Sterling Performance

In straitened times, perks are a tricky area for employers looking to buoy spirits without busting out massive bonuses.

It would be disingenuous to say pay doesn’t matter. But engaging anyone — from board members to employees — is better done by allowing them to take ownership of strategies, says Richard Donkin in the FT.

The psychology of motivation can elude employers because it taps into irrational behaviour. Financial wins work on a different part of the brain to that controlling altruism and social interaction, according to Ori and Rom Brafman’s book, Sway, the Irresistible Pull of Irrational Behaviour.

They quote a study at Duke university in North Carolina, where two groups of students took the same business exam, but one group was offered 2.5 cents for every correct answer.

The unpaid group scored higher on the tests — the reward in this case acted as a disincentive, probably because it was a risible amount. It would be like a friend offering you money to help them move: you’d probably be insulted rather than grateful.

It’s a question of what your incentives tap into — someone’s financial interests or, say, a sense of loyalty. Sometimes the most simple perks work just as well, if they play on the non-financial motivations.

Donkin also notes the value of “speedy recognition” through relatively low-cost rewards — breaks, use of the company Jag, a bottle of wine. This is still money, in some cases — he quotes Projectlink Motivation, which offers vouchers and ‘supercheques’ to high performers as part of its service. But these tend to be more affordable one-offs that presumably give still someone the gambling-high of a big financial win.

I was intrigued by the national differences between gifts people award themselves via Projectlink vouchers. According to the company’s managing director, Stephen Humphreys, the French like a good bottle of wine, the Spanish a cured ham. And the Brits? We slap ourselves on the back with brand new paper shredder.

No-one dies wishing he’d spent more time in the office, says Snakes & Ladders picking up on HBR’s article, ‘When Virtue is a Vice’.

People tend to place a higher premium on work than play. But authors Anat Keinan and Ran Kivetz have done research that suggests you’ll forgive yourself faster for an indulgence today than if you deny yourself happiness for too long.

They asked current college students and alumni how both groups felt about how they’d spent their winter breaks. The alumni who’d not travelled or splashed their cash had lingering regrets — they lasted longer than those of the students who’d spent more freely or studied less diligently.

Likewise, indulgent business people were less sorry about having slacked off as time went by, while those who’d been more conscientious felt twinges of regret over the fun they’d missed.

People who refuse to remove their hairshirts suffer from ‘excessive far-sightedness or hyperopia’. They are what author Tal Ben-Shahar would call ‘rat-racers’, working hard and postponing the fun till later. (There’s a sad end-note to Lord Maclaurin’s ‘Tiger by the Tail’ that should be a cautionary tale to any hyperopic CEO.)

Keinan and Kivetz have a marketing message, too. They asked 57 shoppers to anticipate how they’d feel about two different types of purchase. One would be an indulgent buy to make them feel happy; the other a cheaper item that would allow them to put a bit aside for a rainy day.

Those who expected to feel immediate regret bought the low-end product. The authors suggest anyone marketing expensive goods should try asking consumers to think longer term about how they might feel if they forego an indulgence — “For instance, a travel company might ask customers to consider how they’ll feel about having passed up a family vacation package once the nest is empty.”

It seems pretty manipulative. But I wouldn’t be surprised to see a slew of ’seize the day’ marketing messages as the credit crunch deepens.

Is this a blow for equality? It transpires that in the UK, the office sex pests are most likely to be ladettes.

According to research by Peninsula, a Manchester law firm, 77 per cent of over 2,000 male employees surveyed had been sexually harassed by a female colleague — and had suffered in silence, unsure if discrimination laws applied to them. Two thirds of those surveyed felt that the office was no place for innuendo and banter, either.

Tellingly, 85 per cent of employers admit they are less likely to take a harassment complaint as seriously if it’s come from a man.

On the plus side, this surely spells the end for those nauseating Diet Coke ads. (more…)

Everyone seems to be talking about talent management at the moment. It came up as a priority for at least 50 per cent of Ashridge’s Management Index of important trends, driving the business school to launch a course to help managers frame the business case and avoid common pitfalls.

