Category Archives: Inside Out E-Column

Inside Out E-Column

The value of trust.

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Building trust is essential
Building trust is essential to building a strong team.

If you’ve ever wondered how vital trust is to people in the workplace, here’s some insight from a cultural assessment we conducted recently with the middle managers of a new client. It was the first step in implementing our ImaginAction Continuous Improvement System at that organization.  The assessment tool is simple to use and highly revealing.  It provides a statistical snapshot of how a group of people ranks a set of 40 value statements in comparing their current culture with the target culture they would prefer.

One of the value statements in the assessment is “Demonstrate trust in and respect for others.”  While there is usually a gap in how that statement is ranked between the current and the target cultures with every client, it was especially striking with this one.  Participants ranked it 30th among the 40 statements in the current culture – and number one in the target culture.  We also calculate the mean scores to assess how the group rates the prominence of each value statement for both current and target cultures – 1.0 is the lowest possible score and 7.0 is the highest.  On this statement, the mean score for this group was 3.25 for the current culture and 5.94 for the target culture.

Sending the Wrong Message
That’s a big gap, and the current low level of trust was evident in a later discussion we had with the senior managers.  A core feature of the ImaginAction Continuous Improvement System is the focus on giving front-line and middle managers the authority to approve smaller improvement ideas from employees – rather than going through a suggestion committee or senior management review.  The reason is partly to get more decisions made closer to the where the action is.  It also helps managers develop leadership skills in guiding and coaching people who report to them.

Well, these senior managers didn’t want employees to go through their supervisors with their ideas.  Why?  Because they felt the supervisors would turn down too many potential improvements, and they wanted employees to be able to submit ideas directly into the improvement database.

That approach may sound reasonable on the surface, but the message it sends is unmistakable – “We don’t trust you to be fair to employees or make sound judgments about their ideas.”  Of course, that attitude typifies what the assessment revealed about the disparity between their current and target cultures.

We eventually reached a compromise that gets all ideas from employees recorded – and still allows supervisors to provide coaching and guidance.  The larger issue, though, is how to bridge the current trust gap between upper and lower levels of management.

Taking the First Step
One key to resolving that dilemma can be drawn from Henry Stimson, who was one of the great U.S. statesmen in the first half of the 20th century.  He once said, “The only way you can make a man trustworthy is to trust him; and the surest way to make him untrustworthy is to distrust him.”  The implications of those words are clear for organizations like this one facing a crisis in trust.  While there is truth in the old adage that trust is a two-way street, someone has to take the first step – and it needs to be senior management.

For leaders who choose to ignore Stimson’s advice and withhold their trust, there’s one thing they can count on.  They will rarely be disappointed – because they’re sure to find plenty of people who live up to (or down to) the low expectations they hold of people.  If they choose instead to take that first step in granting trust, they will surely be disappointed once in a while.  But the payoff in performance and loyalty that they will get from the vast majority of employees far outweighs the risks of putting faith in people who feel trusted to do the right thing.

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What do you think?  Please share your comments below.

Inside Out E-Column

Nurturing the leader in all of us.

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Nurturing the leader in all of us
Leadership qualities can exist in all employees.

My 15-year-old daughter, Courtney, recently participated along with 130 other girls in the Junior Teen division of the National American Miss Pageant for the state of Missouri.  She has competed in pageants before, and despite some of my early reservations about her participation, I’ve seen some pretty special things come from her experience in those events.

This particular pageant system judges girls in four main areas: personal introductions about their background and future aspirations on stage in front of a large audience; one-on-one interviews with six judges; community service; and formal wear.

The audience doesn’t get to see the individual interviews, so we were eager to hear what the judges asked Courtney and how she responded.  Interestingly, one of her answers went right to the heart of a core concept that relates to employee engagement.

