Got business problems or challenges at work? With his Two Cents page, Loaay Ahmed shares his expertise in strategic management consulting to help managers, employees, and entrepreneurs thrive.
Bhutan has been measuring their gross national happiness since the 1970s. If they’re well paid, does measuring happiness even matter? And how can we convince the board to approve such spending, if it’s a must?
LA: In the heart of the Bhutan’s Gross National Happiness a concept that’s best described as ‘development with values’. They recognized the fact that while people need to financially grow issues like culture, society, health, and family can’t be ignored. Imagine a country called Garbageland where public healthcare and hygienic standards are the worst worldwide. Now, meet an average Garbagelandian citizen Mr. Luck. He always complains about how the Government is not taking care of the sanitation problem. Last week, Mr. Luck won the lottery with a whopping prize of one million dollars! While Mr. Luck can now afford to change his own personal environment, he’s still living in Garbageland. One year from now the spark of winning that lottery is gone and the stench in Garbageland will remain upsetting Mr. Luck.
Companies are not any different from countries in this issue. You have your own ‘citizens’ to care for and that means more than just paying them. Without good culture, processes, support, care, problem solving and flexibility employees won’t be happy and that means more turnover and less productivity. In the next board meeting, ask the board to compare the general characteristics of citizens of leading countries against those from poorly managed countries and ask them: “If our company was a country, which one of the two would we like to be?” If they choose, the first option then they have to invest in their people like advanced countries do. The return on this investment will be far greater than what just tempting the team with additional bonuses is generating right now…and that’s just my two cents.
Can Sales Executives work better and reach their targets if they’re paid only salaries and not incentives or commissions?
LA: Years of research by many international professional organizations and universities show that incentives are usually offered in two areas: physical and mental performances. In physical jobs, like farming or construction, offering the employees extra cash on the spot if they finish more than their daily load, will work wonders and because all they have to do is to push their bodies and muscles the extra mile to perform faster. In mental jobs, like Sales, for example, it’s a different story. When Sales Executives are given incentives they get excited and push their ‘brains’ to focus more and to close more deals, but they can’t make their brains work faster, better or smarter. So, incentives to the sales team end up bringing more pressure and anxiety rather than motivation and joy.
If you decide to keep your sales team on a fixed income package, you need to make certain adjustments. The company needs to offer a more comprehensive package to cover many of the employee’s lifestyle needs. The advantage to your prospective customers is nonbiased support from the Sales Executives knowing that they’re not a commission. If you’re worried about being taken for a ride by some poor performers, just implement a stricter system that aims to help good performers do better and poor performers find another job in or out of the company…and that’s just my two cents.
Our company is in the international real estate investment business. The newly hired PR Manager is pushing for more publicity and mass communication. She believes that we can attract more investors by having a stronger presence. We’ve been doing well without all that. Do we need the additional expenses?
LA: It depends. Is your new PR Manager spotting an existing or upcoming problem related to your organizational reputation? Maybe you’ve recently had an internal scandal or major management change and she wants to reaffirm that your business is solid. It’s possible that your Business Development team is looking for ways to reach more prospects for a soon to be released product from a different target audience than your current customers. Perhaps you have exhausted your existing customers with so many cross investment opportunities and you need some new blood. Sometimes, newly hired managers want to make changes to show that they’re doing something different and new that’s much needed, but wasn’t done until they joined the organization. Which one is the real reason? You need to find out.
Assuming that having a stronger presence is strategically needed, mass communication and big budget spending is not necessarily the only way to reach your goals. The focus is on reaching a specific target audience with a certain profile that qualifies them to be profitable customers for your business. Study this segment’s demographics, lifestyle, behavior, and mindsets to design tactics that target them at the right places, the right times, and in the right frame of mind. If your company needs stronger presence, it’s with a specific audience not the entire market. Corporate communication is not a popularity contest…and that’s just my two cents.
For Loaay Ahmed’s advice on business or work matters, send a short email to [email protected]. Please note that only the questions chosen for publishing will be answered.
Loaay Ahmed is a management consultant and strategic expert. To learn more about Loaay and his consulting service, strategic business therapy, for more information visit www.knightscapital.com.