Reward, recognition and the power of leverage

The concept of leverage is fascinating isn’t it?  Archimedes said, “Give me a lever long enough and a fulcrum on which to place it, and I shall move the world.”

So we can consider leverage conceptually as something small that has the power to generate massive movement or force. Here’s an easy example.  Many of my clients are banks, and banks are highly leveraged businesses.  It takes just a small amount of capital to support many times that amount in risk assets (interest-generating loans) although specific requirements vary by country, asset tier and the type of capital in the formula.*

Of course bankers will also point out that many of their commercial customers are also highly leveraged, relying on substantial debt to support their own income-producing assets. Leverage is a finely calculated metric in the business world, where dollars are the common yardstick.

But we’re here to talk about human performance, and as I’ve written before in sales management articles, managers can take advantage of leverage to perform very small but meaningful acts to generate powerful feelings of loyalty and dedication in their workforce.  This dedication results in greater performance and employee retention.  So if you are a manager, and you’re not finding imaginative and powerful ways to reward and recognize employee performance, you are missing one of the greatest leverage tools ever.

Now it’s story time. I have a friend, Laura Euckert, who recently accepted a position with a company that provides aerospace technology services. She does a fine job for them, and they appreciate her contribution.

Laura is also an ultra-marathoner, which for those of you who are not familiar with the term, is a person who runs race distances longer than the standard marathon of 26.2 miles.  Last Sunday I competed against her in a 50 kilometer race (31.1 miles) and I can tell you she is very good, as she has completed over 60 such races, many even longer than 50K.

So now that she has been there long enough to have business cards, her enlightened management team ordered them for her.  Seems like a simple thing, not very expensive or time-consuming right?

Lauras bus cardBut these guys didn’t get into the aerospace business by being dumb.  They used their heads and thought, “What would really light her up?”

I’ll let you judge for yourself. Take a close look at what the business card says.

Of course Laura is thrilled with her new cards, and they do more than just make her smile. Every time that card is handed out to a customer or company provider, it becomes an ice-breaker and relationship-builder for her company.  Those managers knew what they were doing.

If you put your mind to it, you can probably think of dozens of “outside the box,” creative ideas to surprise and delight your team. It only takes your willingness to do so and a “What if?” attitude.

It’s a management tool to help you…


Think Like Your Customer

*Basel II requires that the total capital ratio must be no lower than 8%.

Catch them doing something right: The SeaTac Marriott story

In stark contrast to its often dreary weather, the people of Seattle generally have a sunny disposition, and nowhere do you see friendliness and cheer more than in the SeaTac Marriott.  Everyone’s in a good mood at this hotel, not just the staff.  Late in the week the road warriors stay there before the morning’s flight home, so the general mood is upbeat and convivial.

On today’s Fable Friday I’ll share a story with you of my most recent stay there in May. I finished my work earlier in the day, drove to the hotel and went down to the restaurant to eat my dinner.  I ordered a beer at the bar and in response to the young bartender’s question about how my day was going, I replied that all was well, except that I didn’t have a crossword puzzle to do.

Let me go off on a tangent here.  I hate the idea of being one of those losers who sits at a bar staring at his phone and texting, so whenever I eat alone I have with me a Sunday NY Times Magazine so I can do the puzzle.  Except that this day I forgot to bring one.  So the guy leaves to wait on someone else and a few minutes later back he comes with the NY Times. He had run out to the gift shop to buy me a newspaper.  “I hope this helps,” he said.

Well, it sure did!  This was a Friday, and the Friday Times puzzle is the 2nd hardest of the week, so I had plenty to keep me occupied. I said to him, “You just hit the jackpot because I’m going to write to your boss,” and I did.

Now Jeff Hart is a really good guy and a great General Manager for the Marriott, and I did in fact write him.  Jeff told me about Marriott’s program which attempts to find people doing right by customers and nominating them for a valued recognition award.  Jeff was only too happy to nominate the bartender, sharing the story and thanking me for passing it on.

I tell you this story today because it follows up on our last two “Steak and Beans” posts, on how to reward people for doing the right things.  And since I’ve been discussing Fournies’ “Why Employees Don’t Do What They’re Supposed to Do,” you should know that chapter 7 is entitled “There is no positive consequence to them for doing it.”  As the great behavioral scientist B. F. Skinner once noted, “People don’t work to get a paycheck. They work to keep it from stopping.”