The need to lead for everyone.
Here’s what the judge asked: “If you could be principal (CEO in kids’ parlance) for one day in your school, what one thing would you change?”  I’ve always seen Courtney as a thoughtful person, but after all, she is 15, so I expected something along the lines of boosting school spirit, reducing homework, or improving the quality of the food in the cafeteria.  Instead, she responded with an answer that many organizations fail to appreciate when it comes to what is commonly called “empowerment.”

She told the judge she would create more leadership opportunities for all the students.  She went on to explain that she’s had the chance to serve as a student ambassador for the school, and it’s helped her grow in several ways.  She added that she believes every student should have an opportunity to lead in some way in their school or their community.  That’s because, she said, they’re all heading for college or somewhere else in “the real world,” and they need that kind of experience to succeed.  It would also help them be more actively engaged in their school.  She went on to give examples of how she would do that with multiple councils and students rotating in leadership roles.  Bottom line, everyone would have a chance to lead in some way.

The leadership-engagement connection.
Not surprisingly, my first reaction was one of pride and surprise at her insight.  Then after I thought about it, I asked myself a question.  Why is it, I wondered, that most organizations don’t grasp how vital it is to see and support every employee as a leader – especially if we want them tuned in, turned on and taking the initiative to go the extra mile to make their organizations the best they can be?

Perhaps it’s the high-sounding meanings we typically associate with the word “leadership” … or it’s our inability to devise ways that for employees to take the lead when they can.  Maybe we just don’t provide sufficient encouragement for people to feel okay about making the shift from following to leading.

Whatever the reason, shared leadership and engagement go hand-in-hand. Organizations that fail to grasp that notion will continue to be stuck in a paradigm that limits the potential for the leader in everyone to blossom and benefit their organizations – and themselves.

Oh … in case you’re wondering, Courtney won the crown (see pics below) – and we’ll be heading to California for the national pageant over Thanksgiving. I don’t know what kinds of questions the judges will throw at her this time, but I’m pretty sure she’ll be ready for whatever comes her way.

courtney

courtney2

 

 

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What do you think?  Share your comments and ideas below.

Inside Out E-Column

Delivering on the promise.

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The basic idea behind “brand alignment” is pretty simple – When it comes to delivering on your marketing promises, make sure everyone in your organization knows what’s going on and they’re able to walk the talk.  Living up to that ideal, though, isn’t simple at all.  It takes a concerted effort to get everyone tuned in and turned on to the principles and practices that align the “do” with the “say.”

Promise Broken
One revealing way to test if an organization is living the brand is to observe how they deal with customer complaints.  I recently had an experience with a new service I subscribed to online that told me a lot in a hurry about what they believe and how they operate.

Within an hour after subscribing, I got a notice that the first program would be broadcast that same evening.  They described the event and what the participants would learn during the one-hour session.  I didn’t want to miss it, but I already had another meeting scheduled.  Reluctantly, I contacted that person and asked if we could reschedule for the following evening.  She agreed, so I was set to take part in the new program.

Does your company deliver on its brand promise?
Does your company deliver on its brand promise?

Customer Disappointed

I decided to share one of my Inside Out lessons with them in the form of a “strongly worded” e-letter to what I thought was some nebulous person in the ether-world.  To my amazement, I got a reply the next morning from a sales manager named James, expressing regret for my problem and promising to look into it.  Later that day I had my next pleasant surprise.  I got a real live phone call from James explaining how I had been connected to the wrong program.  He also thanked me for informing them because they were able to contact other people who experienced the same problem.  Then he said I would be set up in the near future to participate in the program that had been advertised.

Relationship Renewed

That would’ve been good enough, but then I got a call from David, their head of marketing.  He had received my e-letter, too, and he also wanted to apologize for what happened.  Then he really floored me – he said he wanted to give me a FREE lifetime subscription to their service.  The only thing he asked in return was for me to give him occasional feedback on how I felt the service was meeting their customers’ needs.

I told him I thought his offer was very generous but I probably over-reacted a bit in my note, and his compensation was way more than I expected.  To his credit, he would have nothing of my attempt to downplay my initial disappointment, and he apologized again for “wasting my time” and failing to give me what I was promised.

