Corporate compensation and bonus plans were either not aligned with what we had to deliver or just not enough to impact behaviors. Even worse, different teams had different goals and incentives. They ended up rowing in opposite directions!

I’ve seen a few of my top performers leave out of frustration because their management — I mean myself — didn’t understand how disconnected all these elements were. A recent 2019 research from DDI reinforces the adage: 57 percent of employees have left a job because of their manager. An additional 32 percent have seriously considered quitting because of their manager.

If you are a manager, you know the truth is subtler. You represent the company in your team members’ eyes, no matter how many constraints, from resource-crunch to limited budgets and office politics, you need to handle. Yet, there are rules all managers should keep in mind to have their teams perform at their best. If you want to move beyond management and be a true leader, here are the top three rules I’ve learned — sometimes the hard way — to take your team’s performance and motivation to the next level:

The same DDI research backs it, and something I can say is universal to any team member. The absolute majority of us want to have a positive impact on the world. It’s our primary motivating factor to succeed at work. We want to own it, be truly impactful, earn respect, deserve that promotion, and, by the way, bring in the additional income that comes with it.

So how do you nourish that sense of purpose? By providing a clear vision and a why! It is the motivation towards a positive future. No matter how small or big, your intended destination and values shape such a sense of purpose. Practically, it means you’d better ensure your team is crystal clear about why they’re coming to work every single morning. And to be clear, it has to be more than paying the bills!

Successful whys focus on the value your company brings to the world. It’s not about making money. Revenue growth, profit, and large bonuses are the (positive) consequences of a well-articulated why.

But what if you and your team are not clear yet on these core values and beliefs? Please don’t complain to your CEO about it. Instead, be part of the solution and make sure you bring all these customer and market insights to the table. Any high-performance product team should know these better than anyone else. It will help your senior executives do their job: articulating the best vision and mission for the company.

As a leader, you’re here to let your team understand their impact. You need to ensure you set the destination. Have everyone internalize the values and beliefs and make the mission crystal clear. From there, as we say in Southern Europe: “all roads lead to Rome.” It means that you will achieve the same result in the end, whatever your methods or how you’re doing something.

It’s always been an essential dimension for me as a leader: letting my team figure out how they will contribute to the overall organization’s success. Your team should own how they operate.

In the world of knowledge working, no manager should ever tell you how to do things. They would face quite an uphill battle to make you feel accountable. You’d be just executing then.

Instead, let your team own the “how,” and chances are they will collectively come up with brilliant ideas you would never have considered. Let them surprise you; they will connect the dots and bullet-proof the execution of the plans. Most importantly, they will own the outcome. It’s your best insurance for both top performance and a motivated team.

It’s probably the most difficult one, especially in large corporations where even vice-presidents have a limited say in compensation models. And even if you do, such plans are pretty challenging to design and implement. Sadly, most companies are falling short in the compensation area. It can lead to significant frustrations even if you correctly follow rules #1 and #2. Beyond the apparent notion of building a competitive compensation package, the bonus or incentive is the most challenging part.

The difficulty is twofold here: make the incentives more than a “nice-to-have” and link them back to the team’s impact on the grander company’s purpose.

Although every team and context are unique, here are a few principles I invite you to consider:

  • Make the bonus count. Most product team members end up with a 10–15% bonus. That’s not enough to move the needle. Make it 25–30% of total compensation, uncapped, and you will start to move the needle.
  • Align with broader company’s goals, but make sure you focus on the impact the team has on these goals. Total company revenue or EBITDA is hard to assign to a platform feature team. While you can consider the broader company goals as necessary thresholds, you need the team to own tangible goals they know they can execute.
  • Supplement with non-financial incentives. I’ve always been fascinated by these sales-masters programs that would reward the best sales contributors and send them — and their significant other — to an exotic destination. You don’t have to go that far! You still can build such a kind of recognition for your high-performance product teams. Just make sure you are rock-solid your teams’ impact goals so that everyone is clear on what to achieve.

I realize many dimensions are not under your direct control as a manager. Yet, if you want to be recognized as a leader, these rules will get you started and help you consider your options in your company’s context. I’m sure you will come with your original ideas too! Just remember:

  • Give your team a sense of purpose aligned with your company’s higher directions.
  • Let them figure out how they will execute and get things done.
  • Ensure their compensation is acting as a motivation booster.

To get started, you can ask yourself the following questions to begin validating the three rules:

  • How is my team playing back our company’s higher directions (vision, mission, values)?
  • Is what I’m hearing back consistent or all over the place?
  • How do these higher directions impact their work?
  • Am I intervening in how my team needs to get things done?
  • How effective are my team’s bonuses and incentives?
  • What alternatives do I have?

Keep digging, and if you come to a point where you feel stuck, don’t hesitate to reach out to me

Let The Product Sherpa be your guide!

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