Great Managers are People Farmers (Part II)

Great Managers are People Farmers (Part II)

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If you farmed with potatoes there would be several facts about potatoes you simply had to know, otherwise you would have ended up begging at the side of the road.

So, what are the crucial things you need to know about people?  More precisely, what are those things that we can scientifically know about human nature?

Understanding self-interest

The key to human behaviour is that people are driven by self-interest. If you can crack the nut of aligning  their self-interest with your business goals you are made. Just think of it: How difficult is it to get a teenager to mow the lawn compared to trying to motive them to play X-Box?  In their own self-interest people are innovative (think the ingenuity of prison inmates which I referred to in part one) and energised.  However, it is not good enough to dangle the carrot of salary and bonuses before your employees to unlock the door of self-interest.  You have got to be much more detailed than that.

It should be no great news that self-interest is the key to motivation and human behaviour. After all that is what the most comprehensive framework for behaviour, Charles Darwin’s theory of evolution tells us.  And it is not all bad and egotistical. Adam Smith showed us that selfish behaviour is not all bad news, acting out of self-interest may contribute to the common good.  Modern experiments in psychology also show that people have an inherent sense of fairness and as a manager you violate that at your own peril.  The experiment goes like this: I get to divide say R100 between myself and someone else. The other person then decides if she will accept the offer. If she declines the offer none of us gets anything. In such experiments the majority walks away from an unfair offer and would rather have nothing at all, than a division of R90 vs R10.

So, this is you first challenge as a manager: How do I align the self-interest of my people to the goals of the organisation. If you manage that, you have hit the sweet spot.

Unfortunately that’s not all there is to the story. The most important psychological research of the past 30 years by the Nobel laureate Daniel Kahneman and his colleagues have shown that we don’t always know what is in our own best interest!  Once again think kids. They want Big Macs everyday! But you know that even though that’s what they want, a Big Mac everyday is not in their best interest. So you must intervene, nudge at best in the right direction, but if needs be act the strict disciplinarian!   That is why the syrupy New Age stuff of the gurus like Tom Peters never can work.  As human beings we don’t always act out of our best interests when we act in our own perceived self-interest! Luckily for you as a manager you can read Dan Ariely’s book: “Predictably irrational” (he is one of Kahneman’s disciples).  There is a pattern to our human madness!

Lessons learnt

So here are the lessons from the science for people farming:

  1. Lesson One: People are primarily driven by self-interest, but we have an inherent sense of fair play and altruism on the perifery. One the one hand you ignore the perifery at your peril! On the other hand you must learn to view self-interest as your friend, not your enemy.
  2. Lesson Two: Out of self-interest people are inveterate innovators. There is no such a thing as a dumb, stupid unmotivated work force, only employees who can’t make the connection between their work and their own self-interest.
  3. Lesson Three: There is a difference between perceived self-interest and our best interests. Humans beings are often irrational and blind to their own best interests. Therefore we can’t unconditionally trust our employees just as we would be stupid to trust ourselves unconditionally. As in this example: Many years ago my teenage daughter pouted: “But don’t you trust me, Dad?” I retorted:  “I don’t even trust myself, how the hell am going to trust you?!”  We need a mutual relationship where management and business guard against and uncover the blind spots of the other party.  This is why dictatorships expose business to high risks.
  4. Lesson Four: However, neither a dictatorship, nor democracy will work in business. Whether we manage employees or kids or want to influence our customers, managers are people who must make risky decisions. Managers are people who must decide in a specific situation between giving people freedom, or restraining them and giving clear directives. Any management theory that tells you either of the two will always be the answer is wrong. Full stop! There is no management theory that can take the risk out of decision making. If they tell you that, they lie. And if they lie about one thing, they will lie about other things as well!
  5. Lesson Five: You must be a politician. People are equal in the eyes of the law, not in the real world. They have different interests and different abilities to promote those interests. This creates conflict. As a manager you are called upon to be a politician. You must manage conflicting power interests. Office politics is your job!
Bertie du Plessis
Bertie du Plessis founded his successful consultancy firm, MindPilot, 17 years ago. He names several of South Africa’s blue chip corporations among his client list and has taught as a lecturer and guest lecturer in six different disciplines at tertiary institutions. His fin24.com blog is the most read business blog on the 24.com domain. Visit Bertie Du Plessis's website for more information.