Execs in some companies might say he was crazy to give away so much.  But I’m betting they don’t get many complaints like mine, and when they do, few people raise a fuss because the service is probably impeccable most of the time.  Since it’s an online program, it’s not really “costing” them anything to give it to me free, but it still speaks volumes about their commitment to delivering on their promises – and living their brand.

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Inside Out E-Column

Right to know, need to learn.

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Information overload can stunt your employees' growth
Information overload can stunt your employees’ growth.

The other day, I was re-reading an article by David Berlo – the mentor I’ve mentioned before in Inside Out.  I was amazed at how current his insights were – considering he wrote it in 1976.

The title of the article is “Right to know, need to learn.” One of Berlo’s key themes appears on the first page like the caution on a pack of cigarettes – “WARNING: Consumption of uncontrolled information is injurious to your health.”  His alarm stemmed from a problem that’s familiar to all of us – information overload.  And that was in the days before e-mail, social media and multi-tasking – a contemporary euphemism for organizational ADD.

What You Want to Know Can Hurt You
Naturally, no one likes being overwhelmed by more information than they can process.  But there’s a cruel irony in human nature that goes back to Adam and Eve when they ate the fruit from the “tree of knowledge.”  On one hand, we want to control the information flow so we can manage it.  On the other hand, we want to know everything, and we don’t want to be left out of anything that might be important.  What’s more, the expectation to know more and process more in the same finite timeframe is rising.

So what’s a body to do?

Start by understanding what Berlo called the “twin tyrannies of slavery and freedom.”  Everyone’s clear about the first one.  If I’m your slave, you’re in control of every decision and action in my life – short of basic bodily functions.  When it comes to information, you control it all.  I’m strictly on a “need to know” basis, and I don’t have a “right” to know anything.  That kind of tyranny may have been common in boss-subordinate relationships in yesteryear, but for lots of good reasons, it’s rare in organizations today.

Too Many Options Can Leave You Out of Control
What about the “tyranny of freedom,” though?  If slavery is bad, then freedom is good, and more is better, right?  The answer is yes – to a point.  And that point is defined by the limits of a person’s ability to process the options they have before them.  After that, people go into overload, and they reach a breaking point. When that happens, it’s a lot like being a slave – you’re out of control.  It’s just a different kind of master.

Plug that concept into organizational communication.  The flood of information that flies past employees these days can be overwhelming, and the expectations for processing it are unrelenting.  While there’s no perfect solution to that quandary, one way to manage it is to adopt Berlo’s policy of “right to know, need to learn.”

Let People Control their Information Consumption
As much as possible, operate on the basis that employees have a right to know virtually anything short of personal files and trade secrets.  But don’t use that policy to justify doing information dumps in the name of transparency and unbridled knowledge sharing.  Instead, send out only the information that everyone absolutely must have.  All other information is made available on a need to learn basis.  Then people decide for themselves what to download, and THEY are responsible for deciding when and if they’re going to “consume” that information.  Of course, they need to know it’s available and where to get it – and it has to be indexed so it’s easily accessible.  Otherwise, the “right to know” policy becomes essentially useless.

It won’t rid organizations of information overload once and for all, but it’s a step in the right direction for giving people greater control over how they process information.  It’s also a pretty good blow against the tyranny of freedom.

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Inside Out E-Column

Ownership is more than a feeling.

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When employees feel a part of the success, business thrives
When employees feel a part of the success, business thrives.

One of our clients recently had a bad experience at a hotel where they were holding a management meeting.  To make matters worse, the meeting had been planned by the president of the company, and he was leading it himself.  The next day he wrote a “strongly worded” letter to the local general manager of the facility, which is part of a well-known chain.  He outlined the transgressions in detail and told the manager that the company would not be doing business with them in the future.

