Incentive compensation professionals work hard at developing incentive plans that drive employee motivation while also meeting their company’s strategic objectives. In the past, this has been achieved by using rules of thumb and stringent financial analysis.
Yet, hard work is not enough in today’s turbulent times.
Today, compensation professionals need to add a few more tools to their tool belt.
Specifically, they need to add a deeper understanding of behavioral science and communication strategy. A great incentive program can be a defining factor in an organization’s success but as the world evolves additional measures are needed to ensure that it is resonating with and being understood by the field. Adding behavioral science into the mix can significantly improve your program’s impact and the performance of your teams. Tie these principles together with award-winning communication and you have a home run.
I’m consulting with a 12 Billion dollar sales division of a Fortune 500 company regarding the future of their reward and recognition system. Without going into much detail, they are trying to take a strategic approach to how they can improve the effectiveness of their reward programs. As part of this process, we are using the 4-Drive Theory as a model to help guide how we build this system.
As one can imagine, the organization’s current reward and recognition programs rely heavily on the Drive to Acquire & Achieve. By far, this was the predominant focus for over 90% of the components. Additionally, our research showed that the current system has a number of legacy programs and other recognition items that are no longer strategically aligned with the organizational mission.
There are a number of ways that a reward system can be developed. We aligned on developing a system that would tap into all four of the drives and focus on motivating actions on three specific sales behaviors. With this in mind, we wanted to create a framework that would leverage various reward and recognition components. That framework is shown below:
Within each of these four components could be a number of different programs that would be focused on driving one or more of the desired behaviors. We also identified that while any of the components could activate any of the four motivational drives, that particular drives would be more readily activated by programs within specific components. We’ve mapped this below:
So while both the incentive compensation and the non-cash components easily activated the drives to acquire and challenge, group trips and other recognition were more likely to tap into the drives to bond and defend. This provided us with a framework to think about how we could leverage all four drives with various reward and recognition programs.
While this is a high level perspective, it does provide a company with way to think strategically about their reward and recognition system that aligns it with the 4-Drive Model. We were able to map out specific programs within this framework that provided both a means for effectively driving behavior as well as leveraging all four drives.
To our knowledge, this framework has not been used previously within a large company. We are very excited about how this is being applied and the impact that it will have.
Please let us know if you have any questions or thoughts by leaving a comment below. Thanks.
There was a recent blog from HRZone UK that claimed, “Blog: Most employers spend more on office cleaning than staff motivation.” I cannot vouch for the accuracy of this statement or info in the article.
That being said, accuracy is not the point. The point is, you get what you pay for – right? So what is it that your organization is paying for?
How is your company spending its money? Is it on it’s people or on systems? Is it on sales or is it on customer support? R&D or discounts to suppliers? The money often points to where the focus is for your company?
Two things that I often do when working with companies trying to improve their employee motivation is 1) interview key leaders to understand what the key drivers of the businessare and 2) conduct a total rewards audit. I use step one of this process to get at the underlying drivers of the business. This often isn’t the first thing that comes out of leaders mouths. In fact, it usually requires me to probe with them to really get at the root cause. This understanding of the key drivers is vital to being able to motivate the appropriate behaviors and performance. What we find in step two of this process is that the company’s Total Rewards are NOT in alignment with the key drivers. In other words, companies are often spending their money on things that are not key to driving their success (similar to the clean office analogy in the HR Zone article).
This is not a good way to spend money.
Hopefully your company isn’t doing this. But a simple way of finding out is to look at where you are spending money and then seeing if that aligns with the key drivers of the business. If it aligns, you are doing well, if not, you have a problem.
I found this summary of Lawrence and Nohria’s “Drive” and thought that it was a nice summation of the book. Josh Kaufmann does a nice job of laying out the key insights to the theory and some good ideas on how to apply the theory into the real business world. I really like the final comment by Kaufmann regarding adding a drive around “feel.” It is an interesting concept that I’m going to explore in more detail.
