Motivation and Incentives in the Lean Company
Some groups don’t have to worry about motivation. Sports teams, for example, are filled with people who want to win, or at least enjoy trying. But for most of us, don’t have motivation so easy.
Truly lean organizations have demonstrated a higher level of motivation, incentive, and engagement. In part it may be because of the intrinsic decision making of those practicing the principle of “respect for people.” However, many more tangible strategies and tactics within lean efforts directly interface with the world of incentive and motivation. Here are a few to consider.
1. The annual review
Annual reviews are one of the most ubiquitous tools in corporate America and one of the most criticized. Dr. W. Edwards Deming, one of the most significant contributors to lean, believe that the annual review should be killed.
Most companies are not ready to give it up, but that doesn’t mean it can’t be used to your advantage. Many managers think very linearly about what they put in their team’s goals and how they execute reviews.
- First, feedback particularly around behaviors is most effective when the time between the occurrence and the feedback is minimized, whether positive or negative. Do not use the annual review as a primary means to give behavioral feedback.
- Goals can be set specifically to drive people outside of their comfort zone, which can force new examinations, observations, learnings, and improvements. For example, if a performance parameter was usually measured in weeks you may just start measuring it in days forcing a rethink of the entire process.
- Goals can be used to force people to better connect with customers. For example, if a group is serving an internal customer, instead of adopting your own goals you might just adopt your customers goals. You succeed if you customer succeeds, with no way around it.
- Goals can be used to begin to create habits of focus on the team instead of the individual, or adopting other ideas instead of not-invented-here, or other behaviors. For example, you can measure an individual on how well the rest of the team does, encourage group support and learning. You can have people demonstrate ideas that they adopted successfully from others. Just because performance reviews are done individually doesn’t mean we need to drive apart teams and create silo thinking.
2. Teams and the mini-company
By building balanced scoreboards / scorecards for teams to better connect to the performance of their area, and the integration of daily huddles to communicate and converse about performance and the work, teams move closer to behaving as a mini-company. They down legally own their department, but they build a stronger sense of ownership. They are better connected to the purpose. They see more broadly how different variables and people impact one another. And they are more involved in setting priorities and making decisions on a regular basis.
“Mini-companies” have gone as far as developing their own logos as they get more engaged in the long-term purpose of the team and its mission, not just its performance targets.
3. The elimination of blame for bad process
When we lack structured processes, standard work, and a language to talk about process, when failures occur blame is often the first response. Of course people feel blind-sided by this because “I didn’t TRY to mess up.” And blame is one of the fastest de-motivators of engagement we can find.
When we have structured processes through lean work, and failures occur, it enables us to eliminate that blame. If someone didn’t follow a standard, there is often something that interfered. Instead of allowing workarounds, lean managers will work to remove those interferences. And if people follow a standard and it still fails, then we must reexamine the process. Because of this thinking and response to problem among lean managers, blame is reduced.
4. Kaizen events generate ownership of a process
One of the most common phrases heard in kaizen events is “I’ve been suggesting this for years.” Whether that’s true or not, or it was recommended but not in a productive way, or to the wrong person – none of that matters because the individual was feeling disengaged. They were now in it only as a job.
Kaizen events generate often a significant emotional event of engagement. Ideas are out in the open. Leadership is on the spot as they are both ready for ideas and expecting results. Ideas that stalled before more freely flow into decisions and actions.
The net result on motivation is that team members developed a stronger sense of ownership over at least the process improvements that they helped to design. This is a small but significant step towards building a stronger sense of motivation within the organization, one team and one process at a time.
5. “Suggestion” or idea systems
In truly lean organizations, a common response to “why do you contribute ideas?” is “I get the chance to help make them happen. In fact, the companies that excel at receiving ideas from employees offer very little, if any, financial reward for doing do. But they are not done as suggestions to be handed off. Employees are involved in the idea from beginning to end. There are boundaries, or fences, that contain ideas from going off too far. But resources, connections, and support is provided under the context of helping employees execute their ideas rather than taking the ideas over.
This proves to have the same effect as kaizen events but on a most sustained and steady basis.
Motivation isn’t an easy animal to tame. We should keep in mind that there is never one solution, nor a permanent one. I’m sure many of you have found your own solutions, and we’d love to hear your thoughts.