WEBVTT
00:00:01.790 --> 00:00:05.019
I see this as one of those challenging things in our industry.
00:00:05.240 --> 00:00:08.580
How much is too much and how much is enough, right?
00:00:09.039 --> 00:00:13.050
And there's a concept that I think a lot of people need to understand.
00:00:13.060 --> 00:00:15.509
There's expected and unexpected.
00:00:16.260 --> 00:00:19.170
Expected is your first incentive or reward.
00:00:19.230 --> 00:00:26.129
That's my commissions, whatever bonus structures you have in place, those types of things that are set up that if I achieve this, I get that.
00:00:26.500 --> 00:00:27.359
Those are expected.
00:00:27.359 --> 00:00:30.750
It's actually usually in a job description or some kind of job offer.
00:00:31.120 --> 00:00:33.130
Lined out exactly what that looks like.
00:00:33.859 --> 00:00:42.909
Then you have the unexpected, these things that aren't in my job offer or job description that can determine the environment within which you work.
00:00:43.869 --> 00:00:50.719
So for example, one of the ones I really enjoy doing is an annual trip for the people in a company.
00:00:50.909 --> 00:00:57.820
We call it a mission and it can be revenue based, it could be profit based, it could be a number of customers and a lot of different reasons for these missions.
00:00:58.399 --> 00:01:00.250
But we're going to go do this.
00:01:00.320 --> 00:01:03.770
And if we accomplish this, we're all going to go on this trip together.
00:01:04.609 --> 00:01:16.189
The only problem with that is if you have a group of folks like sales guys that are instant gratification folks, a trip a year from now, they're not really thinking about unless you're a great leader.
00:01:16.879 --> 00:01:19.400
And this is where that leader applies that encouragement.
00:01:20.090 --> 00:01:24.969
He keeps reminding them about the effort and activities and work that they're doing.
00:01:25.450 --> 00:01:30.390
that are all leading to this time together to go and enjoy and be on a trip together.
00:01:31.250 --> 00:01:37.769
And so we got to be really consistent with long term incentives like that, that we keep it top of mind.
00:01:38.260 --> 00:01:44.510
This idea that, Hey, I'm keeping it in front of you, reminding you that you are either performing at the expected level or not.
00:01:44.510 --> 00:01:49.192
And you're at risk of not joining us for this fun trip.
00:01:49.192 --> 00:01:53.875
One of the best books I've ever read about incentive was Freakonomics.
00:01:55.034 --> 00:01:58.275
It's unbelievable, but it has nothing to do about business.
00:01:58.295 --> 00:01:58.784
Really.
00:01:59.125 --> 00:02:07.064
There's a couple of Steven Levitt and Steven, can't remember the second guy's name, uh, but they are researchers.
00:02:07.305 --> 00:02:08.525
They study stuff, right?
00:02:08.914 --> 00:02:11.215
They wonder why people do what people do.
00:02:11.555 --> 00:02:15.268
And incentive is in everything that you do.
00:02:15.268 --> 00:02:17.034
You did it because there was incentive.
00:02:17.555 --> 00:02:21.245
I'm recording this video today because there's incentive that one of you out there.
00:02:21.719 --> 00:02:24.469
might hear this and might go, this guy knows what he's talking about.
00:02:24.780 --> 00:02:26.740
So there's some incentive for me to do this.
00:02:26.830 --> 00:02:30.099
There's incentive for me to brush my teeth because I don't want my teeth to fall out.
00:02:30.780 --> 00:02:33.090
There's everything in anything you do.
00:02:33.539 --> 00:02:42.009
There's incentive behind it because you're expecting something, a result to happen from it, whether immediately or longterm.
00:02:42.520 --> 00:02:50.770
So if we now understand that basic concept that everybody does anything they do based on incentive, how do I determine the right incentive?
00:02:51.064 --> 00:02:59.645
for the right role in my company, the right person in my company, those things get a little bit more difficult, a little bit more nuance.
00:03:00.245 --> 00:03:01.655
So I'm going to give my best advice.
00:03:01.925 --> 00:03:03.814
My best advice is to know your people.
00:03:04.314 --> 00:03:06.905
If I know my people, then I know how to incentivize them.
00:03:07.655 --> 00:03:12.770
So if I got a guy that, likes to drive race cars and drive fast and stuff like that.
00:03:13.000 --> 00:03:19.090
I'm going to apply some incentive to maybe earning a trip to a track and doing a track test day.
00:03:19.969 --> 00:03:21.460
But that's only because I know him.
