Issue 18 (emailed version), Sunday March 4, 2001
Made in New Zealand - twice winners of the America's Cup


EDGE FIRST is an email magazine dedicated to making you a better leader, by providing:
— provocative thinking about what it means to be a leader
— the tools, techniques and best-practices that drive leadership improvement

Increasingly, we'll lean towards the personal, and away from the corporate—delivering on our promise of big ideas in a small package, but with a clear focus on total quality you

"Great leaders honor the people who want to depose them, the assassins in their midst" —Tom Peters

In this issue
WarmUp
HotTopic — Incentives and rewards
Ten Minute MasterClass – Motivation and positive reinforcement
Self Improvement – You're not here to be liked
FeedBack ... on strategy

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WarmUp® — Test vs Template ... incentives and motivation
In different contexts, in several parts of the world, and in various media, your editor has been in the thick of the debate about incentives and motivation, this past few weeks.
In a quality award context, the argument emerges, for example, as the 'test vs template' issue. Used just as a template, the criteria of the Baldrige program, or any of the hundreds of international derivatives, may lead organizations astray. So goes one side of the argument. Key people may spend more time delivering results that look good in an award application, lose focus on what makes good business. In extreme cases the bottom line suffers, the leadership or ownership loses interest, and the scheme (not to mention the business) fails to thrive.
That's a point made strongly by British ISO-Buster John Seddon, who has a partial career de-bunking the various UK and Euro quality award and business excellence schemes. His case — business excellence schemes involve inappropriate incentives.
Used as a test — and this is your editor's case — the criteria serve their design purpose more effectively and more thoroughly than any other approach can: Asking tough questions, forcing organizations to confront hard decisions, driving better business.
If you're in an award scheme, that's something to think about.
This issue explores the appropriateness of 'incentives', and a few aligned leadership issues.
HotTopic® — Incentives and rewards
Bob Adsett (bob.adsett@lineone.net), a contributor to the Deming Electronic Network (den.list@deming.ces.clemson.edu) posed the following, a few days ago:

At our North of England Transformation Network meeting last week in Yorkshire the following question was raised [I'm summarising - ed]:

We are keen to involve our staff in celebrations at work following a company success or milestone achieved.
"The problem we were discussing was how to celebrate success without falling into the realm of rewards (and by definition punishments), and inadvertently creating winners and losers [Bob's asking this question of to a group who over the years have spent days on-line debating the Deming dilemma of incentives driving inappropriate behaviour – his question short-cuts through the trees to get to his particular 'wood' – ed].
"What sort of celebrations have you been involved with and how inclusive has the event been in involving the workforce? How did you determine the level and suitability of the celebration and what criteria have you used in deciding how and when to celebrate?
"Have you involved your internal customers (the staff) in the discussions about what type of celebration should be used, and what would be appreciated?, how successful has this been? Are there any guiding principles that you could offer?"

The debate continues, but here's a response from the redoubtable Myron Tribus (mtribus@home.com), celebrated writer on Deming and related topics (and, incidentally, a co-creator of the Baldrige award scheme – check out the story in the Baldrigeplus.com exhibits).
“I learned a method used by Kajima Construction which I believe fills your need,” Myron wrote. “At their celebrations they had presentations by the people who were most active in achieving the success being celebrated. They used the principle that the lowest level people who participated in making it happen were the presenters. They were all told to tell their story using the "QC story-board" method. Everyone then could enjoy the inside story of what made the success possible, the people doing the work had a chance to be appreciated for what they did. No one was either a winner or a loser. Even top management could bask in the glory and feel that they had contributed by making the systems which made the success possible.”
Myron's email signature block concludes with “Good judgement comes from bad experience. For example: Never squat when you are wearing spurs.”
Ten Minute MasterClass – Motivation and positive reinforcement
Here's another take on the same, larger, subject – incentivising behaviour change. This is from Jeffrey A Berger, PhD, president of Princeton Global Consulting.

