Intro: Motivation in the workplace is an important factor for entrepreneurs. And I often explore the many fascinating psychology research studies that have led us to a deep understanding of employee motivation. The following post is a thorough list of the best psychology concepts for motivating your workforce.

A Road Not Taken…
There was a time in my life when I was studying to become an Industrial-Organizational Psychologist. Basically I thought that listening to, and attempting to vanquish, the workplace-based depression of a Fortune 500 company’s middle managers would be an interesting career. Looking at my current life, I am extremely glad I didn’t venture down that path!

My formal training in psychology, on the other hand, has taught me a ton of valuable concepts that I now use daily. These ideas translate well for almost any situation in the business and marketing world.

A couple of days ago I was speaking to a few budding entrepreneurs and the topic of motivation came up. While speaking with them, I realized how I forgot the actual psychology terms for the theories even though I think about the concepts almost on a daily basis. So I dug out my notes and gave myself a refresher course. The following concepts are some of the more important theories in motivational psychology in terms of workplace behavior:

Intrinsic Motivation

What drives us to do bold things? Those who have a desire to effectively perform behaviors for their own sake are said to have intrinsic motivation. If you are reading this article it’s probably because you are generally interested in learning about psychology. Thus, you have intrinsic motivation towards understanding human nature. Same rule applies in the workplace. Those workers who love being at work and will do anything it takes for the company to flourish are most of the time intrinsically motivated. Put in other words, they have a passion to succeed.

Extrinsic Motivation

Commissions, sales incentives and social praise are well-known motivators. The psychological concept is extrinsic motivation. These rewards can be extremely powerful when looking to motivate your staff to go above and beyond their current comfort zone of productivity.

Overjustification Effect

The catch-22 of extrinsic motivation. The overjustification effect occurs when someone naturally has a passion (intrinsic motivation) to see something through, but is offered a reward for its completion. Thus rendering them less effective. For instance, if an employee loves writing on your corporate blog but you decide to financially compensate them for each post. There is a chance they will find the writing less enjoyable. Since they have to be bribed into writing, then the task must not be worth doing for its own sake.

Positive Reinforcement

Strengthening or diminishing certain employee behaviors is extremely important when developing a highly effective team. This can be achieved with a basic understanding of operant conditioning. Essentially, the concept describes how the effects of praise and reward can be used to refine behavior. While this can be seen throughout life, you can apply the concept when motivating your workforce.

For instance, praising one of your employees (in front of their peers is best) after they made a nice improvement in their numbers during the previous week will result in a greater urge to repeat, or top, those numbers in hopes of further praise. A few examples of positive reinforcements in the workplace are social praise in public, sales incentives & bonuses as well as creative rewards such as early departure from work, casual dress days and in-office game/personal time.

Shaping

After a while, positive reinforcement will become less effective as they will become accustomed to the praise. Withholding the reward unless performance is continually improved upon will help shape the productivity. To illustrate this concept, imagine a bookkeeper that has been openly rewarded for getting the expenses entered in 8 hours. But you have found that the 8-hour timeframe has become the norm. If you feel the job can be done in 5 hours you must praise their performance only as the timeframe improves and ignore slower results.

Achievement Motivation Theory

The desire to achieve the absolute best results possible is an amazing trait to find in coworkers (They are usually entrepreneurs). Those who strive to achieve share these three major characteristics:

1. They favor a work environment in which they are able to assume responsibility for solving problems.
2. They tend to take calculated risks and to set moderate, attainable goals.
3. They need continuing recognition and feedback about their progress so that they know how well they are doing.

Furthermore, these high achievers have been found to carry two different goals – mastery and performance. Which means that as a leader you must recognize what makes these workers tick. The high achievers who strive for mastery of tasks are driven by developing themselves internally and are rewarded by becoming increasingly skilled. Performance based achievers need to be the best. They find satisfaction by completing their duties better than their coworkers.

Needs Hierarchy Theory

Sometimes called Maslow’s Hierarchy of Needs, the concept illustrates human needs, arranged in order of importance. The lower needs on this pyramid must be fulfilled before one can achieve the next higher level:

This chart is important for entrepreneurs and leaders to understand. For example, if an employee is lacking self-esteem or self-fulfillment in their life, there is little chance of them becoming an extremely remarkable addition to your team. You must recognize and create solutions for your staff to become truly satisfied in their life before you can achieve the results you desire.

