Les Landes

Thursday, 21 November 2013 23:37

The perils of rewarding for outcomes

Have you ever been caught in the trap of using the words “performance” and “results” interchangeably? The distinction between the two is important to consider if you want to get the best out of both. It’s pretty simple, actually. Results are the outcomes you produce and performance is how you get there.

However, here’s something you may not have considered. In fact, it might even seem counterintuitive. If you’re focused mainly on bottom line results in what you measure and reward, that will eventually lead to the deterioration of both performance and results. Here’s why.

Outcomes vs. inputs

First, we all know that people tend to repeat behaviors that are reinforced positively. Likewise, people tend not to repeat behaviors that produce a negative response. Next, it’s important to realize that no one has direct control over results — unless the game is fixed or there’s a deliberately unfair advantage. People can only control performance.

Now, if bad performance always led to bad results, and good performance always led to good results, it wouldn’t matter which one you rewarded — results or performance. But that’s not always how things work. Sometimes you don’t get good results even when you give your best effort. Other times, the opposite is true. 

That’s not how things usually happen, but look at what you get when they do. If you fail to reward people for good performance because they had bad results, you discourage them from repeating the good behavior. If you reward them for good results in spite of poor performance, you reinforce poor behavior in the future. The cumulative effect over time is inevitable. Every time you focus on results in a way that either reinforces poor performance or discourages good performance, you take a step backward with long-term results.

Performance is the bottom line

Of course, you have to add up the numbers on the bottom line eventually. Even if winning in the world of business means producing results, lasting success still requires focusing on the drivers of those results, and it’s important to reward effective execution regardless of the outcomes in the short term. Think of it this way: Winning is the name of the game, but performance is the bottom line. 

Clearly, if effective execution isn’t producing the desired long-term results, you need to find the problem. It serves no purpose, however, to penalize people for poor outcomes if they’re doing the right things in the right way at the right time. If that happens, you need to fix the strategies or systems, not the people. Otherwise, you’ll destroy trust in your organization. 

That premise has particular significance for managers in the “people” side of the business. For HR professionals, it’s pretty obvious. Some compensation and bonus programs are notorious for focusing solely on immediate, bottom line results without regard to how they’re produced. That kind of practice often leads to short-term success with negative long-term consequences. Good programs encourage performance that looks at the long haul.

You have to communicate effectively about the steps to success. If it’s results you’re after, you’d better be talking a lot more about what it takes to produce them, because in the end, it’s how you get there that counts. ●

 

Les Landes is president of Landes & Associates. The firm provides management consulting services in the areas of organizational communication, employee engagement, marketing, public relations and continuous improvement systems. They are the creators of the “ImaginAction System,” a tool for getting employees engaged in systematic continuous improvement. Landes is also the author of multiple articles, as well as a recently published book, “Getting to the Heart of Employee Engagement: The Power and Purpose of Imagination and Free Will in the Workplace.” For more information, visit www.landesassociates.com.

Connect with Les Landes on LinkedIn http://www.linkedin.com/in/leslandes or find out more about Landes & Associates on Facebook https://www.facebook.com/LandesandAssociates and follow on Twiter @LandesAssocs.

When you hear someone say, “That person’s got quite an ego,” it’s rarely meant as a form of flattery. In fact, it typically carries a lot of negative connotation.

A more positive way to think of ego is to look at what it takes to maintain a healthy one. Using the word ego as an acronym, here are three key requirements: E-xpectations, G-oals and O-ptions.

 

Expectations

If you want to mess with people’s heads, be fuzzy about what you expect them to do. Then give them a rash of trouble when they fail to meet your expectations. That problem crops up often in the performance review and appraisal process. What starts out at the beginning of the year looking like a clearly defined set of goals and objectives can later become a bone of contention.

The employee and the supervisor discover they had different ideas of what successful completion looks like, and guess who usually wins the argument? Even the best of employees can get bruised egos from that kind of experience. Both people bear responsibility for making the process work, but the supervisor has to take the lead in making sure they are on the same page from the outset.

 

Goals

Remember the classic exchange between Alice and the Cheshire Cat in “Alice’s Adventures in Wonderland”? Alice is wandering around lost. She replies that she really doesn’t know where she’s going, and the cat says, “Then it doesn’t matter which way you go.”

Your ego is in jeopardy if you don’t have clear goals. When it comes to the workplace, employees and supervisors have to make sure that well-defined, meaningful goals are in place if they want to keep people feeling happy, healthy and whole.

 

Options

In my book, “Getting to the Heart of Employee Engagement: The Power and Purpose of Imagination and Free Will in the Workplace,” I talk about imagination and free will as the two essential qualities that differentiate human beings from all other living creatures.

When it comes to free will, our capacity to make choices, to do things that aren’t dictated by the program that controls other animals is a forceful driver of people’s attitudes and behaviors. Failing to appreciate that force leads to some flawed notions about human nature in the workplace. The old bromide that people resist change is a classic example.

The fact is, people change all the time. What they resist is being forced to change without having a say in the matter. People hate not having the control that comes with choices and options. What’s more, they won’t trust anyone who takes that control away from them, and their performance on the job is often subpar when they don’t get it.

That distinction is at the core of a basic misunderstanding about why people supposedly dislike “command and control” cultures. In truth, it’s the command part people hate. When it’s done right, control is just another word for predictability, and employees understand that.

Bottom line, healthy egos are a big part of what makes the business world go ’round. So take the time to make sure employees are clear on their E-xpectations, G-oals and O-ptions if you want to keep them tuned in, turned on and ready to go the extra mile.

 

Les Landes is president of Landes & Associates. The firm provides management consulting services in the areas of organizational communication, employee engagement, marketing, public relations and continuous improvement systems. They are the creators of the “ImaginAction System,” a tool for getting employees engaged in systematic continuous improvement. Landes is also the author of multiple articles, as well as a recently published book, “Getting to the Heart of Employee Engagement: The Power and Purpose of Imagination and Free Will in the Workplace.” For more information, visit www.landesassociates.com.

Twitter: @LandesAssocs

LinkedIn

Facebook