German Approach

Although compensation (Gehalt) is important to Germans, it is only one of several factors which motivate them. Nor is it the most important. Germans simply want to be compensated fairly.


American Approach

Compensation, literally money earned at the end of the month, is by far the most important factor which motivates Americans to work hard, meet goals, and improve.


German View

Americans often come across to Germans as too money-oriented, even greedy. American capitalism has a negative reputation in Germany. The gap between rich and poor is considered to be obscene. “Americans only care about money.”

American View

Americans are surprised by how moderate salaries are in Germany. Top performers don’t earn all that much more than mediocre ones. And weak performers are carried along by everyone else.

Advice to Germans

The good life in the United States is expensive. And Americans tend to have more children than Germans. The U.S. economy goes up and down then up again, and so on. Americans are very conscious of the necessity to earn as much as they can as soon as they can.

If you want to motivate your American team-members to perform at a high level, be prepared to pay them well. Especially the top performers.

Advice to Americans

German compensation can come across as collectivistic. Germans are more collectivists than individualists, certainly in comparison to Americans. As a society they have created other forms of compensation: public safety, free parks and recreation, low-cost cultural institutions, affordable health insurance, generous vacation time.

If you want to motivate your Germans team-members to perform at a high level, don’t focus exclusively on monetary compensation. In fact, be careful of allowing for large gaps between levels of compensation. They could threaten internal cohesion.