The following is the final blog of 3 posts from our guest blogger Paul Schoening, President of Plan C. He is bringing a unique perspective on what it takes for a small business to survive. In his first two posts (here and here) he talked about the difficulty of starting a business based on passion and how that passion is both good and bad. He discussed how entrepreneurs need to look at building a sustainability plan and not a business plan. In this blog are his final two tips. Let us know what you think. Enjoy!
4. Continually learn: I’ve mentioned education already but I need to stress how it’s important to stay ahead of the competition. To do that, you need to carve out time to learn. It doesn’t matter how you learn, but you must be constantly learning. I’m not saying that you need to take classes – but you do need to keep up on things.
Read, attend conferences, sit through webinars, go to the library (I know – old fashioned but it works), find a mentor, network and learn more about your business than you think you will ever use. Using the internet to learn is easier than ever – enter a topic in google and you have thousands of links to explore. Subscribe to websites that help you learn and stay up on leading thought in your industry. University sites offer a lot of free classes via the web (see here). Apple even has iTunesU that you can get on your iPhone or iPad and learn while you are on the go.
When you are starting a business, finding time to learn can feel like you are taking away from other important aspects of the business – but it is key to long term survival. You’ll need to prioritize your time and make critical choices which will allow you to learn and grown your business at the same time…including how to more efficiently sweep the floors! Engaging your new employees through continuous learning is also a key factor in retaining the talent you need to succeed. Rick Osborn, president of the Association for Continuing Higher Education says, that’s a mistake.
“It doesn’t make sense,” said Osborn. I understand that when businesses are looking to make cuts, these are the kinds of programs that are the first to go. In the short term, those kinds of cuts might work for a business. But, in the long run, you’re going to have to restore the cuts.”
Businesses that offer professional development often have a strong track record for employee retention. In fact, employees cite continuing education programs as the No. 2 reason they stay in their jobs, said Susan Porter Robinson of the Washington, D.C.-based American Council on Education.
5. Connect, connect, and connect some more: Get connected with people in your industry, other small business people, and anybody else that could potentially be of benefit to your business. Do this so you can understand the challenges, opportunities and resources available to be successful. Research by the IBM T. J. Watson Research Center indicated that the effects of networking and connecting with other people have a long term positive impact. The research found that 9-months after a networking “mixer” event, participants rated the top five benefits as
Being networked professionally
Feeling energized by the interaction
Gained a business insight
Established a collaboration opportunity and
Had found professional inspiration
Source: Enhanced Professional Networking and its Impact on Personal Development and Business Success, 2006
While every social engagement is not a sales call, it can be a potential opportunity to talk about your business and what you do. Join Linked-In groups, start a channel on You-Tube, expand your twitter accounts. Utilize your network of friends, family and acquaintances. Make the effort. You never know where the next sale is going to come from. Don’t leave anything on the table, this is your livelihood!
Let us know what you think – leave a comment below. Join in the discussion!
For all my passion and research into motivation I have to respectfully admit that motivation by itself is shit. By itself, motivation doesn’t do anything. The most motivated people in the world sometimes still just sit on their butts.
What is needed is behavior.
It doesn’t matter if motivation is intrinsic or extrinsic. It doesn’t matter if my motivation applies to the A Drive or the D Drive (or the B or C Drive for that matter). If I don’t start or stop doing something (i.e., behavior) then the amount of motivation I have is a moot point.
Motivation is important in that it leads to behaviors. Motivation is one of the key elements in achieving behavior change (starting or stopping something). But it is only one part. The guys from Vital Smarts, Patterson, Grenny, Maxfield, McMillan and Switzer came out with a book called “Change Anything” not too long ago. It sheds light on this problem. While it mostly talks about individual change, but their insights can be applied to all motivation. They state that when we fail to change, “…when it comes to personal change, we think first of our own lack of motivation.” The problem with this belief is that there are a number of other factors that influence whether or not we actually change.
Change is hard. That is why motivation is important. It is the gas that powers the change engine. We need it to push through the difficult times and persist with our change effort. Again, Patterson et. al., talk about the other influences on whether or not we change – there are social factors and environmental factors. We can be motivated to loose weight all we want, but if we hang out with people who are always going out and eating big meals and just watching T.V. and if we have a packet of Oreos in the cupboard and no carrots in the fridge – it is much harder (and some might say – even impossible) to change.