At Ribbon Farm, Venkatesh Rao takes a stroll through nine flawed talent management theories to explain why they don’t work. And Tammy Erickson identifies the top 10 talent management challenges.  To her list, I’d add a couple more.

First, the definition. What exactly do people mean by talent management? Is it about identifying and nurturing high-flyers, or helping all of your people to develop their particular skills?

The general assumption is that talent management is an enabler, while performance management is more about setting goals and monitoring their delivery.

But beyond that, there’s a muddle as to what is meant by talent and where it talent resides in the business. Is it the anointed few, or, in the right managerial hands, the many, the any?

Done badly, there’s potential for a massive rift to emerge between the ‘talented’ — the ‘hi-pos’ (high potentials) — and the ordinary, tellingly defined recently as as ‘the po-pos –passed over and p***ed off’.

It’s very dangerous to single out the stars in an organisation to the exclusion of all others. There are far more ‘utility players’ on most teams than standouts, for one thing.

It goes against the ‘enabling’ aims of talent management, for another. If you make a big deal of a select few, there’s every chance you’ll have a clutch of demanding and difficult divas in one corner and the disenfranchised masses in another.

It’s also bad for business, says Professor Robin Stuart-Kotze, chairman of Behavioural Science Systems. He points to the automobile industry as proof. “General Motors, Ford, Chrysler — they struggle while Toyota continues to grow revenue and profits, because Toyota listens to everyone’s views. It gets literally hundreds of thousands of ideas from employees at all levels — and it accepts and implements something like 90 per cent of them.”

The assumption that some people are born talented and some aren’t overlooks the fact that behaviour, rather than personality, drives performance, he adds.

The word ‘talent’ is  part of the problem. Says Stuart-Kotze: “It has a sprinkling of star dust about it and implies that so-called ‘talented people’ are very special, but talent is a relative concept.”

Talent’s also apt to wax and wane. Talent management theories often presuppose a mystical group of Alpha employees whose work is consistently stellar. Individual and team behaviour is cyclical — like stock tips, ‘talent’ tips should be taken with the same caveat — that performance can go up or down.

Yet, it’s a fact that some employees will rise to the challenge more often and more ably. It’s an issue managers are going to have to learn to deal with in a businesslike manner.

“Culturally, relationships are more important than tasks to UK managers, so we shie away from having respectful, frank, potentially difficult conversations,” says Penny de Valk at the Institute of Leadership and Management.

Turns out it’s not the word ‘talent’ we need to be worrying about after all. It’s our old friend ‘management’.

The Workplace Law Network explains how the draft Equality Bill, ‘Framework for a Fairer Future’, could affect UK employers and their teams.

It aims to “de-clutter” complex discrimination laws and bring them together under the heading of ‘Equality Duty’. It also zeroes in on weak spots in those current rules — ageism, homophobia and disability discrimination are still going unchecked, according to Equality Minister Harriet Harman.

Key proposals

• Employers to report on equality matters such as pay and diversity. (According to Francis Gibb, Harman was pushing for compulsory pay audits.)
• Positive discrimination OK for for women or minority job candidates if it comes down to a ‘tie-breaker’.
• No more ageism in the provision of services.
• Employers cannot outlaw discussion of pay.
• Tribunals can rule for the benefit of not just an individual, but the whole workforce of a discriminating employer.
• The government will investigate how multiple complaints can be brought — say, if someone claims discrimination as a disabled woman.
• Public-sector purchasing will promote the equality agenda through through procurement.

It’s all voluntary — at least for now — so employers’ organisation the CBI is broadly approving.

But all this talk of openness makes me think of Trendwatching’s Transparency Tyranny.

Surely all this disclosure can go too far. Or is it just a case of careful training, so that line managers can handle the tricky conversations that ensue when X finds out that Y is earning more — not because of some unfounded prejudice, but because Y is better at their job.

As entrepreneur John Timpson once said, not everyone is equal. (He even admits to ‘discriminating against drongos’.) But perhaps it’s not the employer’s place to exacerbate those inequalities any more than necessary. As you can tell, I’m on the fence on this one.