You can draw different lessons and conclusions from that story. 
Some might say that the employees just didn’t care, and they should be reprimanded or even fired.  I tend to be of the opinion that crap rolls downhill.  I’ll wager that if guests and clients at that hotel are being treated with disregard and lack of respect, that’s what employees are experiencing all along the chain of command from the top down.

When people get past the usual finger-pointing and blame-pinning for problems like that, they sometimes step back and realize it’s not an isolated incident.  Then management says it’s time to “change the culture.”  Before long, they spout the next management bromide about needing to “create an ownership mentality among employees.”

Truth is, you either own something or you don’t.
It’s not a state of mind, and it has nothing to do with feelings.  Owners have a unique stake in the outcome of a business.  The more money the business makes, the more they get to put into the bank.  On the flipside, when times get tough, they’re the ones who take it in the chops. It’s also up to them to take responsibility for getting the business back on track.

That’s not the typical employee compact.  Some companies have backed up their “ownership” expectations by creating profit sharing or gain sharing programs for employees that go down to the front line.  But it’s still not the same as being an owner.  As a practical matter, it’s not always feasible to build employee compensation around a true ownership model.  More to the point, though, programs like that aren’t needed in order to get the performance and behavior that actual owners want from employees.

It’s more an issue of respect and responsibility.
The hotel industry is notorious for poor employee treatment and high turnover.  A notable exception is Baldrige Award winner, The Ritz-Carlton, whose legendary motto about employees is “We are Ladies and Gentlemen serving Ladies and Gentlemen.”  That statement is backed up by the company’s remarkable policy that permits every employee to spend up to $2,000 without approval from their supervisor to make any single guest satisfied.  That’s not exactly the same as ownership, but it’s a strong sign of the trust and responsibility that management places in the company’s employees – and their outstanding reputation proves it works.

Still, there is something special about actually being an owner, and some companies operate with employee-owned models that have remarkable impact when done right.  A story ran on ABC a few months ago (see video below) about a business owner who was retiring and decided to give the company to his employees instead of selling it.  Why?  He said it was because he tried to make all of his business decisions based on what was good for employees – not what was going to make him the most money.  Of course, that’s indeed what made him money because it turned out to be a place where employees loved to work – and customers loved doing business.  Doesn’t get much better than that.

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Inside Out E-Column

Tiny Pushes

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Success results from the tiny pushes of dedicated employees
Success results from the tiny pushes of dedicated employees.

Helen Keller captured the importance of the so-called “little things” in the workplace with great insight and eloquence when she said:

“I long to accomplish great and noble tasks, but it is my chief duty to accomplish humble tasks as though they were great and noble. The world is moved along, not only by the mighty shoves of its heroes, but also by the aggregate of the tiny pushes of each honest worker.”  

We’ve all heard the old saying, “It’s the little things that count.”  As Keller wisely observed, that maxim applies to business as much anything else. With rare exception, though, it’s mostly discounted as a trivial bromide in the workplace.  Going for home runs is much more fashionable than cranking out base hits.

Linking Lean to Little Ideas 

Now, a new report provides compelling evidence that focusing on the micro things is not just a worthy pursuit.  It actually has a big impact on improvements at the macro level, too.  Performance improvement experts, Alan Robinson and Dean Schroeder, first wrote about that premise in their book, “Ideas are Free,” published in 2004.  Recently, they provided more evidence for it in a paper entitled “The Role of Front-Line Ideas in Lean Performance Improvement” published in 2009 by the American Society of Quality in their Quality Management Journal.

According to their research, “the critical component that often is missing in underperforming lean initiatives is the ability to get large numbers of smaller improvement ideas from front-line employees.”

Bigger Doesn’t Equal Better

Going against the grain, most lean initiatives engage small numbers of people in working on short-term big improvements.  The most popular method for these big projects in the United States is the “kaizen event” or “kaizen blitz.”  In many companies, that’s their only method for lean improvement.  But the impact is often limited.  Aside from not being able to get many employees engaged in big kaizen events, the improvements typically don’t have much staying power. One study cited in the paper showed that up to 90 percent of the benefits of kaizen events disappear within six months.