When we are designing motivational programs for our employees, we need to understand that no matter how good our incentive program is or how well we activate the 4-Drives – our employees will be hard pressed to change if the social and environmental aspects are stacked up against them. If we want greater collaboration and teamwork, not only do we need to design the compensation plan so that it supports that, but we might have to look at how we configure our work space and what activities we allow while at work. If we want to get people out in front of customers more, we need to explore what are the routines that we have our employees do that inhibit this or what are the social/cultural pressures that might get in the way of this behavior.
So it boils down to understanding that while motivation is important, it cannot be the only thing that we focus on. We need to broaden our perspective to understand how motivation fits into the larger behavior picture.
And so while you might be motivated to agree or disagree with me – I’ll only know if you leave a comment (and thus, do a behavior). Click on “leave a comment” below.
This means that while theory is nice, what is really important is what happens in real life.
Most of the time when clients hire us, they hire us because we can impact the bottom line through changing the behavior of their employees. Most of them don’t care about the theory behind that change no matter how wonderful it is (e.g., The Four Drive Theory of Employee Motivation) – what they want is results.
Which gets me to the point of this post – if we are really about changing behavior, why do we care about motivation?
Think about it – motivation in and of itself does not change anything. You can be motivated and pumped up and rearing to go and still not accomplish anything. I’ve been motivated for years to loose weight – yet up until a few months ago, I haven’t done anything about it. In their book, “Change Anything” Patterson, Grenny, Maxfield, McMillan and Switzler (the guys from Vital Smart who wrote Crucial Conversations and Influencer) talk about how motivation is just one aspect that is required to achieve personal change. Indeed, they talk about the fact that if all we have is motivation, no matter how much it is, we are most likely headed for failure.
To drive change we also need to have the skills, tools and knowledge necessary to achieve that change. We need to have a social network that supports us in our change efforts and isn’t trying (actively or passively) to derail that change. We also need an environment that helps us and doesn’t hinder us. In other words, motivation by itself is not enough.
Motivation is vital to this whole equation. It is the impetus to get us off our butts and start doing something. It is the pressure that is applied to us throughout the change process – the pressure to continue and not quit when it gets tough. It is the internal drive and fortitude to keep going and keep pushing oneself. Without motivation, no change would happen.
And that my friends, is the reason that motivation is important.
Many of you have read the guest post by Kristen Swadley where she reviews her research on the 4-Drive Model. Here is her Senior Honors Thesis presentation which goes into the details of her study and provides a wonderful overview of what her research uncovered.
A few weeks ago a number of factors all convened so that I spent 5 days playing 99 holes of golf (see here). It was fun, but I’m ok if I don’t hold a golf club in my hands for a little while.
Let’s preface by stating that I’m not an avid golfer nor am I a very good golfer. I’m average. I usually get out 3 to 4 times a year. I can talk the talk, I do some things well, and others not so well. One of the things that I was doing well during those five days was hitting my 9-iron.
And I was hitting it well.
On a pretty consistent basis I was hitting the ball between 140 and 170 yards with my 9-iron – and they were mostly straight (which is a big deal for me). And once* I put one out there about 185 yards (*it was downhill and the wind was behind me). Put this in perspective, according to Brent Kelly at About.com the average men’s 9-iron distance is between 95 and 135 yards. You would need to move up to a 5-iron to reach the average distance I was getting with my nine.
Of course I was hitting most of my other clubs poorly. I’d top my driver and it would bounce out 30 yards. I’d slice my 3-iron into the trees. I’d hit my five iron, but it would fade left and only go about 100 yards. I’d totally duff my 3-wood.
So what did I do?
I ended up just playing with my 9-iron and putter. Honestly. It didn’t matter if it was a par 3 140 yard hole or if it was a monster 540 par 5 – I’d pull out my 9-iron and shoot.
And you know what…I played better than I usually do. We used many of my shots in the scramble competition. I won my head to head match. Overall, I did pretty well using just my 9-iron.
