by Diana Southall | Jan 13, 2015 | action plans, culture
Currently I have four projects re-designing “bonus” or profit sharing plans for a wide range of clients (from 30 to 3000 employees, and from a local company to two mid-sized regional to a global one).
They all are faced with the same challenges:
- Bonus calculations are discretionary (picked by the manager), with limited guidance on how to calculate an amount
- Employees are likely not incentivized for the work that achieve business goals
- Managers cannot clearly explain to employees what they need to do to earn the same or more next year
- Employees don’t like or trust the plans (they do not believe bonuses are internally fair, or that their performance makes a difference in the final amount, or that their bonus is market competitive for their position)
To transition your bonus (profit sharing, incentive) program from a perk for employees to one that motivates and rewards performance and business results, it needs to follow the “4 C’s model.”
4’s Model of Variable Pay Plans
- Control- key individual performance measures in the plan align with business results and are under the control of the recipient
- Clarity – recipients understand the behaviors, activities and results they need to achieve what reward
- (not) Complex— maximum 4 measures (per job role/ level)
- Communication- recipients receive regular updates on the key performance measures to monitor if their work is achieving the target (even if payout is annual, monthly updates are ideal)
(4’C is the revised model from Dr. Jerry Newman’s 3’C Model, University at Buffalo)
Design steps to effective variable pay programs with the maximum business ROI
1. Basically, you need to go back to the drawing board to identify what matters most:
- Outline key business metrics that add the most value to your firm and show achievement toward 5-year goals (strategy)
- Cascade goals and down to department and job level key performance indicators (KPI)
- Create a tracking and reporting system to communicate a monthly dashboard of KPI results (individual, department, company)
2. Finish with Incentive Plan Design:
- When you have completed these first three elements, then link your incentive pool and payout calculation to reward those KPI
- Keep it simple Sam, and communicate clear results often
The real “bang for your buck” will be that everyone be focusing their work on the most important things and finally understand how they can contribute to achieving organizational goals.
Then the incentive pool will be worth every penny.
(Sounds like a daunting task? With expert guidance to facilitate your management team through the 10 key decision steps, you can design a plan in about 3 months.)
by Diana Southall | Dec 16, 2014 | culture, job fit, performance
Does “Scrooge” the manager still exist?
I love this holiday themed article by research group Zenger & Folkman. They research the key differences between high and low performing managers, and recently searched their database of 45,000 managers to identify the Scrooges.
They defined the Scrooge as a leader who is very task focused (drives for results) but has low consideration, and found that less than 1% of managers fit this profile (good news, unless you work there!). You know the type, like Danny Devito in the movie “Other People’s Money” running around yelling “back to work” to his frantic staff loitering outside their cubicles.
Despite the unpleasantness associated with this management style, is there any impact of driving for results while showing limited concern for employees’ needs and perceptions?
Actually, yes—how about the fact that new Scrooges have one-third fewer engaged employees than high impact managers!
The article published in Forbes doesn’t advocate for the opposite set of leadership behaviors (high consideration but low results orientation), as these managers are likeable but may not have high performing teams due to low accountability. This style often frustrates employees because poor performance is tolerated. In the Zenger research, employees with these types of “good guy” managers were only 3% more engaged than those that worked for the Scrooges (49% vs 46% engaged).
Decades of leadership studies have shown that the optimal leadership style focuses on both the task and the people – this achieves accountability and results through positive coaching. In the Zenger dataset, these manager’s style had a huge impact on increased employee engagement- 76% engaged employees (vs 46% for the low consideration manager who drives for results.)
To learn more about how to achieve this balance in your performance discussions, view our video “performance discussions” in the resource section of our free membership .
Link to the article:
http://www.forbes.com/sites/joefolkman/2014/12/12/lead-like-scrooge-the-surprising-research-results/
Image courtesy of stockimages at FreeDigitalPhotos.net
by Diana Southall | Dec 3, 2014 | coaching, performance
According to Toronto productivity consultant Mark Ellwood, managers spend 20% of their time on administrative and paperwork tasks that by definition do not advance business goals.
Some of these tasks are essential to your business success (for example, meeting with key customers or coaching performance). The rest are possible items that could be better completed by someone else.
An essential part of an effective People Plan is the Right Person doing the Right Things. And this includes YOU.
Are you spending your time on the Right Things? What could you accomplish for your organization if you “had more time?”
Here are the typical excuses we make NOT to delegate:
- I am the only person who can do this,
- I can’t trust that she will do it right (or she is not trained to do it),
- last time he didn’t do it right,
- she is too busy,
- I don’t have time to train someone
The solution to all of these is to train someone to do this work, and then let them…
As a business owner or manager, you have knowledge and skills that make certain tasks essential for you to perform for the best interests of the company. Your role is to determine and implement the business strategy and tactical goals through your people.
The majority of your time should ideally be spent on training, managing and motivating your people, and overseeing key action items to achieve company goals (from your short term action plans).
