benchmark.
The second week, Stack upped the ante, offering the workers coffee
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and rolls if they could beat the previous week’s mark. He was increasing
the goals gradually while consistently offering more rewards. The fol-
lowing week, he offered the employees a double bonus: not just coffee
and rolls, but pizza and beer. Moreover, these would be served in
Stack’s own home. The employees exceeded their previous benchmark,
and Stack served 200 people pizza and beer in his home. ‘‘It was the
first time that anyone in management had ever . . . actually told them
how they were really being evaluated,’’ muses Stack.1 But goals do not
always have to be set low and increased gradually to be motivating.
When Charles Heimbold, CEO of Bristol-Meyers Squibb, had his first
meeting with his managers in 1994, the company was doing reasonably
well. Whereas Stack’s biggest danger at Springfield Re was desperation,
Heimbold’s was complacency. ‘‘I brought everyone together and said,
‘We’re going to have a doubling of our sales and our earnings per share
by the end of the year 2000,’ ’’ he reminisces. This was a much higher
growth rate than had ever been achieved before. ‘‘When you repeat
these expectations frequently enough, you can get people to understand
and buy in. People start to say, ‘Yeah, maybe we can do that.’ That’s
the feeling I wanted to create. I wanted our people to believe.’’2
Both the early Hebrews and Christians were struggling sects who
were fighting to maintain their very existence. Numerical gains in the
membership were small. But both groups motivated themselves with
longer-term goals. The Hebrews believed in God’s promise that they
would some day be as numerous as the stars in the heavens. The apostles
believed that some day their tiny ‘‘sect’’ would have more adherents
than any religion in the world. The constant repetition of these expec-
tations by a succession of strong leaders explains their long-term success.
But even in the Bible (and certainly corporate America), intrinsic,
spiritual rewards are not always enough to motivate for performance.
David was a courageous man and great leader, but he was also offered
material and other incentives for killing Goliath. ‘‘The king will give
great wealth to the man who kills him (Goliath). He will also give him
his daughter in marriage and will exempt his father’s family from taxes
in Israel.’’ (1 Sam. 17:25)
The heads of modern corporations do not give away their daughters
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as performance incentives, nor can they exempt their employees from
taxes, but they do use monetary rewards. Bernie Ebbers of MCI World-
Com makes certain that everyone in the firm has stock options and so
is paid like an owner, much like David increased the sense of ownership
in his ‘‘mighty men’’ by making sure that all received a share of the
spoils of war. Says Ebbers, ‘‘You can’t go through the building without
seeing charts . . . showing them what those options are worth.’’3
Charles Heimbold, CEO of Clairol, also makes sure everyone in his
company has stock options. He reasons that if he gives people owner-
ship, accountability, and knowledge, they’ll contribute more to the
company’s success because they can see the link between their perfor-
mance and company performance. One example was Clairol’s Herbal
Essences, a product that was introduced in the 1970s and lagged terribly
in the 1980s. Everyone on the Clairol team knew they needed to repo-
sition the product or ditch it. In a company where performance was
not as closely linked to reward, it would have been ditched. But Clair-
ol’s team saw the product’s potential, and they repositioned it for the
Generation X and thirty-something market. Sales soared, as did the
value of everyone’s stock options.
INSPIRATION
People do not respond just to ‘‘hard dollars,’’ however. Inspiration by
a leader often plays a major role in spurring people on to maximum
performance. Moses inspired the Hebrews to traverse a desert in pursuit
of the ‘‘land of milk and honey.’’ Nehemiah inspired people not with
money but with a goal that was larger than money—the reconstruction
of the wall around Jerusalem. And Jesus attracted his first disciples with
an inspiring new paradigm: ‘‘I will make you fishers of men.’’ They
were transformed simply by joining his organization, before they per-
formed a stitch of work.
