How to Motivate Software Engineers: What is Going on in 2023

Although businesses have generally increased their pay rates over the past year, a majority of organizations still need help to recruit and retain employees. IT-driven startups now have to rethink their ways of motivating software development teams, especially if they will forge long-term relationships with meaningful gains.

happy developer

But which benefits programs or compensation plans can you leverage to motivate developer team models and increase job satisfaction? What does it take to praise your team members and make them productive throughout their stay? Check out our new guide and learn how to motivate software engineers in 2023 and beyond.

How to Define Bonuses Amount for Motivating Developers in Your Team

A well-thought bonus plan can help you express gratitude and keep your dev team engaged in the work at hand. Organizations can design various bonus strategies for incentivizing employees, including milestone, project, or hourly bonuses.

However, what motivates a developer team when it comes to bonuses? How to manage remote developers? How do you define the rewards system? Here are some factors to consider.

Additional Value Added to the Teamwork

Some team members may impress you more than their colleagues because they go the extra mile to ensure that certain goals are achieved. Or, their effort was extraordinary in making a particular milestone a success. In that case, you can reward these developers with spot bonuses.

As the name suggests, spot bonuses are awarded “on the spot” and are an excellent way of fostering a culture of self-drive and excellence. Moreover, this bonus motivates developers because it creates more earning opportunities than a one-time annual bonus.


Bonuses based on salary can also come in handy when motivating developers, given that they are extra pay on top of regular earnings. In addition, salary-based bonuses are ideal when rewarding every team involved in your project for achieving certain goals or surpassing your expectations.

However, a bonus structure based on salary should be equal across the board, especially if you’re going to achieve your goal of motivating the team. For instance, a 10% bonus rate means every team member will take home 10% of their salary in extra earnings. If a developer earns $3,000, the bonus will be $300.

The Type of Project at Hand

You can motivate and manage developers based on the type of project that they are handling at a given time. For instance, projects requiring developers to vest their emotional and psychological creativity, such as product designing, can feature bonuses at select milestone achievements.

The idea is that this approach will encourage developers to push their skills and power of imagination beyond limits with unique ideas or designs ever seen before.


Motivation for software developers can also be based on bonuses structured according to seniority. You will want to give special bonuses to senior developers if you want to retain them. This is because there is a talent shortage and hiring senior software engineers is more cumbersome.

A senior developer is any software engineer on your team with at least 5 to 10 years of experience. It makes sense to retain them on your team because they have a more in-depth understanding of the entire system architect lifecycles, services, and databases.

Expertise Level

It is important to consider skills and expertise levels when motivating developers. Anecdotal accounts based on a recent study show that an organization would be quick to reward a developer with skills related to big data, mobile development, and cybersecurity.

Other skills that are in demand and are often rewarded bonuses include Python, JavaScript, HTML/CSS, SQL, C++, C#, and Ruby.

Perks to Retain and Motivate Developers and Software Engineers

Knowing how to motivate developers extends to understanding what it takes to make them happy and retain them for the longest time possible. Here are some well-thought perks that can help you achieve these goals:

Wellness and Healthy Perks

The current IT landscape presents various health concerns, such as depression, especially among remote developers who don’t often interact physically with their colleagues. It’s worth noting that an employee’s level of well-being and personal satisfaction influences their productivity.

You can offer perks encouraging personal pursuits and hobbies, such as swimming. You can also facilitate free courses that encourage them to learn how to play a musical instrument or speak a foreign language.

Family Perks

Talents in the tech industry are like any other human beings with varying degrees of needs. For people working on time-consuming projects that require them to spend endless hours behind computer screens, you can give them additional days offs. This creates a sense of importance. Even better, you can include family presents to show that you value their loved ones as well.


A tip on how to convince developers that you really care about them as an employee is getting their approval. For example, small gifts, from branded t-shirts to power banks, can help you establish that connection of acceptance with your team members. Software engineers prefer when someone who cares is in the lead, and they’ll stay by your side if you can prove that.

Interesting Projects

Nothing beats the feeling of self-fulfillment that comes with working on something that you’re genuinely passionate about. Working on exciting projects is one of the low-budget ways to motivate tech talents and encourage them to stick around for a while.

For instance, if you want to know how to motivate software programmers, you can always assign them the most challenging tasks. When they solve such problems, other team members will admire their work, and this results in motivational ego gratification.

What Are the Most Interesting and Outstanding New Year Perks for Developers From Forbes Top 100 Companies?

Hiring is getting highly competitive, and Forbes Top 100 companies can’t risk gambling strategies for employee retention regarding new year perks. Here is what they have in store in a bid to motivate developer team models.

Flexible Work Hours

Did you know that 95% of job candidates are more concerned about flexible work hours than the role position itself? With this realization, it goes without saying why Fortune 500 companies see flexibility as an instant way of motivating software development teams. By flexible work hours, you allow your team members to work when they want, provided they turn in quality work within deadlines.

