It’s not all about the money

Motivating employees with numbers isn’t always the best approach


It is fairly common practice for business owners to review financial targets with their teams, but making these numbers a focal point of meetings will do little to motivate employees, say Lisa Earle McLeod, a sales strategist and professional speaker, and Elizabeth Lotardo, a researcher and consultant.

McLeod and Lotardo recently wrote a piece in Harvard Business Review where they discourage setting financial benchmarks as a method of motivation.

They write: “When a leader spends the majority of [time] on a ‘make the numbers’ narrative, it creates a transactional relationship with their employees, making them more likely to create transactional relationships with their teammates and customers.”

The two suggest that to build belief in your organization’s purpose, you should do three things:

  1. Change how you approach your time with your teams. McLeod and Lotardo interviewed Patrick Hodges, president and general manager of Blackbaud, a software company based in Charleston, S.C. He says: “Shifting … from internal metrics to customer outcomes jump-started the next level of customer empathy and value. ... When people feel good about what they do and they’re more successful, they’re not going to look for another job.” McLeod and Lotardo recommend you spend at least half your time with staff building belief in the meaning of your work and half on internal metrics and deliverables.
  2. Discuss individual customers. McLeod and Lotardo explain the more clearly employees understand their direct effects on customers, the more likely they are to put in greater effort. They write: “When you speak about customers, even if your team does not interact with them directly, use their real names, talk about the businesses they have and show your team that real people are counting on them.”
  3. Avoid oversharing. Sharing detailed financial information, according to McLeod and Lotardo, can lead to employees being left to “figure out how to translate broader financial goals into their daily behaviors. It’s confusing at best, dispiriting at worst.” Instead, they suggest: “Focus your language on the two things that are 100% within the control of your team: their mindset and their behavior.”

As you focus on your business in 2021, it might be worth your time to try a new approach to sharing financial information and see how employees respond.

Ambika Puniani Reid is editor of Professional Roofing and NRCA’s vice president of communications.

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