One of my sons is a professional horse trainer. We were at the
lumber yard the other day and the guy there asked him, “My horse does
this and that and the other thing, can you tell me how to fix it?” My
son thought about it for a minute, and replied, “What you need to do is
make it easy for your horse to do what’s right. When the horse doesn’t
do what you like, you make him work and work. When he does what you
want, you let him rest. He’ll quickly learn it’s easier to do what’s
right.”
Isn’t that what we do in business — make it easy to do what’s
right? I remember planning bogies for bonuses as a young manager. My
boss said, “You’d better be careful what you reward. Often that’s all
you get to the exclusion of everything else.” Over the years I’ve
found that to be true.
I remember one company that had set up a system of rewards based on
sales. Things went so well they were on the fast track to bankruptcy.
They hadn’t put any rules or anything in place, and the salesmen were
selling product at any price – giving away the company – to reach the
sales bogie and get the bonus. Not happy with what had happened with
the sales bogie, management changed the bogie to profit, not gross
sales. What happened? Sales absolutely dried up, as salesmen tried to
sell the product for more than it was worth to pump up the profit
numbers so they could get their bonus. They didn’t care two hoots any
more for the top line. They had shifted their entire focus to the
bottom line. I’m guessing that’s not what the management of the
company had in mind either.
When setting bogies, the advice of my friend and manager is still
valid. Be careful what you reward. Be sure your goals find a balance
in all the things that are important to you as the manager. Once you
get your employees going on rewards, they’ll eschew anything that’s not
being rewarded. Often that will bite you where you least expect it.
The best way to evaluate such a plan is to say, “If I reward this
thing (or these things) and my employees focus on them to the exclusion
(or near exclusion) of everything else, what will be the result?” The
more of this type of thing you do (dreaming, planning, evaluating and
executing incentive plans) the better you’ll be able to spot future
trouble spots before they bite you.
But at the end of the day, employees are happy to do what you want
them to. You just have to figure out how to “make it easy to do what’s
right.”
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