Carrot or Stick? Or is there a Better Way to Motivate your Team?

One of the most common challenges all business owners face is how to get the best out of their team. As Tom Peters once said: “Most employees are motivated, energetic, committed, enthusiastic and loyal….. except for the eight hours a day they work for you!”

Seriously, have you ever considered what kind of relationship you have with your employees? In the early days of the Industrial Revolution employees were treated as commodities that had a set price were owed nothing beyond that price. Amazingly some businesses in the UK still operate at that level. It’s still pretty common practice in the construction industry where management and labour tend to have a very transactional relationship.

In the 19th century some companies, such as Cadbury, Rowntree’s and Lever Brothers (now Unilever), pioneered a more philanthropic approach to their employees. These businesses offered their employees housing and other benefits in addition to financial remuneration. But the ultimate goal was still control and the relationship was rather paternalistic. The employer created a sense of belonging to a family which would look after all the employees’ needs provided that the employee delivered his part of the bargain by coming to work and conforming to the employers’ values. Of course, many family-owned businesses still behave in a similar way today.

The transactional approach is cold and clinical and the paternalistic approach is warm and fuzzy but both work after a fashion. Some businesses, however, have adversarial relationships with their workforce. Such relationships are characterised by mistrust, tension and conflict. In many cases these feelings are not voiced openly, but come out in passive aggressive behaviour with employees offering resistance to new initiatives, begrudging compliance with instructions and, even worse, subtle sabotage of the employer’s attempts to innovate and move the business forward.

So is there a better way? In my experience, employee relationships are no different from any other business relationships. They thrive best when treated as partnerships in which each partner has is able to make a contribution to a successful outcome and take a share in the results. Many businesses are good at designing schemes which allow employees to share in the profits of the enterprise. But profit sharing schemes don’t actually tell employees what they need to do to help the company grow.

Very often this comes down to communication. The team don’t understand that they have our permission to contribute because it hasn’t been made clear to them. It seems so simple and obvious to someone on the outside, but in the thick of day-to-day management it’s a point that’s often missed. As leaders we have to take responsibility for this. It’s our job to create an open environment where the team understand that they own part of the relationship and have the freedom to contribute to it.

Here are some practical suggestions on how to do this:-

• make a practice of treating everyone as an equal regardless of their level within your organisation
• consult with your employees when making important decisions. For instance, “I was thinking we could do X, Y or Z. Which would you do? Or do you have any other suggestions?”
• make sure you know some personal information about each member of your team. This will help you understand what really motivates them.
• rather than handing down detailed instructions on how a new task needs to be done, seek the team’s input on defining and shaping their response to the task.
• be proactive in designing work for people that allows them to exercise discretion and judgement

Using these techniques will help you develop a sense of autonomy amongst the members of your team which is the best way of motivating them to higher performance. And there’s unexpected bonus. Psychologists have found that a person’s happiness is directly proportional to the amount of control they feel they are able to exercise over their circumstances. Your employees are no exception and in business there is a direct correlation between the level of happiness in your organisation and the bottom line in your financial statements. Not widely appreciated, but there’s plenty of evidence that this is how it works.