John Caddell's blog

I worked at a medium-sized software/outsourcing company some years ago, as head of sales support. When I arrived, my group was a mess. One of my three employees transferred the first week I was there. The other two were buried in RFPs, trying to write proposals for clients from Brazil, France, Singapore and the US.

To try to get some order out of the chaos, I developed a simple spreadsheet that listed the prospect, opportunity, salesperson, next step, and a few other data items. I used the spreadsheet to allocate my staff to opportunities, and to discuss with the sales VP where we had resource issues–which was most places, since we had no accepted qualification process and chased everything out there. (That’s a story for the Mistake Bank.)

The spreadsheet proved very useful to me. What was funny, though, is that a few years after I left the company, my wife (who still worked there) told me, “You know, they still use that spreadsheet you created years ago to manage the sales pipeline.”

I recalled this story when reading the HBR article on leadership lessons from gaming (”Leadership’s Online Labs“). Another of the very interesting observations from that article (besides those discussed here and here) was the idea that individual accomplishment in the games, even within a team concept, can be tracked and rewarded. Read this excerpt:

A point system…, used by leaders to motivate team members, is also part of a broader game economy. Players use synthetic currencies, such as virtual gold pieces, to buy and sell items of value to one another—everything from weapons to information to an agreement to collaborate on a particular task. (Players can also use real-world currency to purchase valuable items, such as skills or tools that others have earned in the game world, at numerous online auction sites. One of a leader’s tasks when putting together a team is to sniff out players who have tried to buy their way to a certain level of accomplishment.)

Incentive systems used by leaders affect motivation in several ways. Dividing up the winnings from a quest immediately after it’s completed—or, occasionally, awarding loot to someone even as the battle rages—creates a strong connection between effort and reward…. Even when it’s clear they’re unlikely to share in the spoils of a raid, players know that their participation will earn them points for future use. Finally, because individual compensation is based on objective performance data that can be automatically gathered and processed, and then publicly posted in real time, the reward system is generally viewed as fair.

The sorts of contributions people make to a corporate cross-functional team aren’t, of course, as easy to precisely quantify, track, and reward as are contributions that game players make to their guilds. Still, we believe that game-inspired incentives have the potential to dramatically improve leadership effectiveness in business organizations. Companies might devise ways to shorten the lag time between successful outcomes and the monetary compensation for those who contribute to them. For instance, instead of getting an end-of-year bonus, people in certain businesses could be rewarded for their contributions to a project as soon as it was completed—a prospect likely to galvanize their efforts. Also, before the launch of a group project such as a prolonged cross-functional sales effort, people might be given a breakdown of how rewards for a successful outcome will be divvied up.

It’s notable that web2.0 technologies are extremely transparent and open with contributions. Blog posts carry the names of the authors (even when reprinted), commenters are noted. Wiki contributions are tagged with the owners’ names. All in all, there’s a complete accountability map behind any web2.0 project that could be used (were any of them to make any money!) to compensate each individual for his/her particular added value.

So, how much do you think I should get for that pipeline spreadsheet I created?

compensation, incentives, Harvard Business Review