At Novell, Eric Schmidt has an annual dinner as part of the Presi-
dent’s Award program to honor unique, substantial individual accom-
plishment. Spouses are invited, plaques are awarded, and for good
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measure, so are stock options. ‘‘These are simple gestures, but it’s amaz-
ing what they do for people. Recognition like this makes it much
harder for them to leave the company; and it keeps them much more
engaged in their work.’’4 By inspiring and recognizing people for
achievement, Schmidt makes it more likely that this is not the employ-
ees’ ‘‘last supper’’ with Novell. As with Jesus’ disciples, gatherings like these increase group cohesion and motivation and remind all of the
inspiring mission of which they are a part. And those who have not yet
earned the award are inspired as well.
Ray Gilmartin, CEO of Merck, is quick to point out the necessity of
inspiration if a leader (and the company) is to be successful. In choosing
his leadership team in 1994, Gilmartin selected people with a balance
of skills. Yes, they had to have the right skills. But they also had to be
‘‘people who demonstrated the core values of the company, people who
would inspire our employees.’’5
One way to inspire is to set large goals. Says Dave Komansky, chair-
man and CEO of Merrill Lynch, ‘‘You’ve always got to ask more of
yourself and your people than either you or they think can be accom-
plished. If you ask someone to climb a four-foot wall, they’re going to
climb the four-foot wall and feel great. Chances are, if you had asked
them to climb an eight-foot wall, they would have climbed that wall as
well, but you never asked them and they didn’t think about it.’’6
Joshua had an advantage as he approached the walls of Jericho. His
people could see the wall and exactly how high it was—impossibly high.
The only way to knock it down was through a new method—a new
paradigm that had not been tried before. Fortunately, Joshua’s motiva-
tion was very strong, and he communicated that resolve to the rest of
the organization. He also must have recruited some pretty mean trum-
pet players!
Inspiration is not just needed when major obstacles (like walls, kings,
deserts, and famines) loom ahead. Sometimes people are feeling disem-
powered and demotivated because of mistakes they have made in the
past. The best leaders stay committed to the ultimate goal even when
they or their followers have committed ‘‘missteps’’ as they strode
toward the goal.
When King David instructed his son Solomon to build the temple in
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Jerusalem, he warned him, ‘‘don’t be discouraged by the size of the
task.’’ (1 Chron. 28:20) Solomon knew that he was an inexperienced
young man and would probably make some mistakes as he proceeded.
His father’s wise words included the implicit encouragement to be un-
fazed by errors.
In an undertaking the size of Solomon’s temple, errors are inevitable.
After all, he had 70,000 carriers, 80,000 stonecutters and 3,600 foremen.
He ‘‘overlaid the ceiling beams, doorframes, walls and doors of the tem-
ple with gold’’ and the inside of the Most Holy Place with ‘‘talents of
fine gold. The gold nails weighed fifty shekels . . . he made a pair of
sculpted cherubim and overlaid them with gold. The total wingspan of
the cherubim was twenty cubits.’’ (2 Chron. 3) What do you think
would have been the effect on this project and the team that completed
it if Solomon had been preoccupied with errors and ‘‘waste’’ instead of
the success of the overall mission?
In the early days of W. L. Gore and Associates, when Gore-Tex was
still on the drawing board (and the company had scarce funds for ‘‘ex-
perimentation’’), a group of engineers wasted $1,000 worth of material.
‘‘We were just standing there with long faces,’’ mourns one of the engi-
neers, ‘‘and Bill Gore walks up and says, ‘What’s wrong, guys?’ and we
said, ‘Well, we just put $1,000 of scrap on the floor.’ And he said, ‘Try
it again tomorrow. I know you can do it . . . And he walked away.’ ’’7
Bill Gore had the foresight to know that some day $1,000 would
seem like a small expense in the overall life of his company. He also
knew the power of motivation and demotivation. Confronted with
$1,000 of wasted material, he could just as easily have screamed, ‘‘Don’t
you know we’re working with scarce resources here? We’ll never suc-
ceed at this rate!’’ He could have applied negative consequences. But