By contrast, systems in which small, front-line-driven ideas were the main tool for improvement produced the most successful long-term lean operations.  According to the paper, it was this “ongoing and regular engagement with daily problems and opportunities, and the companies’ process-focused approaches … that built their lean cultures.”

Getting Employees Engaged 

In fairness, many companies realize how valuable employee engagement in continuous improvement efforts can be.  The challenge is how to get people tuned in and turned on to doing it as part of their daily work routine.  Here are some features we’ve discovered that generate greater employee engagement in making improvements as part of our ImaginAction Continuous Improvement System:

  • Create an incentive structure that places equal value on small and large improvements
  • Place the responsibility for approving and implementing smaller improvements with front-line supervisors, not a suggestion committee
  • Respond to the majority of employee ideas within 24 hours
  • Focus employees on small improvements within their own areas of responsibility, and give them responsibility for implementation, seeking assistance as needed from their supervisors

Based on their research, the authors estimate that in failing to focus on small, front-line ideas, a company could be ignoring as much as 80 percent of its lean improvement potential. In the end, it is both ironic and counterintuitive, but “small is big” when it comes to creating a culture of continuous improvement.

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To learn more about the ImaginAction Continuous Improvement System, download the ImaginAction System Guide.

Inside Out E-Column

A lesson for the ages.

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Synergies result when teams work together
Synergies result when teams work together.

On April 1, a remarkable story in automotive history will come to an end. Well, not the story itself – it’s too good – but the 26-year-old “experiment” that created it will be a thing of the past.

It all began in 1984, when General Motors and Toyota decided to scratch one another’s proverbial backs with a joint venture called New United Motor Manufacturing, Inc. (NUMMI). The primary motivation for Toyota was to get a foothold for manufacturing automobiles in the U.S. – mainly to stem the public outcry over U.S. auto jobs going to Japan. As for GM, they wanted to learn how to make high-quality small cars that were profitable – which the Japanese proved they could do. As a bonus, GM would also learn how to apply Toyota techniques in other plants throughout their operations.

From Worst to First
Most companies taking on that kind of venture would try it in a plant where they had a strong foundation to build on. Instead, they picked the worst plant in the GM system – in Fremont, California. It was so bad that GM had to shut it down completely two years earlier. Relations between labor and management were incessantly contentious and hostile. Some say they spent more time filing and fighting grievances than making automobiles. What’s more, the product quality was laughable. Cars wound up with the wrong bumpers, steering wheels missing, scratches and dents everywhere. Then they had another crew at the end of the line to repair all the defects.

So when NUMMI was announced, few people thought it would succeed. Not only did they reopen the problem plant – they hired back the same people, believing as Deming always said, problems aren’t about the people, but the system. Before they started operating, though, a sizeable contingent of workers went to Japan to learn the legendary “Toyota way,” working side-by-side with their Japanese “brothers.” It was a landmark event that transformed people’s lives.

You can learn about the details from many sources, including a recent story that ran on National Public Radio.  But at the end of their time together in Japan, a lot of grizzled, hard-bitten workers were literally in tears during the celebration they held before heading back to launch the Fremont operation. They had been given something few of them had known before – a sense of pride and purpose – and the impact on employee engagement proved to be profound.

Marketing is More about What You Do than What You Say
When production started, results were meteoric. Almost immediately, quality and productivity reached levels that paralleled other Toyota plants. Everyone noticed … many cheered … but for reasons that are hard to believe yet easy to understand, little changed for many years elsewhere at the U.S. automaker – despite considerable effort from numerous people within GM. By the time quality became the rule rather than the exception throughout the company a few years ago, it was too late. Even aggressive marketing efforts that touted improved quality initially failed to convince potential customers – too many years of exaggerated claims and poor performance.  Then just when GM started to recover, the economy collapsed, and they had to ask for bailout money to stay afloat.

