The staff motivator that works better than money for Australia’s fastest growing SMEs

Category: Case Studies

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A study of Australia’s fastest-growing companies has found that an environment in which staff want to learn and apply new knowledge creatively is a critical ingredient for growth.

The study, conducted at RMIT’s School of Management, quizzed 253 companies that have achieved growth of 35% to 600% over the last four years. Lead investigator, Dr Carol Tan said the companies involved in the study included Aussie Farmers Direct and Pie Face

“Fast-growth SMEs are the high-power engines of our economy, comprising only 3 to 10 per cent of firms but generating up to 90 per cent of employment growth,” Dr Tan said.

Pie Face is one of the businesses RMIT studied

The importance of what Dr Tan called “learning orientation” emerged from the study, as many of the fastest growing companies studied had created an environment in which staff are committed to constant learning.

“These businesses know knowledge is power,” Dr Tan said. “It has always been said that learning is the only source of competitive advantage. You can learn from competitors, suppliers, anyone in industry.” Businesses that recognise this empower staff to learn, both formally and from trial and error. Teams are encouraged to learn from members’ efforts, so failures become as learning experiences not negatives deserving of censure.

Dr Tan said the study “Also found that rewards associated with performance do not make employees more market oriented or customer oriented. Money can’t buy creativity.” Willingness to learn, however, can achieve those outcomes because staff who want to learn will pick up the knowledge they need to understand the market and will ensure they have – or seek out – the knowledge to satisfy customers.

Tactics Dr Tan has observed which businesses use to create learning orientation include open question and answer sessions among staff, or adoption of social networking tools like Yammer to encourage collaboration. Physical environment is also important, Dr Tan said, as a pleasant one will stimulate staff to higher efforts.


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