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Operational Motivation Plan: The Soft Firm Essay Sample

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Operational Motivation Plan: The Soft Firm Essay Sample


The operational motivation plan for the hypothetical company, The Soft Firm, is described. Rather than attempting to overlay a theoretical motivation plan on top of a traditional organizational structure, The Soft Firm seeks to create an organizational structure and culture that is specifically designed to facilitate the motivational factors relevant to the types of employees needed to support the company’s business objectives. For that reason, the motivational plan cannot be discussed in isolation from the company’s structure and operation. This paper focuses on motivational issues and avoids going into detail about other aspects of the organization’s structure and culture, except to illustrate their relevance to employee motivation.

Operational Motivation Plan: The Soft Firm

The Soft Firm has a clear business focus: To provide information technology consulting services to clients in a broad range of industry sectors. Our business philosophy is that the most effective way to satisfy customers is to motivate the workers who are best able to provide for those customers’ needs. Since the core business activity is information technology consulting services, the most important employees are those who provide such services directly. The relative importance of other roles in the company is inversely proportional to their distance from the core business activity.

Therefore, we did not establish a conventional organizational structure and then attempt to overlay a separate motivation plan on top. Instead, we seek continuously to create an organizational structure and culture based on the fundamental philosophy that the needs and preferences of the core employees must be satisfied. The motivation “plan,” as such, is interwoven with all aspects of the company’s operation.

Company Background

The Soft Firm came in to existence as the result of a merger between Andrews Brothers Consulting (ABC) and Visionary Concepts Unlimited (VCU)1. ABC was the larger of the two, and acquired VCU outright. While both firms were information technology consultancies, ABC were specialists in IBM’s Transaction Processing Facility (TPF) serving the travel industry, while VCU were specialists in eBusiness, eCommerce, and the integration of Internet technologies with corporate information systems.

ABC purchased VCU for their expertise in leading-edge technologies, their business contacts, and their entrepreneurial mindset. Within two years, however, the VCU employees had assumed de facto leadership of The Soft Firm. They opened business in new industry sectors, expanded the operation of the company’s software factory to include emerging technologies, and built a successful technical training business on the foundation of the company’s original in-house training facility. When a downturn in the travel sector resulted in the loss of all but two of ABC’s TPF customers and led to the layoff of over 200 of ABC’s staff, the VCU executives bought out the ownership of the company and formally took control.

Fundamental Assumptions

To design an organization that encourages productivity and long-term employment on the part of information technology specialists requires an understanding of the general characteristics of people who tend to choose that profession and the motivational factors to which they respond.

Work-Related Motivating Factors

In general, professional personnel respond best to the following motivational factors:

* Intrinsic interest of the work itself

* Opportunity for professional development

* Work that is meaningful and worthwhile

* Opportunity to meet challenges and solve problems

* Recognition by peers

* Equitable, skills-based compensation

* Flexibility to define methods for achievement of goals

In terms of ERG Theory (existence, relatedness, and growth needs), IT professionals tend to score highest in growth needs and second highest in relatedness needs (Robbins, 2001, p. 161). In the context of their work, “growth” means to learn new things, to meet new challenges, and to expand one’s technical knowledge and capabilities; “relatedness” means one’s relationship to the professional community of one’s peers, especially recognition and praise from peers whose technical knowledge is respected.

In terms of McClelland’s Theory of Needs (Robbins, 2001, p. 162), IT professionals tend to have a strong need for achievement, a moderate need for affiliation, and a weak need for power. It has been shown that people can be trained to stimulate their need for achievement and to approach their work in ways that maximize achievement (Holly, 1991, p. 128). This can be accomplished through a combination of Goal-Setting Theory, Reinforcement Theory, and Expectancy Theory. Since IT professionals tend to have strong achievement needs from the outset, by establishing an organizational structure and culture that encourages high achievement and by providing ongoing training and support, employees can be motivated to maximize productivity while enhancing job satisfaction.

The Soft Firm’s motivation plan includes elements based on the application of Cognitive Evaluation Theory (Robbins, 2001, pp. 164-165) to create and maintain a working environment that encourages self-assessment of competence. According to a model proposed by Guay, Boggiano, & Vallerand (2001), autonomy supportive techniques can help create an environment that encourages positive changes in perceived competence which in turn lead to an increase in intrinsic motivation. This approach is intuitively consistent with IT professionals’ preference to set their own goals and to determine the manner and method of achieving those goals, and their desire to continue professional development throughout their careers. The Soft Firm hopes to gain productivity, long-term commitment, and employee satisfaction as results of developing high intrinsic motivation.

