Rewarding Teamwork

Teamwork in RugbyI believe every manager is a member of three teams:

  1. The people that report to that manager. This is usually what someone means when they refer to “my team.”
  2. The external stakeholders in other departments they work with every day. For example, marketing is often considered part of the extended team for sales or development.
  3. Their peers in the same department or group. For example, the leaders of each sales region.

Unfortunately, most people think of either 1 or 2 as their primary team, prioritizing their time and decisions accordingly. They view their peers as competitors for fixed amounts of budget, headcount, and attention. This attitude can create unintended silos within a department.

For the last few months, I’ve been thinking about how to encourage teamwork among peers. As such, I was intrigued by a NY Times article about the British fast food chain Pret A Manger which hires, pays, and promotes employees on qualities like cheerfulness, not just pure performance.  This thinking isn’t unique to Pret: the McKinsey book ‘Beyond Performance’ suggests that an organization’s health is even more important than traditional measures of performance.

At Pret A Manger, potential new hires must work a full day in a store, after which the employees vote on whether to keep them. While 90% are hired, those who are not are given £35 ($57) for the day’s work. This is a less expensive alternative to the online shoe retailer Zappos which pays new employees up to $1000 to quit during the initial training period.

The incentives at Pret A Manger encourage existing employees to vet new hires carefully. Bonuses are based on the performance of the entire team, not on an individual. When employees pass training milestones, they receive bonuses in the form of payment vouchers. However, the employees are required to give the money to other employees who have helped them along the way.

While we all know incentives drive behavior, Pret reports that basing the rewards on attitudes over performance creates a more persistent culture of teamwork. Employees are more likely to help each other and to focus on team performance rather than individual results.

For years I have been rewarding teams based on their shared outcomes to emphasize teamwork. Frankly, I’ve seen mixed results. Pret comes with an intriguing idea: reward the behaviors you want and performance will follow.

What do you think?

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14 Responses to Rewarding Teamwork

  1. Mark Yolton (@MarkYolton) March 6, 2012 at 1:55 pm #

    One of my favorite managers said, “Hire for attitude; train for skill.” I appreciate the value of that approach. Most people can learn to do most of the tasks we ask of them … but their ability to work in a team where they will be sometimes leading and sometimes contributing, their ability to influence using soft power while still getting along with others necessary for the next battle, their ability to maintain positive and healthy attitudes even in the face of disappointment or short-term challenges, and all the rest are more at the core of their being / self / personality / world view and therefore harder to teach or learn than a certain skill. I believe that if you start with someone who has the ability to prioritize their co-worker peers as their primary team, and then reward those behaviors, it’s possible to reorient people. The failures I’ve seen have been because people see selfish or self-centered ‘lone hero’ behavior rewarded and recognized much more often than self-sacrificing, humble, servant-leadership and team behaviors. Recognize and reward to reinforce the behavior you really want and it can be done, but it’ll take time and consistency for the manager/leader to prove that he or she really means it.

  2. Natalie Hanson, PhD March 6, 2012 at 2:47 pm #

    Interesting and provocative post as usual, thanks Jonathan!

    I agree with Mark – there is only so much you can do to coach on personality attributes. I do think it is extremely important for both managers and team members to be on the hook for the performance of their team.

    What I’m less convinced of is whether the monetary rewards are really necessary. I require people on my teams to interview and select each other, and (like you, Jonathan) they are accountable for the achievement of group goals. That is in turn reflected in their compensation, but I’m not sure I would want to reward such specific behavior. I am also working with relatively senior, well-educated people in a white collar environment, so it may be that the work context at Pret a Manger requires / warrants a different approach.

    A few other things to note:

    – Dan Pink and many others have noted changing philosophies about how we incent people, and money really isn’t the best way in many cases (again, depending on the type of work).

    – You might be interested in the work of Barry Schwartz. I heard him speak last year about his book _Practical Wisdom. He provided an example about an Israeli daycare center. Parents were coming later and later, which was impacting the staff’s ability to close the facility and get home to their own families. The Director started to fine them, but lateness actually went up, because people felt the fine was worth the extra 15 minutes! The fine was simply the price for arriving late. The Director was trying to say “fine is not a price”, but the only way to have it be effective was to make it a capital offense to come late. And then the Director gave up, but then lateness went up even further – because it was an even better deal! Barry’s message was that before the fine was put in place, parents and staff had a sort of shared moral obligation for closing time. But with a fine in place, there was nothing except a calculation of cost and benefit – no shared moral obligation. Financial incentives encourage people to calculate relative costs and benefits, rather than on doing the right thing.

    You may know that I was at SAP for thirteen years and left in the Fall last year. In my new company, team members are compensated both on the achievement of objectives *and* on a set of competencies. This allows me to coach and guide towards desirable behaviors and outcomes without putting a specific price tag on those. Given SAP’s commitment to shared corporate values, that might be another way to drive desired behaviors without putting price tags on very specific behaviors.

  3. Alyse Wyler March 6, 2012 at 6:13 pm #

    Teamwork seems to be a learned behavior rather than something that is innate. I do believe that positive reinforcement of teamwork can help it flourish. I also think that the “show by example” model works here. Leaders need to embrace teamwork and show it as a best practice. As another point, individuals want to be rewarded and recognized, and that is taken away when a team as a whole is recognized. If both the team as a whole can be recognized and the people within the team can be recognized for their individual skills, that may be a win- win.

  4. sarah March 7, 2012 at 7:43 am #

    As you said, you have to reward the behaviors that you want to see. We don’t reward people for working together or supporting peers. Peer awards tend to be meaningless or seen as “popularity contests.” But popularity inside an organization is a powerful thing. What if each manager asked their team to answer the questions “Who is your favorite person to work with in our team, and why? And who is your least favorite, and why?” We tend to shy away from those kind of conversations, but the information is powerful. Starts with the leadership.