What this means to you as a manager is that you have to constantly catch people in the act of doing something right and spontaneously offering praise.  And even if you think you are doing this now, I can prove to you that it is not enough.  If you have six team members and you pay a compliment six times a week to the team, that means each person hears from you just once. In other words, you think you are offering praise six times as often as you really do. It matters, so by all means add this trait to your daily practices.

No blog post here on Tuesday, as that is the day my June newsletter goes out. It’s a sales management case and quiz for you on coaching, and I hope to hear from you with your answers. Meanwhile…

Think Like Your Customer

Steak and beans: What was the best question to ask the sales manager?

Today we’ll follow up on the steak and beans dinner question.  On Friday I had told you how the sales manager was boasting to me about this dinner, which rewarded his top performers with steak, and “punished” those who didn’t make their sales goals with a plate of beans.  He asked me what I thought of his idea and I asked him one question, letting you guess what it was.

Drum roll please?  Sam Giroux, a pretty sharp guy from Boone Bank in Missouri was not only the first to reply but also nailed the answer.  The question you should have asked the sales manager, which I did ask, was, “And what did you have for dinner, steak or beans?”

He told me he had the steak dinner, because the successful sales managers had enough volume to offset the 4 who didn’t make goal, so the whole state exceeded the overall goal.

I had a problem with that.

You have 4 team members who didn’t make goal and they get “punished” with beans while you eat steak? That doesn’t strike me as great sales management.  As Sam pointed out, as long as one person didn’t make goal, the sales manager should eat beans along with him.

Let’s just review a fundamental sales management practice, using the acronym SCAR, which I use in my workshops. SCAR stands for:

  • Skills
  • Commitment
  • Activities
  • Results

Most sales managers pay attention primarily to Results, as ours did.  But great sales managers assess the Skills of their people and help them improve, through modeling, joint calls, coaching, training and practice in sales meetings.  They also seek to bolster Commitment, or learn if commitment is not there.  And finally, they look at the Activities their salespeople engage in.  Are they the right ones and do they do them enough times?

If you’re a sales manager, and you have 4 team members who are struggling, it’s your job to get them to the steak dinner by focusing on these three critical areas, not just reading the final score.  If you aren’t doing the things that earn them a steak, then you shouldn’t eat steak either.

Many thanks Sam Giroux.

Think Like Your Customer

Steak and beans: sales management at its worst

“Let me tell you about my steak and beans dinner!” the sales manager told me excitedly.  “At the beginning of the fall I announced this big sales push for new business and gave all 15 of my teams a stretch goal to attain, and as an end to the campaign we would have a big celebration dinner in December. But get this, I told them that everyone who hit their sales goal would get steak and lobster, and all those who didn’t meet their goals would get  just a plate of beans for dinner.”

No doubt you’ve heard of this gimmick or some variation on “steak and beans” in which a sales campaign ends with a dinner and the winners get a fancy meal, while the losers have to eat beans or hash or something not so fancy. I’ve heard many variations on this approach and I don’t much care for any of them.

Today’s Fable Friday is a true story. I was helping a company with their sales management routines, and the sales manager for Wisconsin was sharing with me some of the practices he had used in the past.

We had talked through a number of them, and for the most part I was impressed by his overall performance in goal-setting and measurement, but especially in his imagination and enthusiasm. He was what you might call a “hard charger,” setting high standards for his people and expecting strong results.

Our discussion took place in mid-December, just a week after the “Steak and Beans” dinner, and he told me how it went.  “Two things,” he said. “One is that we all had fun, even the guys who had to eat beans, and second, it really got the point across that when you hit your goal you’re rewarded, and if you don’t, it’s beans for you.” 

He went on to tell me that of his 15 Regions, 11 had hit their number and 4 did not, and those 4 were served the bean dinner.  “Of course it wasn’t all that bad, as some of the winners were happy to share with the bean guys.  All in all, it was a great time and an important lesson.”

He then asked me what I thought of this scheme, and seeing that he was excited, I didn’t want to burst his bubble and criticize, but I did have one question, and I asked it of him.

But before I tell you what question I asked him, I want you to figure it out for yourself.  What question would you have asked the sales manager, and why?  I’ll give you the answer on Tuesday.  Meanwhile…

Think Like Your Customer