Another work-related motivating factor is the nature of the work environment. Contemporary work environments in information-related fields differ from traditional work environments in several key ways. Of particular interest are the growing popularity of virtual work environments, the use of virtual monitoring and coaching, the dynamic and flexible nature of the workforce, increasing worker diversity, and the aging of the workforce (Gibbon, 2001b, July 8), especially at the high end of the skills scale.

Generational Motivating Factors

The IT professionals available for hire today comprise two major cohorts. One is the so-called Generation X cohort, born between 1961 and 1981, slightly overlapping the Baby Boom generation. The other is an underutilized resource (Matloff, 2001) of tremendous potential (Gibbon, 2001c, July 8): Experienced professionals aged 45 and above.

On the whole, Gen-Xers tend to value flexibility, a balanced life, long-term relationships, and job satisfaction. Employees of this cohort combine those values with the general traits common to IT professionals (Gibbon, 2001a, July 8). The Soft Firm’s motivation plan must take into account the values of this workforce to be successful.

The stereotypical Boomer values hard work, financial success, and achievement, and is strongly focused on career, sometimes to the detriment of personal relationships and personal interests. However, IT professionals of this cohort tend to vary from the stereotype in significant ways. Their strong work ethic is motivated more by a desire to excel than by a drive for position or wealth. They bring a broad base of life experience to the table, along with deep and sophisticated technical know-how. In many respects, their terminal values coincide with those of Generation X.

Therefore, one of the fundamental assumptions on which the motivation plan is based is the belief that the same motivating factors will apply to both Generation X and Baby Boom employees.

In some ways, Baby Boom employees may be easier to motivate than Gen-Xers. Their experience and maturity tends to set their expectations of work differently. The difficulty they face in finding employment (Matloff, 2001) may act as a self-motivator for long-term commitment.

Stereotypes about older IT professionals tend to operate in our favor for recruiting purposes. Our business model demands personnel who are both highly competent and highly creative. A prevalent stereotype about IT workers over 45 is that they are set in their ways and uncreative. The reality is that creativity is an inherent trait. It is not something that fades with age. If anything, a mature person with long and varied experience of life enhances his/her native creativity through that experience. Any older worker who has consistently updated his/her skills in leading-edge technologies probably possesses many positive characteristics of interest to The Soft Firm, including intelligence, proactiveness, enthusiasm, professional commitment, and creativity. Because conventional wisdom fails to recognize these facts, The Soft Firm is presented with a rich pool of desirable candidates.

Cultural Motivating Factors

The Soft Firm has operations in the US and Europe. The subsidiary that handles Web design work for consultancy projects is located in Italy, and the TPF group that supports the two remaining ABC customers is located in Ireland. (Neither of these business units is shown on the organization chart in Figure 1.) The rest of the company operates in a virtual office environment, with employees located in a wide range of locales. These are primarily located in North America and western Europe.

Therefore, western European values and priorities form a part of the corporate culture. Hofestede’s (1993) framework for comparing cultural values includes three western European nations and the US, among others. Of those, The Soft Firm has employees living and working in all except France. The others appear to have broadly similar ratings in each of the five cultural dimensions Hofstede defines. All three rank high in individualism and low in power distance.

Circa 1993, Germany and the Netherlands both ranked moderate in uncertainty avoidance and in long-term, while the US ranked low. However, changes in the values of generational cohorts may have raised the US rank to moderate in both those dimensions by now. Robbins (2001, p. 67) adds a dimension measuring the desire for quantity vs. quality of life, in which the Netherland scored low compared with a high rating for both Germany and the US. Again, changes in the values of generational cohorts may have changed both those countries’ ratings to low, reflecting the greater contemporary emphasis on individual and family quality of life and a balanced lifestlye.

The conclusion to be drawn from this is that similar cultural values prevail in the countries where The Soft Firm has employees. The exception is the Web design group in Italy, which is actually a wholly-owned subsidiary whose employees are not considered in the motivation plan.

Cybercultural Motivating Factors

The technologies on which The Soft Firm focuses most of its technical consulting work at present are the same as those used in the majority of Open Source development projects. Open Source development projects are carried out in a remote collaborative fashion by volunteers around the world, using the Internet as the common meeting ground, shared work environment, and host network for repositories of code and documentation.

