The (Micro) Manager as Reward Broker

Micromanagement, done right, can be a good thing.  Even a very good thing.  So says Towers Watson consultant Thomas O. Davenport in the BusinessWeek.com article Who Says Micromanagement is Bad?

He isn't referring to the neurotic, control freak variety of micromanager, but rather one who is "suitably precise".  The micromanager he touts is one who allows people to work autonomously, yet gives them the support, guidance and information they need to do so successfully. 

He also believes the effective micromanager is not simply a passive administrator of reward programs, but rather plays an active role in ensuring that a "fair and engaging" deal is put on the table for employees.  The manager as reward broker and customizer, if you will. 

Effective managers act as brokers, ensuring that engaged employees contribute to business success and that the business provides commensurate rewards. They also translate, making the enterprise strategy clear to employees in ways that apply to their own work. Most important, they are architects. They construct individualized reward portfolios, using such elements as learning opportunities, project assignments, and organizational network introductions to ensure that each employee has a deal customized for his or her personal needs and circumstances.

In Davenport's description, the manager's reward brokerage focuses on the non-cash, work experience elements of the reward package.  And while it appears to be true that many employers are ascribing to a "cash is king" philosophy coming out of the recession, it is also true that an attentive, supportive manager who creates a motivating and engaging work experience can build a healthy cushion around that cash package.  An employee working with a lousy manager and in a lousy work environment may be ready to leap for the smallest pay hike, while an employee who feels their manager is going the extra mile to create a constructive and positive situation will likely require a substantial jump in pay to consider (and risk) making a change.

Astute managers are doing this already, having recognized that this is the best way to motivate and retain talent during tough times when cash rewards are hard to come by.  In a recent Cafe post, I quoted another article which reported that 25% to 40% of employees already have some individually negotiated work arrangement in place.  As recovery lifts the labor market, I'm guessing that this number will grow. 

The question for us, as HR and reward pros, is this:  At one point do we need to get ahead of this wave with structure and guidelines in order to ensure that the arrangements being granted are equitable and defensible?  That they aren't just going to employees with the strongest negotiating skills or the most savvy managers?

If our managers are the brokers of the customizable reward package (and evidence suggests that they are already embracing this role) how do we ensure that they are carrying out this charge in a sufficiently thoughtful and purposeful manner?

Your thoughts?

Comments

[Paul Hebert]

Not to toot my own horn but for a while now I've been riding this same horse - managers are the key to engagement. The one-to-one discussions and experiences that occur between the employee and their direct supervisor (manager) are pivitol and critical for employees to be engaged. It's an old saw but sometimes they are true - people join companies and leave managers.

What concerns me is that (and I'm not saying you Ann - just some folks) consultants and managers believe that they should manage the process of interaction between managers and employees with software, procedures and paperwork. When in reality we need training for individual managers with respect to human motivation, engagement, decision-making.

Managers need to understand the "machines" they are repsonsible for. We'd never let a welder go use his/her machine without fully understanding how it works, what each knob and button does and how to recover from errors, etc.

For some reason in business we believe it is more important to teach managers about the processes their people work "within" rather than teach them about the people who work the process.

Don't "get ahead of this wave with structure and guidelines in order to ensure that the arrangements being granted are equitable and defensible" - we first should teach managers how to do - then decide if we need controls.

So to answer your final question...

If managers are truly responsible for "people" it is no stretch to educate them on the proper application of these influence techniques and require they create an individualized plan for each person they manage. Their performance against that plan should count for at least 50% of their performance ranking.

The net-net... Teach and Trust but Verify.

[Steve]

Paul,
I'm not sure I follow your logic. You say you are concerned that "consultants and managers believe that they should manage the process of interaction between managers and employees..." Sounds as if you are advocating a "hands-off" approach.
Yet, in closing you seem to advocate in favor of taking steps to "educate them on the proper application of these influence techniques and require they create an individualized plan for each person they manaage." That sure sounds a lot like setting up procedures and paperwork, though perhaps not software. In fact, it sounds a lot like the "structure and guidelines" Ann suggested in her post.
So, what are you really saying?

[Paul Hebert]

I'm saying that in most cases we want to abdicate the responsibility for these things to systems and procedures versus trusting the manager to do it right. Think of how we tell managers they HAVE TO have so many in each of the ranking levels so it fits a normal curve... things like that are designed to remove responsibility. I'm saying give them responsibility.

I'm saying - train managers correctly - give them free reign to reward as needed (assuming there is training) and follow up regularly to make sure they are applying their training effectively. The ONLY requirement is that a manager needs to think about their people and have a plan. I'm not saying others need to approve it - just that managers take time to make one. And... this would only have to be done once since I'm convinced if done once the managers will see the benefit and then do it on their own moving forward.

So yes - hands off - but train initially.

[Ann Bares]

Paul and Steve:

A great conversation, and I really (honestly) appreciate the tactful pushback, Paul. That is how we learn from each other. I agree that we don't want to structure these kinds of rewards to the point that we allow (or even encourage) managers to abdicate their responsibility for knowing their people well enough to structure an engaging work experience for them. Northing like the "forced ranking" scenario you mention. I think that what I have in mind (which is still, admittedly, vague) is more along the lines of a broad roadmap and a wide set of guardrails - so that everyone works from a common understanding of why this "customization" is an important part of the work experience ... and they are not given sufficient rope with which to hang themselves (which might be a challenge to "unwind", once verified later). (Is this where you are coming from, too, Steve?)

I've seen what management teams with a lot of flexibility and little direction can do with cash rewards - one of the results is the host of discrimination regulations we are now (or about to be) facing. I'm likely dragging a lot of baggage from my cash experience over to this side of the equation - rightly or wrongly, I'm not quite sure.

I admit that it's a delicate balance.

What say others? Am I overthinking and overengineering this (heaven knows that I am prone to both)?

[E James (Jim/UncleJamie) Brennan]

All the posts make sense.

The ancient sports analogy is that of a supervisor as a downfield blocker who opens up the path for their employees. They should be trained to enable their subordinates to maximize their various contributions. Managers may not have direct reports but are additionally resposible for crafting and tweaking any management systems and procedures for optimal effectiveness by users. One of the most vital supervisor/manager functions is fast, timely, accurate, meaningful, etc., feedback, which is a form of reward itself.

[Steve]

Paul,
Thanks for clarifying your position! I feel as if I have a better understanding of what you are saying. I suspect your program would be a bit less structured than one I would design. However, I understand and agree with your concern about too much structure. I think Ann said it well in that it is a delicate balance. Perhaps company culture even comes into play. That is, there likely is not a single "sweet spot" that is right for everyone.

I believe that some structure actually helps encourage some managers to take actions they otherwise would not. Structure sometimes encourages the less bold to take steps they wouldn't otherwise.

Jim, I appreciate your reminder that appropriate feedback can be a form of reward in itself. It is amazing how impactful a few sincere words of encouragement or praise can be, even when offered to a peer or other employee not directly reporting to you.

Thanks all!

[Employee Scheduling Software]

To be honest, I think there should be a mix. Micro-management is good in certain times and situations of the business, but then sometimes you need to be lax as well. I think sticking to one extreme for all situations is not good.