3 Reasons Why One Company’s $70,000 Minimum Wage Hurt Everyone Who Got It

There are three big reasons why this is destructive, and such a bad idea for the people who work there.

Dan Price, the CEO, thought he was giving everybody a great gift great four months ago. Everybody loved it up front. But big cracks are appearing in the idea, because giving everyone a $70,000 minimum wage simply continues the archaic wage practices of the Industrial Age. And it has the same effect—destroying the human spirit. Here’s why.

Reason #1—People Want to Make Meaning, Not Money In her research on Generational Differences in Work Values, Jean Twenge found that Millennials to Baby Boomers are all motivated by the same thing—Making Meaning. A recent Salary.com survey also found that people who are focused on the size of the paycheck are less motivated.

Semco is a billion dollar company with 3,000 Stakeholders. They require people to determine their own pay. Every six months you go to a computer and plug it in. You would think chaos would ensue. But the company regularly has to adjust pay UP as people fall behind the industry average. Why? Because Semco leadership is focused on ensuring everyone finds their work extremely meaningful. For the last 30 years, Semco’s retention has hovered around an unheard of 99% per year. And almost no one makes more than the industry average. Meaning trumps money every time.

Another study by Sylvia Ann Hewlett, on attracting and keeping the best people, shows that at least three things motivate people more than money; flexible work schedules, praise and recognition, and breaking up the work day with walks, bike rides, swims or other non-work activities. A simplistic $70,000 pay raise addresses none of these more important meaning-oriented motivations.

Reason #2—Meaningful Work is Results-Based, not Time-based This $70k minimum wage is a throwback to an archaic system.

For thousands of years people got paid for how many shoes they made, and how well they were made. The better the shoe, and the faster they made it, the more money they made. They were solving problems and Making Meaning, and money came to them as proof.

Along came the Industrial Age Factory System and all that changed. For the last 175 years, and for the first time in human history, we have paid people simply for time spent working. How dumb is that? Gravity Payments fell victim to the Industrialist’s mindset—paying people without regard to production.

In an interview with the New York Times, Price said, “I want to fight for the idea that if someone is intelligent, hard-working and does a good job, then they are entitled to live a middle-class lifestyle.” Interesting quote, because his solution does not reward people for that hard work or for doing a good job.

Alan Wyngarden owns a mortgage company and went results-based. He reduced his loan processor’s base pay from $55,000 to $24,000, then incentivized her for how many high-quality mortgages she produced each month. Within a year she was producing three times as many mortgages at a higher quality, and making $135,000 or more per year. When pay is disconnected from results, people find it hard to be motivated to do great work. It’s basic capitalism.

You can see the angst creeping in. People know that getting paid without regard to performance is a bad idea. Stephanie Brooks, an administrative assistant, said, “Am I doing my job well enough to deserve this? I didn’t earn it.”

Reason #3—Raising Everyone’s Pay to $70,000 is LCD Management Lowest Common Denominator Management levels everyone with broad, sweeping policies that ignore individual performance and team contributions. Everyone “gets an A” (or an F) no matter how they perform.

Marisa Mayer, CEO of Yahoo, found some people not working well from home. So she just herded everyone back into the office day care center to be supervised. In this case, she gave everyone an “F”, even those who deserved an “A”. Motivated people got the same “reward” as the lowest common denominator.

Dan Price at Payment Systems has given everyone a de facto “A”, which treats lazy people the same as top performers. Grant Moran, a web developer who got a $20,000 pay raise but quit after the $70k minimum wage was enacted said, “Now the people who are just clocking in and out are making the same as me, It shackles high performers to less motivated team members.” LCD Management—the great leveler.

Maisey McMaster quit because, as she put it, “He gave raises to people who have the least skills and are the least equipped to do the job, and the ones who were taking on the most didn’t get much of a bump.” Everyone gets an “A”.