00:03:21.710 --> 00:03:27.520
I'm not going to apply that track test day to everybody cause they might not be on board for that.
00:03:28.000 --> 00:03:33.169
So there's this concept of the expected and the unexpected that comes into play.
00:03:33.169 --> 00:03:35.800
It takes a lot of practice to really understand it, but.
00:03:36.210 --> 00:03:37.150
It's not that hard.
00:03:37.280 --> 00:03:41.610
Just know your people, ask them what they're about, what they want to achieve, what are they trying to accomplish?
00:03:41.969 --> 00:03:44.180
And if you really think about it, they're pretty similar.
00:03:44.699 --> 00:03:48.319
Um, a lot of people are saving up for college funds for their kids.
00:03:48.689 --> 00:03:49.599
Okay, awesome.
00:03:50.060 --> 00:03:54.800
Let's set up an action plan that says some of the money you earn aside and maybe we can match.
00:03:54.909 --> 00:03:58.310
And that's the key to the whole thing is figure out, is that really what they're about?
00:03:58.340 --> 00:04:05.360
They just lying to you because they might not be telling you the truth and they might say, Hey, yeah, I want to put college money back for my kids.
00:04:05.360 --> 00:04:05.379
Okay.
00:04:05.780 --> 00:04:07.750
But the reality is they want a new shotgun.
00:04:07.830 --> 00:04:37.454
And so you got to dig deep enough to to find what truly is going to push and motivate somebody And then set them up to have that success with that particular thing There's some things to consider when building an incentive program or contest or anything like that the number one mistake that people that do any kind of incentive do is they Lead people to this first second third finisher type thing You You win, you get this, you get a second, you get that third, you get this.
00:04:37.875 --> 00:04:48.964
And especially when it comes to sales teams and sales teams, you tend to have the same group of people of two to five people that win every contest like that.
00:04:49.524 --> 00:04:53.814
And it becomes boring to the other 10 or 15 other folks that you have selling for you.
00:04:54.725 --> 00:05:01.735
And they're just not into it anymore because you say, Hey, for first place, the most number of contracts this week gets this.
00:05:01.735 --> 00:05:01.829
Thanks.
00:05:02.350 --> 00:05:09.259
Well, the first guy goes out and he had six of them already waiting and he just went and signed them real quick and puts up a big number right away, takes everybody's will away.
00:05:09.660 --> 00:05:10.569
And he did it purposely.
00:05:10.800 --> 00:05:12.259
He's trying to win a contest.
00:05:12.269 --> 00:05:13.120
He's competitive.
00:05:13.879 --> 00:05:18.250
There's another guy and he's over there sandbagging for the whole time or whatever your contest link does.
00:05:18.250 --> 00:05:22.389
And then at the last day, he turns them all in to beat the guy that turned in all the ones up front.
00:05:22.389 --> 00:05:25.930
It tends to be the same two or three people over and over again.
00:05:26.560 --> 00:05:30.110
So if you want to fix that, determine what it is that you want.
00:05:30.470 --> 00:05:36.139
Incentives are about getting not only what they want, but also what you're trying to get out of them.
00:05:36.480 --> 00:05:45.209
If I wanted a bunch of orders turned in, I'd run a contest about getting a certain amount of orders turned in for anywhere from a week to 30 days, depending on how many I needed.
00:05:45.709 --> 00:05:51.459
And I would set a standard like everybody that gets this number, it gets this cool thing, whatever it may be.
00:05:51.839 --> 00:05:56.430
I try to have those be experienced types things that fit the culture of my people.
00:05:57.120 --> 00:06:02.779
So the example I gave earlier was like the guy Getting the one thing that fit for him really well.
00:06:02.810 --> 00:06:04.800
I got to know that side of things for sure.
00:06:05.189 --> 00:06:10.139
But then I also have to understand the environment of my team and the culture I'm trying to create.
00:06:10.139 --> 00:06:17.269
So if I'm trying to create a really competitive culture, I might say, Hey, everybody that gets this number, we're all going to Topgolf together.
00:06:17.290 --> 00:06:20.370
We're going to go have a Topgolf day, Topgolf Olympics.
00:06:20.370 --> 00:06:21.189
We're going to play three of them.
00:06:21.189 --> 00:06:22.180
We're going to Topgolfer.
00:06:22.180 --> 00:06:24.550
You're going to get a Topgolf award and all kinds of stuff, right?
00:06:24.550 --> 00:06:26.569
Like make it really fun, competitive.
