Individual performance, rewards and the team

Posted By on January 13, 2010 in Teams | 12 Comments

A while back I heard a comment that some people were worried that moving to scrum would have a direct affect on their ability to gain financial rewards as scrum was based on the team and not the individual.

I’ve thought about this over time and realised that this is an ingrained cultural issue that is maybe prevalent across the whole industry.

Now of course different members of a team may well be on different salaries for different reasons.  Market forces for example will dictate levels of pay for certain roles, its likely that it will cost you more in salary for someone recruited to a company than maybe it would for someone grown organically within the organisation.

Often however following someone’s initially salary, financial reward or pay rises have been given based on people’s personal performance or perceived performance, it could be there is a hierarchical structure that you move up based on certain criteria.  This has been on going for many years so when people hear that we succeed as a team, we work as a single team and we win or lose as a team then I can understand how they may be concerned with how it affects their yearly financial rewards in terms of pay rise etc.  I don’t see however that just by moving to scrum an organisations method of determining pay rewards would change and in fact I am very confident that it doesn’t and the methods of reward remain unchanged.

If we examine the topic further and take the current approaches to pay rewards what issues may this cause in relation to working with a scrum team?  If financial reward is based solely on individual performance perceived or otherwise then this could lead to a hero mind set.  People may take on over bearing workloads, work excessive hours, with hold information from other team members, not help other team members and let the team fail as long as on an individual level they succeed and ultimately ensure they make themselves look good so that come financial reward time they will get the lions share.  This I’m sure we would all agree is not the best place to be when we need to work as a team to deliver successful projects or products.  In addition of course if everyone took this approach there would be a high probability of project failure and this may reduce the desire to offer any financial rewards from the company.

So how can we change this?  Well if we work as a team, deliver as a team and win or lose as a team then surely we should be rewarded as a team.  If the team is successful then the team is rewarded, if they are not successful then the reward is reduced.  If we took this approach then what mindset would this promote?  If people are measured as being part of a successful team then this will encourage a mindset of one of a team player, ensuring it is the team that wins and not individuals at the expense of everyone else.  Workload would be shared out, information cannot be withheld and people will willingly support and help each other.  They will do this as they will know from a financial aspect it is to their benefit.   We should focus our rewards on successful teams delivering working software and individuals displaying the characteristics that move the team as a whole forward. This method rewards teamwork and successful teams and not successful individuals at the expense of the team.  If all the team work together towards common goals and objectives and not as a set of individuals then there is less likelihood of project failure and therefore the organisation may have more money to offer in terms of financial reward.

Some people may say that this would allow weaker team members to hide away but would this really be the case, this in fact may draw them out more quickly, people will need to be on the top of their game and be adding value to the team in the best way that they can for the team to succeed and in fact may breed higher performing teams.

Over and above this what about the case where we do have outstanding individuals, they may work well in a team and tick all of those boxes and we may want to reward them highly to retain their services and avoid them being tempted to go elsewhere, how do we reconcile this and cater for this scenario?

Now I have been extreme in how I have painted the picture and somewhat simplistic, people and teams are not really at such opposite ends of the scale and of course there are many other factors at play in how teams function and work together other than financial reward but the question remains how do you align individual rewards against the team ethos which in essence was the comment that I heard.

I don’t think these are questions that a scrum team can answer,  this is far deeper and far more in grained and cultural, we would need to change the entire organisation to think in this way and indeed would need to change the way financial rewards are seen and dealt with.  This would be a big ask of any company or industry.

Will we ever get to rewarding by team as opposed to individual? I don’t know, maybe there is some aspect of this already with team bonuses and maybe they need to co-exist along with individual reward as opposed to individual rewards being replaced.   Maybe we need to find a happy medium that recognises and rewards the team, with team work being paramount but can also recognise and reward individual excellence as long as it is not to the detriment of the team or encourages hero behaviour.   

