Financial Incentives – do they work?

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Revisit an Important Topic – a repeat posting from 2013

It is accepted wisdom in human resource management practice that financial incentives, wages and bonuses, drive work performance((1)). This is a part of our business and political culture.((2)) Though studies and surveys have shown for decades that people find many other factors (growth of skills, engagement, sense of purpose, social connection, and many others) to be important in their work, the key to every human resource management strategy has been the compensation plan. Increasingly over the past couple of decades human resource management professionals have devised ever more complex methods for connecting various performance metrics to compensation plans. 

Do Financial Incentives Work? Continue reading

Footnotes:
  1. Note that we are talking about individuals here. Organizations, for profit, non-profits and government, definitely react positively to financial incentives and disincentives []
  2. In fact the notion that people make “rational” decisions based in part on financial rewards is a central pillar of our “if we only let markets work, everything will run smoothly” culture. []

Planes Change. Values Don’t – No Sloganeering

Plane change. Values don't United Airlines

Recently I was on an commercial air flight and was greeted by a bit of corporate sloganeering that accompanied by meal (yes, you guessed correctly that I was on an international flight). The napkin shouted out in bold blue text, “Planes change. Values don’t. Your priorities will always be ours.Continue reading

Managers – Take Responsibility for Employees – Look in the Mirror

Whenever I hear a manager talk about personnel in a complaining tone that focuses on their lack of motivation, sloppiness, and all the other shortcomings that managers so frequently speak or or think about, I am reminded of a central fact about business.((1)) Continue reading

Footnotes:
  1. this actually applies to any organization where there is a hierarchy, non-profits, education, government, and more []

Podcast – Three Counter-Intuitive Steps to Becoming a More Effective Manager

Be a More Effective Manager – stop answering those questions, seize your time, and it’s your fault

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Three Counter-Intuitive Steps to Becoming a More Effective Manager

Become a More Effective Manager – Three Counter-Intuitive Steps

In the world of planning and strategy, there is a truism that too much planning, too much detail, too much analysis, leads to inaction, to a loss of opportunity. Along the same line of observation, in the world of learning to becoming a more effective manager, there can be too much study, too much thinking, too much integration of the many many skills and aptitudes required to become more effective. In both strategy and management skills action is almost always preferable to another round of study. Action bumps you up against the real world and provides the real basis for improving skills and results.

But, that still leaves us with the nagging question as a manager, especially for rookie managers and supervisors, how do I get started?

Based on many years of personal work as a manager and many years coaching managers, here are three steps you can take that will get you into action and guarantee striking results. These results will come in your personal effectiveness and in of the results of the organization you manage.  Remember,  by results, I am referring to the three meanings Drucker defined: (1) direct business results (usually measured in $s); (2) improved organizational culture (values); and (3) development of people.((1))

1. Stop Answering Questions

If most managers could listen to themselves, the proverbial fly on the wall, for just a few hours, they would discover that they are chronically enabling dependency all around them and undermining whatever formal delegation systems are in place. How is this happening? Just listen and you will hear a stream of questions coming at them followed by answers in response. You are enabling the following the reflexive pattern: ask the expert and be rewarded with answers. Ask the boss, get an answer, and be safe from responsibility for the answers.

If you want to get people to take responsibility and be involved in the business, you can’t go on answering all these questions. They will just go on asking whether they need to or not. And, you are spending an enormous amount of your time, your most valuable resource, to answering all of these questions.

What should a manager do to break this pattern? Continue reading

Footnotes:
  1. see Chapter 2 – What Can I Contribute? in his book The Effective Executive []

Managing Key Personnel – Do What Is Inevitable – evasion and self-deception will not work

Recently I was speaking with the owner of a financial services firm. She has 15 people in her organization which is now almost 18 years old. By any measure a successful firm.

She told me about one person who has been with the firm for eight years. The owner described this person as the most professional and reliable person in the organization. She performs all sorts of important customer-facing activities flawlessly. This employee is a key person in the organization. The owner went on to tell me about a recent conversation she had with this key person who confided that she did not want to be just an “insurance geek”. She was emphatic about this. The owner told me that this statement jived with other comments this person had made recently. She believed her and felt that her days are numbered.

The owner then went on to describe how she had begun to put together a job manual for all of the key tasks now under the wing of the key employee. This seemed to me to be just the right step. First, the key employee was cooperating in constructing the job manual. This is a great sign of continuing good faith. Second, the owner is testing out the manual to be sure that it really will be a solid platform for training a replacement. Continue reading