Why the Carrot and Stick style of improvment is flawed.
“You get better at what you measure,” or so it goes. Metrics are an important part of business. It allows us to focus on key areas and ensure that progress is being made. The good thing about good measurement is that it takes the guesswork out of improvement, and makes a more equal environment. If you notice an employee who is not doing a good job and you tell them, they will more than likely get angry and think you don’t like them. If you have a solid measurement system in place then you just show the employee the data. They can understand it and see the need to improve without a lot of emotion.
All this is well and good, but it does seem to raise one problem. We know that people are motivated by WIIFM (What’s In It For Me). You can’t motivate someone to care about something they just don’t care about. To solve this problem it has become common practice to use a bonus or reward system tied to a set of metrics. “If you can bring up production levels 10% by the end of the quarter, you will get a $500 bonus.” On the surface this tactic sounds good. It allows us to help motivate our employees to do better because if they do, they get a reward. It’s the carrot and the stick at work. Do good, get a carrot, do bad, get the stick!!! There are two evident problems with the carrot and the stick as we know it.
1.) It doesn’t matter what you measure, the better you get at something, the harder it is to get better. Lets say that you are measuring production of a product. You find out that you are running at about 20% of what you could be running at. You set up a system of measurement, create a reward structure, train and educate your workforce about the system and then get to work. In the first quarter, you get an increase to 30%. Everyone gets bonuses and everyone is happy. The next quarter you get to 50%. More bonuses are handed out and life is good. Then you go on to get 60%, 65% and then 70%. Then all of sudden your increases are now lucky to grow at 1 or 2%, if they grow at all. What Happened???
There is a certain amount of energy that takes place maintaining a position. Its a lot more work to stay at 70% than it did at 20%. This is predictable and can be planned for, but more often that not when the numbers stop growing at a rapid pace, many people get complacent again as they don’t seem to be making as much of an impact. It hard to get the troops worked up over 1%. How much of a bonus can you get for that extra 1%? Is the work required to maintain your position PLUS the amount of work to get even better worth that 1% bonus? This brings us to point number 2.
2.) The carrot and the stick deal with very shallow motivational tactics. Don’t get me wrong. Money isn’t everything, but stop paying your employee’s and see how many show up to volunteer. The problem is that the prospect of more money is a superficial motivator. Many people want to do a great job. Given the choice between work that is mediocre (or working for a company that is) and working for an industry leader, or at least a strong competitor at the head of the market, almost everyone wants the latter. It is also apparent that most people understand that good work done smartly is the key to a great company. The carrot and the stick relies too much on such a shallow premise that it can actually work to lower motivation.
There is a part in most of us that wants to succeed, and have a part on the winning team. The sense of satisfaction that comes from knowing we did important work for a winning team feels better to us than the satisfaction we get from an extra $50. By focusing on the money (the carrot) we degrade the mission to one of greed, and most people do not want to be seen as greedy, or to be thought of as someone who can be bought. The metrics we use and the processes that surround them should be used and presented as tools given to a skilled and valuable worker. They should not be presented as a “program” or “an initiative”. Rewards should still be given, but they should be done as a thank you in the background, and not the focus of a project. Let the business purpose stand out and be the purpose, not the prospect of a bonus. Let your employees have a deeper since of purpose by completing identified key objectives instead of chasing a carrot.
Why you should plan thoroughly and expect it to fail anyway.
This post started with some discussions I have been having lately with my business partners and colleagues. Here lately I (we) have been battling the same problem regardless of the scope of work, be it brand work, digital work or just good old fashion marketing strategy work. In an effort to reduce cost or speed along a project, the one thing that always seems to get sacrificed is the planning. It takes a lot of time and effort to try and convince people of the importance of planning. So here goes, in a nutshell and as short as possible, why planning is important, even if the plan will more than likely fail.
First off, I will agree that planning anything seems to be an exercise in either mind reading or some other form of extra-sensory intelligence. Most plans are built with the assumption that with enough hard work and diligence, everything can be outlined and mapped to ensure that success is obtained. We look at market research, consumer behavior and mountains of data to try and project what will happen if we do (insert your tactical changes here) or how the market will respond if we (insert your strategy for new product / brand extension / creative idea / making the logo bigger on your packaging).
The fact of the matter is that no matter how hard we all try, we cannot see into the future. We plan hard and thoroughly with the assumption that an educated guess is better than random actions. Then we launch the program / idea / whatever and quickly discover that what we thought would happen usually doesn’t, at least not exactly. As the adage goes, no battle plan survives contact with the enemy (or no marketing or business plan survives contact with your customers or employees). So while it would seem that these are good reasons to not plan or to cut back on the planning process, they are actually the entire reason we should plan to begin with.