Fremont is shutting down this week for two main reasons: GM pulled out of the venture in 2009, and Toyota decided it can handle U.S. production in other plants across the country. Although many are sad to see the plant close, its legacy continues. Perhaps the simplest and biggest lesson from NUMMI is that employee engagement and cooperative systems aren’t just nice things to have. They’re the cornerstone of business success – and the most compelling force for effective marketing a company can pursue.

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Inside Out E-Column

Let people’s emotions get the best of them.

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Emotions drive sales and buy-in
Emotions drive sales and employee buy-in.

It’s a truism in sales that customers make up their minds on the basis of emotions and rationalize their decisions with reason.  That principle holds true in most types of communication where you’re trying to win people over – regardless if it’s for a product, a service or a point of view.

A good example is the remarkable commercial that Google ran during the Super Bowl.  It managed to take the techie tool of a search engine and make a wonderful emotional connection with it.  I decided to compare it to how Microsoft is promoting its new bing search tool in its commercials.

The differences start with the basic style of production.  In the initial commercial that launched bing, a narrator hypes the contrast between a search engine and a “decision engine.” The second commercial illustrates the frustration that people can experience with the “overload syndrome” that bing suggests they get with the typical search engine.  Both spots are well done and attempt to strike an emotional chord, but they still lean more toward the rational end of the spectrum.

The Google commercial, on the other hand, has no narration, just poignant music and simple, engaging visuals that show someone going through various links on the Google site as he makes his way through a series of moving moments in his life.  It brilliantly takes the rational experience of online searching and “humanizes” Google much more effectively than the bing ones do for Microsoft.

The effect is similar to the Anheuser-Busch commercial that shows soldiers coming home from the Middle East.  As they come off the plane and walk through the airport, spontaneous applause breaks out from strangers waiting for other flights – no narration, just moving music and appreciative faces conveying a very touching moment.

When I went to YouTube to look at the AB commercial again, I got a version that was followed by a news report of soldiers coming home and being reunited with their families.  Naturally, that amplified the impact of the commercial, and it showed how well “news” can be linked with “promotion” to create a one-two punch of emotional impact.

By the way, YouTube numbers show that the Google commercial has been viewed more than 4 MILLION times since it was posted after the Super Bowl.  Compare that to the 72,000 views of the bing intro spot and 170,000 view of their “overwhelm” commercial – over a much longer period of time.  Does that say something about how people respond to the emotional versus the rational?  Check them out yourself – and remember those contrasts the next time you’re trying to win the hearts and minds of any stakeholder – inside or out.

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Inside Out E-Column

Counting what counts.

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Determining what matters can drive organizational focus
Determining what matters can drive organizational focus.

Measuring the value of communication has always been important. Today, it’s become something of an obsession, and it’s easy to understand why.  But instead of focusing on measuring the value of communications, communicators should concentrate on communicating about measures that people value.  Here’s an example of how a St. Louis-based winner of the Baldrige National Quality Award, Wainwright Industries, applied that principle.

Making data meaningful with “Mission Control.”
When they set their sites on the award, they knew they would have to collect a lot of data – and figure out how to share it throughout the organization.  The solution was inspired by NASA. The Wainwright team decided to post the data in a single room organized around priorities that came from input provided by employees. They called the room “Mission Control,” and it was designed to let all employees know how various aspects of the company’s performance are tracking at all times. Using color coded flags, the display provides instant awareness of emerging problem areas. What’s more, it activates a pre-set course of action if performance indicators fall below established benchmarks.

While it’s essentially a communication system, not many professional communicators would typically see it as part of their domain. Therein lies the proverbial rub – and the opportunity to be more relevant.

 

Measuring what matters to people.

When communicators measure their success in terms of functional indicators like media impressions, newsletter satisfaction ratings and similar measures, they’re not connecting with most employees who don’t care much about those measures.  Ultimately, the most vital function of organizational communications is to facilitate the exchange of data, information, and knowledge that support employees in doing their everyday jobs. That’s what most people care about – and that’s where communicators should focus much of their measurement efforts.