But employees up for letting it all hang out can have their say, too, by visiting Glassdoor.com — which reveals what employees think of companies, what they pay and how the CEO is rated.

Apparently, something called ‘achievement amnesia’ is blighting jobseekers’ chances of getting an interview.

Research by iProfile has found a mis-match between what employers look for on a CV and what job applicants deliver.

Employers consider work-based achievements essential to a good CV. But job applicants spend more time tinkering with the design than working on the content.

They often dash off their CVs in less than two hours and, in their haste, struggle to recollect significant achievements or learning experiences over six months’ old.

iProfile interviewed 200 employers, of whom 73 per cent claimed they’d rejected job applicants because they’d failed to highlight workplace achievements.

They also claimed that applicants who sell themselves convincingly are in a position to ask for higher starting salaries — 51 per cent of employers said a strong seller could ask for five per cent more.

Start keeping a record of career milestones, suggests iProfile (not surprisingly), using new online sites that allow you to update information continuously.

iProfile has a vested interest in changing the way we compile CVs, but it asks a valid question — is the old-fashioned job resume dead?

Is there a better alternative?

UK managers underestimate the skills of their Chinese counterparts, says Management Issues, reporting on the Institute of Leadership and Management’s report, ‘Global Management Challenge: China vs the World’.

The western perception of Chinese management is outdated, says the ILM — we see China’s as a place where long hours and low costs prevail and management is authoritarian. But Chinese managers are highly principled and consider themselves good motivators who are outcome-focused team players.

What’s more, China is starting to develop a “distinctive and highly effective management culture” that could result in businesses that leave the west in their wake, doing for China what techniques such as ‘kaizen’ did for Japan.

“The similarities with post-war Japan are uncanny,” says David Pardey, the ILM’s senior manager, research and policy. If so, western businesses need to up their game or find themselves outstripped in the longer term.

Chinese managers are generally far more educated and ambitious than those in the west, and in-house training is taken seriously — telecoms giant Huawei has its own university.

The ‘Chinese way’ of management draws on western management models but is binding them with its own culture to create a new practice.

The traits most valued by Chinese managers reflect this:

• Knowledge, wisdom and the ability to learn.
• Taking responsibility.
• Teamworking skills.

“The emphasis is on ‘communitarian’ values, discussion and consensus,” says Pardey. “Decisions emerge, rather than being made.”

What appears to western eyes as a reluctance to make decisions is simply a result of this consensual approach. What’s more, because everyone’s been consulted on a decision, they are more likely to buy into it.

The management model also focuses on long-term results. “There’s a strong emphasis on relationships and not allowing short-term setbacks to deter a business from its end goals, whereas the Anglo Saxon model is much more short-termist,” says Pardey.

He cites China’s barter-style investment in Nigerian oil as an example — it’s willing to shoulder an initial loss for a bigger gain in the long term.

This is where western complacency is dangerous. Chinese businesses may not be immediate threats to their western rivals, but in 10 years, they will have deep foundations that guarantee success.

The ILM research also claims western managers tend to be slower to identify areas for improvement than the Chinese, a trait that must change.

Says Pardey: “We have got to learn and we’ve got to innovate. The UK’s strength is in risk-taking — culturally, it is more prepared for innovation. But not enough UK organisations are at the leading edge.”

Contrary to conventional wisdom, conflict is an essential characteristic of any high-performing team.

Weak teams and committees are full of people who keep their opinions to themselves when together, only to whine when outside the group.

Effective teams get the issues on the table immediately, confident in the knowledge that they are working toward the same goals.

Take Manchester United. From Schmeichel to Keane to Rooney, and not forgetting the manager, Sir Alex Ferguson, the team has always had individuals ready to challenge others — often very directly — to raise their game.