00:06:27.175 --> 00:06:35.404
But if that's not your jam, you've got to just think about, be a little bit creative about what that could look like for you and your business.
00:06:35.915 --> 00:06:37.095
Here's the one thing I know.
00:06:37.694 --> 00:06:46.185
This is, this is a no doubter, the absolute biggest mistake we make is we give cash prizes because we think that's what people want.
00:06:46.754 --> 00:06:51.944
We even go through the effort to ask, Hey, okay, so we're thinking about doing some bonuses and contests and stuff like that.
00:06:51.944 --> 00:06:52.555
What do you guys want?
00:06:52.555 --> 00:06:52.904
Money.
00:06:52.904 --> 00:06:53.384
Money.
00:06:53.954 --> 00:06:58.375
We want money and they don't really, because here's the thing.
00:06:58.995 --> 00:07:00.225
We don't remember the money.
00:07:00.995 --> 00:07:01.795
We get the money.
00:07:02.214 --> 00:07:04.464
We have a celebration for about an hour or whatever.
00:07:04.574 --> 00:07:13.605
You might even gloat over it for a week, but then you spend it in all kinds of places and you don't ever relate anything back to like that money was from this, for me doing that.
00:07:13.935 --> 00:07:18.144
You went and bought a hot dog at the convenience store, put some gas, your gas tank, that kind of thing.
00:07:19.805 --> 00:07:22.555
What we really remember are experiences.
00:07:23.204 --> 00:07:28.355
I remember one of the best experiences we ever had was taking my SEALS team to a baseball game.
00:07:28.355 --> 00:07:32.485
I had contacted the baseball team and said, Hey, I'd like to create an experience for my guys.
00:07:33.045 --> 00:07:34.754
And they're like, absolutely, we'll get it.
00:07:35.004 --> 00:07:36.995
We'll get somebody set up for you the whole bit.
00:07:37.035 --> 00:07:42.675
And like, we got to hit like off in the batting cage, off of like batting practice, pitchers and stuff.
00:07:43.225 --> 00:07:44.944
Those guys talked about that for years.
00:07:45.314 --> 00:07:47.444
And it was one of the best experiences they ever had.
00:07:48.495 --> 00:07:51.595
Those are the things that will really get people.
00:07:52.235 --> 00:07:56.944
To help you achieve that shared vision that you're looking for.
00:00:01.790 --> 00:00:05.019
I see this as one of those challenging things in our industry.
00:00:05.240 --> 00:00:08.580
How much is too much and how much is enough, right?
00:00:09.039 --> 00:00:13.050
And there's a concept that I think a lot of people need to understand.
00:00:13.060 --> 00:00:15.509
There's expected and unexpected.
00:00:16.260 --> 00:00:19.170
Expected is your first incentive or reward.
00:00:19.230 --> 00:00:26.129
That's my commissions, whatever bonus structures you have in place, those types of things that are set up that if I achieve this, I get that.
00:00:26.500 --> 00:00:27.359
Those are expected.
00:00:27.359 --> 00:00:30.750
It's actually usually in a job description or some kind of job offer.
00:00:31.120 --> 00:00:33.130
Lined out exactly what that looks like.
00:00:33.859 --> 00:00:42.909
Then you have the unexpected, these things that aren't in my job offer or job description that can determine the environment within which you work.
00:00:43.869 --> 00:00:50.719
So for example, one of the ones I really enjoy doing is an annual trip for the people in a company.
00:00:50.909 --> 00:00:57.820
We call it a mission and it can be revenue based, it could be profit based, it could be a number of customers and a lot of different reasons for these missions.
00:00:58.399 --> 00:01:00.250
But we're going to go do this.
00:01:00.320 --> 00:01:03.770
And if we accomplish this, we're all going to go on this trip together.
00:01:04.609 --> 00:01:16.189
The only problem with that is if you have a group of folks like sales guys that are instant gratification folks, a trip a year from now, they're not really thinking about unless you're a great leader.
00:01:16.879 --> 00:01:19.400
And this is where that leader applies that encouragement.
00:01:20.090 --> 00:01:24.969
He keeps reminding them about the effort and activities and work that they're doing.
00:01:25.450 --> 00:01:30.390
that are all leading to this time together to go and enjoy and be on a trip together.
00:01:31.250 --> 00:01:37.769
And so we got to be really consistent with long term incentives like that, that we keep it top of mind.
00:01:38.260 --> 00:01:44.510
This idea that, Hey, I'm keeping it in front of you, reminding you that you are either performing at the expected level or not.
