Recognition for the Common Good
Recognize that recognition can be bad. While Dustin was working for a Utah based multi-level marketing company, he was privy to multiple instances of top performing employees being recognized on a company-wide level. This type of recognition program is all over society: sports, sales, education, and work. This brought on a new research idea; Does recognizing top employee’s performance motivate the rest of the employees? In conjunction with UVU digital marketing professor, Mitch Murdock, research began.
From our last episode, Sell them on Renting, we found that peer comparison can be demotivating when one compares themselves with someone who is considered a professional. It made us wonder if top performer recognition within a business atmosphere was wrong, and if there was not a better way to do this. From this idea the concept of a Recognition Ladder was born, new employees can compare their abilities with other new employees’ abilities and more experienced employees can compare themselves with someone of similar equal ability.
At Dustin’s multi-level marketing company, he conducted a study with a group of brand-new distributors from the company, new individuals that had signed on to distribute the company’s products. Each distributor was randomly assigned one of two groups and was shown a collection of made-up profiles of other distributors. The first group was shown statistics of individuals who performed highly and had exceptional achievements, people that made millions while beating the rest of the field. The second group was shown statistics from novice individuals of past groups, like those taking the survey. We followed the performance of both groups of distributors for the month following the survey to see how much revenue they generated for the company. This led to an unsurprising discovery, the group that was shown the novice profiles significantly outperformed the group shown the exceptional profiles. The activity percentage of both groups followed a similar trend with the novice group having a 66% activity rate, while the exceptional group only maintained a 50% activity rate.
It shows that if you are looking to recruit or inspire employees, they need to be grouped by performance.
When further testing the hypothesis, we conducted a second experiment. We gave two groups a list of essential oils that they could purchase from a mock company and then asked how many oils they would be willing to purchase from this company. One group was shown an average performer success story and the other was shown an exceptional success story. The group that was shown the average performer success story, on average, said they would purchase significantly more essential oil bottles than that of the higher performer group.
This effect applies to businesses everywhere. It shows that if you are looking to recruit or inspire employees, they need to be grouped by performance. Then new ways must be found to recognize individuals in those groups. This will boost confidence levels and help individuals to move forward and progress while simultaneously improving the company’s overall bottom line.