While we’re not about to suggest that you treat your team like guinea pigs like Amazon, encouraging competition through what is called a “winner takes all” or leaderboard system has shown to not only boost productivity, but also increase employee satisfaction through increasing the tangibility of, and pride in their work.
Finding a balance between too much or too little competition can be difficult, which is why we recommend keeping a few practices in mind when implementing this system. Read on to find out more:
Measuring employee performance is only appropriate for certain quantitatively measurable roles such as Sales or Customer Service. For less measurable roles, such as creative roles, implementing a leadership system can have negative effects or even create conflict due to the intrinsically subjective nature of the tasks at hand.
Even if the role is sales-oriented, the product itself should also be taken into consideration when introducing a leaderboard in your office. For example, a very active sales industry with low conversion like real estate would work well to introduce a leaderboard, but high conversion sales role would not benefit. For example, a call centre for incoming sales is reactive and thus less merit-based.
Before implementing a leaderboard system to your team, it’s important to introduce the initiative and detail its parameters in order to eliminate potential misunderstanding or rivalry. For companies with an established sales team, such a change signals a major shift, so it’s important to carry it out in a controlled manner, explain the purpose, and respect those who are already working in the position. The key is for your team to understand how they’re evaluated, and what they can do to improve.
While leaderboard systems are common in certain industries, some individuals may be weary to accept a "winner-takes-all" system due to the negative connotations attached it it. For new hires, it’s important to make the purpose of such a system clear, and how they can benefit (i.e. commission, raise, etc.). At the end of the day, you have to accept the potential eventuality that some will be turned off by a leaderboard, so attracting the right talent ultimately comes down to your ability to put forth the right incentives.
So you’ve finally made the jump to implement a leaderboard in your company. What now? You may be expecting a spike in sales or improved performance, but it doesn’t always work out that way. It’s important to remind yourself that general performance naturally fluctuates over time, and that it’s relative performance that matters. If the implementation of this system results in the opposite of its intended effect, you should first pinpoint the reason before penalising your team. Whether it’s because individual value quality over quantity, or lack understanding of how their performance is measured, the key is to find the root cause.
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