Every plan is built on a set of assumptions. We assume our customers will like blue in the design. We assume the market is ready for innovation. We assume that our customer research is factual, even when chances are they are only another set of assumptions our customers make about what they want. So we go thought the best ideas we have, apply some type of logic to them and then craft our execution. In short, we make a stack of assumptions. It should then come to no surprise that, as assumptions often go, the assumptions are off. Sometimes a little off and sometimes a lot, but rarely ever are they right on. The real trick to all of this is to identify which one(s) of the assumptions are off, after all a plan is a stack of assumptions. If you can identify what was wrong in the planning, they you have a head start on figuring out what to do about it. (Pause for the Ah-hah moment.)
Can you imagine going thought the process of a new product launch that misses every projection and you realize that you won’t hit profitability when you need too. If you have no plan you have no place to start to adjust your processes or offerings to make your new product work. Its also common that without a solid plan, you can make some adjustments to your assumptions without fully understanding how they effect the other assumptions you have. You may launch your product and find that you are not moving enough pieces to meet your goals, so you react by offering lower prices or specials. You see the inventory start to turn and your product start to fly off the shelves so feel good about your “save”. Then, five months down the down the road, you discover that you are not going to be profitable in time, and you might run out of money. This is because as one assumption changes so do every other assumption in the stack that follows it. There are too many correlations to track without a road map, and that road map is a plan.
The true value of a plan is that it’s a map to your assumptions. DO not skip, or skimp on this step. Too many things change too fast for you not to be driving with a road map. Know in the planning process what assumptions you are making, even if they seem like facts, and know what assumptions are stacked on top of each. When you know that your plan in some way shape or form will fail to some degree, you will plan better and be ready to make changes as needed. Plan with planning in mind.
What Advertising can learn from the Public Relations Industry.
Advertising is primarily a form of communicating to an audience to get them to take an action, or change their behavior. PR is pretty much the same, but the two use different tactics. What should stand out is the PR function of internal communication. When given the choice on whom to hire for employee communication, PR firms win hands down. This is because as a general rule, there are no “Internal Advertising” agencies.
So if both advertising professionals and PR professionals are communications specialists, then whey is there no advertising function for internal communication? Mostly, because when given the choice, the tactics used by PR professionals work better for internal communication than those of the ad professionals.
Can you imagine running ads for your employees to inform them of your companies’ strategic plans, direction, values and goals? It wouldn’t work. Imagine what the company newsletter would look like without news, and just full of ads?
So what does this all mean? Marketing communications aimed to the external audience (customers) is not so different from those for the internal audience (employees). Your employees have an interest in the success of the company. They need information. There is a group of your target market that shares a pretty close interest in your company, or product / service category. These are the influencers.
Influencers are the group of people that help shape the trends and opinions of the buying market. They influence because they are considered experts in a subject. To have that expertise they need information…just like your employees. The difference is really in the amount of interest a person has in your product / service category to determine whether they are an influencer or not.
This post is not intended to prove that PR is better for marketing communications that advertising is. The point here is that there are many tools in the toolbox available to accomplish each marketing need. If you need to reach the influencers of the market, traditional media and advertising becomes a supportive tactic, not a purchase pusher. Your advertising is a good way to help the general market talk to your influencers by offering a common frame of reference. Your influencers need more information but they like to get it a different way. They want to talk to you sometimes, and have their questions answered. Advertising and even traditional PR is a one-way affair, from you (the company) to them (the customer).
Treat your influencers like you treat your best employees. Don’t sell them. Inform them. Give your influencers a way to talk to you and get information, this way they will have a lot to say to the rest of your market.
It isn’t hard to see why employees, PR professionals, enlightened marketers and customers love social media. It may not be “the” tactic to ensure all your marketing communication efforts are golden, but no one tactic is. It can be a very powerful tool, though.
Not just marketing, the whole world is changing
The changes in business and marketing are not due to brilliant single person innovations, but come from a change that is occurring in society. Everything is going to fundamentally shift, or at least it should. This isn’t just my imagination either, if you want more proof, pick up a copy of Joseph Jaffes Life After the 30 Second Spot, and then watch this:
Sir Ken Robinson on TEDTalks
The secret to success is inside, and outback…
User experience has got to be the number one way to build a brand. My example…Outback Steakhouse. I have been to Outbacks’ all over the country, and it doesn’t matter where you are, the steak is always great. I’m not only talking about the atmosphere, the layout, but the steak. When you go to Outbck, yes the atmosphere is alway consistent, the service is always great, but what you really go for, is the steak. All the atmosphere and smiling faces in the world could not make up for bad steak when that is what i came for.
Make sure your steak is great before you worry bout the sizzle. And when you find that great steak, make sure you can always make it great, at every customer interaction, without fail.
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