  5. Jon Reed March 7, 2012 at 11:46 am #

    A very interesting debate/issue.

    There is a local restaurant of some fame here in Northampton that pays its waitstaff via a tip pool. I’ve had a chance to see the ins and outs of this over the years. On the plus side, you see teamwork you don’t see in many restaurant settings, with all the servers being conscious of what is going on around them rather than only focusing on their tables.

    On the downside, the high performers/rock stars tend to resent the arrangement, moving on to other places where they can maximize their own income, and there is often grumbling about those who don’t pull their weight.

    So that’s a series of conundrums.

    I have mixed feelings about cheerful as a rewarded behavior also. I know from a customer service perspective I’d take a grouchy service rep who escalated and resolved my situation any day over a cheerful one who said all the right happy things and didn’t solve my problem. I think that’s more my bias, I think execution is more important than forcing “happy attitudes” and beyond that, that a diverse set of personalities can be a benefit. It’s interesting to see how to boil down intangibles into metrics but I’m not sure cheerful is the ultimate performance metric. Another trap would be to assume that well liked employees are the best for the team. Being liked is not always the best way to assess someone’s worth.

    I look forward to your definitive answers. 🙂

  6. ken demma March 7, 2012 at 12:38 pm #

    Thanks for another thought-provoking post, Jonathan. I agree whole-heartedly that behaviors are the critical link between intensions and outcomes…and while outcomes (performance) can be affected through external factors (a good market, contributions of others, etc…), behaviors can be most directly controlled or addressed. We tend to not realize this due to 1) measurement bias (we can measure outcomes easier than behaviors), 2) the short-term nature of evaluation (not looking for sustainable positive performance over time), and 3) the intangible benefits provided by the strongest behaviors are less directly tied to outcomes.

    I have witnessed (and worked for, and managed) strong outcome-based “performers”, who have left shambles in their wake…which made achieving repeated or sustainable performance for themselves and the organization, difficult if not impossible. This is observable and measurable as you look at performance over-time.

    Less directly measurable is that behaviors that support teamwork and a healthy and productive work environment lead to various intangible gains, including positive employee attitudes, which can relate to better Customer and Partner interactions as well….leading to satisfaction…leading to performance, over time.
    Investing in the right behaviors may not achieve optimal performance at all times, but will lead there most of the time, with long-term benefits…and foster a healthy and attractive work environment that brings others of like attitude to be part of the team.

    As they say in “Good To Great”, getting the right people on the bus is the most important part…

  7. Vijay Vijayasankar March 7, 2012 at 1:08 pm #

    Teaming should not mean losing individuality and all that comes with it. The best groups I have led have had a few people who did not team well. They were kind of introverted, did not see value in consensus building and so on. But they were extremely good at what they did as individual contributors. As long as they were not disruptive to others’ work – I could find no reason to move them out. It just was a good test on my ability to lead, and now I am convinced that my best bet is to have a mix of people, some that absolutely love to work with each other, and others who work best when left alone.

    Teaming with peers is an interesting scenario. In general – when I look back at my limited experience – people seem to team well in the first one third of their career – then go through a period where they compete for middle management jobs and not team all that well with peers for the next third – and those that make the realization that teaming after all is after all a good thing, and start teaming with renewed vigor for the last third of their careers 🙂

  8. Norman Marks March 15, 2012 at 7:46 am #

    Jonathan, you have commented here and elsewhere on the challenge of assessing and rewarding performance. I have some strong feelings about the use and misuse of these processes.

    While I absolutely agree that it is critical to identify what you want (behavior and actions even more so than results) from each individual and team, then to be able to monitor, assess, and reward performance, how you do that can lead to undesired consequences. See here: http://tinyurl.com/6nja8hv

  9. Anita Gibbings April 3, 2012 at 7:00 am #

    Rewards can definitely drive behaviors and therefore performance but I think there is so much more that influences the quality of teamwork. I think one of the problems with rewards and performance is that you don’t always have a strong link between them. The objectives are set are often vague, the real deliverables different and the only feedback session is a brief once a year affair.

    Your post got me thinking about my previous company where within my department of 200+ people (with 3 hierarchies) where we really lived and breathed teamwork and how they accomplished that.

    Feedback: Of course our bonuses rewarded teamwork but these were vague enough I don’t think they would have driven behavior nearly so well if they had not been reinforced by the feedback culture. These performance reviews were taken so seriously that we were given a 2 day training course on how to give feedback and the process included 360 feedback, 2x a year. They paid professional moderators to conduct the upwards feedback sessions (including everyone 2 levels below). Everyone knew you couldn’t get promoted without positive feedback from your managers, peers and those under you. They created a culture where you earned respect from giving and receiving detailed, frequent and very candid feedback, by doing this you were seen to be supporting the personal development of everyone within the department.

    Time: A strong driver of our team work was that management gave us the time to do it – every Friday was emphasized and ‘knowledge sharing’ day and we were strongly encouraged to meet with colleagues and share and exchange ideas

    Social Status: management gave significant recognition and status to being given the role as an ‘expert’ on a certain topic where it was their role to push out best practices and enhance the skills set of each member of our team. We had an online tool where we could quickly locate these experts and the materials they prepared and they would also conduct informal ‘training’ sessions on Fridays. These roles were coveted even though they involved additional work above and beyond your normal job

    Team Events/Social Ties: And they invested heavily in the social ties – we had ~ 10 full days per year of team events where we did team building events in nature, community activities like building the interior of a house for foster children and just plain social events /parties

    So I think to have great team work you need to work on so many different levers to create that culture.

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