunches and happy hours. However, organizing events for remote teams can be a little more challenging. Consider hosting virtual happy hours, and encourage employees to have one-on-one video chat meetings.

When it comes to team building, think outside the box or ask your team to suggest activities they’d like to do together. Whether you manage a remote workforce or a traditional, in-office workplace, show employees you care by celebrating birthdays, anniversaries and other important milestones.

6. Create an employee recognition program.

Acknowledge your staff’s exceptional and hard work through an employee recognition program. It can be formal or informal, but it should allow everyone in the company – from entry-level employees to C-suite executives – the opportunity to recognize others’ contributions. Letting employees know their hard work is being noticed and allowing them to acknowledge their teammates can boost morale and improve employee engagement.

“Have a recognition program where managers and other employees can nominate a person to be recognized for their achievements,” Arroyo suggested. “Send emails to thank or recognize employees publicly for good performance. You can also organize celebrations or treat meals for completing an important project milestone.”

7. Give performance-based incentives.

To boost employee morale, Lee suggested creating career growth opportunities for your employees based on their excellent performance. For example, give promotions internally before seeking external hires for senior positions, and provide opportunities for employees to change teams based on their skill sets and interests.

By doing so, you will encourage employees to work hard, develop their skills and achieve career goals. You can also give monetary, performance-based incentives, like employee bonuses and raises, whenever you have the financial means. This will encourage hardworking employees to stick with your company instead of seeking other career opportunities with higher pay.

8. Prioritize employee mental health.

It’s crucial to pay attention to your employees’ mental health, especially if they work long hours or have jam-packed days. Workplace stress is an all-too-common occurrence for many professionals that can adversely impact their mental health. 

Remote employees are not immune to workplace stress just because they’re not in a traditional office setting. Many remote workers have challenges achieving a healthy work-life balance and unplugging from work, which can lead to employee burnout. 

To prevent employees from becoming overwhelmed, companies should be disciplined about boundaries and encourage team members to take time off, even if just for staycations. “Demand that your team blocks time off for vacation, as well as daily time off for lunch … or an afternoon workout,” Lanham advised. “Honoring time off is the highest-impact thing you can do for your team.”

9. Implement a health-and-wellness program.

In addition to mental health, your employees’ physical health is imperative to business success. Many employees with office jobs have a very sedentary workday, especially if they’re working remotely, so it can be helpful to implement a wellness program that gets them up and moving.

“Have a wellness program where your company organizes fitness classes or health education classes for your employees to learn more about improving their physical and mental health,” Lee suggested. “One fun way to improve fitness levels is to give everyone a wearable tracker, like a Fitbit, and have an office competition on who has the highest number of steps.”

10. Encourage employee development.

Employee satisfaction tends to drop when your staff doesn’t see opportunities for professional development. Encourage your employees to take on new responsibilities, and give them time to work on passion projects or development courses.

“A strategy that is oftentimes overlooked is to offer professional development courses so that employees can either build upon their current skill set or learn new knowledge that can help to propel them into an advanced position within the company,” Gang said.

Show employees a clear path for advancing within the organization. When your employees know they can grow professionally within the company, they’re more likely to stay there over the long term.

Importance of employee morale

Employee morale is crucial for multiple reasons. For one, happy employees tend to be more productive and engaged: A 2020 Gallup meta-analysis showed that employees who were engaged in their work increased profitability by 23 percent and productivity by 14 percent while decreasing absenteeism by 81 percent.

Especially as remote work remains common, businesses must pay close attention to the employee experience if they want to attract and retain top talent.

“The rise of remote work means that job-switching costs are much lower for star talent,” Lanham said. “Companies that ignore things like morale, culture and alignment will rapidly lose their edge, particularly in the knowledge economy.”

Effects of low company morale

Many companies have seen a downturn in operations as a result of poor morale among employees. If your business does not take steps to address the issue, you may suffer long-term problems, including:

• Loss of income: The financial effects of low employee morale are staggering. According to Gallup’s 2023 State of the Global Workplace report, poorly engaged or fully disengaged employees lead to $8.8 trillion in productivity loss. This figure is equivalent to 9 percent of global GDP.
• Decreased productivity: Unhappy employees are less likely to perform job duties to the best of their abilities. According to a study by Oxford University’s Saïd Business School, happy employees are 13 percent more productive than their unhappy co-workers.
• Chronic absenteeism: Employees who feel their supervisors don’t appreciate their hard work may miss more days at work.
• Increased conflicts at work: When employee morale is low, disagreements among staff may be more common. Conflicts may also frequently occur between management and employees.
• Higher turnover rates: Human resources costs increase if employees are unhappy working for your company. You will need to invest more money in hiring and training due to increased employee turnover.
• Lack of talent retention: If your company has a poor reputation in the industry, you will have difficulty attracting quality employees.
• Poor brand image: Consumers are less likely to remain loyal to a company that does not treat employees well.

What causes low employee morale?

Here are some reasons employee morale might be low at your company.

Employees sense a lack of communication and trust.

When employees don’t feel like they have open communication and feedback with their managers, it can lead to low morale. For example, maybe they feel they can’t safely ask questions without being ridiculed or reprimanded, or maybe they think company goals aren’t being communicated clearly. Whatever the case, ineffective communication and a lack of feedback can cause employees not to trust company leaders.

Employees are burned out.

Employee burnout is a modern business crisis. It can happen when companies place more importance on productivity than employee well-being. Employees who feel their company doesn’t care about their happiness, long-term professional goals, or company culture are more likely to burn out.

Employees feel like their work is going unnoticed.

Low employee morale can occur when workers feel like their work isn’t being recognized and there is little or no incentive to perform well.

“If there is no performance bonus and employees only receive a fixed pay, employees have no monetary incentive to do well and may seek to do as little work as possible,” Arroyo explained. “Employees who don’t receive recognition after performing well or going the extra mile for the company can lose motivation.”

Employees are overqualified or have no clear career advancement opportunities.

These two issues may be separate or intertwined. For example, if you hire overqualified employees, they will likely get frustrated or bored with their work. That could ultimately cause them to quit, thereby increasing your employee turnover rate. Similarly, low morale can occur when an employee outgrows their position and sees no clear career advancement or professional development opportunities within the company.

Getting your employees emotionally invested

Employees who feel deeply tied to your company and its mission and vision will do better work. That’s even truer if you set up your workplace and company culture so employees feel seen, heard and not overly stressed. This starts with encouraging clear and open communication – especially the philosophy “no question is too stupid to ask” – and continues with employee appreciation and recognition. In short, it’s just about being a kind and good person.

Max Freedman contributed to this article. Source interviews were conducted for a previous version of this article.