What is the future of leadership?
As we turn the page to 2016 several things are becoming the burning issues of the day. In a scant five years from now, most of the workforce will be made up of Millennials. This presents a daunting challenge as what we have been taught as managers and leaders will simply not work on this emerging dynamic. What do we need to do to engage this talented yet often misunderstood generation?
For starters, the new workforce does not and will not subscribe to many of the management philosophies we have been taught. Following are a few keys to assuring the younger generation helps organizations grow and prosper. WARNING: some items may be sensitive in nature, meaning they may be dismissed by the reader. Yet, unless we challenge current precepts, the struggle to find, attract, maintain and engage the workforce will continue and may even be a death spiral for many organizations.
Let’s get started.
In the second decade of the 21st century organizations continue to utilize this worthless tool. Management and leadership must understand performance appraisal and its various iterations simply no longer work. This process is based on judgment factors, people are poorly trained in it and new neuro-science research points out that it creates a barrier, even in high potential employees. Additionally here are two facts surrounding its use.
- It is despised by the workforce. 98% of all employees do not like the process.
- 90% of them do not work.
Consider this. If this were any other business measure that would wind up on a financial statement, would it be continued? We all know the answer to this. It would stand out and simply be eliminated. So why do we continue this fruitless, pointless exercise?
Perhaps it was the way we were taught. Management and leadership go through the exercise because instructions from on high mandate it be done. In reality it is a method of carrots and sticks, reward and punishment. Added to this is the element of how it affects one’s pay. So we put most people in a typical bell curve, rewarding the “exceptional” employee’s, punishing the marginal workers and leaving the vast majority of the remaining workforce fighting for scraps.
Is there really that much difference between someone receiving a 3.5% increase compared to a 3.0%? For someone making $100,000 a year the difference is $500. Breaking it down even further, this creates little over $9 per week difference, which is not a great deal more increase in ones standard of living. And it creates infighting, sabotage and myriad of things people do to get a gold star. In reality is there really that much separation? Does it truly make much of a difference?
Probably not, but it resorts in winners and losers, and a lottery, per se.
Workforce Bribes (aka Incentives)
If this wasn’t bad enough, we also try incentives. Once again, this has been proven to be an ineffective method of recognition and rewards. If too high they create greed and if too low, they create no meaningful results. Is it really necessary to resort to inducement to get people to do the right thing?
We think not. However, so many organizations believe these work, it is difficult to break through the logic of them.
For example, I once worked for a CEO who created a $250 quarterly attendance incentive program. He was so proud of it!
His rules were simple and listed below.
- You must not miss time from work during the quarter, including:
- Dental or Doctor appointments (ok fair enough, providing your doctor or dentist had after normal work hours).
- Jury Duty (contrary to our civic duties and a jury summons).
- Vacation (you are reading this correctly. He considered one’s earned vacation an absence for the purposes of this incentive program).
Accordingly, this reward became a joke. Not surprising, but it seemed only Exempt personnel ever received the “incentive”. He asked me to participate in this exercise and my reply was pretty blunt and not very politically astute. I simply told him I didn’t need $250 that badly.
On the flip side of poorly constructed incentives are the ones where the carrot is so high, that people cheat to get the award. In either situation, the word bribe still comes to mind. If you pay people fairly, within the market then what is the value of incentives?
As Douglas McGregor so eloquently stated generations ago, money is not a motivator except for very short term periods, but the absence of fair pay is a catalyst for demotivation.
Performance Management is the Key
In a very recent study, an overwhelming majority, nearly nine out of ten workers wanted development more than money. There is something clearly wrong with the manner in which we accomplish this. Moreover, this trend has been going on for the past 15 years. Why is this?
We seem to have a tendency to think that learning stops as soon as we walk across the graduation stage. Nothing could be more wrong. Commencement is really the beginning and not the end.
When leadership fails to understand the value people place on continuous learning, they then seek ways to get people to do things, such as providing artificial incentives.
But what if we take a realistic view of what drives people? We may find realistic answers to this conundrum. I think it is our responsibility to develop people in the modern sense. We must abandon practices that do not suit the modern and evolving workforce. As we often say in our consulting business, you cannot utilize 20th century methods in a 21st century world.
It is time for leadership to evolve…if they are brave enough.