Due to the close attention paid to vendor-neutral standards and the need for consistency to enable code sharing and easy integration of packages developed by different individuals and groups around the world, a set of conventions and de facto standards for development has evolved through consensus of Open Source developers. As a result, The Open Source movement has evolved a breed of IT professionals who are completely at home in a virtual environment, accustomed to working as members of self-directed teams, and able to express a high degree of creativity and originality while adhering to a base set of standards. This population spans all generational cohorts and national boundaries.

By creating an organizational structure and culture and a virtual work environment with the same general characteristics as the Internet, using the same technologies as Open Source projects, establishing a development process that supports self-managed teams, and following the same consensual technical standards as those employed by the majority of practicing developers worldwide, The Soft Firm facilitates productivity and encourages a high level of intrinsic motivation in employees.

The Organization Chart as Motivator

An organization chart can be regarded as a description of an organization’s structure and culture, stated in a graphical language. The idea of a graphical notation for a language is not new; an example familiar to information technologists is the Unified Modeling Language (UML) (Alhir, 1998).

The power and immediacy of a graphical language must not be underestimated. Chinese is written in ideographic symbols that are much faster to read than phonetic alphabets or scripts, because the brain need not translate from symbols to sounds, from sounds to words, and from words to meanings. The brain registers meaning immediately and visually. Watts (1975, p. 14) describes the sensation elegantly when he writes, “Alphabetic writing is a representation of sound, whereas the ideogram represents vision and, furthermore, represents the world directly – not being a sign for a sound which is the name of a thing.”

I do not use the word “sensation” lightly in reference to the experience of reading Chinese and, by extension, of reading any graphical language. It has a distinctly visual feel, as compared with reading a phonetic alphabet. Vinueza (2000) broadens the popular philosophical notion that “thinking consists in tokening sentences of an inner mental language” to embrace the notion “we not only think in a language of thought, we also sense in one.” This notion seems intuitively valid based on experience, and is one of the key reasons for discarding the conventional notation for the organization chart.

A prospective employee’s conception of the organizational culture will be shaped in large part by his/her initial visual impression of the organization chart. The first step in introducing a new employee to the organizational culture, then, must be to present a description that accurately and immediately conveys the nature of the culture we wish to cultivate, encoded in a language that is close to the core of human thought: A visual language.

What is the relevance of a visual language to The Soft Firm’s motivation plan? The majority of the most capable and successful professionals in the IT field are visual thinkers. To communicate our organizational culture to them clearly, efficiently, and accurately, a visual representation makes the most sense.

Consider the popular notion of left-brained vs. right-brained individuals (Hopper, 1998). The left-brained individual tends to exhibit characteristics of linear, sequential, symbolic, logical, verbal, and reality-based reasoning and information processing. The right-brained individual tends to exhibit holistic, random, concrete, intuitive, non-verbal, and fantasy-oriented reasoning and information processing.

Another model of cognitive styles, presented in “The Programmers Stone” (Carter, 1999), describes two mindsets as they apply to the task of software engineering. One that roughly corresponds to an “intuitive” or “right-brained” or “visual, mathematical” thinker is called a “mapper.” The other, which corresponds to an “analytic” or “left-brained” or “verbal, sequential” thinker is called a “packer.”

The model is quite simple as it pertains to cognitive styles. A mapper tends to visualize the framework of a model of an entire problem all at once, and to fill in the details later. A packer tends to accumulate details first, and gradually to build up a mental image of the whole.

A wealth of anecdotal and experiential evidence strongly indicates the best and the brightest in the IT field are “right-brained” thinkers, or “mappers.” A single glance at the organization chart will load a great deal of information into their minds regarding the culture of the company. To ensure we hire the “right” kind of people and get them off to the “right” start in the organization, that initial mind-load must be accurate.

The conventional organization chart consists of boxes connected by lines in a pattern suggesting a hierarchy of authority. The boxes are labeled with terms such as “Project Manager,” “Software Engineer,” “Network Administrator,” and “Chief Financial Officer.”

The shapes and labels of the boxes and the rigid relationships suggested by the hierarchical layout create assumptions in the mind of the reader. The assumptions are those of the conventional organizational structure and culture. The assumptions limit the scope of responsibilities and actions of each member of the organization to those of conventional job descriptions.

