OK, how do you motivate a team for real?

How to motivate your team — another in a long line of business-facing concepts that should matter to people who become managers, but often don’t matter. (Alas.) Here’s the rub on this whole deal: we love us some “teamwork” and “collaboration” in organizations of all sizes, even though we’ve got straight-up research that people don’t really want to collaborate with others that much at work. (While we are social animals, and that’s true, there’s also a lot of idiots at work — and that’s even more true.)

So we force people into these collaborative, “cross-functional” boxes a lot of the time and ask them to come together and hit targets. That’s often a massively flawed, extremely fraught process involving a lot of no-context deliverables and backstabbing. And then what happens at the end?

We promote individuals, not teams.

That’s kind of where this whole deal on “how to motivate your team” starts to collapse. It’s hard to motivate a team when the individuals are the ones who reap the benefits. Think of this math, right? If you bring together 10 people “cross-functionally” on a project, and the project is a massive success, how many of those 10 people will get a salary bump or bonus from it? I would guess 5 at most. In most companies, it would be 1-2 — and those 1-2 wouldn’t even be based on performance. They’d be based on who was closer to the power core before the project even began. That’s how a lot of this tends to work.

So that’s the first issue.

The second issue is this weird intersection point between “what managers believe” and “what employees believe.” Here’s what I mean. If you talk to a manager about how to motivate your team, here’s what he/she usually says:



Now if you talk to an employee about team motivation, here’s what he/she usually says:

“Respect or meaningful work, and yes, money is nice.”

I’m not trying to downplay money here. Daniel Pink keynote speeches be damned, we’re all out here chasing the cheddar to some extent. But managers tend to view it as the be-all and end-all on how to motivate your team, and for employees it’s not always about that in the No. 1 slot.

Where does this leave us on how to motivate your team? Let’s dive deeper.

How to motivate your team: Extrinsic factor research

A-ha! Let’s begin with money.

Cool research here from Northwestern regarding employee motivation. This is mostly in a quarterly sales context (“hit your targets,” a manager bellows), and not everyone works in that environment, but it’s still interesting stuff. The most recent Nobel Prize in Economics was about contract theory, and a lot of that is tied in here. Most work deals are essentially a contract of some kind, so there are lessons inherent here.

Do most managers really understand how to motivate their team? 

The key takeaway:

They found that a simple or “linear” contract is generally best. This means that the reward offered is directly proportional to how an employee performs and the risks that she takes. There is no threshold to game: a CEO is compensated equivalently for the same rise in profits regardless of whether the firm barely hits or barely misses its target. 

And also, this:

“What CEOs sometimes do,” says Georgiadis, “is they see they’re going to miss their earnings targets, and then they cut maintenance, or R&D projects, or some investments on this or that, or training expenses. By doing this, they meet the targets—but they’re really shifting output earnings across time, because they’ll have to do that maintenance at some point. And at the same time, they’re shifting risk, in the sense that if I cut maintenance, that means there is a higher chance of a disaster happening.” 

You take these two together and you have an issue. Basically, senior executives tend to make more from bonus than base. Bonus is usually contingent on factors that encourage myopia. So like, let’s say you hit 20% CAGR for fiscal year. You know that means $500,000 extra for you. If you’re at 17% CAGR with a month to go, and you know that laying off 44 people whose names you barely know will get you half a million bucks, will you do it? I bet you will. So I think we all know this, but incentive structures are pervasively misguided in most corporate settings.

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How to motivate your team: What would work extrinsically?

Alright, let’s go two-fold on this.

At the senior executive level: First, stop having your senior leadership act as individual contributors. Their bonuses should be contingent only on macro factors, not task factors. Second: use this linear contract deal. It will encourage smarter risk-tasking. Most senior guys still will figure out a way to game the system, but at least there’s a mechanism in place.

At the middle/rank-and-file level: Pay people above the market. Do research and pay people above the market. It’s that simple. If you offer more money relative to skills, you get better people. Not sure how this confuses hiring managers, but it does. Oh wait. Those hiring managers are ludicrous middle managers crippling the economy, but they themselves get bonus’ed on keeping costs down! It all comes full circle!

I try to think about work in different ways, and I also try to call out some managerial nonsense we’ve all experienced. If that kinda sorta interests you, I do a newsletter every Thursday. Feel free to join up.

Let me give you a quick story here. Somehow, I signed up for Glassdoor email alerts — probably about a year ago when I got canned. So yesterday, I get this email from Glassdoor about a “marketing coordinator” position in Ft. Worth. I live there! A-ha! I don’t really want a full-time job right now — I’m hitting my targets doing freelance — but I open the email anyway. This job lists about 17 necessary skills, right? What’s the projected pay? $35,500. Are you kidding me? Did someone really think that a person with 17 developed skills would want to be paid less than $36,000? The recruiting process is a joke in America.

Final deal about how to motivate your team extrinsically: if a middle manager or rank-and-file has an option for a bonus (beyond cost of living increase) or a raise/promotion, please tie it to an objective measure. We tie so much crap at work to subjective measures whereby a middle manager places an employee in a box, secretly hoping that expands the pie for himself. A lot of this happens because no one really understands money or how it works in a company.

How to motivate your team: The intrinsic side

All the Type-A target-hitters just tuned out, but intrinsic motivation is powerful. Unfortunately, per documented research, most managers do not grasp that. 

The intrinsic side of how to motivate your team is where concepts like “employee engagement” and “employee recognition” live. Remember our executive friend above, who needs three percent more growth to get his bonus? In his mind, this is a “fluffy HR thing.” Anything assigned to HR for a money-maker is a priority wasteland; to them, HR is a compliance-driven joke they rely on to force out people who aren’t like-minded with them. 

So look, intrinsic motivation is a powerful element of this “how to motivate your team” discussion. But, the people with the most authority tend not to care. I’ll still create a list, however!

How to motivate your team: The work-life balance dichotomy

When you hear the term “work-life balance,” a lot of people instantly think “Buzzword.” That’s always been funny to me. Towers Watson has done research saying it’s one of a company’s biggest strategic advantages. Let’s use a money example again.

You make $75,000 doing sales at a widgets company, with potential for bonus. But all those bullet points above — flexible work, respect, recognition — are in play. You have a good boss. Now someone comes along and offers you $120,000, but the interview/courting process is a train wreck. The new boss you’d have seems very demanding. So. Do you leave $45,000 pre-tax annually on the table and stay, or do you jump? Many people stay. So for all this bullsh*t and bluster about “employee engagement stats” and “turnover churn,” here’s what it comes down to. Provide a respectful, nice place to spend 10 hours/day without idiots running around screeching at you about targets, and you’ll keep people in-house. That keeps knowledge in-house, and that helps consistent revenue.

How to motivate your team? Don’t be an idiot.

What else might you add on how to motivate your team?

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