Stars
And Losers:
One Approach

To: The Director of the Audit Bureau
From: Bob Behn
Re: The Performance Bonus
Date: June, 1998

Whatever you do, do not personally select your unit's "stars." It will have the same impact as announcing at Thanksgiving dinner which 20 percent of your grandchildren are the stars of the family. You may have some clear sense of which employees (or which grandchildren) are really tops, but it is not going to do you or your organization (or family) any good to announce it. It will bring you nothing but grief.

I. Problem #1: A Small, Fixed Number of "Stars." The legislature has decided that your organization has exactly three stars — not four, not two, and certainly not 15. And maybe you do have exactly three stars — three individuals whose performance is clearly superior to the work of whoever is next. More likely, however, you (or anyone) would have a difficult time deciding who's number three and who's number four. After all, the choice depends upon the criteria you use — upon the kinds of performance that you consider most important and the contributions to the audit bureau's performance that you consider most important. On these criteria, responsible managers will easily differ. It is not at all obvious who are the top three stars.

II. Problem #2: A Large Number of Self-Perceived Stars. Moreover, every member of your unit believes he or she is a star. Just ask them. Most of the members of your unit could, if invited, offer a perfectly defensible explanation of why he or she is the unsung hero of the unit. This is not completely self delusion. Different people are good at different things. You select them for assignments at which they will succeed, and they self-select for assignments at which they will succeed. As a result, most of them do quite well at what they are asked to do.

Consequently, in anointing three individuals as your unit's elite, you are directly destroying the self-esteem of the other 12. The new bonus lets you tell three people that they are stars. But it also forces you to tell the others that they are losers. This does not help you manage your unit. The months following the announcement of the three stars will be characterized by low morale, low motivation and low performance. The Star Award will not motivate improved performance in your organization; it will undermine it. All this for a measly 42 (pre-tax) dollars per month.

III. Possible Strategies for Coping with the Star System. When faced with this kind of conflict-creating, morale-destroying choice, many organizations and many managers seek ways to avoid labeling anyone as a loser. They draw straws. They take a vote. They give the money back. They give the money to three people, who throw a party. They give the money to three people, who write checks to everyone else. All these strategies are designed to avoid labeling the vast majority of the organization's employees as losers.

Sometimes even the winners aren't thrilled. They may be embarrassed by the failure of their many outstanding colleagues to win star status. Or they may feel the resentment of their colleagues. Indeed, they may discover that being labeled a star — that is, one of the boss's pets — complicates their ability to work collaboratively with their old friends.

So what strategy should you choose? This depends upon the personal and professional cohesion that exists in your unit. If, as the unit's leader, you have been able to establish a sense of common purpose and trust among your 15 people, you might ask them what they would like to do — either individually or collectively. If your people work well together, if they care about each other, if they are serious about achieving your unit's mission, they will appreciate being consulted.

Call a meeting. Explain the details of the Star Award. Seek out their advice. Then be prepared to take it. Your staff will, of course, suggest a variety of ideas — some reasonable, some outrageous. But if they agree on an approach — one that is neither illegal nor immoral — you have to be willing to accept their judgment. Whatever they settle on, you will have avoided that trap of personally labeling 80 percent of your people as losers.

IV. Better Ways to Motivate Your People. The big mistake the legislature made was to assume that money is an on-the-job motivator. Undoubtedly, the civil service pay scale isn't attracting enough new talent. But a $42-per-month bonus isn't going to solve this problem. If government wants to attract more talent, it needs to raise the pay scale. Extra money will pull in more applicants — but even then, once they have a job, this money won't make them work harder.

Instead, the manager needs to employ a variety of strategies to recognize individual performance — and do it frequently. The list of ways to achieve this is endless. To reward outstanding work, a manager can feature it in a newsletter or special report; ask the individual to explain an innovation to the staff or at a bigger meeting; send the individual to a conference; create an opportunity for additional training; or hand out a bigger computer, chair, or window.

Admittedly, all these rewards are, at least partially, psychological. But psychological rewards are important. They can be even more important than money. And they aren't limited. You can give psychological rewards to every deserving employee. You can give them out every day. You can use these psychological rewards to make every employee feel like a star.

Agree or disagree? If you think you have a better way to deal with this month's Manager's Choice dilemma, or would like to expand on Bob Behn's approach, share your thoughts with other readers here. Send your solution to mailbox@governing.com. Please include your name, location, government or business title or job description, and a daytime phone number (for verification purposes).

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