00:01:44.510 --> 00:01:49.192
And you're at risk of not joining us for this fun trip.
00:01:49.192 --> 00:01:53.875
One of the best books I've ever read about incentive was Freakonomics.
00:01:55.034 --> 00:01:58.275
It's unbelievable, but it has nothing to do about business.
00:01:58.295 --> 00:01:58.784
Really.
00:01:59.125 --> 00:02:07.064
There's a couple of Steven Levitt and Steven, can't remember the second guy's name, uh, but they are researchers.
00:02:07.305 --> 00:02:08.525
They study stuff, right?
00:02:08.914 --> 00:02:11.215
They wonder why people do what people do.
00:02:11.555 --> 00:02:15.268
And incentive is in everything that you do.
00:02:15.268 --> 00:02:17.034
You did it because there was incentive.
00:02:17.555 --> 00:02:21.245
I'm recording this video today because there's incentive that one of you out there.
00:02:21.719 --> 00:02:24.469
might hear this and might go, this guy knows what he's talking about.
00:02:24.780 --> 00:02:26.740
So there's some incentive for me to do this.
00:02:26.830 --> 00:02:30.099
There's incentive for me to brush my teeth because I don't want my teeth to fall out.
00:02:30.780 --> 00:02:33.090
There's everything in anything you do.
00:02:33.539 --> 00:02:42.009
There's incentive behind it because you're expecting something, a result to happen from it, whether immediately or longterm.
00:02:42.520 --> 00:02:50.770
So if we now understand that basic concept that everybody does anything they do based on incentive, how do I determine the right incentive?
00:02:51.064 --> 00:02:59.645
for the right role in my company, the right person in my company, those things get a little bit more difficult, a little bit more nuance.
00:03:00.245 --> 00:03:01.655
So I'm going to give my best advice.
00:03:01.925 --> 00:03:03.814
My best advice is to know your people.
00:03:04.314 --> 00:03:06.905
If I know my people, then I know how to incentivize them.
00:03:07.655 --> 00:03:12.770
So if I got a guy that, likes to drive race cars and drive fast and stuff like that.
00:03:13.000 --> 00:03:19.090
I'm going to apply some incentive to maybe earning a trip to a track and doing a track test day.
00:03:19.969 --> 00:03:21.460
But that's only because I know him.
00:03:21.710 --> 00:03:27.520
I'm not going to apply that track test day to everybody cause they might not be on board for that.
00:03:28.000 --> 00:03:33.169
So there's this concept of the expected and the unexpected that comes into play.
00:03:33.169 --> 00:03:35.800
It takes a lot of practice to really understand it, but.
00:03:36.210 --> 00:03:37.150
It's not that hard.
00:03:37.280 --> 00:03:41.610
Just know your people, ask them what they're about, what they want to achieve, what are they trying to accomplish?
00:03:41.969 --> 00:03:44.180
And if you really think about it, they're pretty similar.
00:03:44.699 --> 00:03:48.319
Um, a lot of people are saving up for college funds for their kids.
00:03:48.689 --> 00:03:49.599
Okay, awesome.
00:03:50.060 --> 00:03:54.800
Let's set up an action plan that says some of the money you earn aside and maybe we can match.
00:03:54.909 --> 00:03:58.310
And that's the key to the whole thing is figure out, is that really what they're about?
00:03:58.340 --> 00:04:05.360
They just lying to you because they might not be telling you the truth and they might say, Hey, yeah, I want to put college money back for my kids.
00:04:05.360 --> 00:04:05.379
Okay.
00:04:05.780 --> 00:04:07.750
But the reality is they want a new shotgun.
00:04:07.830 --> 00:04:37.454
And so you got to dig deep enough to to find what truly is going to push and motivate somebody And then set them up to have that success with that particular thing There's some things to consider when building an incentive program or contest or anything like that the number one mistake that people that do any kind of incentive do is they Lead people to this first second third finisher type thing You You win, you get this, you get a second, you get that third, you get this.
00:04:37.875 --> 00:04:48.964
And especially when it comes to sales teams and sales teams, you tend to have the same group of people of two to five people that win every contest like that.
00:04:49.524 --> 00:04:53.814
And it becomes boring to the other 10 or 15 other folks that you have selling for you.
00:04:54.725 --> 00:05:01.735
And they're just not into it anymore because you say, Hey, for first place, the most number of contracts this week gets this.
00:05:01.735 --> 00:05:01.829
Thanks.
00:05:02.350 --> 00:05:09.259
Well, the first guy goes out and he had six of them already waiting and he just went and signed them real quick and puts up a big number right away, takes everybody's will away.
