Incentives

Some years ago I first heard, from Accenture consultants, the so called “up or out” approach.

In a few words, your career must proceed with continuos promotions, otherwise if after a certain time you stuck to the same level, you are invited to choose different solutions out of the firm.
At a first sight, the system should grant to always have the strongest performers to leadership positions. In practice, the strength of the company is maintained by the internal competition: everyone struggle to perform the best in order to be evaluated high enough for the promotion. The firm itself grows either because of the great effort put by the few winners, but especially because of the unrewarded effort put by the many losers. That is where their “margin” is.

I do not want to enter into ethical disquisitions, but what I would like to discuss here is the mechanism of “incentives” and whether the up or out system may be considered one of them or not.
Incentive, what is this? It’s adding an expectation that encourages people to behave in a certain way. Which way?
By definition, incentives imply that you wouldn’t do the thing you are being asked to do for intrinsic reasons. What exactly you would not do naturally so that you must be attracted by an incentive?
Let’s discuss this.

Is it done for granting people to “put maximum effort at work”? I do not think so.

If you chose to dedicate your life to technical consulting this imply you are really motivated to what you do. You felt something pushing you to a certain type of job, that requires a huge effort, preparation, dedication and ability.

What kind of “incentive” should attract these people? The beauty of the project, the prestige of the result, the difficulty involved. Money? Yes, for a certain extend.
What else? What is the need of incentie enabler? What is that thing you would not do for “intrinsic” reasons?

My personal answer is “competition”, is “fight those working as you do to stay ahead”. There is no intrinsic reason to always struggle for being promoted and stay on top. Ask a painter, or musician. He would tell you tons of intrinsic reasons for putting all his heart and effort on what she does.
But he would not mention “to be the best of all the musicians”.
If he says so, it is because there is an incentive working behind the scene. For example a great salary for directing a famous orchestra, or whatever.
Some people do not react to incentives at all.
Incentiving starts with “in” like “influencing” rather than “inspiring”.

According to Ruth Grant, a Professor of Political Science at Duke University, “incentives in the workplace […] undermined team spirit”, […] made her feel manipulated […] I began to notice that incentives have become the preferred tool of policy in all kinds of settings – governments, businesses, schools, prisons, hospitals – and it seemed important to think through which uses of incentives are innocuous and which are not.”

The Race to the Top obviously involves severe renouncing; people need to voluntary obey to a coercive force that attracts over a unique direction.

But passion and love for your work is intrinsically volunteer, and it’s all over the place. Sometimes is upwards, sometimes is down.
Always keep in mind what trade comes with the incentive.

Up is just one of the possible directions.

This post is dedicated to a great friend and an incredibly talented consultant who is about to commence a new adventure, taking him very far from home. I really wish the best for him, wherever he goes.

Further readings:
http://www.russellsage.org/blog/interview-ruth-grant-ethics-incentives

 

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