The role of positive reinforcement in changing behavior is not a new, Berger says (he's a PhD in psychology, by the way, and a psychologist and executive/managerial coach in private practice in Metuchen, New Jersey). But it's often misunderstood and misused. To effectively use positive reinforcement, it is important to understand what, when and how to reinforce to get maximum impact.
Positive reinforcement is idiosyncratic. What may be positively reinforcing for one person may actually be aversive to someone else.
Giving positive reinforcement can change a relationship from being contentious to enthusiastically cooperative.
Engaging in a process of positive reinforcement has been proven to have the capability of changing a person who is on the verge of being fired into one of the best performers in the company.
Using positive reinforcement correctly helps people to become self-reliant and self-confident.
Having a work environment where positive reinforcement is an ongoing process greatly improves the morale of the employees. Improvement in morale positively impacts productivity which, in turn, improves the bottom line.

The rules surrounding positive reinforcement are universal. They always apply, no matter what you are doing:
(1) Don't make assumptions about what other people like. If your perception is wrong, you might negatively reinforce them. Find out what each individual considers to be positively reinforcing by asking, observing behavior and/or experimenting with different kinds of reinforcers. Don't minimize the power of words. Regular verbal recognition can be as much a positive reinforcer as material recognition.
(2) Positive reinforcement only influences the behavior that is occurring at the moment it is given. It's critical that attention is paid to what a person is doing and saying at the moment you are positively reinforcing. If you are not careful, you might reinforce a behavior that you may later have to extinguish. It is important to remember that you will get more of whatever you reinforce. Only focusing on the behavior you want to reinforce is much more effective than discussing many issues, one of which you make positive comments about.
(3) The biggest problem in reinforcing behavior in corporate settings is that rewards are given for results, not behaviors. This means that they are delayed beyond the time the behavior occurred and have little impact on future behavior. If you want a person to work hard, it is important to reward the effort rather than the outcome. If the effort is rewarded, the person will continue to try. If the person is rewarded when they have a positive outcome, effort decreases unless positive outcomes are continuous. It is unrealistic to expect continuous positive outcomes. Therefore, if only outcomes are rewarded there will be a decrease in the effort made which causes a further decrease in future positive outcomes. This results in a downward spiral of the effort made.
(4) A single reinforcement does not change a behavior. Reinforce more than you think you should. It takes repetition for positive reinforcement to have an impact and frequency for positive behavior to continue. Experiments have demonstrated that it takes six months of continuous, consistent reinforcement to change any given behavior. Any inconsistency dilutes the power of the reinforcement and prolongs the time necessary to effect the change.

Giving people consistent positive feedback results in people feeling better about their relationship with you. If they feel better about this relationship, they will be more cooperative and helpful. They will be glad to see you when you walk into the room. They will be openly friendly. They will work harder for you because they will want to please you.
This may sound utopian, Berger says. But he considers it's not the slightest bit unrealistic. Being an expert at positive reinforcement takes work in learning how to listen to and observe people. Once you learn, people will respond more positively to you. This creates a life that is lighter. It makes working with others less stressful thereby making life, even in a work setting, much more fun.
Self improvement - you're not here to be liked
Katherine Hammer (http://trax.fastcompany.com/ft?tobeliked22701) says she left the faculty of Washington State University in 1980 to join Texas Instruments as a systems programmer – looking for a career that would provide more money and mobility. Academics are not well paid, but do enjoy flexible hours, summer vacations, and inspiring environs. By comparison, 50/52 in a windowless cubicle at TI felt like a jail sentence.
Cooped up in corporate purgatory, she resolved to make sacrifices only when she could identify payoffs. Tolerance for employees who lacked commitment and for managers who failed to address performance issues disappeared. But, predictably, “colleagues disapproved of my behavior -- and they let me know.” Finally, she says, “I became so miserable that I asked to meet with my boss's boss, Martin.”
She told 'Martin' she was tired of feeling like a bitch. He replied, "You're not here to be liked. You're here to be respected. Keep doing what you believe is right." She learned to temper her behavior, but after 20 years still finds herself returning to Martin's advice when the going gets tough. “Here,” she says, “are three leadership truths that have guided my behavior over the past 20 years.”

