Individual Blog Week 2

I feel that the bottom line of this week was financial incentives are not always the answer. We tend to think that people will respond to money. It is as if money is the answer to all problems, when in reality it is not. Financial incentives can create a motivational effect, informational effect, and selection effect if used correctly. These can be achieved by offering a pay-for-performance schemes, which motivates their employees to work harder in order to achieve higher financial rewards, providing people with information about the priorities and values of the company, letting the true mission shine through, then there is the selection effect which is the idea that motivated people who are motivated to work harder will chose a workplace that will give them more money for their efforts. This makes workplace feel like financial incentives are the way to go, however there are implications to this idea, which could backfire on a company. For instance, the motivation could cause more problems or costs to the company. For example, “Hard Facts Dangerous Half-Truths & Total Non-Sense” illustrates how garbage truck drivers were given the incentive that if they finished their eight hour shift early, they could go home, and be paid for a full days work. However, this led to many issues such as a decrease in the quality of their work, illegal practices as well as safety issues such as driving unfit trucks. The drivers were motivated to finish their job early, however the quality of work decreases greatly. There were cases in which garbage was not even picked up. These financial incentives can also attract the wrong kind of talent. For instance, would you rather have someone would work hard but could only be motivated by money? Or would you rather have an employee who is wired to work hard all the time, and be promoted to more senior positions, which in turn have a higher paycheck? This helps in proving Jame Treybigs theory “if they come for money, they will leave for money.” In management it is extremely important to look at the big picture to try to determine if a financial incentive will be helpful or hurtful. For instance in my experience at Nordstrom having a base pay plus commission  as well as cash for every credit card opened attracts individuals who are motivated, and confident, it made everyone more focused on customer service, and helps to let Nordstrom’s mission and desire to serve the customer shine through. This company made an excellent choice by choosing this style. As a manager it is important to know what kind of people your system will attract and if it is right for the company, a lot of research and time will have to be put in to determine if incentives are for you. I agree with the idea that incentives are a great way to motivate employees, but financial incentives are not the only option. We have to begin to understand that there are intrinsic values that are important to individuals, motivation through these values, will help to eliminate the implications of financial incentives. What kinds of incentives have been successful in your work place? Is it a company wide incentive or just in your department? Do you feel that incentives would motivate you to work hard, or do you work to your full potential at all times?

I enjoyed Dan Ariely’s videos on decision-making. “Are we in control of our decisions?” video intrigued me the most. What he means by this is, are we making a decision or is the picture or preconceived notion we have making the decision. He had some great points that I feel need to be showcased. One being his idea of illusions. He felt as if people made decisions based on illusions not on a realistic situation. For example, he shows a picture of a vertical table, which to the eye looks longer than a horizontal table next to it. He asks the question, which table is longer? Most people would answer the vertical table, he then draws lines across both tables, and puts the lines together to show that the horizontal was actually the right answer, to show that we were not in fact in control of our decisions the illusion was. Being able to be in control of your decision is a must have skill. A manager needs to be able to look at infomation and determine if something is an illusion to the eye, or straightforward  evidence to back up a decision. The manager needs to find a happy medium in-between evidence, and their own wisdom, to determine what decision needs to be made to benefit the company/team as a whole. I think this concept should be examined more. We need to know how we can test managers to see what drives their decision making skills. Do you feel that most managers are in control of their decisions? If not, what do you think drives their decisions?

The blog on Harvard Business Review titled, “The Power of Meeting Your Employees’ Needs” by Tony Schwartz, found that there are ways to increase performs other than financial incentives. If you meet four basic needs. The needs are renewal, value, focus and purpose. Once these are met the quality of work improves. A survey was done, that shows how meeting these needs correlates with the variables that influence performance. It was found that when one of an employees needs are met, they report a 30% higher capacity to focus, are more engaged  and have a higher retention rate. This is a good example of research and proven data. There was a meta-analysis of 263 studies across 192 companies and employers with the most engaged employees were 22% more successful. This was not based off of personal opinion, or experience. It was a major undertaking to gather and sort through this data. There seems to be scientific reasoning behind this study. There was a clear goal, framework, and hypothesis. There was an experiment, that yielded data, that was then evaluated. This provides great evidence. As a manager you could look at this study and determine if you wanted to instate a system to help meet the needs of the employees to become a more successful company.

This course in my opinion is very rewarding. I take away warning signs and what to look out for. I found that I am able to look at situations and decipher what is evidence based and what isn’t. Having this ability and then the ability to form recommendations is a great skill to have, and I am excited to watch that skill mature.

