The greatest single obstacle to the success of any business, is the mismatch that occurs between the behaviour we need from our people and the way we reward them.
For example, we need highly productive factory workers, but we don’t pay them to produce. Instead we pay them by the hour, offer them very little job security and grant pay rises only when they threaten to strike or resort to a host of counter productive measures.
The result? Workers do the minimum amount required to keep their jobs, think up restrictive work rules and resist change.
So what’s the answer?
The Things That Get Rewarded Get Done!
What is motivation?
Motivation comes down to the will to act. Motivation is what makes people act or behave in the way they do. When you observe people doing certain things, you might find yourself asking “What are their motives?”
Similarly, if we want to motivate our team, a good question to ask is “ How can we motivate them?” You will achieve the results you are looking for by giving people the incentive to do what has to be done.
What is being rewarded in your work place?
You can observe a lot by watching. Look around your work place and you will find examples of the right behaviour being ignored and the wrong behaviour being rewarded.
For example, does your organisation:
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Need better results but reward those who look the busiest and work longer hours?
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Require quality work, but set unreasonable deadlines encouraging people to cut corners?
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Expect loyalty but offer no or little job security and pay the highest salaries to the most recently hired or those that threaten to leave?
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Need creative workers and thinkers, but chastise those who dare to be different?
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Ask for teamwork, but reward one team member at the expense of another?
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Need innovation, but penalise unsuccessful risks, frown on mistakes and encourage people to do it “ by the book”?
The above examples are the most common mistakes made when it comes to rewarding people in their job.
When you think about it, that graph displaying the performance of the company and the end of the year, represents the collective behaviour of your people. Reward people for the right behaviour and you get the right results.
1. Reward solid solutions instead of quick fixes
We all know the story of the farmer who killed the goose that laid the golden egg. In this case the goose represents the “production capacity” in your business and the golden egg represents “production”.
The farmer had been delighted in watching his wealth grow as each day the goose produced another golden egg. However, the farmer got greedy and decided to go for the quick fix and get all the eggs.
He killed the goose, reached inside to gather all the eggs. Of course, he found none and now he can’t get any more.
The same applies to the newly appointed production manager who wants to impress his boss by driving up production and cutting back on down time for regular maintenance.
Short term, profits increase dramatically, however long term production capacity in diminished and profits inevitably decline.
Examples of behaviour to reward and to avoid:-
Encourage
Making a commitment to a long- range plan and sticking to it
Performing regular maintenance and investing new and better ways of doing things
Realising that the people closest to the job usually know the most about it are probably best placed to generate ideas to improve the way things are done.
Avoid
Achieving short term goals at any cost
Using old equipment until it falls apart because that’s the cheapest way to go
Letting managers make all the decisions because its faster and they are paid to do so.
2. Reward Risk Taking Instead Of Risk Avoiding
Trying to get some team members to take responsibility for what they do can sometimes seem impossible and frustrating sometimes. People will come up with all sorts of excuses about why things aren’t done …. “ I was too busy” …” That’s not my job” …. “I didn’t receive the paperwork” ….You didn’t give me the go ahead” .. etc
Many organisations operate under the “Go ahead and do it, but don’t do anything wrong” rule. Successful businesses encourage people to take smart risks, give them boundaries to work within and realise that making intelligent mistakes are part of the price you pay for personal and company growth.
We all have a tendency to avoid making mistakes. It’s a natural part of being human. We all want recognition and acceptance and one sure way of achieving this is to “look good” and don’t do anything “wrong” that will attract attention or criticism.
Every time you try something new you run the risk of failure. But worse than this, is the consequence of not taking risks … boredom, frustration, stagnation and ultimate decline in company performance.