The key to success is to ensure that the conflict is positive, not destructive. In business, there are two major advantages to allowing conflict and differences of opinion to influence big issues and decisions:

• Clarity of solution. Sculptors often remark that as they work on the stone, the final piece reveals itself. Solutions to major decisions are the same. They are crafted and shaped by the arguments and counter-arguments that positive conflict encourages. As weak arguments and ideas are chiselled away the best solution becomes clear.
• Commitment to action. Allowing and encouraging positive conflict builds rather than destroys commitment. Everyone can be involved in developing the solution, giving your team greater ownership of the solution. As the quality of the final solution is likely to be higher, your people will have greater confidence that it will work in practice.

So how can you promote and develop positive conflict with your team? Here are three steps you can take:

1. Develop genuine alternatives. There is more than one way to grow sales profitably. A good alternative should
   • Address the issue or opportunity head-on.
   • Enable you to create real performance improvement.
   • Improve your competitive position.
   • Be feasible for your organisation to deliver.
2. Encourage an ‘inquiry mindset’. Harvard Business School’s David Garvin argues that business leaders should create an ‘inquiry mindset’ across their teams, promoting collaborative problem-solving where team members remain open to alternatives and accept constructive criticism. They should avoid an ‘advocacy mindset’, where decision-making is a win-lose contest involving persuasion, lobbying and the dismissal of others’ views.
3. Recognise the risks. All alternatives have risks and, even with your final solution, these should not be played down. Recognising the risks allows you to plan preventative and contingent actions, giving you and your team even more confidence in the final solution.

Is there sufficient positive conflict in your team? If not, is it time to encourage your people to challenge others’ ideas and assumptions and put forward genuinely new alternatives?

Another note on Generation X, this time more positive. They may be the bashful ‘dark-horse’ generation between the limelight-hogging Boomers and Millenials, but X-ers are behind some of the most radical social media businesses in the world.

This is the upshot of the fantastically named book, ‘X Saves the World’, by Jeff Gordinier, reviewed on Wikinomics by Naumi Haque.

Gordinier on YouTube gives a flavour of the book. In brief:

In their quiet, questioning way, Gen X-ers are changing the way the world does business, especially online through Google, Wikipedia, Craigslist — “those companies have altered the face of global media,” says Gordinier, not without justification.

Gen X-ers, rebelling against the ‘macro’ approach of the Boomer, create businesses with a “niche quality, in-betweener, middle-child sensibility”, says Gordinier, contrasting Google’s low-key founders with Apple’s mythologised Boomer boss.

They like to influence their immediate sphere, radiating out from there: Architects for Humanity is a perfect example of the X-er’s “indie philanthropy”.

Gordinier deems the X-er “anti-collective” and not especially motivated by money. Yet the business examples he cites are often both extremely rich (Brin and Page of Google, for example) and creators of sprawling online collectives.

Whether X-ers meant to become captains of industry or not, many have. Now in charge of some of the world’s biggest businesses, they’ll have to tap into Millenials’ sensibilities as employees and customers.

That’s going to be tough if all X-ers share Gordinier’s view of the next generation — “in it for the money” and “completely greedy”. Not a great start to a fruitful working relationship.

Personnel Today reports back from a CIPD conference where Fionna White, Nestle’s head of recruitment, talked about ‘candidate relationship management’, which brought cost-per-hire down to £700 a person.

How she did it: She took £5,000 she’d been allocated for one hire and spent it on developing a Web presence. Called the Talent Pool, the site posts specific jobs, but also allows candidates to submit their CVs, even if there isn’t an appropriate vacancy for them at the time.

HR can then assess submissions as they come in, rather than being inundated with CVs over a month or so. At launch, 300 people registered, 25 were rated excellent and seven appointments were made.

As a concept, the top benefit must be that anyone who registers with this type of site is demonstrating a real interest in the business — so you’ve got an early indication of loyalty. On the minus side, it’s an ongoing cost and without promotion, a fairly passive hiring vehicle. But clearly, the advantages outweigh the disadvantages for Nestle.

“We had a case of a candidate being kept warm for a year, and when a job was finally available, we rang them up and they accepted — in effect, a 24-hour turnaround from offer to acceptance. You can’t ask for more than that,” said White.