What are you worth? Are you sure….?
OK reader, be completely honest. Have you ever compared yourself with college mates or peers working in the same or other companies? If you answered “yes”, your comparison was probably based on how much they earn relative to you. Right? I am not a mind-reader. The point is that over the years, capitalistic societies have constantly focused on money (and what it can buy) as indicators of worth. In fact, it is this deeply-ingrained thinking that is also the reason behind workplace schisms such as gender pay disparity.
As an international executive search professional, my work extensively involves working with compensation packages. Both client companies and individual candidates most often highlight and ask about compensation (and how it’s structured). For the one, compensation is a measure of how they “value” talent; for the other, the “numbers” represent an opportunity to validate what they believe they are worth.
But just because most companies and individuals see it this way, does that make it right?
My views have started to change
I recently read “Drive”, a book about what motivates people, written by renowned author Daniel Pink. I was drawn to the book because ability and motivation to perform are key elements of what we at LS International look for when searching for the best candidates on behalf of our clients. I admit that the book has certainly made me think about how we should look at this whole notion of “worth” and “motivation”.
The author posits that extrinsic rewards, such as higher compensation, work well for “algorithmic tasks” (which he defines as those that are based on a proven approach or formula or have a well-defined ending). However, he finds that people who perform tasks that require innovation and flexible problem-solving or are higher in ambiguity are not as motivated by “extrinsic” rewards. He explains that people are motivated more by “intrinsic” factors. For instance, people prefer a higher degree of autonomy in their life. In other words, they would like greater freedom to make their work decisions, decide work styles etc. Backed by research findings, the author reveals that the secret to high performance lies in an individual’s ability to define his/her individual purpose in life and thereafter, expand and enhance his/her abilities and direct his/her own life in the pursuit of that of individual purpose.
This initially sounded counter-intuitive because one assumed that people are driven by a biological drive to seek rewards and avoid punishment. I associated constructs such as “higher purpose” with philosophers or hugely-successful (and super-rich) CEOs delivering keynote addresses at plenary sessions of conferences. But having read the book, I have started to change my mind. I am fascinated by the author’s cogent arguments- and the conclusion that conventional carrot and stick approaches used by companies to reward performers are flawed.
Companies and candidates need to change their paradigms of “worth”
The ideas propounded in “Drive” has major implications for current and future workforces especially because of two specific trends:
- Automation is reducing head count of people involved in “algorithmic tasks”; and
- Companies are seeking to hire and promote employees with competencies that allow them to identify and address challenges in environments of growing ambiguity and more rapid and unpredictable change.
We are already seeing that millennials entering the workforce are generally more concerned about “autonomy” aspects of their jobs than were people from Gen Y or X. They do not mind being a part of the gig economy if it gives them the time and space to pursue passions- and what a wide range of passions these youngsters possess- working with under-privileged kids, fighting climate change, raising awareness about mental health issues, diversity and inclusion and so much more.
HR and Business managers can no longer rely as much on compensation as a magnet to attract and retain talent; they will need to consciously create workplace environments, teams and policies that genuinely motivate employees by giving them greater autonomy. This “space” and “freedom” could potentially manifest in several ways, such as the following:
- Giving people the freedom to question status quo and boldly think outside the box;
- Allocating reasonable organizational resources to try something new;
- Backing by the employee’s managers and the company’s leaders to take calibrated risks; and above all,
- Not labelling the lack of success of such initiatives as “failure” or treating it as a reflection of the individual’s abilities and instead, mentoring employees who take such initiatives to distil learnings from their experiences, build resilience and bounce back to take another shot.
Organizations that are able to do the above consistently will be better-positioned to get the most out of their employees in terms of productivity, collaboration and innovation; it will also lead to superior engagement and loyalty.
Failure to do the above may lead to the apocryphal situation of applying lipstick on a pig: it is a waste of lipstick and will only annoy the animal. The parallel is to assume that money alone will motivate all employees to perform better in their roles.
For candidates too, making this mind-shift is important. For instance, A may be happy with a lower compensation, if she gets a month off every year to say, work with under-privileged children. B may be happier than C (who gets a higher salary) if he is allowed to work from home unless there are exceptional reasons for him to be physically present in the office. I use these examples because many organizations are starting to be more flexible about such things that enhance “autonomy” for candidates as a way to attract and retain talent. This means looking at one’s worth not just in terms of the money we make but also by factoring in the extra time/flexibility our employees offer us to pursue our personal passions in life.
Some of you may feel there’s nothing new about asking an organization to align its people more consciously with its purpose or giving employees greater freedom. These ideas have been around for some years now, but many companies still don’t do this well or pay only lip service. Even today, when trying to attract talent, the emphasis is inordinately on the compensation. Fair financial rewards are an important element for sure, but must not be viewed by either side as the only or most important factor that motivates all employees. There will always be exceptions- and it is the responsibility of executive search experts to gauge such exceptions and assess/position them suitably.
Triggering the right motivators is key
To quote Jen Welter, Ph.D, the NFL’s first female coach, and now a sports psychologist and motivational speaker: “If you want to be successful in this world, you have to follow your passion, not a paycheck”.
It is important to look not just at a candidate’s experience or skillsets; the ability to perform in the new role must be clearly assessed. This also means evaluating what will motivate each candidate presented to clients. The right motivators will spur employees to go after more ambitious goals, pursue personal excellence with greater determination, collaborate better and think outside the box. In turn, all this will lead to superior performance (which is what companies want) and better rewards by way of promotions, raises, bonuses etc. (which are important to candidates). However, continuing to view or use money as the primary (or dominant) motivator is like putting the cart before the horse. The choice is thus between consciously architecting a new paradigm that gives us greater freedom and flexibility in defining what our worth is and clinging on to what is clearly a paradigm that is past its “best before” date.
Company performance can be tangibly amped up by using the right ways to motivate employees and partners. “AMP” is a pretty handy acronym for what Daniel Pink lays down as a mantra for motivating people and thus eliciting higher levels of performance: A for Autonomy. M for Mastery. P for Purpose.