Monday, February 8, 2010

Reward the effort

To get a constant flow of new ideas, reward people for their effort, not just for ideas that turn out to be successful.

Many people believe that ideas are only of value if implemented, and that rewards should therefore go only to people whose ideas are successful. This approach is counter-productive, for several reasons.

1. It can be difficult to attribute a successful idea to any one person or even to a group. Many different skills may be required to put the idea into practice. And there is the risk that the wrong person may take the credit for the idea.

2. It is difficult to decide what is an appropriate reward for a successful idea. An idea may make or save the firm a lot of money. How should the value of an idea be quantified? How much should the inventor of the idea receive? A percentage, or a holiday, or a movie ticket? There is a lot of potential for perceived unfairness, resentment and demotivation.

3. It is the habit of contributing ideas that will produce more ideas in the future. Therefore, encourage the habit.

People who have an intrinsic interest in the issues are more likely to offer valuable ideas than those who are just looking for the rewards. If people are interested and challenged by their work and feel involved in the business, they will want to contribute to its success.

Work on getting people more engaged with the issues. Thanking your team for their contributions and reminding them how much you value their help will make them want to help you more. Keeping them informed about what’s happening in the business will keep them interested and build intrinsic motivation.

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