How do you reward and motivate your team?

Historically, reward and motivation in Financial Services and to a lesser extent Financial Planning was easy. Pay them next to nothing to come to work but give them more money the more they sell and possibly a fancy trip somewhere nice for those that sell the most. This, I would argue, was the perfect alignment of purpose and profit i.e. the purpose of the business was to make as much money as possible therefore it was perfectly aligned with the profit driver and what better solution than to reward staff with money, lots of it.

The purpose in most, if not all, quality Financial Planning businesses is not profit. Clearly without it we wither and die but it is not the destination. Most business will expect to make profit as a by product of their purpose so how do we make sure that we motivate and reward our people to deliver on our purpose?

In Smart we believe that

1. Even if we wanted to use money, money in itself isn’t always a successful motivator.
2. Money on its own as a motivator can actually damage performance ,
3. If you want to improve performance you need to take away money as an issue in its own right, i.e. pay someone enough to make more money not a motivating factor
4. That autonomy (giving someone the chance to do it their way), mastery (wanting to get better because its fun) and purpose are the biggest motivators

If you accept these tenants our collective challenge therefore is to look to encourage the above behaviours alongside, or maybe instead of, just incentivising through bonuses.

How could we do that?

Pay all of your team the correct salary so that no one looks to their bonus to make up their income. Give each team member the space to do their jobs to the best of their ability and their way without micro management?
Support their personal and professional development financially and collectively?
Talk about the firms purpose / why?

(If anyone is interested, our Why is covered here)

The most challenging element is to define the non financial bonuses that you provide to your team that they attribute most value to. It could be holidays, freedom to work on other projects, opportunity for further study (I don’t mean more CII exams) but understand your staff properly will make this easier. Do you know your staff as well as your clients?

Assuming the business has long term financial targets in addition to its purpose vision mission etc I would advocate a sensible bonus pool for the team to reflect the attainment of those figures. This would be on company wide financial performance not individual income targets therefore everyone is ‘in it together’. I would suggest that the distribution of bonus should be effected by their individual contribution to improving the business, service to clients and their own mastery NOT on their personal financial contribution to those targets.

There will always be room for improvement but this feels to me like a more aligned incentive programme than those historically offered and likely to produce less unintended consequences.

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12 thoughts on “How do you reward and motivate your team?

  • Great piece Steve and I couldn’t agree more. For a great read on understanding your teams needs in a deeper way I recommend people read The Dream Manager by Matthew Riley. For a great philosophy on team remuneration & culture check out the E-Book Breakthrough by Tom Miller http://www.vladvisors.com/e-book/

    Reply
  • Great piece Steve!

    Money, in itself, is a poor motivator but only to the extent that we pay people a ‘decent wage’ not to worry too much about it.

    I’ll add to Brett book recommendations, a great book by Dan Pink – Drive: The Surprising Truth About What Motivates Us – has lots of evidence to support your argument here and great examples of how successful companies are doing this.

    Reply
  • The link to the Breakthrough e-book doesn’t work apparently (problem on their website). I’ve got a pdf copy I can email anyone who is interested. Drop me an email to [email protected] and I’ll get one sent to you.

    Reply
  • Great article and some good tips, one of my all time favourite management books is Dale Carnegie’s “How to win friends and influence people”. A book that has been around for years but one I think every manager should read, I have a great team around me who enjoy working for me and produce great results because I value every single one of them. Money and bonus’s aren’t always the number one factor as you say, but of course it helps and I like your ideas.

    Reply
  • Agree wholeheartedly Steve. Whilst money is a factor for many people, I find that if you invest time, effort and money in your team, it can be just as motivational. Empowering your team to take responsibility, ownership and giving them that general feeling of being valued and them feeling that they are making a difference is just as powerful.

    Reply
  • I completely agree with you Steve. We are motivated by much more than money and I do believe that simply using money as a motivational tool can drive poor behaviour.

    I agree with you Brett about the Dream Manager, it really stuck in my mind after I read it. I’ll have to check out the Tom Miller book too, thanks for that recommendation.

    Reply
  • The link to the Breakthrough e-book doesn’t work apparently (problem on their website). I’ve got a pdf copy I can email anyone who is interested. Drop me an email to [email protected] and I’ll get one sent to you.

    Reply
  • Great article and some good tips, one of my all time favourite management books is Dale Carnegie’s “How to win friends and influence people”. A book that has been around for years but one I think every manager should read, I have a great team around me who enjoy working for me and produce great results because I value every single one of them. Money and bonus’s aren’t always the number one factor as you say, but of course it helps and I like your ideas.

    Reply
  • Agree wholeheartedly Steve. Whilst money is a factor for many people, I find that if you invest time, effort and money in your team, it can be just as motivational. Empowering your team to take responsibility, ownership and giving them that general feeling of being valued and them feeling that they are making a difference is just as powerful.

    Reply
  • Great piece Steve!

    Money, in itself, is a poor motivator but only to the extent that we pay people a ‘decent wage’ not to worry too much about it.

    I’ll add to Brett book recommendations, a great book by Dan Pink – Drive: The Surprising Truth About What Motivates Us – has lots of evidence to support your argument here and great examples of how successful companies are doing this.

    Reply
  • Great piece Steve and I couldn’t agree more. For a great read on understanding your teams needs in a deeper way I recommend people read The Dream Manager by Matthew Riley. For a great philosophy on team remuneration & culture check out the E-Book Breakthrough by Tom Miller http://www.vladvisors.com/e-book/

    Reply
  • I completely agree with you Steve. We are motivated by much more than money and I do believe that simply using money as a motivational tool can drive poor behaviour.

    I agree with you Brett about the Dream Manager, it really stuck in my mind after I read it. I’ll have to check out the Tom Miller book too, thanks for that recommendation.

    Reply

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