Motivator-Hygiene Theory

Also called the Two-Factor Theory, the Motivator-Hygiene Theory isn’t backed by a lot of supporting data in the psychology/research world. But it has transformed many organizations in terms of employee motivation. The concept is based on the suggestion that an employee has two needs:

1. Motivator Needs – These produce job satisfaction and are considered higher needs. They can be satisfied by providing stimulating, challenging and absorbing work. Meeting these demands will result in job satisfaction. However, the lack of a challenging job will not create job dissatisfaction.
2. Hygiene Needs – These produce job dissatisfaction and are considered lower needs. A few examples of these needs are a company policy, working conditions, wages paid and other external factors that can directly affect a worker such as their supervisor. Meeting these needs does not result in job satisfaction but rather prevents job dissatisfaction.

The take away from this concept is that as you oversee your organization, it is important to emphasize job enrichment. Put in other words, be sure to maximize the potential of every single employee by consciously recognizing the opportunities to promote satisfaction and demote dissatisfaction in the workplace.

Equity Theory

Ensuring that your employees feel equal amongst their peers is extremely important when creating a motivated workforce. The equity theory describes how workers assess their efforts and outcomes on the job by calculating a “productivity ratio.” They then (most likely unconsciously) compare their ratio to the perceived ratios of their coworkers.

Further studies have expanded on this theory by classifying three types of equatorial behaviors:

1. Benevolent – These workers feel satisfied when under-rewarded compared to coworkers and feel guilty when equally or over-rewarded.
2. Equity-Sensitive – These workers believe everyone should be rewarded fairly. They dislike when they are under-rewarded and guilty when over-rewarded.
3. Entitled – These workers feel they should be over-rewarded in comparison to their coworkers and dislike anything less.

The important idea here is that you must keep a careful eye on the workforce’s perceptions in regards to pay and rewards.

Goal Setting Theory

The goal setting theory is somewhat common sense but it reinforces the fact that a worker’s motivation shares a direct relationship with their goals. This theory was developed by Edward Locke and illustrates that by setting specific and challenging goals for your team motivation will provoke extreme productivity. From profit goals for your sales force to timeframe goals for your research team, your overall business will benefit greatly by implementing this strategy.

Valence-Instrumentality-Expectancy (VIE) Theory

This theory may be one of the most important concepts for motivation – but is often overlooked by most businesses. The VIE theory states that people are motivated to perform as expected because of the prospect of personal advancement such as a pay-raise or promotion. Put in other words, workers who aspire for a better status at work will do anything they believe will get them their desired results.

So what does this mean for your business? It conveys the fact you must clearly illustrate what actions you are looking for when it comes to your employee’s possible pay-raises, bonuses and promotions.

The Pygmalion Effect

The final concept on this list encapsulates the above ideas. The Pygmalion Effect produces a self-fulfilling prophecy in which your expectations about the level of your employees’ job performance can directly influence their performance. Put in other words, managers who expect high performance tend to get high performance and those who expect poor performance tend to get poor performance.

Conclusion

As a leader, understanding your team’s underlying desires and their motivating forces will be essential for your continued success. I hope these psychology concepts help you grow as an entrepreneur. Please feel free to share this post and I’d love to hear your thoughts on this in the comment section below. Thank you and good luck!

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Are you WOWing your customers?

When it comes to customer service all the talk recently has been about Zappos. And for good reason. They’ve done an exceptional job delivering on their brand promise, “Deliver Happiness.”

The reality, however, is there have been countless companies delivering customer service at a loyalty level for decades.

One such company is Nordstrom. Their employee handbook, printed on a small gray card, might be THE clue to delivering WOW.

It contained these 75 words:

Welcome to Nordstrom

We’re glad to have you with our company. Our number one goal is to provide outstanding customer service. Set both your personal and professional goals high. We have great confidence in your ability to achieve them.

Nordstrom Rules – Rule #1: Use best judgment in all situations. There are no additional rules.

