The Promotional Idea Showcase - Summer 2002 - Updated Quarterly

Inside Incentives
Motivating Your Middle 60%
By Bruce Bolger
“The same people always win.” It’s one of the most common complaints when employees see a new incentive program. Almost every organization or corporation has its top 20%. That’s roughly one in five who give their all. At the bottom, there’s that other 20%, those who couldn’t care less and probably shouldn’t be there to begin with. 

But in between is a large group that, though more difficult to define, holds tremendous opportunity for performance improvement: the middle 60%. 

They may not operate at peak performance, but they have the potential to do better. Some are held back by lack of knowledge/ training or management. Others simply don’t have what it takes to perform better. 

The case for improving performance in the middle 60% is compelling because it represents the bulk of any firm’s workforce. Efforts typically yield modest per-person gains, but the collective impact could be extremely significant. 

Quantify The Benefits

Many companies rely on the well-known theory that the top 20% is likely to produce 80% of the results. However, research conducted by Harvard professor Leonard Schlesinger lends support to the theory that paying more attention to average performers can have a favorable long-term impact on profits, market share and customer retention. 

The lack of emphasis on the middle 60% suggests most managers overlook the benefits of motivating them. Do the math. It’s easiest with salespeople — even a slight improvement by the middle 60% can affect overall results very favorably. The same concept makes sense in almost any area. Time lost to accidents, doing more with less, customer retention, better service, or product quality can all have a long-term impact on the bottom line. 

What’s Best For You?

Start by ranking your target audience based on buy-in, commitment, and performance. Does your firm fit the 20-60-20 profile? If you can honestly say over 50% of your employees fall into the category of high performance, you’re already doing a lot right. And you’ll have a harder time eking out additional gains from folks at this level.

Conversely, if you have a large percentage of people at the lower end of the scale, there may be serious underlying problems that can be resolved only by concerted action on the part of senior management. In any case, it’s critical to determine what factors explain your firm’s particular performance mix. It’s especially important to assess such things as top and middle management style, level of buy-in to the firm’s mission, training, turnover percentage and demographics of the audience. It also helps to determine how improving commitment will affect factors like sales, productivity, customer retention and safety. 

You can do this informally or via surveys/focus groups. Once you quantify the potential value of improving the performance of the middle 60%, you can determine how much to spend on the effort. If you already have incentive and training programs in place, it might cost relatively little. 

Action Plan

Here are steps you can take to get the “middle 60” focused on improving their efforts to achieve your objectives: 

Set realistic goals. What do you want to accomplish? You might expect your top people to improve performance by double digits, but you shouldn’t expect similar results from the middle. If possible, check what’s occurred in past incentive/training efforts. If there’s little evidence the middle group achieved the improvement you envisioned, develop a more conservative forecast. People rarely reach for goals they feel incapable of achieving. And too easy a goal could have the opposite effect. It’s also important that goals be quantifiable. For example, “increase sales by 5% in the fourth quarter vs. the same quarter last year,” or “decrease customer complaints by 10% vs. the last six months.” 

Employee involvement. Most firms try to develop an incentive program with no input from the target audience. Extremely unwise. Before designing any campaign, it’s critical to determine what “leverage points” can improve its chances of success. Using a trained facilitator (ask your HR department), assemble a representative group of employees (good and average performers) and try to determine four things: what degree of improvement is feasible; what suggestions participants have to achieve your goals; what obstacles they see; and what the firm can do to boost its chances of success. 

It’s a painstaking process, but it often uncovers issues that escape notice. You may discover problems that no incentive effort could overcome. 

A mission. Employees strive harder to hit goals when they believe in a company’s mission. Many firms fail to foster this kind of commitment, but there are some who’ve done it — Southwest Airlines, Nordstrom’s and FedEx, for example. Maybe customers of these companies aren’t always greeted by a perfect employee, but the norm is definitely a cut above average. This behavior must obviously start at the highest levels of any organization. 

Training. When the objective is to improve the performance of the middle 60%, training should be directed at specific issues related to the firm’s goals. Training reinforces a campaign’s efforts and is directed where it has the greatest impact. It must offer clear benefits, come in an easy-to-digest package and be available when needed. 

Performance measures. Aside from sales, it often seems difficult to measure performance, and a lot of firms give up because of that. However, re-search by the American Productivity and Quality Center shows that most of a company’s functions can be easily measured. This in turn allows you to identify and correct problems. 

Program structure. Most managers have little or no formal training in developing incentive programs. For simplicity’s sake, firms often use “closed-end” incentive programs, which reward only top performers. In contrast, “open-ended” programs do a far better job of addressing the middle 60, because they reward all participants for exceeding a specific benchmark.

Communication. People are bombarded daily with information. They rarely have time to grasp anything not essential to their lives. Since work carries a degree of importance, firms can break through with information if they ensure all employees realize they can benefit by digesting it. Routine award statements or performance reports can provide an ideal medium for strategic messages. They should reiterate the company’s mission, the program’s goals and the requirements to win a reward. 

Recognition. Employee surveys commonly reveal that people feel neglected, an attitude that’s certainly prevalent in the middle 60%. People claim to work hard solely as a matter of personal pride. It shouldn’t be a surprise that firms with a reputation for high customer service always put great emphasis on recognizing exceptional employee performance at every level. A true customer-driven company also goes out of its way to publicize this recognition. 

Bruce Bolger is president of Selling Communication Inc. He has worked in the incentives and marketing fields for 30 years.