#54 Goals That Don't Motivate: Carrots and Sticks Are Not Motivation

If you ask business owners why they set company-wide goals you hear stuff like this…

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Goals get everyone on the same page and moving in the same direction.
Goals give us a target to focus on and rally around.
Goals help us hold each other accountable. 
Goals motivate people. 

These might all be true.  But that last one is especially questionable. It's a sloppy / incorrect interpretation of the word motivation.

MOTIVATION versus MOVEMENT

To explain the difference between these two, here's our favorite psychologist Frederick Herzberg. This is a quote of his I shared with you back in post #8 - Movement is Not Necessarily Motivation

“Movement is a function of fear of punishment or failure to get extrinsic rewards. It is the typical procedure used in animal training and its counterpart, behavioral modification techniques for humans.  

Motivation is a function of growth from getting intrinsic rewards out of interesting and challenging work.

While the immediate behavioral results from movement and motivation appear alike, their dynamics, which produce vastly different long-term consequences, are different.  

Movement requires constant reinforcement and stresses short-term results. To get a reaction, management must constantly enhance the extrinsic rewards for movement. If I get a bonus of $1,000 one year and $500 the next, I am getting extra rewards both years but psychologically I have taken a $500 salary cut.

Motivation is based on growth needs. It is an INTERNAL engine, and its benefits show up over a long period of time.  Because the ultimate reward in motivation is personal growth, people don’t need to be rewarded incrementally.  I write a book - a big accomplishment.  Then I write an article - a lesser accomplishment, but nevertheless an addition to my personal growth."

So movement is about short term results and external rewards - carrots and sticks. It might look like this.

If we do X million in sales this year, I’ll pay you a bonus, give you a t-shirt, and we’ll throw a party.

You’re luring folks down a path you want them to take. There’s no motivation here, but who cares? Who ever said there’s anything wrong with movement goals?

WHEN MOVEMENT GOALS FAIL

Research shows that movement incentives -  bonuses and rewards for achieving goals - can be effective at increasing output. BUT, only if the job is primarily mechanical. Well-defined. Orderly. Repetitive. The kind of work that doesn’t require much cognitive load.

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So if this describes your business, get out the carrots and sticks. Set goals, provide rewards,  put up charts, measure progress. You should be able to achieve the movement you’re looking for.

If, on the other hand, your work is creative, cognitively challenging, or involves decision making, you might want to try something different. For this type of work, the presence of carrots and sticks tended to LOWER performance. That’s right. Providing incentives for hitting goals had a negative impact on performance.

If you want more info on this research see this TED talk from Dan Pink or read his book DRIVE.

We’ll look into Pink’s work in more detail once Version 1 of the Map is complete. But for now, let’s just make the assumption that you're going forward with a movement goal because it’s what you’re used to.

THE MAC DADDY of MOVEMENT GOALS

This is the number one movement goal I see across small businesses.

“We’re going to hit X revenue in Y years”. 

Y is almost always 1, 2, or 5 years. And X is $10 million, $20 million, or $50 million dollars.

But where did you get this beautiful number?

Nine times out of ten it’s wishful thinking. You took current revenues, threw a trend line on them, and rounded up. Voilà this conjured up number is now your guiding light. 

Or maybe your number has real meat behind it, maybe you factored in economic forecasts from experts in your market. If that’s the case, I would point you to pages 218 and 219 of the amazing book Thinking Fast and Slow. It’s written by Daniel Kahneman, Nobel Prize winner in Economics, and he points out that…

“People who spend their time, and earn their living, studying a particular topic produce poorer predictions than dart-throwing monkeys.”

So be careful setting your goals based on an “experts” prediction. You’d do as well taking the team on a field trip to the zoo.

Regardless of where you get your number, please at least take it one step further. Take the time to understand what's in it for the folks on the front line that’ll be doing the actual work.

