How do you incentivize people to do a good job? How do you keep them motivated? It would be nice if incentivization were simple, but it’s not. What motivates people is one of the biggest questions of leadership. There are no straightforward answers because human beings are complex. Getting them to ‘do stuff,’ especially stuff they don’t particularly want to do, differs from person to person and within the context of their needs and values. Poor leaders believe that monetary compensation is a primary driver of engagement. Money matters, but it only matters so much. Appreciating people’s effort, in most cases, matters more.
Why doesn’t money matter that much? It’s because we humans have a notion that deeply affects our behavior. We have a sense of justice. We care most about our pay when we feel that we are not getting our fair share. When pay is unjust it undermines performance. Getting a paycheck at a regular interval doesn’t incentivize high performance either because it becomes expected. The best advice on monetary compensation is to pay people justly and well enough to remove it as an incentive. Take it “off the table” so that it doesn’t complicate what really matters. What matters more? There are many factors, but one of the most significant is recognition.
Recognition matters. One research team found that recognition, properly executed, could make a company three times more profitable as compared to companies with low recognition activity. People just want to be appreciated for what they do and feel that they contribute meaningfully to the organization. The best way for leaders to connect team members to a sense of belonging is by recognizing their efforts.
So, how should leaders recognize? How should leaders thank and reward people for their work and engagement? What follows are six principles of thanking and rewarding.
Recognize the deed: Recognize the deed rather than the person. “Sally, you put together an outstanding sales proposal that was, according to the client, the best they had yet seen.” Is much better than, “Sally you are awesome!” The former emphasizes what was done rather than who did it which inspires others to do the same. Other research has proven the same regarding critical feedback. When feedback is negative, criticize the action rather than the person. Consider the difference between “Sally, your sales proposal lacked evidence of clear ROI.” And, “Sally, you perform poorly.” The former is constructive, while the latter demeans the character of the individual without any direction on how to improve.
Do it publicly: Thank and reward people in front of others, especially other team members. There’s an old mantra about rewards – thank in public but punish in private. It’s good advice and generally true. It’s worth reflecting upon what Napoleon Bonaparte had to say about rewards – “A soldier will fight long and hard for a piece of colored ribbon.” Small gestures have big impact particularly when there is a physical artifact emotionally attached to it. Military culture recognizes deeds and effort by awarding medals and their associated ‘colored ribbons.’ These are literally small, inexpensive tokens that recipients can wear, place on a desk, or stash away in a curio cabinet. Such tokens can take many forms – coins, buttons, pins, trophy cups, plaques, and so forth.
Do it infrequently: As a common courtesy for simple acts of cooperation and kindness, saying “Thank you,” cannot be overdone. Like getting a paycheck on a regular basis, getting thanked and rewarded routinely loses its emotional impact quickly. Infrequent and unexpected recognition is most powerful. As a leader, you should be saying “thank you” for special effort to one or more people daily, but not always to the same person. Roughly, more tangible rewards should decrease in frequency as they increase in scope and impact while the publicity surrounding them should increase proportionally. Get that report when you expected it? Thank the person that wrote and delivered it right then. Did a team member go out of their way to make sure a difficult customer was satisfied? Thank them in front of the rest of the team at tomorrow morning’s team meeting. Did the sales team close a big deal? Take the team to lunch. These are simple gestures that are meaningful and cost little or nothing.
Do it now: Thank and reward immediately or soon after the commission of the act to be recognized or when evidence of its success is obvious. If someone wrote a great sales proposal, recognize that immediately as a stand-alone event. A simple public thanks and a call-out to its quality is probably sufficient. But, if the proposal results in a signed contract a month later, then that too is something to recognize on a scale appropriate to the accomplishment.
Do it justly: Remember that people expect justice. They trust you, the leader, to ensure that the team environment remains fair. So, if they perceive that one or more members of the team are receiving unmerited thanks and rewards, or that you are ignoring the efforts of others, then you are undermining the sense of fairness and justice that people expect. Often, this can be perceived as favoritism which erodes the high levels of trust that high-performing teams need.
Peers do it best: When you, the leader, thank and reward, that’s great but, peer-to-peer recognition is more powerful. Team mates recognizing other team mates for their efforts is evidence of a strong, mutually supportive, high-trust team. As the leader, your job is to nurture or nudge such behavior if not outright ask someone on your team who did something worthy of recognition so that they can call out a peer rather than you, the leader.
That’s it, just six fundamental principles for being a grateful leader. Use them daily!