Reward is all about money, right?

Leadership Memo 2021-11

In my previous Leadership Memo, we explored how the motivation and the form factors of the rewards differ for the generations. In another post, I dived deeper and looked at how those motivations and form factors play out in the current debate about going back to the office versus working remotely. So, obviously, having only one reward and recognition system doesn’t work. I also mentioned that you need to be creative, keep the incentives fresh, and tailor them to teams. So, how do we do that? What does that even mean?

First, we need to be mindful that all incentives drive behaviour. So, you need to know what you are trying to achieve (the purpose of the reward) and what behaviour you would like to effect or encourage (the value). Then, you need to think through what unintended consequences there can be as people want to get the reward. Otherwise, the unintended consequences may end up doing more harm than good.

Let’s walk through an example. In the United States, when cities need money, one of the common solutions is to incentivise police officers to look for traffic violations. So, what is the goal of this incentive? Adding extra revenue to the local treasury. What behaviour would the city like to encourage? Citizens abiding by the traffic laws, which would help keep the city safe. Sounds good so far. Are there any unintended consequences?

Here’s what a recent news article says: “A hidden scaffolding of financial incentives underpins the policing of motorists in the United States, encouraging some communities to essentially repurpose armed officers as revenue agents searching for infractions largely unrelated to public safety. As a result, driving is one of the most common daily routines during which people have been shot, shocked with a stun gun, beaten or arrested after minor offenses.”

Some unintended consequences! The goal may be met (the local treasury getting more money), but is this incentive a good way to achieve that goal? Once you think this through, you can come up with a system that is more adaptable.

Second, you need to be creative and keep the incentives fresh. Change them from time to time, otherwise, people will game the system. You can read my earlier article titled “How to make reward and recognition fun and relevant?” for some examples of the different rewards, as well as how to keep them fresh. It’s not about the stated policy. The underlying reward system is going to guide what people do.

Last but not the least, we need to tailor the incentives to the teams. What does that mean? It means understanding what the teams appreciate and want. You need to know what your teams like and dislike. It’s just like any relationship. It’s similar to how you find out what your friends like, what your girlfriend/boyfriend likes when you’re dating, or what your spouse likes. When you put thoughts into it, it shows that you care about your teams. When the team likes the awards and incentives, they realise management knows them, cares about them, and appreciates them. In turn, they work harder to “earn” those awards.

What is your experience with reward and recognition? Drop me a note and let me know. I’d love to hear from you.

Latest happenings:

1. Busy conference season continues. After speaking at Agile Tour London, Agile Tour Brussels and Agile Online Summit in Oct., I’ll be speaking at Agile Business Conference on 9 November. Come join me as we explore inclusivity in the workplace. Being Agile doesn’t automatically mean inclusive. Register here.

2. On 18 November, I’m invited to participate in the 24-hour Reinventing Work event, called “A playground for new ways of working”. I’ll be giving a workshop on “How to make performance review meaningful and timely”. It’s performance review session, so this is especially timely. It’s free! Register here.

3. “Our Agile Tales” podcast, episode 4 of Agile @ Tesla is out! We dive deep with Joe Justice, chatting about Elon Musk’s desire and drive to innovate quickly. The result is tangible organizational agility at Tesla. We cover everything about agility, from HR (episodes 1-2) and Finance (episodes 3-4) to applying agile methods to product development and hardware. Take a listen and let me know what you think.

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