Monday, March 24, 2008

More on Incentives

One thing that has continually bewildered me about modern management is the application, or rather failed application of incentives on a day to day bases.

Often when people talk about "incentives" they usually think of a monetary based program where you are given more money for some achieved goal etc. But really, incentives are much more and much less than that. If you really and I mean REALLY look into to what an incentive is, it is nothing more than using rewards to generate a desired outcome.

So what is incentives really? Here is a definition from one of the many online dictionaries
"Something that incites or tends to incite to action or greater effort"
That is simple right? I mean, what's so hard or complicated about that? Until you look at what those "action" you are inciting them to perform.

When a manager or leader speaks and acts, they are always promoting one form of behavior over another. When they praise someone, they are promoting that person's behavior as the "gold standard", and when they berate someone they are saying "don't do what this person does".

That is simple on the surface, until you look deep into it's implication. Does the behaviors you are promoting generate the outcomes that you want? Or does the behavior has nothing to do with the outcome you actually want, but only looks good on the surface because of how you believe people SHOULD behave?

As an example, Manager A and Manager B (real names has been hidden to protect the guilty) had very different policies when it comes to their teams. Manager A was very much about making sure there are asses in seats for specific hours of the day. Manager B's policy was, soon as you're done with your work and everything is on schedule, you can go home. At the end Manager B's team was on the average about 20% more productive than Manager A's team. You may ask, "How is that possible when B's team can just come and go at will? I bet some of them don't even put in a full 40 hours a week!"

The answer is simple, it comes down to what you are actually encouraging them to do, and what behavior you are really rewarding. What is team A's reward for doing more work in less time? NOTHING! they have to spend the same number of hours in the office regardless of how quickly they finish a task. So where is the motivation to do more? None of course!

Conversely, team B's incentive is clear. Soon as they are done, they are welcome to go home early. (of course manager B was wise enough to first understand that the team was interested in having more personal/free time to use with their family, or social life) The more inventive few are quick to come up with ways that will reduce the amount of work involved while pushing out same quality work and rest of the team quickly picked up on the techniques since they want the same rewards. Soon the entire team was using the new time saving methods, be it to write codes, filing paperwork and so on. Manager B and then take this information and formalize it as regular procedure for the team and give them a well deserved pat on the back! As well as more work because after all they are heartless managers.

In short, anytime when you say or do anything as a leader or manager. You must keep your eyes on the prize. "What is the outcome you want your people or crew to achieve?" If attendance is your goal, then reward them for being there, but if productivity is the goal, then reward them by tangible means for doing work faster and more efficiently!

Bottom line, keep your focus on the achieving real result, and not what makes you feel comfortable seeing. Because, when you go broadside to broadside, you want your crew to feel like they have a stake in the outcome!

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