Therein lies the problem…
I did pretty well for me – but I definitely wasn’t one of the top golfers playing. Sure I did better than I usually do, but I know that using my 9-iron on a long par 5 is not the optimum solution. Yes it improved my game – but I wasn’t going to be able to match the top golfers I was playing with if I only used two clubs.
I often see companies that use incentives like I use my 9-iron. It becomes the only club in their bag.
Therein lies the problem.
We find that we have some success with an incentive program/reward program/new initiative and we think, “hey, we’re doing pretty good here.” Then we use the same thing again and again – regardless of the issue we are trying to address. The problem is that using that approach, we will never be at the top of our game. We will never be able to fully motivate and engage our employees. We will get to the equivalent of a 540 yard hole, which requires a creative new approach – and we pull out the “9-iron incentive” instead because, hey, “I can hit it 170 yards.” But that probably won’t ever get you a par. And it certainly won’t get you an eagle.
There are a number of clubs that we have to use to help drive motivation. We need to engage people with challenging jobs, build great interpersonal connections, create a culture that people are proud of, make sure that people have opportunities to grow and excel. But these are all harder to master, take longer to build, and have a higher probability of a major slice or hook – so we too often just fall back on the old faithful 9-iron incentive plan.
The Driving Range
So I need to go out to the driving range and start working on my other clubs – maybe starting with the 8-iron and moving down the line**. That is the only way that I will ever improve my game and become a “good” golfer.
The only way a company will ever become really good at motivating its employees is to start developing their skills with other methods of engagement besides incentives.
Get out on the proverbial driving range and see what works for you. Add a little more job rotation. Change the goal setting system. Maybe some more team building. How about a more open and communicative culture. It takes practice. It takes time. There will be a few shots that go in the water…but in the end, its what is required to become a scratch golfer or a great company!
(**Of course, I think I’ll take a few more weeks off from golf to fully recover…I mean 99 holes in 5 days is a lot!)
Let us know what your favorite club is – leave a comment!
According to the Four-Drive Model the drives to acquire, bond, comprehend, and defend motivate every human being and should all be addressed in the workplace. However, it is critical for managers and leaders to recognize that employees are motivated by the four drives at differing levels. My recent study, which is discussed in the post “New Research on The Four-Drive Theory of Employee Motivation”, revealed that a person’s demographic background effects which of the drives he or she values the most.
This information could have three potentially significant effects on the way managers implement the Four-Drive Model of motivation.
First, managers can use the results from the study to fine-tune motivation techniques in order to best fit the strongest drives of each employee. Workers should be tested to determine which of the drives is most motivating on down to which provides the least motivation. This will allow managers to not only implement all four drives, but to build custom motivation plans based on what drives the employee the most.
Second, managers can find ways to fulfill each of the drives in order to increase motivation. For example, employees who had sought higher education valued the drive to comprehend more than those who had not obtained a college degree. Managers can make note of employees with higher educational levels and ensure that they are given ample opportunity to express ideas, problem-solve, and engage in challenging and meaningful work. Those with a strong drive to acquire should be given recognition and opportunity for advancement. Employees with a strong drive to bond need opportunities to work in teams and collaborate with coworkers, while those with a strong drive to defend need to see fairness and just processes in the workplace. Research has shown that increasing fulfillment in all four drives leads to much higher motivation in the workplace, but if that is focused specifically to what drives the employee the most without disregarding the other three drives, I believe this would have additional positive impacts on motivation.
Finally, managers should have some way to assess employees in relation to how they perceive that each drive is being fulfilled and they are being given enough opportunities to excel in those areas that most strongly motivate them to go the extra mile. Whether through employee questionnaires or informal meetings, it is a critical step to get feedback from employees so that any necessary changes can be made to further increase motivation in the workplace.
Feel free to comment with any questions or feedback.
Ms. Swadley recently completed her thesis titled: Managing Motivation in the Workplace: A Demographic Dissection of the Four Drive Theory. She is currently at Missouri Southern State University. This article is based on the research that she completed in her thesis.
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