NANCY NAPIER: Low friction in one company results in higher salaries

Published: August 29, 2012 

A few weeks ago, I wrote about how much I dislike dealing with organizations that cause me friction. An airline puts me on hold for 30 minutes, quotes one price and 30 seconds later tells me that “the fare is gone, so you’ll have to pay another $100.” An organization offers “one-day service,” and then when I show up with my business document, I learn that “one day” means, “drop off your document and come pick it up the next day during these hours that are convenient for us, not you.” OK, so maybe I confused “one day” and “same day.” I’ll never do that again, to be sure. Still, it’s a hassle for me as the consumer.

Friction. Not fun.

Alas, friction happens within organizations as well, even within teams of people. You’ve probably dealt with it, and so have I. Often we just whisper or complain about it.

But one organization has developed an approach that deliberately tries to reduce friction. It has gone so far in the attempt to “lower friction” that the effort comes into its compensation plan.

The company is in the fast moving high-tech world and is growing like crazy. In the past three years, it has more than tripled its employee base, and it doesn’t look like the end is anywhere in sight. Bringing new people into the organization, getting them up to speed fast and being sure that they work well with others is critical if the firm is to succeed. So the top managers have developed an idea they call “net contribution” to assess how well an employee performs but also what level of hassle or friction the employee adds.

At review time, the senior leaders ask team members to evaluate a person three ways (the manager does it, too). First, what’s the employee’s performance and contribution in the job for which she was hired? That’s one that we all know and understand and do already as managers.

But the next two questions are a little different.

Second, what’s the employee’s performance and contribution above and beyond the job description? For example, does the employee help out in areas beyond her job? Does the employee take on new tasks willingly, even if they aren’t directly part of her job? Does the employee try to do things that benefit the whole company, not just that person or his specific area?

Finally, what’s the friction or hassle associated with this employee? Is it someone who’s frequently causing lots of drama or headaches — to team members, the manager or the company at large? If the employee drags down others, causing friction or hassle, that friction is considered in the total review.

The formula would be something like this: Job Contribution + Above and Beyond Contribution – Friction = Net Contribution.

Interestingly, as the senior manager says, if you plot contribution against salary, they should be (and are) correlated. So if someone is above the line (too much friction) or below (more contribution), the company “adjusts” pay.

Think about what your own Net Contribution or that of your employees or teammates might be. If you could reduce the friction to zero, just imagine how far a company or team — or individual — could go.

Here’s the catchy formula: JC + ABC - F = NC.

NANCY NAPIER: Executive director for Boise State’s Centre for Creativity and Innovation. Contact her at napier@boisestate.edu.

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