How to Fix This People are motivated differently, and one size does not fit all. Great incentives include a variety of rewards and take into account individual motivations. Bad incentives are simplistic, focused solely on money, and imposed by a top-down hierarchy (Industrial Age LCD management) which assumes it knows better what you need, without including you in the solution.

Tying income directly to production helps people love their jobs. At our company, nobody will ever get a pay raise because they hung around another year. They get them because they add more value than they used to—a very capitalist idea. As a result, people are more motivated to work, create, solve, and innovate, and get pay raises that reflect those results. We’ve had zero voluntary turnover in nine years. Why would people leave a results-based system that focuses on making meaning, and doesn’t shackle them to people who aren’t as motivated?

Great companies focus first on:

a) building meaning into their work,

b) tying pay to results, and

c) creating a Highest Common Denominator workplace that celebrates great contributions and reaching for the stars.

People will raise themselves to our lowest expectation of them. The most motivated achievers with brains are leaving Price’s company, and over time, only the least motivated will stay. Play a game that motivated adults want to play, and great achievers will rise to your greatest expectations of them.

Making meaning, and results-based incentives always attract great people. LCDManagement makes them leave. Your choice.

Article as seen on Inc.com

My First Presentation

I still remember my first presentation as a professional consultant. I had only been on the job for a few weeks and we were doing a strategic planning project for a large energy company. I had done a key part of the analysis that needed to be shown to the client, so my manager asked me to give the presentation. Our consulting firm had a particular style for presentations, so my boss did quite a bit of editing and reformatting of my slides. No problem. I thought that I was ready ... until I gave the presentation. I stumbled through it. And I  realized afterwards that even though it was my analysis, it was my manager's presentation. I had never really "owned" the final version of the slides. Leaders are regularly faced with a version of this temptation to "fix" someone else's work, especially when the leader is also the owner. The risk is that in doing so, these leaders take “ownership” away from the staff members who have spent considerable time on the task or project up to that point. That can be demoralizing. But even worse than that, it can also lead to less than satisfactory results. Staff members may fall short when the work is given back to them because they don't understand the "improvements." Or the leader is forced to stay over-involved when he or she should be working on other things.

I don't want my opening illustration to be misunderstood. My manager's changes truly did improve the presentation. It communicated the right information in a much more meaningful way. Some of the fault belonged squarely on my shoulders for not spending more time practicing with the new slides so that I was comfortable with them. But the question remains for every leader: how can you accomplish your goals and meet your standards for excellence and at the same time, allow staff members to retain a sense of ownership?

YOUR ATTITUDE IS YOUR ALTITUDE

Dare to Serve Reflection: How do you think about the people you lead? Last night I enjoyed a dinner conversation with a Popeyes leader who oversees more than a dozen restaurants. In our chat, we were reflecting on how grateful we both were for the momentum in our business – and how blessed we felt to be a part of this company. I was so impressed with this person’s genuine love of the restaurant business. It led me to ask him to share a bit about his family history.

He told me about his grandparents. He had spent summers with them – working the land. Learning what hard work looks like. Learning what it means to serve others – the workers on the farm. Learning how to prepare food from the barn and the garden. A hard life in many ways, but a place to learn how to love others, do productive work, and treasure the simple things. He then said – “I think this is where I learned my love for the restaurant business.”

And then I understood so much about the man – his values, his perspective, and his attitude. His mindset was – “I can find joy in serving others, in working hard, and in treasuring life shared with the people in our restaurants.” Wow. I want to work for him. Wouldn’t you?

When I joined Popeyes in 2007, we were suffering from a lot of things. Discouragement, disappointment, skepticism, frustration, and more. Our employees had watched multiple leaders come and go without a turnaround of the business. Our franchise owners were exasperated at the poor performance. Our board wanted to know what was wrong. Our shareholders wanted their investment to provide a return.

We needed new results to be sure. But to get there, we also needed a new attitude. We needed to think freshly about our work. Why it is valuable? Why do we want to work hard to solve the problems? Why we want to serve the Popeyes family well? Without a fresh mindset about the work, we would have been doomed to repeating history.

