68. The Motivation Secret
Bonus and commission are so 2010s. Here's what you should be thinking about.
I used to work in the music industry. I’m not going to go into detail about my job, because it has nothing to do with what I’m going to talk about. But I will say it was my dream job and it was pretty darn cool. I have some amazing stories, none of which I’m going to share right now. I already told you that, so stop asking
When I started my record company I had a co-founder. Let’s call him Michael, mostly because that’s his name, but also because he looked like a Michael.
Michael and I worked together at a record company (at which point I was James Brown’s “main man”. I have a poster signed from him saying “to Jeff, my main man” as proof that I was, in fact, at one point in my life, somebody’s main man.)
I knew that I eventually wanted to start my own business. I was aware that I had the entrepreneurial gene but was trying to learn all I could from big companies before I ventured out on my own.
One day, I stumbled across a relatively unknown band from Kansas. I was blown away by their music. Michael loved them too. But our company didn’t love them enough to invest in them.
I can be stubborn when it’s something I’m very passionate about. Music brings out the passion in me and this band’s music definitely tickled my passion bone. Needless to say, I couldn’t let the band go that easily.
After some discussion, Michael and I decided to create a side company, split ownership 50/50, sign up the band and put out a record ourselves. So that’s what we did.
My motivation in creating this company was from the soul of an entrepreneur. I believed in what we were doing and wanted to continue releasing great music from great bands and create a great company with meaningful value.
I knew very well that this first band was the beginning of my journey and I was happy to have a partner in the process.
Once that first record was manufactured I spent every free moment promoting it. I huddled up in my one bedroom apartment and called radio stations, record stores, music magazines and influencers. I worked that sucker with everything I had while still trying to hold down my day job.
Lo and behold, the band started gaining momentum and garnering attention. I was excited and ready to dive into the warm water of entrepreneurship.
I suggested to Michael that we quit our jobs and do our record label full-time.
Michael said no.
He didn’t want to leave his job. He wasn’t interested in doing more.
Alas, Michael’s motivation was simply to put out one record for fun. He did it. Once we released that record, he had reached his finish line. Mission accomplished.
As for me, this was simply a warm up - I was just getting to the starting line.
In the end, we split amicably. Michael stayed in his job and I quit my mine. I created a new company (crank!) and used that first band to build a label that in four years was acquired by Interscope/Universal Music.
Motivational Alignment is Everything
That experience with Michael was my first real insight into the challenges that arise if individual motivations are not verbalized and aligned.
We are all motivated by something, whether it’s money, fame, family or an endless addiction to Hostess Twinkies.
It is this motivation that gets us out of bed when we really don’t want to. It is what drives us to focus a little harder in our jobs and it is the reason why we don’t succeed in times when that motivating factor is missing.
Not everybody understands what truly motivates them. I know this because I ask people what motivates them. They sit silent for a little bit. A wee bit of smoke starts coming out of their ears as their brain searches for a true motivation. Then they start talking and keep going until they say something that feels right. That’s the sure sign that that they haven’t yet thought about it. Not that there’s anything wrong with that.
Money Isn’t Always Everything for Everyone
Do you know what motivates you?
For years I thought my motivation was money. Turns out I was wrong. For a good decade I tried to act as somebody would if they only cared about money. I wasn’t good at it.
My real motivation, I learned, is being able to create and grow new things. I’m an early adopter that loves bringing new ideas to life and getting people to be wow-ed by them. That’s my drug. I’m a creator.
Being able to clearly understand and articulate your motivation is important for anybody that wants to find happiness, value and growth in their career. And, arguably, in their life.
Knowing your motivation will guide the jobs you take, it’ll define when you will be successful and when you won’t, it will provide a roadmap of how you can create successful relationships with your bosses and properly reward your employees.
Speaking of employees, let’s chat about those hooligans for a minute.
Motivation In The Office
Great leaders understand the motivations of their employees. Understanding these motivations not only helps them communicate more effectively, but it guides compensation and incentives.
I got into a conversation recently on the Hubspot Partner Facebook group about commission and bonus structures for sales people.
I don’t like the words “commission” and “bonus”. They represent an old-fashioned way of looking at communication and culture. Yes, “commission” and “bonus” are two types of motivators. However, they are strictly cash motivators. What if the person isn’t motivated solely by cash?
For too long companies have focused on quantifying motivators for sales people and not quantifying motivators for others.
