“So, what gives?” Jamie asked. “Our company spends a lot of its resources on training, planning, development programs. Why do they always seem to run out of gas? You suggest we are missing something on the back end.”

“When I look at behavior, I think we, as managers, truly miss the boat. We are always looking at the front end of the behavior instead of the back end. And the back end, the consequences of behavior, are much more powerful drivers than the front end.”

“I am not sure what you mean,” Jamie responded.

“Jamie, you have a teenager at home, right?”

“Oh, yeah, somewhere in his room, beneath the glow of some Realm vs Realm computer game, I think there is a teenager in there somewhere.”

“Tell me, how complicated is that video game?”

“Oh, boy, I can’t make heads or tails of it. When I look at that screen, there is so much stuff going on, including multiple chat channels, voice over the Internet, status panels, swords, animals, shields, walking, running, flying, transporting, vaporizing.”

“So, to learn how to play that game, you must have sent your son to an expensive training class?” I asked.

Jamie started to laugh. “Are you kidding? He just sat in there for hours and hours, without eating or sleeping. I don’t know how he learned it, but it wasn’t from a training class.”

“You mean, you didn’t encourage him. You didn’t bring in a motivational speaker. You didn’t make him practice?”

“No way, quite the opposite. We discourage him from playing the game, sometimes we even ground him from playing.”

“So, let me get this straight,” I began, “your son has learned to play a computer game at an extremely high level of competence, without going to a single training program. Sometimes he skips meals and sleep to continue playing this game. He does it in spite of his manager’s (mom’s) discouragement. Everything that has been done, up front, violates everything we know about competence and mastery. So, what’s happening?” -TF

“So, what do you think was missing?” I asked.

Jamie was retracing the steps of her company’s Quality Circles program. There was nothing wrong with the program. It was clearly designed to bring out the best in her people. It had short term results, but, in spite of a great deal of up-front planning and expense, the program experienced an early death.

“You are suggesting,” Jamie began, “that we did our front end work well, but we were missing something on the back end?”

I nodded. “One primary function of a manager is to influence behavior. Indeed, to influence behavior, we spend a lot of time in meetings, developing programs, teaching, training, writing manuals. We spend a lot of time up front, trying to influence behavior.”

It was Jamie’s turn to nod. I continued. “While those things we do up front do have an influence, most behavior is not prompted by what comes before but by the consequences that happen after. As Managers, we spend a lot of time training. We see the behavior performed well in the training room, but a week later, nothing has changed on the floor. The fire has been put out, the behavior has been extinguished.” -TF

“So, if, for the moment, we put aside bonus and incentives, tell me, how do you bring out the best in people?” asked Jamie.

“You tell me,” I replied. “What kinds of things have you tried, besides bonus and incentives?”

Jamie had to stop and think. Slowly she retrieved an idea her company had tried in the past. “Quality Circles,” she floated. “A couple of years ago, we tried Quality Circles.”

“And how did that work out?”

“Well, it seemed okay, for a while. Everyone got pumped up, we had some meetings. Some of the meetings generated some quality improvements. Is that bringing out the best in people?” she asked.

“It’s a start. What happened to the program?”

“I don’t know. It just sort of died. We got busy, skipped a couple of meetings, before you knew it, we were off the wagon.”
___
In the past, what kind of programs has your company tried, to bring out the best in people? Over the long haul, how did they work out? -TF

Last week, based on a number of conversations I had with Reggie, we started a heated debate about incentives and bonus compensation. Reggie’s experience had backfired on him.

“So, tell me Reggie, what exactly were you trying to accomplish with the bonus system? Because that is where we have start our discussion. What was the purpose?” I asked.

“The purpose, well, you know. I want my managers to stay focused, to have the company’s best interest at heart, to take that one more phone call before going home,” Reggie replied.

“And how did you communicate this to each of your managers?”

“Well, once a year, we sit down and look at their job. We break it down into Key Result Areas, then create a goal in each area, for the year. We attach dollars to each of the goals, to be paid quarterly. We are doing it just the way our consultant told us to do it.”

“And what are the results?”

“It’s all over the board. Two managers made most of their KRAs, but I don’t think they did anything special, it just happened. Three other managers did some suspect things to manipulate the numbers into the last quarter, so they got their bonus, but, they didn’t really achieve the goal, it just looked like it. And two other managers, well, they missed their targets, in fact, they quit trying about halfway through the quarter.” Reggie stopped. He didn’t like his own expert opinion on this.

“So, by your assessment, the bonus program achieved results in two cases, but you figure those results would have occurred with or without a bonus program. And in five other cases, the bonus program created manipulation or became a disincentive to performance,” I restated.

“Yes, that’s it. So, you tell me. What could we do differently to get the behaviors we want that drive the results that we want?”

The past few days discussion on the impact of bonuses has stirred quite a bit of email and posted comments.

Bonus systems are seductive for both the manager and the direct report. They sound great when times are good, the manager can relax accountability efforts (seduced by the good times). But when times are not so good, things turn sour.

It all comes back to the contract. As a manager, I expect my team members to do their best every day. In exchange, they can count on consistent fair compensation.

The last email I received posed this simple question. “What type of incentive program would you recommend over a bonus program?”

It’s a sucker punch question. Incentives hearken back to the carrot and stick. Incentives and bonuses create distrust and the circumstance for manipulation. Incentives and bonuses say “I do not trust you to do your best.”

So, what type of incentive program? It’s the incentive program of trust. Next week, we will talk about its elements, and how a manager has real influence in the areas of motivation and performance. Rather than just throwing money at it. -TF