Lateral Capital Management, LLC

Recognizing Success: Ways To Say “Good Work”

Early Stage companies have more people talking to them about business “culture” than they can possibly listen to. It’s the topic du-jour in Silicon Valley and thus everything you read. This note isn’t about culture. It is about reminding CEOs that they and only they can be the “Thanker in Chief.”

There are hundreds of books on how to create the “right” program for recognizing and rewarding (R & R) people for their work. There is no right, but there are plenty of wrongs. As our Early Stage companies think about their R&R programs, we offer the following thoughts:

  • Build your own R&R philosophy. Our view is that whatever you do, recognizing success in your company should include everyone in your organization; not just the Sales people or the top managers. This is based on the conviction that having “one team” pulling on one set of strategic ropes is key to success.
  • Make R&R an everyday affair. R&R isn’t just about what kind of performance earns a bigger bonus. Your bonus program is a hygiene factor; part of the compensation “table stakes” for every employee. What we’re talking about here is what makes people delighted with their work every day; what turns their work from a job into a calling.
  • Custom Design your rewards to drive specific desired outcomes. Having one program for all employees makes life simple, but it’s like buying a pizza lunch every Friday. It rewards everyone equally and after the third week, it’s part of the compensation package which you had best not take away!
  • Time recognition to fit the contribution. We aren’t big fans of the “contest” school of rewards. Naming an Employee of the Year or Month is better than no recognition at all. But again, it decouples the performance you want to see from your recognition of it. Better to catch someone doing something right and recognize them on the spot, in public. And for heaven’s sake, remember that the best parking spot in the lot should be reserved for your best customer, not the Employee of the Month – or worse, you!
  • Great R&R Programs. The best kinds of Recognition and Rewards are authentic and personal. They come from the heart of the organization, but particularly the heart of the CEO. It really doesn’t matter what the recognition is, as long as it is directed against a specific strategic priority; something that really is key to success for the company. In other words, you want to recognize and reward the behaviors that will make your company bigger, better, sooner.
AwardRecognition For
Lunch with the CEO

A cross-functional work team which deliver a project ahead of time and underbudget. Rewarding the team as a group tells people that the best work happens when a team pulls together and that you want to encourage teaming behavior in the company. Make the lunch special by having it outside the office, even if it’s the local Chipotle.

Time Off to Volunteer

Many employers share their “Why” with a particular non-profit. This could be a corporate program (like Delta Airlines with breast cancer research) or a cause of the employee’s choice. When you support volunteer time that aligns with the “Why” of your company, you remind people that there is a bigger long-term purpose than simply making money.

Family Recognition

For an individual performer, a night out with a significant other (SO) can be very meaningful – particularly if the person involved has been working a lot of overtime, taking them away from their family. It allows the employee to say to their SO, “See, they do recognize all the work I have been doing.” But don’t just give them a gift certificate. Call the restaurant ahead of time; arrange for flowers or champagne and a personal thank you note from you at the table of the employee – and their significant other.

Professional Connections

Staff people in accounting or R&D are key to your organization’s success. But they identify strongly with their profession as well. Working in a small company may make them feel cut off from their technical peers. So sending them to an annual conference or paying their professional association dues (often at a cost under $100.00/year) can be very meaningful. This would make particular sense if you see the need to hire more people in specific fields. Remembering: Most new employees are “found” by current employees.

Educational Development

Today, employees recognize that maintaining professional skills requires constant updating. Sending a lab technician to HPLC training at a nearby college or purchasing professionals to a negotiation seminar will take them out of the office for 2-3 days. But it says that you value them enough to invest in their future – and that you expect them to grow in their professional skills. This would be consistent with a strategic objective to reduce turnover or even to limit the need for additional people by “training up” your existing staff.

Finally, you do not have to establish “Annual Traditions” (like a holiday party) unless there is a reason to do so. And don’t worry about starting something you will have to do “all the time” just because you did it once – especially if there is no above-normal performance to recognize. Let your instincts guide you. But by all means, say thank you.