The message The Soft Firm wishes to convey is that the organizational structure and culture are unconventional and, furthermore, that they are based on features that directly contribute to the motivational factors important to the “right” kind of people – the best and brightest in the IT field.

To convey the desired message, we redefine both the graphical and the textual language used to describe the organization. We adopt a graphical notation that enables us to express the notion of “scopes within scopes” as opposed to the traditional “hierarchy of authority” structure. In creating a textual language to describe the organization, we define names that describe roles in the company, as opposed to titles that label positions. These elements are intended to establish a mindset that facilitates motivation, as well as long-term retention, productivity, and job satisfaction.

The Soft Firm’s organization chart is expressed in a graphical language consisting of just two symbols: A stickman figure representing one or more individuals, and an oval representing a scope of activity. The symbols will be familiar to readers who have a background in object-oriented analysis and design, because they are borrowed from UML.

The textual language used in the organization chart consists of names of various roles played by individuals in the firm. The roles are given unconventional names in a deliberate attempt to free people from the constraints implied by conventional “position titles,” while still suggesting the general kinds of actions expected by players of a given role.

Figure 1 shows a simplified sample of The Soft Firm’s organization chart.

The roles defined for professional staff are as follows:

Visionary-Realist. This is broadly equivalent to an executive management role in a conventional organization. Overall leadership of the firm is expected to reflect both a visionary outlook on commercial possibilities and a realistic understanding of what is technically feasible. A Visionary-Realist, or a pure Visionary, sets the direction of the firm with collaboration from any other members of the firm who are interested in providing input to that decision.

Other Visionary-Realist roles are played by individuals who share the balanced qualities of vision and realism and who possess a particular interest in dealing with specific issues important to the firm. These interests might include financial planning, directing professional development of employees, procurement, facilities management, advertising and promotion, coordinating external relationships, or infrastructure management for the virtual office environment. The scope of a Visionary-Realist’s activities is company-wide.

Evangelist. In this role, an individual seeks, establishes, and nurtures business relationships and explains the mission and capabilities of the firm to the outside world. In a conventional company, the activities would span the job descriptions of marketing and sales executives and representatives. The scope of activity spans multiple customer relationships.

Storyteller. Individuals in this role work directly with customers and with project teams to liaise between the business culture and the technical culture. They assist customers in understanding and quantifying their needs, and translate those requirements into terms understandable by the professional staff. They also communicate project progress and setbacks to customers. In some conventional organizations, this role is played by a “business analyst” or “systems analyst.”

Coach. A Coach is a specialist in mentoring work teams toward the goal of full self-management, and continuing to reinforce good practices in mature teams. A coach may also become involved in dispute resolution among team members. A single coach may mentor multiple teams, or may focus on just one team, depending on the level of maturity of the teams in question. Less mature teams require more mentoring than more mature teams. This role has no direct analogue in most conventional organizations.

Apprentice. These are junior-level IT professionals who are learning on the job under the guidance of more senior team members and coaches. They correspond generally to university interns and to entry-level hires in conventional organizations. The Soft Firm applies an apprenticeship program to all new hires, in keeping with the firm’s philosophical belief that an apprenticeship system is generally good for the IT profession. This practice has no direct analogue in conventional organizations.

Mage and Sage. These roles represent progressively senior levels of competence in professional services. The scope of activity of a Mage or Sage is usually limited to a single project at any given time. However, the flexible organizational culture allows for multiple roles, depending on need and interest. In addition, at the Sage level an employee is eligible to represent the firm in professional organizations, at industry conventions, as a guest speaker, as a participant in cooperative university programs, as a member of community and social responsibility organizations, and as a participant in standards organizations. A Sage may also act as the technical lead on project teams that have not achieved the maturity level of “self-managing,” and as a technical mentor to less senior colleagues.

Terraformer. This is a necessary technical support role that corresponds to various positions in conventional organizations. The scope of activity is company-wide, but is directed toward the creation, enhancement, and support of the technical infrastructure of the virtual office environment. As such, the work includes network administration, database administration, system administration, and other mundane tasks in addition to creative work such as participating in the design and implementation of collaborative work facilities and intranet resources.

The single letters shown next to several of the ovals on the organization chart are abbreviations for named scopes of activity. T means team, F means firm (or company), C means community, R means customer relationship. Not all ovals need be labeled with a letter. A scope of activity that collects multiple instances of other scopes, or that illustrates a scope that crosses boundaries, need not be labeled.