And you should bear in mind that these folks might not be as excited about growth as you are. Think about it this way. Assuming you're profitable and won’t close the doors if there’s zero growth, aren’t they better off not growing? Doesn’t steady state mean less stress and more predictable days? Maybe even getting home in time to see the kids soccer game?

To be clear, I’m not arguing against growth. I cut my teeth in a couple venture-funded companies designed to grow at crazy speeds or die. But those kinds of companies are rare. Odds are you’re more of a bootstrapped, locally-funded business that doesn’t have a gun to it’s head for growth.

And for these kinds of businesses, I’ve heard growth discussed this way by the rank and file.

“All I’m doing is putting more money in the old man’s pocket. Why should I bust my ass?”

“If we hit the number I”ll get a piece of cake and a cheap t-shirt. Then they’ll just raise the damn goal again and we’ll jump right back on the same old treadmill. Only it’ll be running a little faster.”

That’s not good, but it doesn’t mean you shouldn’t have a goal of business growth. It does mean you should recalibrate your focus a bit. Realize that hitting a profit or revenue target is a symptom of doing other things well. So you can share the big round number with folks if you choose. But at least make sure each individual understands how they impact that number. How tangible movements by them make a real bottom line difference.

Instead of saying our goal is $2 million in profit. Say our goal is $2million in profit which means shipping has to average 300 zero defect boxes out the door per day. Marketing has to do this. Sales has to do this. Manufacturing has to increase efficiency and cut waste by doing this. HR must hire 7 people that FIT our business. 

Being this granular with your goals is most likely to inspire the movement you're looking for. 

But what about motivation, is there any chance for it?

THE MAP

(This site is all about building a Map that will help me do work and life better. So at the end of each post I check in to see if any changes / insights come to mind.)

Let’s start with the assumption that your business is a 100% repetitive / mechanical type place. You pump x widgets out the door per day. Each person is a cog in the machine and zero creative thinking takes place.

A very unlikely scenario, but it gives us somewhere to start. In this case I would call your attention to the left side of the map - BE FAIR DAILY (BFD). This is all about the environment / context / culture you create. And it’s pretty much the only lever you have.

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So review your ME / WE and make sure you’re cleanly and consistently expressing your values and beliefs through your business. The more heartfelt you are, the more connected folks that FIT will feel. Morale will improve and identifying good hires will get easier. Coming to work will be more enjoyable. 

That’s a helluva lot of good, and, at best, it’ll net you employees that feel NOT DISsatisfied. And while that sounds a lot like kissing your sister, it’s actually a big accomplishment. Better than most businesses. And enough to get folks to engage with your well thought out movement goals.

Now let's get more realistic. Assume that at least some of your jobs require creativity and cognitive load. This opens up the right side of the Map which I call HELP GROWTH HAPPEN (HGH). This is all about motivation and it’s driven by two factors. Feedback - sharing honest, constructive advice. And Freedom - giving folks the tools and latitude they need to take responsibility for big challenges.

Over here goals have less value. Remember I pointed out that they can actually work against you in the face of creative work.

Over here it’s more about allowing the individual the latitude to experiment, and that’s hard to build goals around. The drivers over here on the motivation side are intrinsic. And that internal engine only runs when the individual feels like they’re growing in a direction that’s important to them. And you, the business owner, don’t get to decide what that direction is and you can’t put a number on it on their behalf.

You need to put folks in positions that match their personal areas of motivation and you have to give them some rope. In return, hopefully, you’ll get an amazing level of energy and devotion that you can't get with bonuses or t-shirts. You’ll see that determined look in their eye that shows they’re challenged and struggling and engaged and growing.

If you really want to help them you should start by removing any and all corporate obstacles from their path. And maybe you could play a little “I Did It My Way” in the background. 

DAMN - I was supposed to finish version one of the map today but I never got to my own goals / CAN?’s for MapOfMe. Oh well, that’ll be next time.

***Note: This site works best when you read the posts in order. So please head to the ARCHIVE to get started.