I am a healthcare leader who has made more than my share of mistakes. In my defense, some of those mistakes were based on ideas that sounded intelligent in theory, but that didn’t work in practice. Here, I’ll share some of my learnings specifically about aligning teams around organizational goals.
When I started experimenting with aligning compensation with goals, I tried to have each team create their own department-specific goals, and we planned to bonus on the achievement of those goals. My logic was that the sum of departmental achievement would help our whole organization to make progress. The actual outcome was that each department achieved their goals and received their bonuses, BUT our company as a whole had our worst overall economic performance in recent memory. Something wasn’t adding up, and it became apparent that while making and achieving departmental goals improved the department itself, the lack of focus between departments pulled everyone in too many directions. The departmental goals didn’t align us around the most important priorities for our organization.
After this realization, we adopted new strategies that changed how we approach organizational goals as a team. I’ve summarized these strategies into steps below in hopes they might help you as a leader.
Step 1) Determine a single goal that is most important for your organization right now. I have tried to focus on several things at once, with the idea that we can make some progress on all of them and that would be a good thing. My actual experience is that organizations with significant day-to-day work, like running a hospital department, simply do not have the capacity to improve many things at one time. This requires making tradeoffs and explicitly *not* working on some important areas. This is hard because it will frustrate some of your teammates or stakeholders who want something improved, and it will leave you with an uncomfortable anxiety about the priority that is *not* getting worked on.
Step 2) Put everyone in your organization on the same incentive aligned around that singular organizational goal regardless of their function (with very few exceptions). This is hard because there are many team members who will justifiably say, “This is a bad incentive for me because I can’t impact X directly.” This may be true but the importance of the goal outweighs creating perfect incentive alignment. More importantly, can you feel good about rewarding individual team members if the organization isn’t succeeding in general? I can’t. Fortunately my team has found ways to help connect their work to the goal. A winning team that achieves its goals and the morale and satisfaction that comes from that is incredibly valuable.
Step 3) Try shifting from annual to quarterly incentive bonuses based on the “one thing” you’re focused on. You are more likely to make significant progress on one focused goal each quarter than you are to make progress on four goals in constant focus throughout the year. Quarterly bonuses remind the organization more frequently what the focus is, and it allows more “real-time” feedback on your progress. It is important to create a way to “catch up” in later quarters if you miss the first time to keep team morale up.
Step 4) Make the goal and progress as visible as possible. Both progress and failure to make progress can serve as motivational tools – but only if the team is aware of where they stand. A big frustration from our team was that we set the goal at the beginning of the quarter but they didn’t actually know how we were doing on the goal until the end of the quarter. An understandable frustration in hindsight, but we hadn’t figured that out when we set the goal.
Step 5) Review progress weekly if possible. A month is a long time in a workplace, and a quarter is an eternity. We ended up creating a dashboard that one of our team members emails to the whole organization each week. This helps people know how we are doing, and we can adjust accordingly if needed.
These steps are not a perfect approach, but they have worked for us with lots of feedback and adjustments along the way. I hope you might be able to use some components to motivate your team, and that they are as candid with you as my team has been with me throughout this process. Good luck making your organization great!
President, Rural Physicians Group