Reward the right behaviour – or it will kill your business.
Best Practice Advice & Strategic Issues

Reward the right behaviour - or it will kill your business.

May 8, 2015

by Tony Vidler

Kindergarten teachers know it, so why don’t the leaders of professional services firms know it and use it?

We tend to get the behaviour we reward repeatedly.

I have been reminded of this simple concept several times in recent weeks.  In one instance it was watching a previously excellent professional run amok and engage in an increasingly erratic fashion, eventually inflicting permanent damage on his firm.  In another, I watched a firm struggling to get a grip on precisely how they should reward a fairly large crew of pretty good performers. Both firms had forgotten the basic concept that Kindergarten teachers know and use all too well.

In the first shambolic example, the firm had created a system whereby a hard-charging and enthusiastic professional was being entirely remunerated for the time spent inside the business “fixing it”.  Guess what?  More and more things needed time spent on them, and more and more things suddenly needed fixing…and the hours mounted.  So more money was paid over….and the cycle repeated itself ad nauseum.  In just a few short months the professional believed that the more time spent worrying over everybody else’s jobs, the better the business would become.

What actually happened was disenfranchised staff and colleagues throughout the rest of the business, less focus on the individual’s real skill set and abilities which could enhance the firms prospects, and a much much higher demand for money from “the Rock Star” who “was fixing everything”.  People began disengaging, or leaving, placing further financial pressure on the firm which in turn required more time at a now higher price to fix everything….and you can guess how that one played out.  A shambles.  The Rock Star is becoming Last Man Standing.

Lack of appropriate control mechanisms for sure, but fundamentally the wrong behaviour and focus was being rewarded.  The business is now officially dying.

The second example is far more uplifting, and is very much a “story in progress”.

It is a well established professional services business with superb internal controls and management, with clear understanding on what every person’s primary role and value to the organisation is.  It has a genuine “team” approach, where the attitude is the “sum of the whole is greater than the individual parts”.

While the team is (generally) performing very capably, and at higher level than most competitors, there is an inherent dissatisfaction – they believe they can, and should, do better.  However there is a need to tread carefully, as the existing culture is an excellent one and the people are performing well already.  Management have thought very carefully about what behaviours they value, and which behaviours support their culture and values prior to putting together additional rewards and recognition.  Most importantly perhaps, management understand that recognition IS a form of reward.

The end result is a reasonably simple system that focusses on 3-5 key activities that drive results for each position.  A little like the old “20 points per day” process – though with a touch more sophistication to it.  Complete the particular activities for your role on a daily basis and accumulate points…and everyone who hits their own benchmark number gets rewarded the same as everyone else in the organisation (no matter their job) who has hit their benchmark number too.  Those who are consistently performing are recognised as leaders and role models, and given extra kudo’s as such.

There are multiple people in the organisation with similar jobs, but then there are others with very different jobs too.  An excellent rewards system focuses on the actual job that each individual was brought on to do…there is no separation of those who are revenue generators, or those who are service or admin oriented.  Each is part of the team for a reason and has a role to play.  Each team member plays their part and is recognised and rewarded for doing so very well.

The result? a co-operative and positive culture chasing success and higher performance.

The lesson?  Don’t underestimate the importance of which behaviours you give recognition to, and reward.  Some will kill your business….some will make your business.  Reward the right behaviours well.

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