I 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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Paying new employees to quit sounds counter-intuitive but it could the key to high-performance organization.

In “Why Zappos Pays New Employees to Quit – And You Should Too,” Bill Taylor explains…

When Zappos hires new employees, it provides a four-week training period that immerses them in the company’s strategy, culture, and obsession with customers. People get paid their full salary during this period.

After a week or so in this immersive experience, though, it’s time for what Zappos calls “The Offer.” The fast-growing company, which works hard to recruit people to join, says to its newest employees: “If you quit today, we will pay you for the amount of time you’ve worked, plus we will offer you a $1,000 bonus.” Zappos actually bribes its new employees to quit!

Taylor doesn’t explicitly use the phrase but, by paying new employees to quit, Zappos is using culture to align execution with strategy.

Hiring candidates is extraordinarily difficult — the so-called war for talent. It does seem counter-intuitive to essentially bribe a new employee to quit so soon after hiring them. But, in Zappos’ case, it’s consistent with their strategy.

Zappos is obsessed with excellent customer support and recognizes that well-trained and motivated employees are the key to delivering this excellence to customers. (If Zappos used the Balanced Scorecard, I would imagine the Customer and Employee perspective would be disproportionately weighted.) Any employee who isn’t willing to embrace this a focus on excellent customer support will eventually detract from the company success. It’s better to weed these employees out early on.

As Zappos gets larger and more successful, some employees might be willing to stick around – even if they don’t completely buy into the approach. For that reason, Zappos has upped the offer as time has gone on, from $100 to $500 to the current $1000. Increasing the offers is a sign senior management actually believes in their strategy. They could easily justify $5000 or likely more.

A reminder for all of us: the best business performance starts with the best people.

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