For example, you should be the person who reviews financial statements, budgets, and forecasts. You do NOT need to be the person who creates invoices, enters checks or goes to the bank to deposit checks.
We all have tasks that could be adequately performed by a staff member. Often these are administrative or routine in nature. If you spend 30 minutes analyzing your monthly financial statements by computing ratios or comparing to prior months, this is a task that your accounting person can complete and provide in a report with the monthly income statement.
What to delegate
To determine what tasks you can delegate, I highly recommend a simply time study. For one week, track your time in 15 minute increments. You can do this with a printed time chart (every 15 minutes on the left, one column for each day), a voice recorder, or an online time tracker (such as bill4time.com) or even an I-phone app (such as timewerks).
It takes a bit of effort to remember to log your entries, but if you capture 75% of a week you have great data to analyze. If you can also track your phone calls this is additional information. One memory trick is to set a timer to ring every 15 minutes, and record your tasks since the last entry.
Your delegation action steps
- At the end of one week, calculate the time you spend on various work categories, and highlight those that are not essential for you to do. Also review your outgoing emails and phone calls for patterns.
- Divide your tasks into priority categories (a, b, c) or use the Steven Covey method of categorizing by urgent and important. Items that are not important are candidates for delegation, automation, or even elimination.
Typical items for delegation:
- basic fact finding/ research
- entry and collection of data and routine reports
- basic analysis and problem solving suggestions
- routine communication
- sorting of emails and mail
- tasks that you are not very good at or dislike
- “enrichment” tasks that can give an employee the opportunity to learn and develop
3. Identify to whom to delegate
Once you have identified tasks to delegate, select an appropriate staff member to become responsible. Delegation can provide “stretch goals” to provide job enrichment to employees, so don’t always give items to the most experienced. If you have multiple task sets to delegate, share this among several staff members.
4. Train that person and the “inspect what you expect” until they are meeting expectations and you can be confident in the results without taking the work back.
5. Remember, you will have to invest a bit of time in the short run to reap the long term rewards of off-loading some of your tasks. You will also continue to be responsible to manage the process and review outcomes.
by Diana Southall | Nov 25, 2014 | coaching, culture
Would you want to work with someone who has passion, focus, integrity, and positivity?
Or how about someone with great planning and interpersonal skills?
Of course! (No wait, give me that team mate who is Debbie Downer, always late with her work and tactless…)
As a coach of People, you want to demonstrate both the business skills expected of peers and the leadership traits that build trust and engage a team.
Here is a fun and quick list compiled by a very creative guy, Barry Feldman.
He calls these the “monsters of influence” but I call them essential for a Coach.
Influence pulls your team together, rather than pushing them.
Homework: Want to do your own “self-assessment” for this year– how would you rate yourself on these? (And how would your team rate you?)
Image courtesy of David Castillo Dominici at FreeDigitalPhotos.net
by Diana Southall | Oct 14, 2014 | performance, recruiting
Really- why not?
I hear this phrase far too often from managers who are now urgently rushing to fill an open position. Perhaps someone quit on short notice, or an employee on leave decided not to come back. Or you had to take decisive action to terminate an employee whose behavior warranted such a quick outcome.
Moral of the story? Here you are scrambling to find “someone good” on short notice.
And everyone on your team is feeling the pain, because they are picking up the workload for the missing person, most likely doing tasks that are unfamiliar or not in their area of expertise.
What does the team want? A new, awesome, fabulous team mate (who needs no training) – and make it quick! Can she start tomorrow?
Despite the apparent urgency of the situation, you know what I am going to tell you next….
“Take your time to find the right person.”
In the midst of your crisis, pause, take a breath, and met me remind you what is at stake…
Hiring an A player may take a few more weeks of recruiting, more focused and stringent selection, and passing up on “good enough” candidates who can start tomorrow. But that A Player who starts in 4 weeks will likely learn the job more quickly, be an asset to the team right away, and be performing at a higher level in six months.
Rushing to settle for a C player (usually a perfectly nice person who was a decent performer at a prior job, but NOT a fit for your job) means a few weeks saved now, and hundreds of hours lost later.
C Player’s are estimated to take 25% of a managers time—the one or two people on your team who struggle with the job knowledge, performance expectations, or do not match the attitude and culture you need can suck 10 hours a week!
Do the math- 10-20 hours now versus 500 hours next year … and that does not count the actual and opportunity cost of lower quality or service, slow processes, lost sales, unhappy customers, unhappy co-workers, and unhappy managers.
You are not a beggar, and you can be choosy! Only settle for A Players with a 90% chance of success.
There are fabulous candidates out there—but you have to cast a wider net, be more selective and systematic in your selection, and wait until you have found “the one.”
Learn more:
Read our articles on “selection” to find out more about what you can do to evaluate and validate your candidate’s job fit.
Read our article about how to always be scouting for talent and building a virtual bench, so that you are not scrambling for applicants next time!
Image Courtesy of FreeDigitalPhotos.net.