Is your attitude determining your altitude?

What emotions do you have about your workplace today? How will your mindset affect your work today? What could you do to approach the work freshly and positively?

Serving Performs.

Are You Interested In Becoming An “Exemplary Leader”?

You may have been born with some leadership traits but an Exemplary Leader is created over time and of course the whole process starts with a right spirit toward God. You see we’ve been created for excellence and to operate with a Spirit of Excellence.

The mind ultimately becomes a battlefield where God’s vision, desire, and action mapping for our lives collide with soulish emotional issues like insecurity, worry, anxiety, doubt, fear, etc.

An Exemplary Leader creates a lifestyle of seeking, obtaining and imparting Insight, Growth, Impact and Legacy as is the focus of Convene.

You begin this journey with the end in mind, “What legacy do I want to leave this earth with?”, “How can I best honor God with my life” and work backwards from there. This vision of a future state actually starts attracting resources to fulfill your vision of legacy. I often say that where God’s vision is for you that’s where His provision will be and where it will start showing up. “Seek FIRST The Kingdom of God and all that you will need will be added unto you.”

“How do I know His vision / legacy for my life”, you ask? Well, it’s in His Word and it is in your desires; “When we delight ourselves in the Lord He give us the desires of our hearts”. When we are God focused, dwelling in His presence continually, living in the awareness of His presence He places His desires for us in our hearts to be acted upon. Jesus says to us, “My sheep hear My voice”…. “The steps of a righteous man are ordered by the Lord”. On a business level and as a business and organization leader, a CEO | Business Owner | Solo Entrepreneur, how are you going to develop into an Exemplary Leader? A leader who inspires others, drives people toward excellence, holds people accountable, instills a sense of trust promoting sustainability and profitability for your organization honoring God in the process and changing the culture?

Learning what exactly makes an Exemplary Leader is your first step. Among other things, an Exemplary Leader centers around character, purpose, integrity and values all converging creating a leader driven by a Spirit Of Excellence and this attitude, “Whatever you do [whatever your task may be], work from the soul [that is, put in your very best effort], as [something done] for the Lord and not for men, knowing [with all certainty] that it is from the Lord [not from men] that you will receive the inheritance which is your [greatest] reward. It is the Lord Christ whom you [actually] serve.”

Manifesting a Spirit of Excellence is allowing the manifested Glory of God to be seen.

Here are a few initial steps to start taking in order to becoming the Exemplary Leader you’ve always wanted to be:

1. Defining Your “WHY”! | Establishing Your Vision

What is the “one thing” that, as a business, you are most passionate about, solves a problem, and honors God? “And He who sent Me is [always] with Me; He has not left Me alone, because I always do what pleases Him.” Jesus

What is your “Why” [vision / purpose]? What are we in business to provide a solution for?

The most useful vision statements are laser focused on your primary customers desired results; a solution that solves a problem. “I have come to seek and save the lost” Jesus stated.

What ‘need’ are we developing a solution for?

In conjunction, “What’s” the one thing you must measure to know if your successful.

When there is a big enough reason “Why” [vision / purpose], you will always figure out the “how”. What purpose and passion [The Why] is burning in your soul for your business?

Vision should then result in priorities being established; it is about getting and remaining focused on it. Laser-Focused.

2. Self-Control

“… the fruit of the Spirit [the result of His presence within us] is love [unselfish concern for others], joy, [inner] peace, patience [not the ability to wait, but how we act while waiting], kindness, goodness, faithfulness,  gentleness, self-control…. those who belong to Christ Jesus have crucified the sinful nature together with its passions and appetites.”

Exemplary Leaders are effective and efficient, exercising the character quality of self-control; self-discipline and willpower in order to stay focused on the big picture, stay the course, and create enough margin in your life in order to focus and keep driving toward the vision. “Do everything decently and in order.”