The way to convert risk avoiders into risk takers is to create a climate that promotes, rewards and supports risk taking and gives people the opportunity to learn from their mistakes with out fearing repercussions. Here are some guidelines to consider when establishing a healthy risk taking environment:
a. Educate and remind people that intelligent errors are part and parcel of making progress in the company and as an individual.
b. Walk the talk .. make sure you are leading by example . be open about your own mistakes and how you have learnt from them.
c. Don’t waste time on small risks … if you want to achieve great things, take on great projects!
d. Celebrate both successes and setbacks … we all like to give recognition when we win, but the time for greatest support is when we have taken a chance, tried our best and have fallen flat on our face. If Edison had given up after his 900th “failure”, the light bulb would not be with us today. Every time an experiment failed, he said he was one step closer to success.
e. Don’t take risk for others or come to their rescue if things don’t turn out as they would have liked…. coming in over the top deprives them from learning and growing from the experience.
f. Encourage smart risks, not foolish chances …. Be sure to read our next month’s newsletter to see the appropriate way to delegate and encourage risk taking without fear of a calamity occurring.
3. Reward applied Creativity Instead of Mindless Conformity
It’s true that no organisation can be effective without a certain amount of conformity and good systems. However, the important capital asset is not money, buildings or equipment, but ideas!
Back in 1976, a young engineer got bored with the repetitive routine of installing computer chips and asked his bosses if he could design a personal computer .His bosses said no. So, not to be deterred, he built his computer from home and named it Apple. Today that engineer is worth over a billion dollars.
Anybody can come up with new ideas. All you need to do is gather people around and brainstorm solutions to a problem. You will be surprised at just how creative your people really are!
In a lot of cases, management asks for new ideas and quickly reject them. Or the people who come up with new ideas are not rewarded, instead those with the “proper” credentials are given the accolades.
The key is to create an environment that encourages new ideas and make innovation and continuous improvement part of every one’s job. To make it happen, you need to set up rules to play the game.
a. Tolerate failure – many of the ideas that will be put into action may not get the results we are looking for. But this is all part of the process of continuous improvement.
Understand that most innovations are not successful. The key to success is to be persistent and learn to develop an ability to cope with disappointment, failure and rejection. Above all keep trying.
Anyone who has become successful, knows this, because they have lost more often than they have won. Getting it wrong is Ok so long as we learn from our mistakes and move closer towards our goal.
b. Pay royalties for successful innovations – to keep innovators motivated to keep on innovating, give them a piece of the profits generated from the innovation.
c. Encourage competition – Internal competition between groups is a great way of encouraging innovation. The challenge of competition keeps people excited and encourages new ideas.
d. Ask everyone to contribute at least one new idea and a deadline for achieving it – innovation is everyone’s business and the people closest to the job are usually the best at coming up with new ideas to make the job better.
e. Give people the tools to think creatively – like any new skill, creative thinking and idea production can be increased with practice and training in how to use simple techniques like brainstorming, using different frames of reference, combining old ideas into a new perspective.
4. Reward decisive action instead of paralysis by analysis
The purpose of any organisation is to gets results. That means decide what your going to do and do it now! In any organisation you will find people willing to analyse, verbalise and give their opinions, but few who will be decisive.
Most people simply don’t have the assertiveness and self-confidence to put their career or reputation on the line when its time to make a decision.
Good managers promote innovation and growth by giving their staff the freedom to decide and act. They tell their people to “ make up your mind and do it. If it isn’t working out, fix it or try something else.” The key here is not to penalise for making a bad decision.
Guidelines for encouraging good decision making
a. Make decision making a habit
b. Don’t tolerate reverse decision making
c. Obtain the best information you can within the time limits
d. Brainstorm as many different alternatives using problem solving tools such as Mind mapping and Force Field Analysis
e. Take action or reward those who do.
5. Reward smart work instead of busywork
Unfortunately, most of us are not rewarded for achieving specific goals that contribute to output. Instead the rewards go for punching in and out at a certain time.
Worse still, managers assume that those who work long hours and look the busiest, must be the best workers and reward them for their behaviour rather than their results.
The solution is to reward people for achieving results and goals and rather than just looking busy and appearing to be totally dedicated and over worked.