The first step is to ensure you’re focusing on relevant indicators.  Examples might be safety, employee learning and development, results of continuous improvement efforts, quality of products and services, defect and rework rates, results of employee opinion surveys, customer satisfaction, sales and margins, progress reports on employee profit-sharing and the like.

Sharing information so people see why it matters.

But all that data is useless without an effective system for sharing it.  In short, measurement needs to be supported with a communication system that spans the entire organization.  Communicators shouldn’t try to do it alone, though.  They should work closely with other key functions – human resources, organizational development, finance, quality, information technology, sales, marketing, customer service, etc.

The roles played by the people in this measurement and communication “orchestra” vary depending on numerous factors. Someone, though, has to take the lead and serve as the “conductor” who keeps the group operating in unison.  That role is ideally suited for communicators who can see their way out of their traditional boxes.

Regardless of who plays what role, several important elements have to be built into the design of an effective measurement and communication system:

  • Leading and lagging indicators
  • Frequent and timely
  • Simple
  • Visual
  • Relevant
  • Quantitative
  • Benchmarked
  • Action-based

Click here for a brief description of each of those elements.

It’s a big role to take on, but it’s worth it.  Beyond the merits of the system itself, communicators stand to be recognized more for the value of their work – and appreciated more for their contributions to the performance of the organization.

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Inside Out E-Column

Focusing on results can lead to poor performance.

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Remember to recognize strong performance
Remember to recognize strong performance.

I want to share another insight from my late friend and mentor, David Berlo.  He always emphasized the distinction between results and performance.  Results are the outcomes you produce, and performance is how you get there, he said.  From there, he asserted that being singularly results-driven in what you measure and reward eventually leads to the deterioration of both performance AND results.  Here’s why.

Outcomes vs. Inputs

First, we all know that people tend to repeat behaviors that are reinforced in some meaningful way.  Likewise, people tend NOT to repeat behaviors for which they receive negative response.  Next, it’s important to realize that no one has direct control over outcomes (results) – unless the game is fixed or there’s an unfair advantage.  People can only control inputs (performance).

Now, if bad performance always led to bad results, and good performance always led to good results, it wouldn’t matter which one you rewarded – results or performance. But that’s not always how things work out.  Sometimes you don’t get good results even when you give your best effort – other variables can come into play.  Other times, just the opposite is true.  You can give a marginal effort and come out smelling like a rose.

That’s not how things usually happen, but look at what you get when they do.  If you fail to reward people for good performance because they had bad results, you discourage them from repeating the good behavior.  If you reward them for good results in spite of poor performance, you reinforce poor performance in the future.  The cumulative effect over time is inevitable.  Every time you focus on results in a way that either reinforces poor performance or discourages good performance, you also take a step backwards with long-term results.

Performance is the bottom line.

Of course, you have to add up the numbers on the bottom line eventually.  But even if winning in the world of business means producing results, lasting success still requires focusing on the drivers of those results, and rewarding effective execution – regardless of the outcomes in the short run.  Berlo summed it up this way: “Winning is the name of the game, but performance is the bottom line.”  Clearly, if effective execution isn’t producing the desired long-term results, you need to figure out where the disconnect is.  But it serves no purpose to penalize people for poor outcomes if they’re doing the right things in the right way. If that happens, you need to fix the systems, not the people.

So what does that mean for us in the people professions?  For HR people, it’s pretty obvious.  Some compensation and bonus programs are notorious for focusing solely on immediate, bottom line results without regard to how they’re produced – often leading to short-term “success” with negative long-term consequences. Those programs have to encourage performance that looks at the long haul. For communications people, we need to look at where the bulk of the ongoing organizational dialogue is focused.  Are we communicating effectively about the “steps to success” – or is everything employees read and hear about focused on the end game?  If it’s results we’re after, we’d better be talking a lot more about what it takes to produce them – because in the end, it’s how you get there that counts.

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