CHAPTER 8

How to Recognize and Reward People

HOW TO RECOGNIZE AND REWARD PEOPLE

This chapter continues with the idea that
your job is to steer people, helping them stay
the course and stay on course.
On going feedback and incentives are used
to steer
Incentives - are promises of a reward
An incentive can be a promise of a future
reward, such as a bonuses
HOW TO RECOGNIZE AND REWARD PEOPLE

Rewards - how organizations fulfill the
promise.
Recognition - how the organization
acknowledges and shows appreciation for
people
Recognition programs may use financial
rewards or non-financial rewards.
COMPARISON OF INCENTIVES AND REWARDS
Factor Incentive Rewards
What it is A promise of a future
reward
Something earned to
encourage the
continuation of or the
achievement of specific
results, behaviors, or
activities
Something given after
the
fact in appreciation of
good work or
acknowledgement of
some
result or achievement
Something given to
encourage the
continuation of specific
behaviors or activities
When it occurs Before, during, or after an
activity, event, or result
Either during an activity,
after a result, or after
the fact
COMPARISON OF INCENTIVES AND
REWARDS(CONT.)
Factor Incentive Rewards
Purpose To encourage and
motivate people to behave
in specific ways or to
achieve improved results
To provide direction
To motivate when done
during an activity
To acknowledge when
done after the results
are in
Criteria Tied to desired results
May be tied to behaviors
that lead to results
Tied to desired results or
specific behaviors that
lead
to results
PERFORMANCE IMPROVEMENT
First question to ask- what would I want to
accomplish by using incentives or rewards?

Second question - how will I know whether
the incentive or reward I did what I wanted it
to do?
PERFORMANCE IMPROVEMENT
Performance improvement - following a
systematic process to identify and use
appropriate incentives to get the results you
want.
Without systematic process, one could
potentially reward people who does not
contribute to the success.
COMMON MISSTEPS
1. They fail to point out the importance of the work to be
done.
2. They discount the significance of a personal thank you,
general courtesies, and politeness.
3. They are unclear on their purposewhether they want to
encourage specific behaviors or reward results.
4. They fail to link the reward or recognition to performance.
5. They do not reward people fairly or equitably.
6. They think treating everyone the same is best.
7. They think treating everyone differently is best.
8. They reward meaningless results.
LEADING AND LAGGING INDICATORS(LEADING)
The presence of some activities and
behaviours improves the odds that the
organization will be successful.
Examples: following up with customers in a
timely fashion or complying with safety
procedures
LEADING AND LAGGING INDICATORS(LAGGING)
Accomplishments are lagging indicators,
because they are the results that occurred
after people engaged in specific activities
and behaviours
Examples: amount of product sold compared
to quota or customer satisfaction rating
received compared to what was expected
LEADING INDICATORS
Results happen when managers,
supervisors, and workers engage in specific
behaviors and activities.
Incentive plans can be designed to
encourage the behaviors and activities that
are linked to results..
LEADING INDICATORS
Supervisory Behaviors
-leading indicators of good employee relations and performance
such as:
Setting clear expectations
Giving regular and frequent feedback
Regularly displaying common courtesies
Saying thank you
Being fair when giving people attention or help
Explaining the organizations vision and his or her vision for the
work unit
Showing respect
Taking an interest in peoples careers
SUBORDINATE BEHAVIORS
Activities and behaviors that are leading indicators of
subordinates accomplishments depend on their jobs.
Examples:
1. Sales not promising beyond the capabilities of
products or services, prepared for client meetings
2. Customer Service asking permission before
putting a customer on hold
3. Technicians - arriving early, complete work in one
visit

LAGGING INDICATORS
accomplishments or the results that occur at
a specific point in time, the end of a project,
or after an implementation.

include things like bonuses, merit increases,
and promotions.

LAGGING INDICATORS EXAMPLES
SAFETY - the incentive might encourage
people to hide accidents. The second problem
is that it encourages co-workers to exert
pressure to hide injuries.
SALES - company bonuses were solely based
on total sales volume, not margin.
Margin - difference between net sales and the
cost of the merchandise
RECOGNIZING THE UNSEEN AND THE UNCLEAN
people who work behind the scenes and do
work that is overlooked and under-
appreciated(housekeeping, maintenance,
etc.)

they also experience emotional burnout and
their efforts should be acknowledged
PEER RECOGNITION
Recognizing the work done by your fellow co-
workers, customers or team mates.

Examples:
Im too clever for my job award is given by co-
workers when they see a colleague do
something very clever
companies allowing peers to nominate co-
workers for awards when they see someone
receive outstanding comments from customers.
HOW TO RECOGNIZE AND REWARD PEOPLE

Compensation - Incentive used to pay
people fairly.

Meaningful Work - most powerful incentive
to perform is the work itself especially if
people believe what they do is important.
ALIGNING INCENTIVES
It is important to identify the right
combination of results and the contributing
behaviors.
Alignment happens when the incentive plan
gets people to behave in ways that lead to
desired results.
Safety incentives only work when:
Clear expectations about all the factors that
contribute to performance
Good documentation
SUMMARY
People who are passionate and have good
relations with each other can beat a lousy
system.

Look beyond the organization for rewards;
come up with some yourself. Start by letting
people know how important their work is and
how others rely on them.