No back-office functions such as accounting, legal support, payroll processing, or benefits administration are shown on the organization chart because all such routine functions are outsourced. The Soft Firm wishes to concentrate all its effort on its core business. Outside companies that specialize in back-office functions can perform those functions effectively. This practice also simplifies the motivation plan by eliminating the need to accommodate non-technical personnel to any significant extent.

The reason for explaining the organization chart at such length in a paper devoted to the motivation plan is that the structure and culture represented by the chart are fundamental to The Soft Firm’s approach to employee motivation. This is clearly not a structure that was devised by an accountant. It was devised specifically to emphasize and foster the motivational factors that apply most strongly to IT professionals, for the simple reason that IT services are the core business competency of the firm. The organizational structure itself lies at the heart of the firm’s operational motivation plan.

It is illogical and counterproductive to try and force IT professionals to conform to the mold of a conventional hierarchical organizational structure. The obvious logical approach is to establish an organizational structure that enables IT professionals to be as effective as possible in their work (Unlimited Motivation, 2001, July 8).

The organization chart is among the first documents shown to prospective employees. This is done both as a means of screening applicants and as the first step in orienting new employees. Those who relate to the chart and readily perceive that it represents flexible roles within changing scopes of activity that have porous boundaries in a collaborative and supportive professional environment are likely to be good choices to join the firm. Those who fail to understand the unconventional chart are less likely to be suitable candidates.

Even in the first interview, then, the process of employee motivation begins. The firm identifies candidates who will fit into the organizational culture and respond to its inbuilt motivational features. The candidate begins to learn the structure and culture that will nurture his/her professional growth.

A final note on the organizational structure: It is not for everyone. It can work only for a company whose sole purpose is to apply information technology to various problems. The structure is well suited to an IT consulting firm such as The Soft Firm, but would probably be impractical for a company that had to support research, product development, customer support, manufacturing and distribution, or a company whose core business was something other than IT, and for whom IT was merely a business tool.

Specifics of the Motivation Plan

This section highlights specific elements of the motivation plan. These elements are to be understood in the context of the organizational structure and culture described elsewhere in the paper, and of the fundamental assumptions about motivation on which the plan is based.

Recruit Compatible Individuals

Perhaps the simplest and most effective step we can take to maximize employee motivation is to select candidates whose personal values and perspectives are compatible with those of the firm. A professional who is in tune with the business philosophy, working conditions, level of collegial interaction, and other characteristics of the working environment is more likely to maintain a high level of intrinsic motivation than someone who is at odds with those factors.

A few shortcuts in recruiting can increase the chances of finding compatible candidates:

* Solicit recommendations from current employees. People tend to prefer working with like-minded colleagues. An employee who is a good fit for the organization will recommend others who are likely to be a good fit, as well.

* Look for experience on Open Source development projects and/or team experience in a virtual environment. A professional who was successful in one such environment can be successful in another.

* Look for evidence of participation in the cyber world. People who actively participate in newsgroups and discussion boards and who create their own websites are already comfortable with living in a virtual world. They will require less cultural adjustment to fit into the organization.

* Use the Web to announce the firm’s existence and organizational culture to prospective employees. The kind of professional who proactively seeks out such announcements and follows up on them demonstrates both individual initiative and familiarity with a virtual environment, while also showing an active interest in the firm.

* Focus on desired personal traits over specific technical experience. A professional who has demonstrated expertise in one or more relevant technologies can learn any new technical skills necessary to succeed on the job. Personal traits that run against the grain of the organizational culture cannot so easily be changed. For example, a person who has an internal locus of control will more easily respond to the demands placed on him/her by Management by Objectives and Goal-Setting Theory (Robbins, 2001, p. 1667), which are integral elements of the motivation plan. The “wrong” kind of person will not respond positively to the motivational factors applied by the firm.

Throughout the interviewing and assessment process, be frank about the unique characteristics of the firms’ organizational structure and culture. Look for verbal and nonverbal cues that indicate the candidate’s instinctive grasp of the concepts and initial “gut” reaction to them. Favor candidates who seem to relate to the organization instinctively and naturally over those who struggle with the concepts or who seem uneasy about the unconventional structure.

People who meet these criteria will be easier to motivate and manage than others.