00:05:09.660 --> 00:05:10.569
And he did it purposely.
00:05:10.800 --> 00:05:12.259
He's trying to win a contest.
00:05:12.269 --> 00:05:13.120
He's competitive.
00:05:13.879 --> 00:05:18.250
There's another guy and he's over there sandbagging for the whole time or whatever your contest link does.
00:05:18.250 --> 00:05:22.389
And then at the last day, he turns them all in to beat the guy that turned in all the ones up front.
00:05:22.389 --> 00:05:25.930
It tends to be the same two or three people over and over again.
00:05:26.560 --> 00:05:30.110
So if you want to fix that, determine what it is that you want.
00:05:30.470 --> 00:05:36.139
Incentives are about getting not only what they want, but also what you're trying to get out of them.
00:05:36.480 --> 00:05:45.209
If I wanted a bunch of orders turned in, I'd run a contest about getting a certain amount of orders turned in for anywhere from a week to 30 days, depending on how many I needed.
00:05:45.709 --> 00:05:51.459
And I would set a standard like everybody that gets this number, it gets this cool thing, whatever it may be.
00:05:51.839 --> 00:05:56.430
I try to have those be experienced types things that fit the culture of my people.
00:05:57.120 --> 00:06:02.779
So the example I gave earlier was like the guy Getting the one thing that fit for him really well.
00:06:02.810 --> 00:06:04.800
I got to know that side of things for sure.
00:06:05.189 --> 00:06:10.139
But then I also have to understand the environment of my team and the culture I'm trying to create.
00:06:10.139 --> 00:06:17.269
So if I'm trying to create a really competitive culture, I might say, Hey, everybody that gets this number, we're all going to Topgolf together.
00:06:17.290 --> 00:06:20.370
We're going to go have a Topgolf day, Topgolf Olympics.
00:06:20.370 --> 00:06:21.189
We're going to play three of them.
00:06:21.189 --> 00:06:22.180
We're going to Topgolfer.
00:06:22.180 --> 00:06:24.550
You're going to get a Topgolf award and all kinds of stuff, right?
00:06:24.550 --> 00:06:26.569
Like make it really fun, competitive.
00:06:27.175 --> 00:06:35.404
But if that's not your jam, you've got to just think about, be a little bit creative about what that could look like for you and your business.
00:06:35.915 --> 00:06:37.095
Here's the one thing I know.
00:06:37.694 --> 00:06:46.185
This is, this is a no doubter, the absolute biggest mistake we make is we give cash prizes because we think that's what people want.
00:06:46.754 --> 00:06:51.944
We even go through the effort to ask, Hey, okay, so we're thinking about doing some bonuses and contests and stuff like that.
00:06:51.944 --> 00:06:52.555
What do you guys want?
00:06:52.555 --> 00:06:52.904
Money.
00:06:52.904 --> 00:06:53.384
Money.
00:06:53.954 --> 00:06:58.375
We want money and they don't really, because here's the thing.
00:06:58.995 --> 00:07:00.225
We don't remember the money.
00:07:00.995 --> 00:07:01.795
We get the money.
00:07:02.214 --> 00:07:04.464
We have a celebration for about an hour or whatever.
00:07:04.574 --> 00:07:13.605
You might even gloat over it for a week, but then you spend it in all kinds of places and you don't ever relate anything back to like that money was from this, for me doing that.
00:07:13.935 --> 00:07:18.144
You went and bought a hot dog at the convenience store, put some gas, your gas tank, that kind of thing.
00:07:19.805 --> 00:07:22.555
What we really remember are experiences.
00:07:23.204 --> 00:07:28.355
I remember one of the best experiences we ever had was taking my SEALS team to a baseball game.
00:07:28.355 --> 00:07:32.485
I had contacted the baseball team and said, Hey, I'd like to create an experience for my guys.
00:07:33.045 --> 00:07:34.754
And they're like, absolutely, we'll get it.
00:07:35.004 --> 00:07:36.995
We'll get somebody set up for you the whole bit.
00:07:37.035 --> 00:07:42.675
And like, we got to hit like off in the batting cage, off of like batting practice, pitchers and stuff.
00:07:43.225 --> 00:07:44.944
Those guys talked about that for years.
00:07:45.314 --> 00:07:47.444
And it was one of the best experiences they ever had.
00:07:48.495 --> 00:07:51.595
Those are the things that will really get people.
00:07:52.235 --> 00:07:56.944
To help you achieve that shared vision that you're looking for.