Speak the Unvarnished Truth
Toot your corporate horn, certainly, but upper management must also honestly acknowledge past shortcomings and discuss areas of improvement. If a manager always attributes failure to external factors – marketplace shifts and bad hires – without acknowledging his contributions to the situation, he will never overcome the weaknesses that hinder success. When he fails again, he will waste valuable brainpower avoiding the truth. He will also compromise his ability to lead.
Shine a critical light in your own direction, and you will foster trust among your team members. When you make a mistake – and you will – your employees will trust your judgment and your ability to deliver the necessary remedy.

Rethink the Future – Always
Many legendary leaders brag about a gut intuition that helps them recognize problem areas in need of change. This intuition may sound remarkable, even romantic, but it does nothing to advance trust and loyalty within teams. Leaders who use analytical skills to evaluate assumptions, recognize mistakes, and make adjustments accordingly will thrive.
True leaders will openly identify past weaknesses, and then rethink their battle plans and articulate those changes to the people they lead. They will adopt a new vision when needed and make companywide buy-in a priority. Those who follow intuition alone will earn only contempt, not to mention a trash-and-burn reputation.

Don't Let Blunders Get You Down
Your employees must trust that you will not abandon the company's interests, even in the face of emotional and financial hardship. They will remain committed only if they trust their leaders will persevere. This harkens back to the comitatus model of leadership in medieval Germanic cultures: While the chieftain and warriors recognized their co-dependence, the chieftain was obligated to demonstrate the strongest courage and skill.
Few of us demonstrate all of these skills consistently, Hammer says. As much as we hate to admit it, our own fears and inadequacies limit us. Moreover, the people we lead see our failings clearly. We cannot run. We cannot hide. We must own up to our shortcomings and demonstrate commitment to organization and cause.
FeedBack ... on strategy
Every issue, we encourage it, and sometimes people respond. Here's some (abbreviated) thoughts on strategy (prompted by last issue's Michael Porter material) from an EDGE FIRST subscriber …

”I find, personally, that strategy is about coming of age, about wisdom. It's when you know the game because you've learned the techniques, mastered the basics, watched how others do it, good and bad - then make up your own mind and set your own course.
”In some ways companies are similar - are they mature enough to chart their own course, or are they following the pack? Real strategy is proactive, and provocative. Porter notes what people call strategy is nothing more than short term competitive positioning and inherently reactive - I agree.
”I liken it to the personal journey of finding your place in the world. Companies need to ask themselves what they are, and what the wish to be to the world. That's real strategy. What do they want to be to their customers, their staff, their families, their communities and the environment.
”Superior profitability is important only in so far as it gives you choices - if you aren't alive you can't contribute. But superior profitability is a flawed measure of contribution, of progress.
”An individual may or may not enjoy superior profitability depending on the path one chooses - but there is more to an individuals life than making money, and this philosophy should apply equally to organisations. In "Built to Last" Merck makes this point strongly when giving away treatments for illness - TB and River blindness. The first to the Japanese after WW2 and its no accident that Merck is #1 in Japan, the second to Africa because to not make the remedy available would have disillusioned Merck staff.
”Individuals and companies should strive for what I call an "added value existence" which profitability fails to measure adequately, both the value and the harm generated by organisations. Progress is subjective, but it is also measured by limited means – usually dollars.
“It is people who get in the way of progress because in the world of DCF, IRR, NPV etc time is considered scarce, when, in fact, it is infinite. It's only our obsession with one generation, with the 12 month financial year. If we valued the long term and measured performance based on contribution to sustainability and society as a whole, the perspective of time and progress would also change.
”Reminds me of the book "Pillars of the Earth" where the construction of a medieval Cathedral was prosperity for at least two generations, and a lifes' work for many tradespeople - now that's focus, that's long term thinking!
”It is time we changed our whole frame of reference for what profitability is, what is contribution, what is sustainable progress and how do we measure it. I appreciate the sentiments and thinking of Porter and others, but without addressing the means of measuring success, contribution, added value, or whatever, its all old wine in new bottles to me.”
Next issue Thursday, March 15, 2001 - reader contributions warmly received
Copyright © 2001, Macpherson Publishing All rights reserved
EDGE FIRST is a trademark of Macpherson Publishing
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Written and edited by Malcolm Macpherson
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