Self-Control as well has to do with inner motivation; pleasing God or seeking people’s approval.

Exemplary Leaders establish clear goals and objectives, leading others on the journey to manifesting excellence. An Exemplary Leader develops a clearly articulated vision [The Why] for their business and the self-control to become laser-focused on bring the vision into reality.

This laser-focused approach includes creating the right business model and organizational design: systems, structure, strategy, style, staff, shared values, and skills. The truth is, “organizations function the way they are designed to function”. It is up to the leader to create the environment and culture to realize the vision, honoring God in the process and influencing the marketplace toward the Kingdom of God.

Self-Control, among other things, has to do with following through in everything you do and measuring the results of the core activities that drive the business to its intended vision. Remember, what you don’t measure you can’t manage and targeted adjustments are not possible.

Being strong in your resolve and resisting the inevitable temptation to give up, or lose your identity for short term gain you are honoring God and setting an example for others to live up to. Jesus was tempted in this way and He responded with, “It is written”. His identity was clear and His mission was non-negotiable.

3. KEEPING A “CLEARLY DEFINED VISION” IN FRONT OF PEOPLE

This has to do with keeping the corporate mandate visible. Mandate is something you do that you would die to accomplish.

God has created us with a desire to be involved in a cause and we operate better together when the cause is clearly understood by everyone. What is your “Why”?

The people you are leading need to completely understand the vision of the enterprise in order to gain meaning in their work, share your vision and work ethic in a heartfelt way. Every step of the way, communicate with your team to make sure they’re on the same wavelength and know what you expect of them.

The implementation of a defined vision requires a defined method. You need a plan, a method, a course of action in which you’ve gotten those around you involved in.

A mandate requires a having a razor fixation which then engages people. Take that a step further and get them involved in the planning process. This gives everyone a greater sense of ownership toward the end result; it results in greater retention and sustainability leading to greater customer satisfaction, profitability and legacy generating. This honors God.

“But I do not consider my life as something of value or dear to me, so that I may [with joy] finish my course and the ministry which I received from the Lord Jesus, to testify faithfully of the good news of God’s [precious, undeserved] grace [which makes us free of the guilt of sin and grants us eternal life].” Paul

4. VISION INVOLVES OTHERS

To me money is not the most important thing in your purpose. What we need more than money is people. In God’s Kingdom and Way of acting and behaving money is considered temporal and a “little thing” but people’s souls are for eternity.

Vision and Purpose involves others. It requires us to become “others focused” and not “self-focused”. How do you help the people around you grow and improve? Provide for their families? How do you teach, lead, and succeed together. How do you disciple people in a marketplace environment?

Exemplary Leader praises highly and in public while criticize constructively and in private. The way you praise and criticize others can make all the difference.

Publicly praising the people who do excellent work for you will feel a sense of accomplishment and the drive to do even better.

When someone does something wrong, offer constructive criticism and do it privately. Suggest solutions on how they can improve and take the time to answer any questions. They’ll accept your input more willingly if they know it’s done to help and not to harm.

Exemplary Leaders make it a point to understand their people. You can’t truly lead a group of people unless you truly understand their hopes, dreams, struggles, pains, and goals. All the good intentions in the world mean nothing unless you have a true sense of the people you’re working with.

Getting to know each other on a personal level will strengthen the bond between you. They’ll want to do better for you because you’re more than just a “boss”, you care.

Be their leader, first, and their friend second. You’re their leader and that means that you have to make difficult decisions from time to time. These decisions cannot be affected by personal relationships.

Choose your emotional response to a situation carefully. Sometimes you’ll need to practice the art of silencing your inner thoughts when they’re not appropriate in order to set a positive example. “Be still and know (recognize, understand) that I am God. I will be exalted among the nations! I will be exalted in the earth.” One way we exalt God is by the way we treat others with love and compassion. Make the hard call. There are times when you have to bite the bullet and make some unpleasant decisions. Firing, demoting, and holding people accountable for their actions can be very hard at times. As a leader, it’s your responsibility to handle these matters. Being Christ like in how you handle it is how you please and honor God.

