Morale the Tangible Intangible

Morale is tangible and intangible at the same time. A development team with high morale has tangibly higher productivity than a team with low morale. None of the team members on the high or low morale teams have a little indicator of their morale. Sometimes it is evident and other times it isn’t.

Many companies try to raise and maintain morale through food and environment. I personally agree with this approach.

Google has good food available for every employee for free and perks like personal development projects. What is the ROI (return on investment) for this? Its a very intangible thing. A manager or accountant couldn’t say that a product shipped because of the food the programmers received.

I have personally seen the decline of morale due to pulling food and perks. A new boss came into a previous company and saw the food and perks and the amount of money spent on them. In his mind, there was no way to tangibly equate the amount of money spent with the improvements in the product or morale. He stopped all of them at once. The morale suffered greatly and never went back to its previous state. As a result, the product suffered.

There is some scientific theory to this. Our brains have a very funky risk/reward calculation. An example is Harrah’s casino. They would give a gambler “free” money after they lost a certain amount of money to prevent them from focusing on gambling’s risks and their personal losses. The person had just lost $200 at a slot machine. A Harrah’s person gives them $10 of “free” money. The personal net loss was $190, but the woman’s perception was that she got “free” money and she is happy.

I think morale and perks operate the same way. The company receives more work and more productivity from a happy worker. The company gives $20 of perks and receives $200 in labor. The employee focuses on the $20 in perks, not the extra labor.

As always, these are my opinions and not necessarily those of my employer.