Employee Motivation: Different Strokes for Different Folks

New data on what motivates IT employees is not exactly a surprise, unless you look at the numbers by age group.

By Ellen Muraskin

A report recently released by Forrester Research asked 129 IT professionals how IT employees are motivated. The results should not surprise: interesting work and autonomy, followed by work/life balance and base compensation, led the aggregate list when subjects were given a choice of 12 motivators.

When broken down by age, however, job security led the list for employees 45 and over, followed by base compensation, interesting work, and autonomy. For employees under 45—those too young to see kids’ college or retirement looming—work/life balance and professional development took third and fourth place.

Of Forrester’s recommendations, these perhaps fit the VAR shop best: Carefully design, define, and explain employee roles, review performance more often than yearly, and train those who struggle to work autonomously. Gauge the success of your employees’ autonomy by measuring results, not hours.

Jay Strickland, president of 25-person IT consultancy WingSwept, based in Garner, N.C., applied some of these lessons when putting his Pay for Performance profit-sharing plan into effect 18 months ago. “It’s not open-book management,” he cautions, but it does key monthly bonuses to a combination of profitability and a role-based scorecard. Profitability is a multiplier: If it doubles, so does the achievable bonus amount. “This lets employees realize that they have to control expenses while still pushing for top-line revenue. They have just as much incentive for profitability as an owner.”

But to factor in individual performance, that bonus amount is also multiplied by the percentage on the employee’s scorecard; a 50 percent score could halve the bonus. Employees score themselves, though, and turn their cards in every month. “Some of the things on the scorecard are very black and white,” says Strickland, “like, ‘Did you do this part of the job?'” Other things are less so: “‘Did we get one referral from a client in the network division?’ They can’t directly control that, but they can do things to increase the opportunity for that to happen.”

Strickland is careful to point out that this is not a utilization bonus program, an approach he says ultimately fails all consultancies, including his own. “An incentive program based on utilization can force someone to do all the billable work they can possibly withstand but not do any housekeeping. They can leave a train wreck that takes an entire admin person to clean up after them. We need people to have balance.”

Under Strickland’s program, the staff also has variety. “Someone in our managed service division could easily find himself in the government division as well. A lot of our people cross divisions as many as three times a day.”

Pay for Performance appears to be working: Strickland is on his 19^th consecutive profitable month. In 2009, he was profitable only six months out of 12.

Top 5 IT Employee Motivators

SOURCE: FEBRUARY 2011 FORRESTER RESEARCH SURVEY OF 129 IT LEADERS