No matter where your leadership role takes you, believe that you can be a strong leader. Remember that in order to lead others, you must be disciplined yourself. After all, your actions will speak louder than anything you can say.

In order to gain the respect of others and honor God in the process, strive to lead by Christ’s example in every area of your life. You’ll be well on your way to becoming an Exemplary Leader!

“You will keep in perfect and constant peace the one whose mind is steadfast [that is, committed and focused on You—in both inclination and character], because he trusts and takes refuge in You [with hope and confident expectation].”

Does the Everyday Mundane Matter?

Do you believe the everyday activity of ordinary Christians has deep religious significance? The answer really depends on when in the history of the church you ask it.

Prior to the Reformation, Christians in the medieval church would have answered no. They believed only priests did spiritual work. All other activity was secular.

It was the sixteenth century reformers, men like Martin Lutherand John Calvin, who rediscovered the biblical idea that everything we do is important to God.

These men encouraged Christians to be salt and light in the world. They believed it was possible to maintain integrity of faith while injecting Christian influence within society.

They were right.

Western civilization is replete with examples of followers of Christ who positively shaped culture through their work in the fields to which God had called them.

Many American evangelicals during the last seventy-five years have let the sacred/secular distinction corrupt their worldview in such a way that they leave their faith at home when they enter the public square.

They are ambivalent about engaging with social and political matters, as the Reformers urged.

They fear involvement in such secular matters will compromise the integrity of their faith.

They are convinced faith is a private matter and best kept that way.

They have lost sight of the spiritual significance of their work.

To be sure, the risk they have identified is real. Being in the world but not of it is not easy. It is not safe. But it is what we are called to be.

These thoughts came to me recently as I was finishing Carl Henry’s Uneasy Conscience of Modern Fundamentalism, published in 1947. In this book, Henry, an American evangelical theologian who served as Christianity Today‘s first editor-in-chief, wrote a stinging critique of Christian fundamentalism in the late 1940s.

Almost prophetically, Henry argued fundamentalists did not present Christianity as a worldview with a vision for impacting culture. Instead, they chose to emphasize personal salvation. In doing so, they offered a truncated, impoverished version of the gospel to the world. This gospel was too other-worldly and anti-intellectual to be taken seriously.

And so, in their efforts to preserve orthodox Christianity from modernity and liberalism at the beginning of the twentieth century, evangelicals lost an important ingredient that has been a powerful influence throughout the 2,000 years of Christian history. They forgot how to be leaven in the loaf. (Matthew 13:33)

The good news is that sixty years later, many of Henry’s hopes for evangelicalism are beginning to be realized. Today’s evangelicals are re-engaging many social and political issues and working together to influence culture for the kingdom.

Yet the importance of our daily vocational work in the furtherance of God’s kingdom is still lost on many believers. Many still feel they need to quit their jobs and start working for ministries or non-profits to truly make a difference in the world. They don’t. They can be salt and light right where they currently work.

Bringing faith to work or anywhere else in the public square runs many risks, but it is essential if Christians are to be leaven where leavening is most needed.

If Christianity is to once again become a positive influence in American public life, all Christians need to be present within that life as salt and light. Christians need to leave the safety of their Christian ghettos and take the risks necessary for reforming, renewing, and recalling today’s culture.

The legacy of the Reformation invites us to engage the world. It instructs us in how to do so with integrity and as public witnesses to the power of the gospel.

So, do you believe the everyday activity of ordinary Christians has deep religious significance?

The real question should be “Does the Bible teach that the everyday activity of ordinary Christians has deep religious significance?”

The answer is yes, absolutely yes, in any age.

Originally published by the Institute for Faith, Work & Economics (IFWE). ©Institute for Faith, Work & Economics 2015. Used by permission.