Please feel free to ask your department manager, store manager, or division general manager any question at any time.

Is there any coincidence that for decades Nordstrom had the highest sales per square foot in retail? I suggest not.

Want to deliver WOW customer service? Hire WOW people. Then get out of the way and let them WOW your customers.

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Knowing what you know now, what advice would you give to a new entrepreneur?

I’m often asked this question as I travel around the country speaking to groups on 21st century capitalism and leadership. This is a great question.

I would offer these 10 11 truths:

1. The moment you decide to create something for others you are a leader. Act as such. Be an example. An example to your employees. An example to your vendors. An example to your customers. And, most importantly, be an example to your family.
2. Your job as a business is to solve problems, not create them. For far too long too many businesses have created more problems then they are solving. (e.g. energy industry, food industry, health industry) Let that not be you. Make the commitment to be a business that focuses less on the bottom line and more on  improving the well-being of others.
3. You must have the willingness to do whatever it takes. Ask yourself, “Am I willing to do whatever it takes?”  If your answer is anything less than, “Hell yeah!” close up shop and go do something else.
4. Your business is about service, not personal achievement. Often when I ask entrepreneurs why they started their business they give answers like, “freedom of my schedule,”  ”be my own boss,” or “make money.” I cannot stress enough that if you start a business based solely on your own personal acheivements you will fail. Your purpose has to be bigger than that. Much bigger. One that serves others. You just get to enjoy some of the rewards along the way.
5. Treat your business like your baby. And know that, just like your baby, it matures and you have to let go of perceived control so it will flourish. There will come a time in your business’s life-cycle that YOU are the problem. Be aware enough to recognize it when it arrives and humble enough to bring others on to the team who are more talented than you.
6. Being a founder is about stewardship, not ownership. Being a steward is different than being an owner. We’re all just temporary custodians of whatever we think we own, including our business. Remember, some day you will no longer be the owner, but you will always be the founder. Make business decisions based on the founder’s legacy you want to build.
7. If you think you have competition you really don’t know who you are. While there may be others in your industry there should never be another like you.
8. Some people will say it’s too expensive no matter how low the price. Other people would gladly pay more no matter how high the price. It’s never about price. It’s always about value.
9. Don’t bet your business on the illusive home run. Focus on a steady diet of daily disciplined improvements. You’ll score more runs (make more money) in the end.
10. Without the fun quotient the chances of success are severely diminished. Have fun. Lots of it.

Oh, and one last thing…

Take care of yourself.

Make your spiritual, emotional, and physical health a priority.  When owning and running a business you will experience more stress than you can ever imagine. But if you are unhealthy you will be of no use to anyone including those most important to you. There will never be anything more important than your health. Never. Always remember that.

So let me ask you, knowing what you know now, what advice would you give to a new entrepreneur?

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During my one and only job interview in the corporate world, I was asked the go-to question:

“What is your biggest flaw?”

And while I’m not sure how others respond when asked this, I replied:

“I have a crippling problem with perfectionism.”

But looking back at that answer, is this really a problem?

I once thought it was my flaw. A sort of OCD I developed over time. I re-read everything I write over and over. I am compulsive about how & where I keep my possessions. And anything I do or buy needs to be Googled to ensure I’m making the right choice.

This all takes an excessive amount of time… But is it a problem?

The Perfectionist Entrepreneur

So let’s explore this. Does striving for that little extra create a problem within your life, relationships and business building efforts?

I’ll give you my thoughts, then open up the floor for debate. Cool?

Does it guarantee quality?

First and foremost, with all the constant nitpicking of my efforts, I have noticed that the end result is of extremely high-quality. While I understand nothing is perfect, striving for perfection has created some remarkable outcomes, far exceeding my initial vision.

Had I simply settled for ordinary – or even slightly extraordinary – I would never had accomplished a lot of my feats in life.

Can it minimize mistakes?

I despise the feeling of buyer’s remorse. And I especially dislike ending up with something I loathe. I would imagine we all do.

But when it comes to business decisions, striving for perfection is an extremely important skill. Especially when some commitments made in business are life altering.

Losing sleep before deadlines?