Four-day Work Week

A recent study by Qualtrics reveals that 92% of employees prefer working four days a week, even if it means logging in more hours on certain days. Countries such as the UK are also conducting multinational four-day workweek experiments, which are proving to be a success in terms of increased productivity.

Private Health Insurance

Access to special health facilities is more like a basic need now. Employers are offering private insurance coverage to retain talent than a universal healthcare system in their local country. This boosts their experience in many ways, such as reducing waiting time when seeking treatment services.

Paid Self-care Days

Companies in the Forbes Top 100 list are taking mental health awareness issues seriously by addressing concerns around this matter and rethinking ways how to motivate programmers. Mental health and burnout have been on the spot for a while, thanks to the Covid-19 pandemic. For this reason, 23% of employees note that their employers have introduced new mental health services, including paid self-care days.

Company-sponsored Development Programs

The economy isn’t getting any much better; neither is the disposable income of many tech professionals. Tech talents, whether newly hired or existing ones, are interested in a company that self-sponsors development programs to teach new technologies.

Startups Tips to Motivate and Retain Developers and Win the Battle with Fat Enterprise Bonuses and Salaries

Although fat enterprise bonuses and salaries are at the top of guidebooks on how to motivate development teams, not all businesses can afford them, especially startups. If that is your case, here are some tips for fostering motivation:

Invest in New Technologies

Startups that want to build top-tier development teams and retain them should adopt new technologies that are fun to work on. This includes high-potential innovations that can help them learn new things, such as big data, cloud computing, blockchain, or data science.

Create HR-friendly Policies

Tech talents will be more than happy to work in an environment that promotes individual well-being or respects their culture, even if the pay rate isn’t competitive. Compensate for fat salaries and bonuses by allowing developers to work under local managers. Listen to their needs and make noticeable improvements, and they’ll make your workspace their second home.

Reimburse Healthcare Costs

You can create healthcare reimbursement accounts if you cannot afford private insurance cover costs. This serves as a motivation for developers, especially if you want to keep them around for a relatively long time, say 3 to 5 years. This approach is sustainable, given that unused money is rolled over for use in the next few years.

Help Your Developers Extract Value Out of Their Current Pay

Tech professionals are often aware of possible salary offers even before they attend an interview. What many employers need to know is that 93% of job candidates prioritize assistance in retirement and financial planning when picking a workplace. This means that facilitating online sessions for financial health once in a while can be a deal breaker when retaining startup developers and helping them grow.

Motivate a Single Developer vs. Motivate a Developer Team: How to Find the Balance?

Deciding on how to motivate software development team, whether a single developer or all team members, can be challenging at first. However, it all boils down to the reasons why you’re doing it and what you want to achieve in the long haul. For example, it might be best to motivate the developers individually if you recognize hard work. The same applies when you are rewarding expertise level or higher proficiency in certain skills.

However, if your goal is to retain top talents, it will make sense if you motivate every member of the team. This builds trust because team members often rely on watching each other amongst themselves. Betraying one of them will most likely influence the stay of others. You should also reward and motivate the whole team if your goal is to achieve a specific milestone achievement or introduce new employer benefit packages.


Retaining top talents should be a priority for any IT-driven organization in 2023 and beyond. It allows you to focus on core business functions instead of dealing with hiring bottlenecks now and then. But it’s only possible to achieve this with motivation. Leverage this guide to motivate developer team models today and gain the competitive edge for seizing viable opportunities as they arise.

Frequently Asked Questions (FAQs)

How can I make my software engineer happy?
You can impress and motivate the software engineer in your dev team through a spot-on bonus for a job well done. Alternatively, you can compute an annual percentage bonus, say 5 to 10%, if you're working on a long-term project.  
Does motivation influence the retention rate and bring developers loyalty?
Motivation enhances greater job satisfaction which can help you retain top talents, especially when they happen to be extra productive with minimal supervision. 
How to build an effective motivation system for software engineers? 
You can learn how to motivate software engineers by listening and paying attention to their concerns about work-related matters, such as compensation or recognition. After that, make improvements around these areas, and they'll be encouraged to stay. 
Is a hybrid working environment good for developers' mental health? 
Yes, a hybrid working model is good for mental health and serves as motivation for software developers. This is because allowing your team members to work partly from home shows that you care about their emotional well-being and saves them daily hassle, as well as the costs of commuting. They also get more time to spend with their loved ones.
Read also
software development teams in Portugal
Why Hire Software Development Teams In Portugal Portugal is fast becoming a popular destination for hiring excellent software development teams due to its strong talent pool, competitive prices, and...
AI in project management
How AI is Transforming Project Management According to a 2023 report from, approximately 21% of project managers are already leveraging the power of artificial intelligence to maximize...
Legal and Compliance Considerations in IT Staff Augmentation
Navigating Legal and Compliance Considerations in IT Staff Augmentation The IT talent market is seeing an increase in demand for specialized talent. To close the gap, businesses are increasingly resorting to IT staff augmentation...
Book a Call