Who led the study?
These findings came from a large study by a research team from Stanford University, Harvard Business Review and the London School of Economics and Political Science. In their study they asked whether or not good management strategies – targets, incentives and monitoring – can help with motivation.
Targets, incentives and monitoring explained
There are many different management practices that you can use to motivate staff. These include targets, incentives and monitoring. Unfortunately, individuals and organizations sometimes fall into the trap of over-relying on one main management strategy, such as the use of incentives.
However, this can become problematic, for example, if there is no clear target or goal to achieve.
Being able to use a repertoire of management strategies can help motivate employees. Three good management strategies are targets, incentives and monitoring.
- Targets involve a focus on long-term goals that are achieved through smaller achievable short-term goals.
- Incentives concern high- and low-performing staff. For instance, are high performers retained and rewarded and are low performers moved on?
- Monitoring concerns the collection of performance data to help identify opportunities for improvement.
What did the researchers do to find out about targets, incentives and monitoring?
The researchers went and asked managers several open-ended questions. The managers were working in medium-sized organizations that employed between 50 and 5,000 employees. Firms from developed and developing countries were invited to take part in the study. They did this research in and with thousands of organizations.
Motivation and productivity
Even though they found good examples of organizations that used stretch goals effectively, (stretch goals are challenging goals), overall they found that management practices were poor.
Examples of both unmotivated managers and staff were found in the study. They found instances where French managers found it challenging to motivate staff who were on permanent contracts.
Elsewhere they found situations where overly complicated performance indicators made the use of targets useless as the complexity of the indicators made the targets incomprehensible to staff.
Four key recommendations: shared goals, responsiveness, use adversity to motivate and self-assessment
The researchers shared four key recommendations to help organizations become more successful.
- Goals within companies should be visible to everyone.
- Small changes can help drive larger company-wide changes.
- Organizational leaders shouldn’t shy away from challenging conditions but rather they should use these challenges to motivate change within the organization to help the organization to succeed.
- Managers can benefit from a realistic appraisal of their management practice. This is because managers aren’t always good at appraising their own skills.
A summary report can be downloaded.
Summary
In summary, targets, incentives and monitoring do make a difference and can motivate staff and managers.
Within organizations goals should be visible to all and targets should be able to be understood by everyone.
Small achievable goals or targets can help facilitate large-scale changes. Challenging conditions can help organizations succeed and managers should be supported through realistic appraisal of their management practice.
Reference
Bloom N, Sadun R, Van Reenen J. Does Management Really Work? How Three Essential Practices Can Address Even the Most Complex Global Problems. Harvard Business Review. Harvard Business School Publishing Corporation 2012.