Here are some guidelines for turning “actors” into producers:
a. Make sure you have the right person for the job
b. Give people the right tools to do the job
c. Make sure everyone knows what their boundaries are and the job’s limits
d. Get each person to understand how their job contributes to the overall work effort – this shows people that their contribution is meaningful and they are less likely to go off on tangents and waste time.
e. Support those who results are falling short of their efforts – show them how they can improve, particularly in their time management skills.
f. Don’t insist on things being a particular way – so long as you are getting the results, be careful not to insist on procedures to be followed to the letter. Instead let people improve the system for the better.
g. If people have finished their work for the day, send them home.
h. Simplify the way things are done so time is not wasted on unnecessary activity.
As a business grows and success usually leads to complexity. They hire more people and create new systems and procedures to handle the complexity – which leads to things becoming more complicated. The paradox which faces management is to keep everything as simple as possible so people can get on and do their jobs.
The advantages of a trim organisation, is that it is more responsive, flexible and better equipped to cope with change and seize opportunities.
The key is to eliminate the unnecessary!
Use the following strategies to simplify what you do and cut the unnecessary:
a. Simplify jobs – ask everyone who works for you to write down the answers to the following questions:
- What results do I produce in my job?
- Why am I producing them?
- What Am I doing that is unnecessary?
Get everyone to go back to basics to determine what they do. If it doesn’t contribute to adding value then it can be eliminated.
b. Simplify the structure – question every job and level of management:
- Do we really need it?
- Can two levels be combined?
- Is every job worth more that it costs?
- Is it regularly contributing to output, or is it creating needless work
c. Simplify procedures and controls – it is easy to simplify the way we do things by breaking every procedure into as many detailed steps as you can chart them and question every step:
- Can we eliminate it?
- Can we combine two or more steps?
- Can we change the sequence of the steps to make it more efficient?
d. Simplify communication – the current business environment thrives on knowledge and producing volumes of information. The challenge is dealing with information overload and is a key factor in confusing and immobilising people. We all need to work hard at keeping our communication as simple and brief as possible. Keep all written communication to an absolute minimum.
- Question every line of every form, report or memorandum and ask :
” Does this cause any one to take a useful action?” If not get rid of it!
- Communicate to others in language they understand
- Question whether standing meeting are necessary and whether they serve a useful purpose and ask can they be eliminated, reduced or combined.
- Reduce your time on the telephone by having your incoming calls screened
In summary, focus on selecting, sending and receiving information that you and others need to get your work done and ignore the rest.
e. Reward people who simplify what they do.
7. Reward quietly effective behaviour instead of the squeaky wheel
Every organisation needs reliable people who know their jobs and do them without calling a lot of attention to themselves. But too often the deeds of the quiet heroes are drowned out by the “squeaky joints “ who spend their time creating problems instead of results.
Managers, being problems solvers, get sucked in into the trap of reinforcing the squeaky joint behavior by spending loads of time solving their problems for them. This leaves little time to devote to the quiet achiever who may end up feeling neglected.
Most people don’t mind working hard, so long as they receive due recognition for their efforts, rather than feeling like they are being taken for granted, used or exploited.
To encourage more quietly effective behavior, try the following:
a. Consciously work at identifying and acknowledging good behavior
b. Seek out the “quiet heroes”, and resolve to spend time encouraging and rewarding them – it’s so easy to overlook dependable people. Remind yourself just who is important to the organisation by asking the following questions:
- Who is rarely if ever, absent?
- Who works well under pressure?
- Who consistently turns out quality work and on time?
- Who is willing to go the extra mile when the team really needs it?
- Who can you count on to take up the slack in someone else’s absence?
- Who doesn’t constantly pester others for advice and guidance?
- Who produces many more answers than questions?
- Who helps others to do they jobs better?
- Who regularly strives to do their work better?
- Who smooths out conflicts, fosters cooperation and builds morale?
c. Keep alert for squeaky joints and don’t oil them – reward the high producers with your time and attention so people start to get the message.