Align Personal and Company Goals

One of the functions of the Coach role is to provide frequent reinforcement of the alignment of individual employee goals with company goals. Given the narrow focus of the company’s business activities and the fact the professional staff directly supports those activities, such alignment is definitely achievable. However, it does not occur automatically. Left entirely to their own devices, technical employees will spend an inordinate amount of time playing with new technologies and experimenting with various development ideas. The tasks required to complete consultancy projects are really quite similar to these, and employees can be guided to direct their energies toward those goals while maintaining reinforcement of motivational factors.

The virtual office provides another source of reinforcement for goals alignment. Employees work online, with a live connection to the firm’s intranet and other networked resources, and with live communication with team members and other personnel. Corporate communication disseminated via this medium lends support to the efforts of Coaches to maintain awareness of company goals and to illustrate how individual professionals can satisfy both personal and company goals concurrently.

Professional Development

An important motivating factor for IT professionals is the opportunity to increase knowledge and skills. The Soft Firm offers financial support and flexible work schedules to employees who wish to work toward advanced university degrees, earn professional certifications, take specific training courses, and participate in professional seminars and conferences.

The organizational structure and virtual environment also provide means for employees to enhance their technical skills. The team work model and, where appropriate, the Extreme Programming methodology, give employees the opportunity to work closely with peers. This presents opportunities for knowledge sharing, learning by observation, and direct mentoring. The intranet resources provided by the company offer computer based training and documented “trails” for self-directed Internet-based learning. The firm recognizes and rewards all forms of professional development, whether formal or informal, whether accredited or self-directed.

Autonomy in Structuring Work

The majority of the work performed by employees is defined by the requirements of consultancy projects. Therefore, they cannot be granted full autonomy to determine project schedules, set team composition, and choose methodologies and standards. However, the team work model is designed and implemented in a way that allows work teams to exercise considerable autonomy to achieve project goals within the stipulated budget and schedule.

The firm applies several methods to build employee competence and confidence in estimating projects, planning and structuring work, self-monitoring performance, and improving effectiveness.

Management by Objectives (MBO) develops employee competence in goal-setting, self-monitoring, and incremental improvement (Winning, 1995). It encourages autonomy by shifting the responsibility of performance appraisal from management to the employee him/herself. This increases individual autonomy, which is an intrinsic motivating factor for most professionals.

Based in part on a motivational theory known as Goal-Setting Theory, MBO allows employees to set challenging goals and use those goals as the yardstick of success. Given appropriate ability and employee acceptance of an agreed-upon goal, more challenging goals usually lead to higher performance, which in turn enhances the employees self-efficacy, leading to more challenging goals, and so on (Robbins, 2001, pp. 166-167).

MBO is integrated into the team work process and is reinforced by the Coaches and Sages. Apart from acting as an employee motivator, MBO also provides mechanisms useful in applying Total Quality Management (TQM) to the firm’s professional services work.

At the level of employee performance evaluations, principles of MBO are applied to enable the employee to define his/her own medium term and long term goals, and to assess his/her own progress toward those goals. The use of individual mission statements is a tool that enhances this process (Motivation Tip #17, 2001, July 8).

Another means of increasing employee autonomy is to mentor them in improving the level of indvidual initiative they use in day-to-day work. According to Oncken (1999), employees may exhibit five distinct levels of initiative. From low to high, they are:

1. wait until told (lowest initiative);

2. ask what to do;

3. recommend, then take resulting action;

4. act, but advise at once;

5. and act on own, then routinely report (highest initiative).

By guiding employees in achieving higher levels of personal initiative, we improve their capability to define more characteristics of their own work, which in turn builds confidence and enhances intrinsic motivation.

Peer Recognition

One of the strongest motivating factors for IT professionals is simply peer recognition. The organizational structure and culture and the day-to-day procedures for work teams as reinforced by the Coaches all encourage close collaboration among professional employees. Employees are encouraged to praise each other using the virtual office facilities to publish notices of recognition for specific achievements, constructive attitude, or any other reason.

However, peer recognition within the organization is not sufficient. Professionals generally have a sense of belonging to the profession itself that may be stronger than their sense of belonging to an employer. To make use of this feeling as a motivator, The Soft Firm encourages employee participation in technical conferences such as Java One and Comdex, in standards-setting organizations such as the Object Management Group and the World Wide Web Consortium, and in Open Source development projects outside of work.