Almost everybody loves money, but only a select few view it as a primary motivational tool, while for others it can fall somewhere between a thwap across the face and a great thank you gift (depending on the amount given).
According to a study by the Make Their Day research firm, 70% of workers don’t need monetary rewards to feel motivated. In fact, in their survey of 1,200 workers, 83% said recognition for contributions is more fulfilling than any rewards and gifts.
Fortunately, certain company roles attract certain motivations. Or rather, a person’s motivations define the type of role in which they will be most successful.
What I’ve done is put together a list of roles and the motivations I’ve found in the people who are most successful in those roles.
This is, of course, not an end-all be-all. Each company is different, people are different. However, what follows is a general structure that I’ve found to be a helpful guide over the years.
Great Sales People
Primary Motivation: Winning
Reward structure: Give them more kibble when they win
Sample Motivation Plan:
X% of revenue for each new business closed
X%/2 of revenue for each renewal
Y% of their total revenue if they hit their yearly goal
50% of Y if they are 85-99% of goal
100% of Y if they are 100-110% of goal
110% of Y if they are 110-120% of goal
120% of Y if they are 120-130% of goal
Great sales people are motivated by winning. ABC, Coffee is for closers and all that stuff.
They are competitive humans who are focused on landing a big fish. Winning doesn’t always mean being motivated by money, but of all the roles in a company, the sales team is more likely to be motivated by money than are others.
Incentives for sales people are the carrots that keep them going. Give them clear goals, clear motivations for achieving those goals and motivations if they exceed them. That makes sales people happy and they can sink or swim for their earnings.
Great Customer Success People
Primary Motivation: Helping others succeed
Reward structure: Retention, Net Promoter Score (NPS), customer happiness
Sample Motivation Plan:
X% of company profit is a nice thank you, but not the best motivation plan
Give them gifts that make them happy and help them succeed when they achieve certain milestones. When they have a big win (e.g. retaining a big client), if the company maintains a high NPS score for the quarter, or whatever the milestone, give them a gift with high perceived value that recognizes their efforts.
In general, customer success employees are not primarily motivated by money. I’m not saying that money doesn’t help - it does - but money is usually not their main driver.
What I have done in the past is reward positive CS behavior with a meaningful, personal gift. If they are a big sports fan, give them great tickets to see their favorite team play. If they’re a foodie, maybe a gift certificate to their favorite restaurant. Do they like wine? A wine-of-the-month club is a great idea.
Understand who they are and be thoughtful and personal in your thanks.
Primary Motivation: Building fun things, solving problems, learning the latest technologies
Reward structure: Give them time to create. Give them kudos for delivering important projects on time
Sample Motivation Plan:
X% of company profit is a nice thank you, but not the best motivation plan for them either.
Give them the freedom to come up with new cool ideas.
Recognize them for their accomplishments
Technologists love technology. They get their jollies out of solving problems and using the latest technologies to do it. Remaining on the leading edge of new technology trends is critical for their career growth.
Reward technology team members by letting them build and giving them the resources they need/want to feel happy doing it. Google’s 20% time or a quarterly hack day are great ideas for motivating technology teams.
Company recognition is also a huge motivator. More than most, company culture is important to attract and retain great technology folks. (I’ll talk more about culture in other pieces)
Great Operations People
Primary Motivation: Organizing, creating efficiency, being in control
Reward structure: Acknowledge when they’ve created and implemented something of high value
Sample Motivation Plan:
X% of company profit
Y% of revenue from new channel they created (if appropriate)
Opportunities to lead or speak in front of large groups
When I talk about operations I mean the people who are in charge of process and information flow, whether it’s product managers, project managers, people operations or anything else that fits in that box. These are usually the go-to people in any organization, the ones that seem to always know what’s happening and why. They like being in the know and they like being recognized for that.
Motivating them means helping make them feel special. Let them lead meetings, let them be part of strategic brainstorming, let them have control, either at a micro- or macro-level. And always acknowledge their big achievements on a group-wide or company-wide scale.
What This All Comes Down To
It’s time we put away with the thought of bonuses and commissions and focus ourselves on motivations. I’ll give some insights in a future piece about ways to really understand and socialize people’s motivations, but I’ve written too much for me to get into that here. So tell me…
What is your motivation?
How are you motivating others on your team?
What is the best/worst motivational culture you’ve experienced?
Leave your thoughts in the comments!