Blog from John de Koning, Managing Director Marketing technology with Incentro on Linkedin.com, May 2015. Why focussing primarily on financial outcomes, when the only production factor that can create value is the human being? Choose for employee happiness!

During the last months, I had a lot of great discussions with clients and other parties about our culture as main differentiator. At Incentro, we’ve embraced the ideas and vision on employee happiness from Ricardo Semler. We believe that if you make employee happiness THE number 1 priority, clients will be happy and positive financial results will follow naturally. Most companies are still managing the other way around; they put financials and shareholders value in front (and manage pie charts and MS Excel sheets) instead of paying attention to their people. My question is: why focussing primarily on financial outcomes, when the only production factor that can create value is the human being? Wake up! Focus on the happiness of your people!

One thing that stimulates happiness is empowerment. At Incentro, we take this very seriously. The ultimate goal: to make myself as a manager irrelevant! Step by step we’re taking empowerment and self management to the next level. Recently, we did something ‘disruptive’, even for a company as Incentro. We decided that employees should decide about the increase of their own salary for 2015…..A crazy thought or a very good idea?

What did we do?

We started with an introduction evening on finance and general management. We showed everyone ‘how Incentro works as a company from A-Z’ and discussed several scenario’s, outcomes and their consequences. It was a very energetic session with a huge attendance (90%). After that, a survey was send to all employees with two questions:

1. What salary percentage (raise) would you suggest for 2015 (in percentages)?
2. What is the motivation of your choice?

We had a second evening to discuss the results.

Results

What happened next was incredible cool! Although the survey was anonymous, every single colleague explained his answer and motivation. Even those who wanted a huge raise (between 9-12%)! If necessary, a group discussion (about what’s the best for myself, for us as a group and Incentro in general?) followed. After these useful interactions, people had a change to adjust their answer based on their new insights. Some lowered their percentage, others increased it. For us a a management team, that was ultimate form of empowerment and self management!

So what about the percentage? In 2014, salaries increased with 4,5%. At the end of the second session, there was a final percentage of 4,9%…..

This is just a number. The side effects were even better: there is a great understanding of ‘how Incentro works’, employees feel even more empowered and the Incentro Rotterdam happiness score has never been so high (measured by Great Place to Work® institute). Experiment successful!

Tips and trucs for other companies

After this great results, I collected five practical tips for companies who would like to do the same:

1. Read Ricardo Semler’s books

In his books, he describes the transition from a traditional business, which focuses on sales, profit, and efficiency, to an organization where you focus primarily on the happiness of your employees. We adopted this philosophy, believing that financial results will follow naturally. It works!

2. Make employee happiness priority number 1

Pay attention to the workplace design and look for mechanisms to stimulate happiness. For example, if you give people room for entrepreneurship and the chance to participate in decisions they are automatically happier. Scientific studies show this. We work as much as possible with self-directed teams that are actually independent businesses.

3. Give complete trust

If you give people unconditionally trust they will act accordingly. The management team might be skeptical, because what if the employees decide on a 20% salary increase? My advice: don’t govern by fear. Because they were trusted, our employees handled it very well. If you have the courage to let go and give them trust, your people will use it in the right way.

4. Make the decision-making process transparent

In order to make the right decision, people need the right information. Therefore, we invited everyone to first take a look inside Incentro as a company, since we want people who work daily at client sites to have a complete picture of how the business works as well. In that way, everyone understands the consequences of decisions for the company in general and knows how to make sensible choices for the interest of the business, rather than personal interest.

5. Be critical at the front door

Everyone was enthusiastic about the process, but this is also because we look closely at people’s attitudes during interviews. First, we look if there is a cultural fit. After that, we look at hard and soft skills. At the end of the day, we are technical specialists, but we expect more from ‘Incentronauts’. If there is no match on our core values Happiness, Specialism and Ambition, we say goodbye, even if it is a technical genius….

Good luck, don’t worry, be happy!