Compensation Force

On Fully Mobilizing Human Minds

In an interview on innovation in management featured in the McKinsey Quarterly (2008, No. 1), author and strategy guru Gary Hamel talks about the need to radically change how we design and manage organizations.  I particularly liked this quote:

The old model was, “How do you get people to serve the organization’s goals?” Today we have to ask, “How do you build organizations that merit the gifts of creativity and passion and initiative?” You cannot command those human capabilities. Imagination and commitment are things that people choose to bring to work every day—or not.

Hamel also shares some interesting thoughts on where the art & science of management is headed in the future:

Increasingly, the work of management won’t be done by managers. It will be pushed out to the periphery. It will be embedded in systems. I think we’re on the verge of what I would call a postmanagerial society. The idea that you mobilize human labor through a hierarchy of overseers and bureaucrats and administrators is going to look extraordinarily antiquated a decade or two from now.

And:

There is a danger ... of creative apartheid. Too many executives seem to believe that while a few people in the company may be really clever and creative, most folks aren’t. When you look at companies like Toyota, you see their ability to mobilize the intelligence of so-called ordinary workers. Going forward, no company will be able to afford to waste a single iota of human imagination and intellectual power.

An interesting article that's well worth checking out.

A Few Pithy Management Quotes

Peggy at the Career Encouragement Blog has a post today featuring some great management quotes from a client of hers who seems to have a real gift for (as Peggy tells it) "delivering nuanced feedback via pithy sayings". 

Check it out!

Bruce Ellig on the Most Common Compensation Mistakes

The August issue of WorldatWork's workspan magazine features an interview with Bruce Ellig, the WorldatWork Keystone Award recipient in 2004, more recently honored with the University of Wisconsin-Madison School of Business' Distinguished Business Alumni Award, whose total rewards career covers a span from the 1960's through today.

In the workspan interview, Ellig is asked about the common mistakes that new practitioners to the field of rewards make.  His response, part of which I quote below, provides wisdom worth heeding for all HR and reward professionals (even those of use who've been here for a few years).

Too much focus on trends and hot topics.  Not enough focus on customizing programs and processes to address real needs.  People have programs looking for an application rather than analyzing the issue and then determining what's the best program or process.  Too many start at the end and work toward the beginning.  Logically they should start at the beginning.

Here, here!  My experience would completely confirm the prevalence of this problem.  When I speak publicly on the topic of rewards, and in meetings with prospective clients shopping for a consultant, the most frequent question I am asked is:

What are the hottest trends in compensation? 

It is the wrong question, and it reveals a fundamental misunderstanding of how rewards work in an organization.  It also reveals a desire to skip the basics (as Ellig states, analyzing the issue and determining the best program and process - to address it) and simply apply the coolest new solution without thought to its fit or relevance. 

The result of this all-too-common mistake: a reward program that rightly deserves even Alfie Kohn's harshest criticism.   

Jeffrey Pfeffer on Incentives

Guy Kawasaki  has posted an interview with Jeffrey Pfeffer, Thomas D. Dee II Professor of Organizational Behavior at Stanton University's Graduate School of Business and author/co-author of 12 books, and I thought that Professor Pfeffer had some worthwhile wisdom to share on the specific topic of incentives:

Incentives should be large enough to provide an occasion for celebrating success but not so large as to distort behavior.  And incentives can include recognition and things other than money.  Companies get themselves into trouble all the time by being too clever with their incentives.

Words worth noting!

Charles Koch on the Role of Incentives

In his new book The Science of Success: How Market-Based Management Built the World's Largest Private Company, Charles Koch, the CEO of Koch Industries, Inc., opines on the role of and reasons to use incentive plans.

Proper incentives motivate people to work harder, be more creative, and create more value for others and, hence, themselves.

These are not, however, the only reasons for using incentives.  Even when well-intentioned and motivated people are eager to succeed, they still face the challenge of understanding where and how to focus their time and effort.  Successful entrepreneurs use the incentive of the market to determine the most productive course of action.  Likewise, employers should use incentives to guide employees toward areas where their attention and effort can create the most value.

I appreciate his point that incentives do not exist merely to motivate people who would not otherwise be inspired to do good work, but rather that incentives play an important role by signaling (in a powerful and economic way) the most important work priorities in order to provide guidance on how people should best focus their time and attention.

On Motivating People

The following excerpt, from the Harvard Business Review article What Leaders Really Do (abstract) by John P. Kotter, reminds us that truly motivating people involves more than just offering money in exchange for achievement, but rather tapping into some of our most fundamental human needs.

Motivation and inspiration energize people, not by pushing them in the right direction as control mechanisms do but by satisfying basic human needs for achievement, self-esteem, a feeling of control over one's life, and the ability to live up to one's ideals.  Such feelings touch us deeply and elicit a powerful response.

Search internshipson College Recruiter.

Andy Grove on Committing to Performance Management

A noteworthy quote on the topic from Mr. Grove, former President of Intel.  A great retort to the complaint we hear from far too many in management roles; that they are too busy to spend time managing the performance of their subordinates...

At Intel we estimate that a supervisor spends 5-8 hours on each employee's review, about 1/4 to 1/3 of 1% of the supervisors' work year.  If the effort expended contributes to an employee's performance even to a small extent over the course of a year, isn't that a highly worthwhile expenditure of a supervisor's time?

We are paid to manage our organizations.  To manage means to elicit better performance from members....  We managers need to stop rationalizing, and to stiffen our resolve and do what we are paid to do.

On Niceness (In the Workplace)

Author Malcolm Gladwell makes important points about niceness in the following quote, particularly its role as a barrier to good management practices (especially true here in the land of 10,000 lakes, where our culture of "Minnesota Nice" can be positively debilitating in the workplace):

It [is] the practice of niceness that [helps] keep other values, such as fairness, at bay.  Fairness sometimes requires that surfaces be disturbed, that patterns of cordiality be broken, and that people rudely or abruptly be removed from their place.  Niceness is the enemy of fairness.

John Kenneth Galbraith on Progress Through People

Another pithy performance management quote, this one from economist John Kenneth Galbraith:

People are the common denominator of progress.  No improvement is possible with unimproved people.

Elvis Presley on Values

The King dispensing organizational wisdom?  Not exactly, but I think his words -- noted below -- are worth considering in that context.

Values are like fingerprints.  Nobody's are the same, but you leave' em all over everything you do.

The essential truth in this statement holds for organizations as much as, and in a similar way to, individuals.  Your organization may or may not take the step of formally acknowledging, articulating, documenting or reinforcing its values -- but those values exist nonetheless, and they manifest themselves in all aspects of operations.