Throwing money at people and problems is seldom a solution, although it might seem like an easy way out. Just ask children who have been deprived of their parents’ time and attention. Large sums of pocket money and expensive gifts cannot compensate for that fundamental human need of acceptance through stable relationships.
The same would apply in the workplace. As a business owner it seems like a plausible solutions to give financial rewards and a percentage of the profits to your employees to “buy” their productivity and to increase quality. Like with children, this seldom satisfies the receiver and in the long run the giver is often disillusioned about the lack of performance. These materialistic rewards easily become a cost and not an investment.
It might seem that I don’t have any empathy with our employees – to the contrary. I belief that people are the biggest assets in an organisation. The KAIZEN™ approach to management and leadership is one of utmost respect for people and trusting relationships. Many research articles indicate that a better reward for most people is work satisfaction, fulfilment in the workplace, and enjoying a good work culture. The money-carrot is overrated in my view. In any case, how easy is it for workers or management in a non-Lean environment (where things are transparent) to manipulate data to avoid paying bonuses, or to ensure that extra few dollars on the payslip?
To truly value your people you need to engage with them at the Gemba (the real place in Japanese). Respect them by solving their (and actually your) problems with them, see how they are performing and find ways with them to solve the problems that’s preventing them from reaching the business targets. This KAIZEN™ approach to business excellence requires a new mind-set, a hunger to learn more about being efficient.
So, before devising a complicated incentive scheme, and ordering the new staff lunch room furniture to try and make people happy, consider changing the fundamental way of leading your people. This might bring much higher rewards for employees, customers, suppliers, and the business owners.