Why Rewarding Group Performance Is Mission Critical

When we think of recognizing good behaviors or high-quality work, we frequently think of singling out the best people. Many companies still only reward the most productive individuals — the most valuable players and the rock stars. However, research has demonstrated that praising and incentivizing the team is just as important. Creating a sense of group identity is critical for organizations seeking to inspire collaboration and innovation.

Hard-Wired for Teamwork

Jay Van Bavel and Dominic Parker write in Harvard Business Review that good leaders are “entrepreneurs of identity,” that they’re the key to creating high-functioning teams. “Human beings evolved in groups, and most of us still work in groups every day,” they write. “Indeed, humans are unique among primates in that we readily cooperate with in-group members — even if they are completely unknown to us.”

In fact, this instinct is so strong it can push people to overcome a variety of barriers. Think about sports fans who have nothing else in common with each other but who nevertheless bond over their favorite team, or the immediate connection that people of the same nationality share when they’re outside of their home country. Instead of thinking selfishly, group members begin to think about what’s best for their collective.

Shaping Reward Programs to Inspire Employees

Van Bavel and Packer say that employers often focus on meeting employees’ financial needs to motivate them. However, organizations ignore employees’ social needs, such as belonging to a group, obtaining status, feeling distinctive, and maintaining certainty.

Rewarding both individual and group performance fosters a sense of belonging and a sense of distinctiveness. Effective leaders may offer traditional incentives, like bonuses and advancements, based on the success of the entire organization. Incentives that include a whole-team experience outside of work — such as a happy hour — will continue strengthening those connections.

At the same time, leaders need to be on the watch for the downsides of team identity. Expectations of conformity and groupthink are a danger when employees value group cohesion over all else. Encourage dissent as a way to explore the validity of ideas, or assign an individual employee the role of devil’s advocate to sidestep these problems.

Organizations that devise carefully thought-out plans to motivate employees are more likely to maintain a competitive advantage. Leaders are always on the lookout for how to support positive employee behavior and collaboration.

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