Nothing can ever be good enough. I often find myself up all night before a deadline tweaking my work. (And it’s not like when I was in school, procrastinating beyond belief until the night before a due date.)

These days, it seems like whatever the task is, I can’t stop thinking about it, refining it, adding to it until I absolutely must declare it finished. And while I’m not sure this is a flaw, it definitely isn’t enjoyable in the long run. Because there is always something next.

Will it up the image?

The perceived value rises as a result of the first three points. Whenever I spend ridiculous amounts of time working on something, improving the tiniest of details, it tends to be noticeably better.

For instance, when I was a web designer, I would have a site technically done in a few hours. But I would then sit for days, sometimes weeks, staring at the site’s design & code, searching for anything that I could improve. And this, as you can imagine, didn’t make me a terribly efficient designer. But it did make me extremely effective in delivery.

But is there diminishing returns?

The Law of Diminishing Returns seems to come into play here as well. And working too much on one project may result in quality declining. However, since I put strict deadlines on most everything I do, I luckily seem to rarely notice this.

Ultimately…

While I dislike the constant hassles, and the endless nights working much longer than I probably should on my projects, I thoroughly enjoy being a compulsive perfectionist.

What do you think?

Are you a perfectionist? If so, how do you approach work? Are deadlines the only reason you declare something finished?

And if you aren’t a perfectionist, what are your thoughts on those who overanalyze everything?

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I despise most networking events.

Of the countless networking opportunities I’ve been invited to, I oftentimes decline. Mostly because they are at the crack of dawn and require me to use a handful of alarm clocks to successfully wake up… Only to meet a bunch of self-serving business people.

But when I do take the plunge and attend networking events, it’s for one main reason:

Experimenting with Interactions

Where else can you go into a room filled with dozens of business people, all wanting something from you?

Whether it be to give you their business card or sell you something, most people’s intentions at networking events are egocentric. And this makes them perfect guinea pigs for testing business interactions, communication techniques and a multitude of other people skills.

Step 1: Determine the Variable

The variable is the one factor about yourself you would like to test and improve.

Is it how people respond to your profession? Is it your sales skills? Is it how you flip conversations in your favor? Is it your elevator pitch?

It can be anything.

Step 2: Maximize the Constants

In order for an experiment to yield statistically significant results, you have to identify as many unique components of yourself as possible. These must stay the same throughout the event.

This may come in the form of what you say, how you hold your drink, the way you smile, etc. Every aspect that isn’t being tested during the experiment must be painfully similar in each interaction.

Step 3: Start Networking

If you’ve been to a networking event before, you know the procedure. But keep in mind as you approach people, be sure to keep the way you introduce yourself constant. (Unless the intro is what you are testing, of course)

Step 4: Discover Your Test Subject’s Disparities

Not only do you have to track yourself, you must also take a mental note of the differences in people you talk to. Mainly, the three to concern yourself with are:

• Their personality (analytical extrovert, amiable introvert)
• Their experience (fresh newbie, experienced executive)
• Their outward characteristics (middle-aged male, young female)

These variables should be relatively easy to spot. But are essential to your test’s accuracy.

Step 4: Get to Testing Your Styles

Here comes the fun part. Now that you have a good grasp on how to carry yourself. As well as identifying the variables within your networking guinea pigs, you can now get to testing.

However – and this is important – you must test only two or three different styles. And test each style multiple times with a wide variety of people.

Step 5: What’s Working?

As you continually chat with others you will begin to see what styles resonate with certain people. And also see what doesn’t.

It’s important to start crafting your style only around what works, forgetting what doesn’t.

Step 6: Success

In short time, this strategy for networking events will help you become a master at social interactions. And ultimately, your abilities will constantly be enhanced through this near scientific approach to learning social skills.

What’s you’re thoughts? Have you tried this?

(photo: PerformImpact)

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As we settle into this second decade of the 21st century, our world is rapidly changing. Moore’s Law, which states technology doubles every 18 months, is fostering an exponential growth in the way we conduct business and live our lives. Or so it seems…

We can video chat with a business colleague in Japan via Skype, effectively creating a global business landscape.

We can track the exact distance and how many calories burned during our last run via a smartphone app, signifying our growing integration of technology into our everyday lives.

