Principle Based Management™ (PBM), formerly known as Market-Based Management®, provides a holistic approach to making decisions, solving problems, and creating value for individuals in your community, team members in your organization, and society at large. In this PBM 101 series, we’re unpacking mental models, ideas, and tools that can help you reach the next level in your work.
At Stand Together Foundation, we believe that a fulfilling life starts with being motivated to contribute to something that matters. Although individuals may appear to be compelled by things like money and prestige, there is usually a deeper instinct that drives their actions: the desire to use their innate gifts to make a positive impact on the world.
That’s why the Incentives Dimension of Principle Based Management (PBM) asks employers to explore ways they can motivate employees by treating them as individuals with unique circumstances, motives, and abilities. This is foundational to our management philosophy and how we view talent, the employment relationship, and compensation. Ultimately, both the employee and the organization should benefit from the employment relationship, which means each employee must create value, and the organization must create an environment where each employee can do great work and be rewarded appropriately.
What incentivizes (and motivates) people can take many forms, based on the individual. They include both monetary and non-monetary compensation. Management practices like thoughtful performance reviews, tailored responsibilities, and professional development and growth opportunities can also provide meaningful motivation for employees. As a nonprofit leader, your challenge is to consider incentives in a way that encourages each team member to make the maximum possible contribution to the long-term success of your organization that is also personally fulfilling (win-win).
Of course, effective incentives are unique to every organization—so we can’t share a blueprint that will magically work for your team. Instead, we encourage you to consider the types of behaviors that you hope to inspire (contribution-motivated behaviors) as well as those you want to discourage (deficiency-motivated behaviors). Use these behaviors as guidelines to measure how well your organization is doing today, and to inform future decisions about incentives and compensation. Most likely, your team will demonstrate behaviors that fall into both categories. That’s normal! It doesn’t necessarily mean that you have the wrong employees (although you should be carefully hiring for both virtue and talents), but it does mean that you have an opportunity to creatively explore incentives that inspire meaningful work within the walls of your organization, and align with the culture you are trying to build.
Nobody is perfect, but we believe the most successful organizations seek to acquire and build a culture of contribution-motivated employees. They are constantly looking for new ways to use their abilities and interests to help colleagues and clients succeed. They are energized by finding creative solutions to challenges and uncovering new opportunities. They don’t hold back, because they feel that their work is appreciated and valued.
The following lists are not all-encompassing, nor should we label someone as contribution-motivated or not. These lists of attributes can provide opportunities for self-reflection and improvement.
When you are contribution-motivated you tend to:
- Recognize what you are good and how you can contribute
- Embrace the unknown without being told exactly what to do
- Seek to make a difference in the lives around you
- Respect and include others
- Embrace lifelong learning and growth
Employees who trend toward behaving in a manner that is deficiency-motivated will have a detrimental impact on your team. Individuals who don’t take personal responsibility, shift blame, or even undercut the work of their peers are exhibiting deficiency-motivated behavior. Instead of feeling energized, they feel that their work is unimportant, and avoid doing more than the bare minimum required to keep their job.
When you are deficiency-motivated you tend to:
- Avoid responsibility and accountability
- Avoid and be defensive of feedback and criticism
- Compete with others rather than collaborate
- Criticize rather than contribute