These activities help to build associations among colleagues that foster peer recognition, which in turn motivates employees to higher levels of performance in pursuit of the company’s goals. At the same time, company support for employee participation in such activities may help to assure long-term retention of valuable professionals.

Making it Worthwhile

Professionals typically want their work to have value; they want to apply their efforts toward something useful and worthwhile (Robbins, 2001, p. 205). The usefulness of employees’ work is publicized in the virtual office through electronic newsletters, e-mail, newsgroups, and internal websites. Members of teams that successfully complete projects are publicly recognized by the Visionary-Realists and others.

As has been pointed out elsewhere, “worthwhile” means more than merely “useful.” Many contemporary professionals want to make a contribution to the world on a more general level than just satisfying the technical requirements of their jobs. The Soft Firm encourages and supports employee participation in public-interest organizations that have some relationship with the firm’s business area, such as Computer Professionals for Social Responsibility (CPSR, 2001).

Financial Incentives

The use of financial incentives has been shown to be a double-edged sword. Salary levels, bonuses, and stock options must be weighed carefully to ensure employees are compensated as they deserve without short-circuiting the company’s non-financial motivational efforts.

According to Cognitive Evaluation Theory (Robbins, 2001, pp. 164-165), excessive extrinsic motivators may interfere with intrinsic motivators. In the case of IT professionals, the strongest motivators are intrinsic. Therefore, it follows that the use of extrinsic motivators must be carefully considered.

The Soft Firm uses a combination of skill-based and variable pay plans. Base salary is skill-based, and pay range is centered on industry averages. This is bolstered by bonuses for timely and high-quality completion of projects. To tie bonuses into other motivators, the company also offers financial incentives for professional development. The costs of university, commercial training, technical certifications, professional memberships, and expenses for attendance at professional events are covered. In addition, the completion of a university degree or the earning of a technical certification are reflected by an increase in base pay. These achievements are also reinforced by public recognition, to maximize their motivational effectiveness.

The firm also offers a flexible benefits program. Employees may choose from a range of options depending on their individual needs. In some cases, the available benefits depend on local conditions. For example, employees who live in the Netherlands have less need for company-sponsored health care benefits, since their social system handles most medical costs. In contrast, US employees usually want a more generous company-sponsored health care plan, especially if they have families.

Stock options are offered as an optional component of the compensation package. The purpose is to prevent stock options from having a negative effect on intrinsic motivation in employees who lack the temperament to deal with fluctuating stock prices, while keeping the option available to those who want it. When stock options are chosen, the compensation package is balanced by adjusting the base salary level.

Employee Participation in Business Decisions

Under an “open book” management philosophy, the firm keeps employees informed of the financial status of the company at all times (NCEO, 2001). The purpose of this in terms of motivation is to include employees in important corporate decisions so they will align personal goals closely with company goals with a minimum of coaching.

The open book management approach enables most or all employees to understand the financial status of the organization well enough to participate in financial decisions, and to understand their own stake in such decisions. In financial matters, we use participatory decision-making but not full employee involvement.

Not all issues are decided strictly by one method or the other. For example, a combination of participation and involvement would be applied to a question about expanding the business to encompass a new technical area or market segment.

Another motivational function of open book management is to tie work team performance to company revenue. A formula is applied daily to each team that computes the revenue per labor hour for the team (Case, 2001).

Stealth Motivation

Not all aspects of the firm’s motivation plan are explicit. Many are built into the organizational structure and culture, and the management style. For example, team operation and development are integrated into normal everyday work practices. There are no special presentations or team-building exercises as such (Team Building in Secret, 2001, July 8). Similarly, Quality Circles do not meet as a separate activity; their functionality is part and parcel of everyday team operation.


The key elements of The Soft Firm’s motivational plan are:

* Hire the right kind of people to achieve the company’s business objectives;

* Stay abreast of the values, priorities, and motivational factors important to employees;

* Establish an organizational structure and culture that promote and facilitate the kinds of motivational factors that are effective with information technology professionals;

* Incorporate motivators seamlessly into all aspects of company operations and procedures; and

* Continuously reinforce the culture in everyday operations, rather than making special presentations or engaging in team-building exercises outside the context of work.

We do not expect employee motivation to be automatic merely as a result of the organizational structure and culture, but by creating a non-traditional structure and explicitly building a culture around the needs of the key set of employees, The Soft Firm facilitates and simplifies motivational efforts.


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