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CHAPTER 8How to Recognize and Reward People

HOW TO RECOGNIZE AND REWARD PEOPLE

This chapter continues with the idea that your job is to steer people, helping them stay the course and stay on course.

On going feedback and incentives are used to steer

Incentives - are promises of a reward An incentive can be a promise of a

future reward, such as a bonuses


Rewards - how organizations fulfill the promise.

Recognition - how the organization acknowledges and shows appreciation for people

Recognition programs may use financial rewards or non-financial rewards.

COMPARISON OF INCENTIVES AND REWARDS

Factor Incentive RewardsWhat it is • A promise of a future

reward• Something earned toencourage thecontinuation of or theachievement of specificresults, behaviors, oractivities

• Something given after thefact in appreciation ofgood work oracknowledgement of someresult or achievement• Something given toencourage thecontinuation of specificbehaviors or activities

When it occurs Before, during, or after anactivity, event, or result

Either during an activity,after a result, or afterthe fact

COMPARISON OF INCENTIVES AND REWARDS(CONT.)Factor Incentive RewardsPurpose • To encourage and

motivate people to behavein specific ways or toachieve improved results• To provide direction

• To motivate when doneduring an activity• To acknowledge whendone after the resultsare in

Criteria • Tied to desired results• May be tied to behaviorsthat lead to results

Tied to desired results orspecific behaviors that leadto results

PERFORMANCE IMPROVEMENT First question to ask- what would I want

to accomplish by using incentives or rewards?

Second question - how will I know whether the incentive or reward I did what I wanted it to do?

PERFORMANCE IMPROVEMENT Performance improvement - following a

systematic process to identify and use appropriate incentives to get the results you want.

Without systematic process, one could potentially reward people who does not contribute to the success.

COMMON MISSTEPS1. They fail to point out the importance of the work to be done.2. They discount the significance of a personal thank you,

general courtesies, and politeness.3. They are unclear on their purpose—whether they want to

encourage specific behaviors or reward results.4. They fail to link the reward or recognition to performance.5. They do not reward people fairly or equitably.6. They think treating everyone the same is best.7. They think treating everyone differently is best.8. They reward meaningless results.

LEADING AND LAGGING INDICATORS(LEADING)

The presence of some activities and behaviours improves the odds that the organization will be successful.

Examples: following up with customers in a timely fashion or complying with safety procedures

LEADING AND LAGGING INDICATORS(LAGGING)

Accomplishments are “lagging” indicators, because they are the results that occurred after people engaged in specific activities and behaviours

Examples: amount of product sold compared to quota or customer satisfaction rating received compared to what was expected

LEADING INDICATORS Results happen when managers,

supervisors, and workers engage in specific behaviors and activities.

Incentive plans can be designed to encourage the behaviors and activities that are linked to results..

LEADING INDICATORSSupervisory Behaviors -leading indicators of good employee relations and performance such as:• Setting clear expectations• Giving regular and frequent feedback• Regularly displaying common courtesies• Saying thank you• Being fair when giving people attention or help• Explaining the organization’s vision and his or her vision for the work unit• Showing respect• Taking an interest in people’s careers

SUBORDINATE BEHAVIORS Activities and behaviors that are leading indicators of

subordinates’ accomplishments depend on their jobs. Examples: 1. Sales – not promising beyond the capabilities of

products or services, prepared for client meetings2. Customer Service – asking permission before

putting a customer on hold3. Technicians - arriving early, complete work in one

visit

LAGGING INDICATORS accomplishments or the results that

occur at a specific point in time, the end of a project, or after an implementation.

include things like bonuses, merit increases, and promotions.

LAGGING INDICATORS EXAMPLESSAFETY - the incentive might encourage people to hide accidents. The second problem is that it encourages co-workers to exert pressure to hide injuries.SALES - company bonuses were solely based on total sales volume, not margin.Margin - difference between net sales and the cost of the merchandise

RECOGNIZING THE UNSEEN AND THE UNCLEAN

people who work behind the scenes and do work that is overlooked and under-appreciated(housekeeping, maintenance, etc.)

they also experience emotional burnout and their efforts should be acknowledged

PEER RECOGNITION Recognizing the work done by your fellow co-

workers, customers or team mates.

Examples: “I’m too clever for my job” award is given by co-

workers when they see a colleague do something very clever

companies allowing peers to nominate co-workers for awards when they see someone receive outstanding comments from customers.


Compensation - Incentive used to pay people fairly.

Meaningful Work - most powerful incentive to perform is the work itself especially if people believe what they do is important.

ALIGNING INCENTIVES It is important to identify the right combination

of results and the contributing behaviors. Alignment happens when the incentive plan

gets people to behave in ways that lead to desired results.

Safety incentives only work when: Clear expectations about all the factors that

contribute to performance Good documentation

SUMMARY People who are passionate and have

good relations with each other can beat a lousy system.

Look beyond the organization for rewards; come up with some yourself. Start by letting people know how important their work is and how others rely on them.