Do I think we should get to the position whereby scrum teams are rewarded as a team based on team success?  Yes I do, will it be something that I will see as common practice in the medium or maybe even longer term?  Probably not, that is within the hands of individual organisations and down to industry trends. 

Indeed maybe these questions throw up many more questions in themselves and this whole topic is one of extreme complexity with many factors at play whether this is at an industry level, organisational level, team level, individual level and even down to the culture within the country that you operate.

About Tom Reynolds

With over 25 years experience of working in IT, Tom prides himself on being a “passionate, self-driven, energetic Agile Coach, Trainer and Change Agent.” Tom has a proven track record delivering scalable enterprise software to major blue chip clients, as well as a proven ability to guide teams and organisations to help them to adapt to life in an Agile environment. Contact Tom

12 Responses to Individual performance, rewards and the team

  1. CharlieinJax

    Our experience is that working in an agile team does not make it harder to be recognized. In fact, it tends to make visible those who do not perform well and clearly shows when people are performing at peak (every day in every scrum meeting).

    Working in this environment not only reveals the team member’s inherent technical skills, but also intangibles like courage, communication, orientation toward team and the desire to win.

    • Tom Reynolds

      Yes I agree from a scrum perspective everything should be very transparent and indeed the daily scrum meeting does make it visible the team members that are performing well. It’s interesting but very true that you also see peoples other less tangible skills coming to the fore, those people who willingly help to spread knowledge, help others etc. You can also see this in retrospectives and planning meetings, some people maybe more engaged than others.

      So in terms of rewards then yes peoples individual contributions can be easily seen as one of the fundamentals of scrum is transparency so this should not be a cause for concern for anyone and hopefully by working with scrum we can encourage good team working habits that benefit the team and the individual so that everyone can grow.

  2. Very interesting post. I agree, the weaker individuals will find their own forte. Many people prefer to work in a team/scrum enviroment, as it gives them the courage to put forward plans which they may not necessarily do on their own.

    We are by nature pack animals, as such working in a good team enviroment satisfies this side of our genetic make-up.

    That team work is a valid way of working is well illustrated by looking at successful athletic teams, who by playing together win the highest accolades.

    I do not feel it in any way dimishes the individuality of any one person. Within a team enviroment there is a need for all types of people, all with different skill levels.

    • Bob

      Mary: “We are by nature pack animals”: I’m assuming that you mean “pack” like in a wolfpack vs. pack animal as in donkey/horse/mule;-) If that’s the case, then I would have to agree.

      Tom: Sadly I must also agree that a great deal of change will have come about at the cultural level before companies can learn to create spaces that promote intrinsic motivation effectively enough to make financial incentives a thing of the past.

  3. Ignoring for the moment that financial rewards don’t have the positive effects that many seem to search in them, rewarding teams still has the dysfunctional effect of putting teams inside a company into competition to each other.

  4. Tom Reynolds

    Hi Ilja,

    Completely agree that money is not a motivator which was borne out by research by Frederick Herzberg in his work on motivation and hygiene factors.

    However individuals still want to be paid for their job and generally speaking have been conditioned into thinking that if I’m good and do a good job my salary will increase and will increase more than someone who is not perceived to be as good so people clearly have fears about moving to a more team motivated environment and how this personally affects their salary review, this was the comment that I heard so needs to be addressed in some way.

    On your second point would this really put teams inside an organisation into competition with each other? In my organisation different teams deliver customer projects to external parties and therefore they are not competing with each other anyway, their goal is to deliver the project and we of course want them to deliver this as part of a team working together. If an extreme mindset was promoted that if you personally succeed you will be rewarded then that would no doubt be to the detriment of the team as people would look out for themselves, whereby reward for the team would create the mindset of the team succeeding which is a much better mindset for delivering projects.

    If you had multiple teams working on the same project then I think the success would have to be for the whole project and not for individual teams within it, after all the goal is the project and not part of a project.

