how companies get motivation wrong

How Companies

Get Motivation

WRONG!

Kurt Nelson

Many companies get

motivation right…

Many companies get

motivation right…

Yeah for them!

But many companies get

motivation wrong

And some get it spectacularly wrong!

And some get it spectacularly wrong!

Ouch!

And that’s not good

And that’s not good

Decreased Motivation Leads to:

Lower productivity

Higher turnover

Decreased sales

Lack of creativity

In our work with companies across the country, we have had the opportunity to examine why this

happens…

In our work with companies across the country, we have had the opportunity to examine why this

happens…

And understanding is the first step in getting it RIGHT

Focus only on money

No manager discretion

No manager tools

Too complex

Wrong m

easure

Comm

unication

Fixated on costs

Here is a short list that describes just a few of the more common

mistakes that we’ve seen

1. Focus too much on the drive to Acquire (i.e., the pay plan)

1. Focus too much on the drive to Acquire (i.e., the pay plan)

Companies that do motivation right have a comprehensive plan that emphasizes

more than just pay. They focus on:

• Teamwork

• Work Environment

• Work/Life Balance

• Growth Opportunities

• New Challenges

• Commitment to Ideals

• Corporate Identity

• Broader Purpose for Employee

2. Don’t give front line managers enough discretion

2. Don’t give front line managers enough discretion

Front line managers typically have the greatest impact on individual employees

perception about the company.

Limiting how they can motivate or not trusting them to do it right decreases their

motivational effectiveness.

3. Don’t give front line managers enough tools

3. Don’t give front line managers enough tools

Companies that do motivation right provide their managers with:

• Motivational Training (e.g., “How to Motivate 101”)

• Discretionary Reward Programs

• Easy to Use Reports

• Motivational Support from home office

• “On the Spot” Awards

4. Making incentives too complex

4. Making incentives too complex

While companies might want to make their IC plans more complex to try to

ensure fairness or meet certain budget expectations…

The more complex and harder they are to understand, the less

effective incentive plans are at driving behavior change.

5. Rewarding the wrong things

5. Rewarding the wrong things

Too often, companies good intentions can lead to rewarding the wrong behavior. The most common

mistakes:

1. Rewarding things that are not in alignment with strategy

2. Reward things because they are easy to measure

3. Rewards have become entitlements and perceived as “unchangeable”

6. Not communicating enough

6. Not communicating enough

Highly motivating companies over communicate to their employees –

regarding their:

• Pay Plans

• Total Rewards Strategy

• Reward Culture

• Company Mission

All of these are vital to a highly motivated workforce.

7. Focusing on the “cost” of motivational programs – not the

results

7. Focusing on the “cost” of motivational programs – not the

results

Focusing on the “cost” of a program is short sighted.

The real focus should be on the motivation that the program instills

and the results or “lift” the program has on performance.

Cheapest isn’t always the best!

Does any of this sound familiar?

The real question is…

The real question is…

what to do about

this?

First recognizing where we tend to go wrong is key

First recognizing where we tend to go wrong is key

We just covered that…

Then we merge theory and expertise to develop solutions

using…

The 4-Drive Model Employee Motivation of

Lawrence & Nohria

2002

Then we merge theory and expertise to develop solutions

using…

Acquire

Bond

Challenge & Comprehend

Defend

The 4-Drives

Acquire

Bond

Challenge & Comprehend

Defend

We need to focus on ALL 4 Drives

together (not just Acquire)

Then give front line managers the tools, the training and the discretion

to use them effectively

Then give front line managers the tools, the training and the discretion

to use them effectively

Tools:

• Easy to use sales or performance reports

• Manager discretionary incentives (cash and non-cash)

• Simple “On the Spot” Awards

• Recognition programs – peer-to-peer, manager nominated, VP review

• Training on how to use rewards effectively / motivate employees

Discretion:

• Provide Managers with clear objectives

• Create rules that are flexible enough to accommodate Managers special situations

• Monitor only for bias and cheating

• Utilize online platforms to manage programs and provide flexibility

• Direct access to IC/HR team

Simplify, simplify, simplify

Simplify, simplify, simplify

Rework your incentive plans to simplify them:

1. Reduce the number of items you’re paying on (3 or less is best)

2. Focus only on key results that people have control over

3. Simplify the math for calculating earnings/winning

4. Limit the number of qualifiers, multipliers, kickers or other factors

Conduct an analysis on what behaviors your reward programs are driving

Conduct an analysis on what behaviors your reward programs are driving

Conduct research to ensure that your programs are:

1. Driving behavior that is in-line with company strategy (e.g., profit not just revenue)

2. Measuring the appropriate results / behaviors and not just those that are easy to quantify

3. Have not become so entrenched that they are perceived as entitlements and not incentives

4. Leveraging (not duplicating) other incentives or pay plans in the behaviors they are rewarding

And make sure that this is ALL

communicated with a PASSION!

And make sure that this is ALL

communicated with a PASSION!

Utilize live meetings, well done Power Point presentations, professional print and online communications, voice mails, flash e-mails, memo’s,

manager talking points, posters, etc…

Finally – don’t let Purchasing focus you just on the direct cost of a program – make sure you look at how the program drives

motivation and results.

A program that increases sales performance 1%

at a $1Billion dollar company = $10 Million in

additional sales

Finally – don’t let Purchasing focus you just on the direct cost of a program – make sure you look at how the program drives

motivation and results.

A program that increases sales performance 1%

at a $1Billion dollar company = $10 Million in

additional sales

Finally – don’t let Purchasing focus you just on the direct cost of a program – make sure you look at how the program drives

motivation and results.

That might just be worth a few extra thousand!

Make sure that you don’t make

a motivational…

Take Action Today!

To find out more on how to motivate your employees

www.lanterngroup.com

or our blog

http://thelanterngroup.wordpress.com/

©2009 The Lantern Group – use permitted with acknowledgement