Do your employee incentives encourage productive behavior?

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Reward programs gone horribly wrong

I think we’ve all seen examples of reward systems leading to counterproductive behavior.  My favorite example is working for a fast food joint when I was in college  and having a “seventy second drive-through time” contest.  Our goal was to keep the average time between customers leaving the drive-through menu (presumably having just placed an order) and customers leaving the drive through window (presumably having just received their food) below one minute and ten seconds – for an entire week.  The reward for meeting this goal was a week’s vacation in Hawaii for the GM and his wife.

We had a clock above the drive through window that let us know what our average drive through time was for the day.  That clock was the center of our world for a week, and we were led through some strange strategies to beat it.  The eye-popping cheats my team employed to meet this goal were as follows:

1. Assistant GM wearing headphones sets up an unsecured cash drawer on a makeshift table outside in front of the drive through menu.  Customers placed orders with her directly and paid.  She asked them to wait until she gave them the go ahead to drive forward to get their food.
2. AGM receives word via her headset that the customer’s order is nearly complete and she waves them through.  Customer drives over the sensor, starting the seventy second drive through clock at 0.
3. Customer arrives at the window seconds later, receives the food through the window, and drives off.   Total automatically measured drive through time: less than ten seconds.
4. In case of an unusual order, the customer was asked to pull all the way through and wait in the front parking lot to have the order delivered when it was finished.

Why people buy in to flawed reward systems

I can only really defend #4 as sound practice for operating a drive through.  If a customer’s complex order is going to slow up the rest of the business, it makes sense to pull them aside and let simpler orders keep going through.  Similarly, a table for two is always quicker to get at a restaurant than a table for ten.  The rest of these things were unsafe and dishonest and completely against the spirit of a program to minimize drive-through time, but I believe the GM received his trip to Hawaii all the same.  The only reason the rest of us were complicit in these ill-advised plans was because we wanted to keep our jobs.

So – make sure your employees’ individual incentives are aligned with your organizational goals.  If your new systems and processes (such as Enterprise 2.0) are going to require realignment of your employee’s daily work, be sure their goals and rewards are similarly recalibrated.

Current management theory on rewards and engagement

I had a conversation this morning with a coworker about career advancement in the form of promotions and raises and how (or if) they aligned with internal collaboration tools like SharePoint. I was thinking of Freakonomics when discussing this but I just got around to reading Venkatesh Rao’s review of “Drive” by Dan Pink (drive in this context appears to be mean employee engagement) and this part jumped out at me:

[W]e get a speculative list of reasons why carrots and sticks don’t work for creative work. The book calls this list the “Seven Deadly Flaws”

1. They can extinguish intrinsic motivation
2. They can diminish performance
3. They can crush creativity
4. They can crowd out good behavior
5. They can encourage cheating, shortcuts, and unethical behavior
6. They can become addictive
7. They can foster short-term thinking

In-the-flow versus “sure we’ll get to it the day after we run out of real work”

This fits right in with the accepted idea that the way to make enterprise collaboration work is to use it “in the flow” of our everyday work rather than using it “above the flow”.  In the flow means you’re actually getting your job done by using these tools as opposed to doing your job once and then going to another platform to write about it.

At the end of the year when your corporation looks over its employees’ performance and decides who’s helping the company out to the degree they need to be reinforced and who isn’t, are your reward systems structured to account for team-wide successes or individual stars?  It is easy enough to compare one person’s productivity against another’s as long as you are only measuring their direct outputs and not those of the people they work with and facilitate on a daily basis.  If you want your collaborative systems to succeed, be sure employees are incentivized to share rather than hoard.

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