- Don’t spend your time helping people solve problems that they intentionally create. Instead, tell them it is their responsibility and add it to their workload. Be sure they are trained well in how to solve problems effectively.
- Don’t refuse to give work to those that intentionally screw it up. Expect them to do it and hold them accountable.
- When you give criticism remember this golden rule:
Praise the worker, criticise the work
None of us enjoy having holes poked in our work, especially when we have invested a lot of time, effort and emotion into it. Nevertheless, it is an important part of the manager’s job to point out errors and provide guidance when things need correcting.
When you have to be critical, be careful! Like walking through a minefield, one wrong step can cause irreparable harm to the person you are counselling. Consider the following:
- Never begin your criticism by pointing out what is wrong. That puts people on the defensive and defensive people don’t listen. Instead, begin by praising the good things about the person’s work and how you appreciate their effort and ability.
Then shift your focus to what needs to be done to make things right or to keep them from going wrong in the future. Ask the person for their ideas on how to fix the problem. This shifts the emphasis away from you telling them what to do to asking them for their contribution. Finally, end the discussion by again praising the person for their efforts, offering your support and expressing confidence in them
- If someone is blatantly lazy and not performing to expectations, be more direct. Tell them how disappointed their work makes you feel, because you know they are capable of doing a much better job. Then get to the specifics of what you expect from them and give a deadline for getting it done. Again, end the discussion by offering your support and telling them “ You’re much better than this”.
A constructive critique leaves others with an understanding of the errors, the means to correct them, a feeling of appreciation and an eagerness to improve.
In our busy, ”instant” society we put a premium on getting things done quickly. Everybody wants things done yesterday. Not that there is everything wrong with working quickly. But all too often the results are second-rate work that led to poor quality goods and services.
In our attempts for continuous improvement, we have focused on two things:
- How can we do it faster?
- How can we do it cheaper?
Unfortunately, we have overlooked a third and most important question:
- How can we do it right the first time?
Working faster and cheaper only allows you to produce the same old defects more efficiently. On the other hand, improving quality has a number of long term payoffs:
a. Lower costs – Doing things right the first time, lowers the cost of inputs, materials, amount of supervision required, maintenance and warranties. It is estimated that as much 20-30% of the cost of manufacture is due to waste in the form of rework, waiting, defects etc.
b. Higher Output – doing things right the first time makes previously wasted resources productive. Managers spend less time to monitoring and inspecting and more time to productive activities.
c. Worker pride – doing things right the first time creates the positive feelings of confidence and success that come from mastering a job and doing it well. In turn, this motivates people to work harder. Work is not a chore, but becomes enjoyable.
d. Customer loyalty – The average business spends about six times more in resources to attract new customers than it does to retain existing customers. Doing things right the first time ensures that you get repeat business and referrals to new customers. Research suggests that customers will demand increasingly higher levels of quality and are willing to pay extra for it.
The reason why organistions suffer from excessive waste and poor quality is due to the reward system in place that encourages quantity instead of quality.
Getting a commitment to quality starts with rewarding it. Management must have a vested interest in producing quality outcomes and empowering those responsible for achieving it.
The key is to structure the organisation to ensure quality and continuous improvement becomes a way of doings things and not just another fad. Several factors need to be present:
1. Every manager needs to understand what quality is and what it is not!Quality is :
Conforming to a set of preset measurable standards
A total, ongoing program and a commitment right through the organisation to getting things done right, the first time.
Proper planning and design to prevent defects before they occur
Measured by calculating the cost of quality – eg how many defects happen, unproductive time,
Quality is not :
Telling people to do their best
A goal to be set, reached and then forgotten
The inspection, detection and correction of defects
Measured by subjective evaluation
2. Train everybody in how to understand and learn to use basic quality control techniques such as charts, statistical studies and analysis. People at all levels can contribute to measuring and then improving the score.
3. Spread the enthusiasm with communication, goals and rewards. For example, post a quality scoreboard or bulletin board to display results. Run contests become departments to challenge them for the best quality improvement and output.