    Personally I think this whole topic is one of great complexity and how you balance the needs of the individual and the needs of the team to positively promote both at the same time is a balancing act.

  5. What with those projects that fail or are wildly successful due to outside circumstances? What about the necessary failed experiments? Would it really be fair if my salary depended upon what project I’m happen to work on? Would there not be a competition about getting on the best projects?

    What if one project team needs the help of another team, in terms of labor or knowledge? Why should they waste time helping each other?

    To my knowledge, studies show that for salary to be perceived as fair, your best bet is to base it on “time span of discretion” and job-complexity.

  6. Tom Reynolds

    Hi Ilja maybe you mis-understand what I’m saying.

    I’m not suggesting that salary review is based solely on the performance of the team, but the conclusion I’m being drawn to is a combination of the team and the individual with the balance set to an appropriate level whereby individual performance alone at the detriment of the team is not recognised and is not rewarded. If we focus only on the individual it would create a position of every one individual out for nothing other than themselves which in my opinion would create a very poor working environment with people stepping over each other to succeed at all costs with lots of office politics with absolute ruthlessness. I have witnessed this sort of extreme mentality although thankfully not within my organisation.

    Projects fail yes and they fail for lots of reasons but in my 20 plus years of software development I have not come across a project that has been wildly successful through outside circumstances, they have been successful based on good project teams with good customers who wanted to truly partner with the teams building the software. In my environment of a software house we don’t have failed experiments as such as everything we do is commercially driven by our customers.

    Would individuals want to get onto the best projects, yes of course but they may want to do this anyway irrespective of monetary value, people like to succeed and be on teams that succeed. It may also have the opposite affect and they may ask why isn’t my team as good, how can we make our team as good as them?

    I shall look up your links on the Google board and also have a look at “time-span of discretion” thanks for the pointers.

    In terms of job complexity, how is this measured? What if I had someone on my team who’s job is not as complex as someone else’s but without them doing their piece the project would fail completely, are they not worth as much as someone with a more complex job but if they failed you would not have a failed project?

  7. Hi Tom,

    I agree that it’s good to emphasize team performance over individual performance. What I’m saying is that *company* performance is even more important, and therefore probably should be the primary factor for determining salary.

    As you say, there are already forces at work that make people want to work on successful projects, even without monetary incentives. So monetary rewards are hardly necessary. What adding money to the equation does, though, is pushing people from social norms (“what’s best for the community, i.e. the company”) to market norms (“how can I optimize my salary?”, “why is he getting more than me, although I work as hard?”). See the book “Predictably Irrational”.

    Regarding your last point, as far as I understand the findings of those studies, the point is exactly that “how much is this person worth to the company” is actually *not* a primary factor for the salary *to be perceived* as fair.

    After all, “this project would fail without this person” is often a highly subjective statement.

  8. I’ve always wondered how the agile process would be affected by monetary incentives. Take an extreme example: the team only get paid if they deliver all the goods for a sprint.

    From an investor perspective, agile is interesting in that I get appraisal gates on progress at the end of each sprint.

    From an agile contributor viewpoint where do the same incentives fall?

    • Tom Reynolds

      Putting aside the fact that money is not an incentive given the extreme example you would not have a team as they would all leave and no one would want to be on a team like that.

      But what are the incentives for an agile team?

      From my experience and feedback I have received in different forms from team members the incentives are much more geared towards people as human beings. They are incentivised through the fact that they are empowered, more in control of their own work and how they do it. There is a high degree of collaboration which allows them to feel part of a team and to interact with people and the customer; they get rapid feedback on their work both good and bad that allows them to alter what they do for the future. If you do agile and scrum well then the team work in a trusting environment, they are allowed to get things wrong without blame being apportioned but over time they are incentivised by being able to see themselves and the team they work with grow and thrive and produce astonishing results, it is producing astonishing results and results to be proud of within a trusting, collaborative and empowered environment that are the incentives for agile teams.

      Tom

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