Individual Blog Week 1

In this session, we were introduced to evidence-based management. Once you know what it is, it is important to know how to use evidence-based management effectively. In order to do so, one needs to know poor decision practices, how to recognize them, and then avoid them (Pfeffer-Sutton, 2006). I believe this is very important because it lays the foundation of the future, therefore in my opinion it is one of the most important concepts of this session. Understanding poor decision practices, is taking into consideration the actions that are proven to be harmful to businesses, accepting these, and not thinking you as a manger with years of experience know better. For example, in the text casual benchmarking, doing what seems to have worked in the past, and examining deeply held yet unexamined ideologies are areas that should be recognized, and then avoided. For example, if you think of Nordstrom, who is known for their customer service as well as their commission and hourly wage system. Many department stores believe that they could change their payment system to commission, which would result in an increase of sales. It is the idea to copy tactics that work, but instead management should be coping the thinking, or the philosophy of the organization instead of one of their ideas. Just as the text, “Hard Facts Dangerous Half-Truths & Total Nonsense” states that “Toyota’s success is not a set of techniques but it’s philosophy” (Pfeffer-Sutton. 2006). It is Nordstrom’s culture that brings them success, not tactics. Being able to avoid these poor decisions is essential when creating the right perspective while managing a company. Since evidence-based management is defined as a way of seeing the world and thinking about the craft of management, one must use proven facts and logic to do their jobs better. Therefore recognizing these poor decisions, which are fact base, is a great first step in becoming a more logical manager, and not relying on ones own ideas and opinions to become a CEO hero. Having this skill is a sign that the appropriate management style can be achieved. It is  clear that I do not question the validity of this concept. There are countless examples of where benchmarking, relying on the past, and false ideologies have destroyed companies, and many managers careers and reputations. It is interesting to see how many companies ignore these decisions, and continue to forget that times are changing and a structure or tactic you employed at your previous job five years ago might not work in present day at a different company. For me, this is a warning sign. Do you agree that all managers should avoid benchmarking, past ideas, and ideologies? Or do you think that if used the right way it could benefit the company, and consumers?

I also found that the concept of wisdom is extremely important when trying to manage. A manager could follow all of the guidelines put forth, yet there could still be something missing. That is the attitude towards the business. This is where wisdom shines. I would define wisdom as the ability to judge what is right, true or lasting. Wisdom is explained in our text as "knowing what you know and knowing what you don’t know" as suggested by Plato. For example, mangers use wisdom even when they are not completely qualified to make a decision. Having wisdoms allows managers to make decisions based on what they know, and from that experience gain the unknown along the way, making you a better person, and leader. The wisdom of the manager is then transformed into the attitude toward the company. If a manager has wisdom, it will be obvious by evaluating the work, the culture of the company, and the happiness of the employees and consumers. It shapes how people think, act and feel. It is essential in my opinion because having wisdom allows the leaders mind to be open to facts or ideas that they did not know, leading to a more successful business. Having the ability to have faith in something or an idea that is not based off of ones own experience or opinion is extremely important, and wisdom is the key to this. I always wonder, how can we determine if someone has wisdom? Are their different types of wisdom? I truly believe that wisdom is a positive and could never have a negative impact on a company. Do you agree? What makes you feel this way?

I found a management recommendation on Harvard Business Review  in which I find to not use much evidence-based information. This blog discusses a leaders role when facing conflict, and the difference between hot and cold conflict. I found that it was all based off of personal opinion and experience. There is a whole section that is describing the author’s accomplishments and work experience, which is the base for his recommendation. I would have liked to see examples of success stories from different companies, or HR departments that support the guidelines presented by this author. Even evidence of case studies done on behavior and work place culture would have helped the management recommendations. But instead there is no reference to any information, other than his own experience. Chris Edmonds is a good example of reaching out to get some information, he shares his secrets of being a great boss.  He used his experience to gather information from large pools of people all over the world. He is creating his own experiment and gathering data to find five secrets to be become a great boss.

I feel that I have taken a lot from this first session. I believe that I have created a foundation in my mind for the rest of the class, and have been given a taste of what’s to come. I now know what to look for and what to avoid, steps to actually use evidence-based management, and what perspective a manager should have. This will all lead to a successful analysis of management styles, and allow me to offer recommendations of substance. I hope to be able to identify weaknesses and strengths of certain management, and be able to determine if their data is reliable, if it is sound, and what they could be doing better, to benefit the company has a whole.