4. Ask the person who does the job how to improve it. Odds are the person who does the job knows more about it than anyone else. Seek out their ideas and reward them for it.
9. Reward loyalty instead of turnover
We hear a lot of business owners lament in saying that they can’t understand why young people aren’t more committed to work. Managers are more often than not talking about the apparent lack of commitment and loyalty from employees.
Every organisation needs loyalty, but few actually reward it. Instead they hire, fire and manipulate people according to current economic needs. Worse yet, many organisations encourage people to be disloyal. Often the most recent hired, gets paid the most.
Advancements and career paths promised at the initial interview go to outsiders rather than promoting from within. Sometimes the only way to get a pay rise is under threat of leaving for a better offer elsewhere.
The key to getting loyalty is by following a very simple principle:
You Get Loyalty And Commitment From People By Giving It To Them
If you ask employees who say they are loyal to their employer, they will say they belong to an oraganisation that cares about them, challenges them, believes in them and wants the best for them, not just as employees but as human beings.
In the final analysis, loyalty begets loyalty, trust people and they will give trust in return, offer friendship and you will receive friendship, show commitment to your employees and they will committed to you. It’s that simple.
Employee loyalty and dedication doesn’t just happen. Management must make it happen. Here are the basics that you need to get right:
a. Provide job security
b. Build trust by keeping channels of communication open and clear
c. Promote from within
d. Invest in the long term growth and development of your people
e. Pay and benefits must be perceived as fair
f. In short, treat people as you would like to be treated
10. Reward working together instead of working against
How united are your people where they work? Do they:
- Try to build up the importance of their own work and downplay the importance of others?
- Refuse to fully extend a helping hand to each other when it is needed to get the job done?
- Spend lots of time sniping, backbiting, criticising each other and playing political games?
- Form personal rivalries and “us verses them” group factions that disagree over just about everything?
If some of these descriptions apply to your work place, chances are that the reward system is structured to pay off one person or group at the expense of others. A reward system that produces few winners at the cost of many losers is asking for trouble.
When it comes down to it, every organisation is a team working together to achieve common goals. Teamwork rarely happens by accident. It occurs when management decides to make it a priority. and structures the work and the organisation in ways that encourages cooperation.
He are some practical tips for team building:
a. Create self-managed work teams – Studies have shown that the creation of autonomous work groups can result in higher morale, productivity and teamwork.
b. Encourage competition that achieves common goals – If you find individuals or groups working against each other when they should be working together, here’s what to do:
- Create a common goal with rewards that can only be achieved by working together.
- Identify the rewards for working against each other and remove them
- Call the game. If two or more people are sniping and playing political games with each other, put an immediate stop to it. Meet with all parties at once, face to face, and get the issues out in the open.
c. Prevent future competition – set up your reward system to head off unforeseen problems. Here are some to prevent problems of misplaced competition before they start:
- Reward people and groups on the basis of how they contribute to the group or organisation as a whole
- Reward people and groups for the help they give each other
- Stimulate frequent interaction between members of groups
- where possible, rotate members amongst groups
- Avoid setting up win-lose competitions between individuals and groups where cooperation is essential
d. Build teamwork with pride and recognition
e. Use the “most important words” in communicating with your team – As you build cooperation and trust, keep these points in mind
Six important words in our language are ..'I admit I made a mistake'
Five important words are ………………..“You did a good job'
Four important words are ………………..' What is your opinion'
Three important words are ……………….' Let’s work together'
Two important words are ………………..' Thank you'
A Single important word is……………….“We”
Rate your performance in the ten types of behaviour: -
Instructions:
Step 1: Score where you think your performance is now.
Step 2: Score on the same table above where you would like your performance to be.
Step 3: Identify the area which has the largest gap between the now and where score
Step 4: Develop 2 or 3 actions from the recommendations in this paper to improve your performance
Step 5: Review your scores in six months time.
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