But what notable changes have we seen in the world of education? In our pedagogic foundation for which our entire lives are based?

America’s Population of Products

Our industrial-age mindset still holds prevalent when thinking about learning. That we are nothing but products on a factory line. And after 18 or so years of systematic construction we are sent out into the world, a “finished product.”

“Intellectual growth should commence at birth and cease only at death.”
- Albert Einstein

However, this age-old mentality doesn’t work anymore. If you truly want to stay on the top of the education hierarchy, there must be a smarter way to learn. And it shouldn’t be generically designed for you by someone else who thinks they know what’s best. There’s got to be a revamp of our frame of mind towards educational design.

Grade levels based upon age not skill, graduations signifying completion, and a multitude of other preconceived notions of an educated life is our downfall. And ultimately, will become our failure as a society.

So this, from my eyes, is where we stand: A nation filled with undervalued educational beliefs. That a piece of paper on the wall is all that is needed to succeed in the world. And most unfortunately, that education only happens in the classroom.

The questions I pose:

Do you think Americans, in general, stop learning once they graduate school?

How can we start (or how are you) integrating technology into education?

What can be done to shift the mentality of those who rarely pick up a book?

And if books are becoming the unpopular way to learn, what are the alternatives?

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When was the last time you hopped out of bed, excited for the day to begin? To wake up with a smile on your face, knowing you have the chance to improve the lives of others around you? For most, it’s been far too long. And for some, it’s a daily routine.

But why is this?

In the history of the world, it’s never been easier to do what you love. To work where you want, when you want, if you want. And create remarkable lives for you and your loved ones. But it’s only possible with a passion for what you do.

The Hard Truth

Your passion takes money. It’s true. Those who say money isn’t everything, hasn’t lived without it for long. I’ve had days I was unsure if I’d be able to eat while praying my cell-phone isn’t disconnected and hoping that my last pair of jeans didn’t rip further beyond repair. Trust me, money is a necessity.

Don’t get me wrong, money does not cause success nor happiness. Money is simply the gateway to doing what you love. It creates the ability to help others, to travel the world, to support your favorite charity or whatever else you dream of doing.

But you will never achieve the financial strength needed by working a bullshit 9-5 job for someone else. Current business owners will agree with me on this. The only person getting rich in the corporate world are the owners, not the doers.

“Entrepreneurship is living a few years of your life like most people won’t, so that you can spend the rest of your life like most people can’t.”
- Unknown

So where does this leave us? Current wisdom tells us that if we go to college and get decent grades we’ll get a great paying job. Kiss your boss’ ass for 40-50 years, invest in a 401k and hopefully you’ll retire a millionaire. This advice is utter bullshit.

I don’t know about you, but I’d prefer to do what I’m passionate about today. To live the life I dreamed about as a kid. To support my parents who devoted their lives to supporting me. And wake up happy.

The Balancing Act

In comes this blog, The Edge of Innovation.

Greg Hartle and I have decided to help you find your passion while growing your business. And to cease your objections before they begin; a business should not require millions of dollars to launch. Nor a large factory and countless workers.

Today’s business models can be based on a laptop and Internet connection. One that utilizes innovative strategies mixed with the latest technology. And most importantly, a business that opens up a lifestyle conducive for helping others, for following your passion.

Does your business need to be your main passion?

No. Mike Rowe will tell you that someone needs to do the dirty jobs. But at the end of the day, whatever business you’re in must improve the lives of others. As well as facilitate a better life path. And ultimately, strive to create unlimited wealth beyond your wildest imagination. It’s possible.

We Need You

But no business owner will be able to enjoy their passion if they get stuck in the business. Becoming overworked is never fun, no matter how much you initially enjoyed the work. Therefore, this blog will act as an occasional motivator, instructor and mentor. Not just from Greg and I, but from you, the reader. We, in no way, feel we have all the answers. So the community that will be formed around this blog will be asked for input and advice. Lurkers are welcomed… but to truly receive the best benefit from this chronicle of business building concepts we hope you’ll ask questions, pose alternatives and hopefully become a regular contributor.

We look forward to the future with you.

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