Manager's Briefcase
Book Summary: The Carrot Principle
by Laurie Ginn, Program Attorney, The National Judicial College

Companies survive or die based upon their employees’ work. The Carrot Principle, by Adrian Gostick and Chester Elton, discusses methods to develop satisfied and engaged employees through management’s leadership.

Management, with the Carrot Principle techniques, nurtures the employees’ growth within the company. The authors stress that employee engagement, not just satisfaction, is critical to a company thriving. Employee engagement spurs the quality of work and the quality of service employees give to the company’s customers, which reflects the company’s values.

What does “engaged” and “satisfied” mean? Merely satisfied employees do the assigned tasks and are content with the way things are. Satisfied employees may feel imposed upon when asked to do extra work or non-typical work. Engaged employees, however, are the employees upon whom management depends. Engaged employees see the company as a team and suggest fresh alternatives to revitalize the company. Engaged and satisfied are not always separate. Engaged employees can also be satisfied employees.

Employees can fall into four categories and can at times shift between the categories. The four categories are

• high engagement/high satisfaction,
• low engagement/low satisfaction,
• low engagement/high satisfaction, or
• high engagement/low satisfaction.

Once the highly engaged employee becomes unsatisfied, the employee may look for other employment. The high engaged/high satisfaction employees are the employees that other companies desire because these employees are the key dependable employees.

Leaders keep their employees engaged by answering their employees’ questions. What does the company consider to be important? How does my effort contribute to the company’s goals? What is my reward for my effort?

To answer the questions above, leaders

• establish goals,
• fully inform and communicate,
• “build trust,” • make employees accountable, and
• reap the rewards of “engaged” and “satisfied employees” and other rewards.

Thus, the employee knows what is expected and what is gained.

In “carrot principle” terms, leaders plant the seeds of success with explicit goals. The employee understands what is expected. The carrot takes root via “open communication” as the employee undertakes the assigned task. Free to ask questions, employees continue to grow in the job or task. Leaders “build trust” by recognizing the individual employee and the individual’s unique ability. Leaders “weed” and correct the employee, when needed. The “harvest” consists of the “satisfied and engaged employee, higher company profits, and greater customer loyalty.”

Leaders must know their employees to use carrot principles. If an employee does not like public recognition, leaders tailor the public recognition to minimize any embarrassment while still providing that employee with the recognition that he or she deserves. A reward must mean something to the individual employee. A gift certificate to a book store will not carry the same “reward value” to all employees. Leaders cannot assume all employees share the same strengths. Teams use their combined strengths to succeed. To succeed, leaders must discover and celebrate the strengths in their individual employees.

Leaders hold employees accountable for the major and minor failures, but must equally hold employees accountable for major and minor successes. Celebrating employees creates the atmosphere of “what I do matters.” Employees think, my manager realizes when I do well, not just when I make mistakes. Getting to the heart of the way employees think about their job is critical to The Carrot Principle. When the leaders struggle to get employees to complete a job, time is wasted and frustration rises. With carrot principle techniques, leaders can validate their employees’ actions on the job.

Employee recognition is the key to retaining employees the company already has and to building an attractive atmosphere for future employees. When should a company recognize the employees? The authors suggest that employee recognition is an on-going process and integrated with the company’s values.

Informal recognition for routine work may be a short message focused on the specific task, for example. Special recognition for outstanding work is an opportunity to show how the employee met the goal and championed the company’s goals. Commemoration dates are opportunities for the company to highlight the employee’s efforts over an extended time. Team and division recognition may occur at any time: at the beginning of a project, during a project, and after a project concludes. The Carrot Principle relies on recognizing employees continuously.

Employee retention saves companies potentially enormous sums of money – job advertisements, time spent in interviews, employee training, and lost institutional memory. A company’s biggest resource is the employees, who are the company’s representatives to the public. The Carrot Principle is a worthy resource, supported with research, to keep and engage your employees.

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