The Rewards
The truth
What gets recognised is what gets repeated, whatever anybody says. So recognition gets designed rather than improvised.
First, the thing chapter seven owes you
Chapter seven said no bonus is ever attached to a team's goal number. And you pay bonuses. So what makes sense? What is fair? What can be defended?
The shared company goals can be a number. Everybody carries it, and no individual improves their own position by not aligning or lowering their own ambition. Gaming it would take a conspiracy.
The individual half has to be judged. A grade, from somebody who was there, with the reasoning written down. Not a formula sitting on a key result, because that is exactly where sandbagging lives.
If that feels less precise than a formula, it is. It is also the only version that does not quietly teach your best people to aim lower.
The logic and signals
If you pay a bonus, it is a signalling system that also happens to be a payment. Three principles, and they came out of getting this wrong more than once.
Fairness is not uniformity. The same structure for everybody feels fair, and it is not. A salesperson, a finance lead and an engineering director have genuinely different lines of sight.
The question for every role is the accountability radius: what can this person actually influence?
And there is a boundary you should not cross. Attach cash to a goal that needs ambition, experiments and a tolerance for being wrong, and nobody will aim like that again. Those are exactly the goals worth having.
So it splits like this. Everybody shares a stake in the company's outcomes, because those are the outcomes. And the individual part sits on the measures inside their own radius.
A customer success lead, for example, might have a bonus weighted 55 per cent toward company goals and 45 per cent toward personal goals (no team goals). A quota-carrying salesperson carries all of the bonus for the company because their individual performance is already paid through commission, and two personal incentives for one person cancel each other out.
Where team performance measures live
Health metrics are your non-negotiables, made measurable.
The five to ten measures that tell you that a team is in good health on a dashboard, along with relevant measures that come from your strategic choices.
Along with general health metrics, make those measurable and put them on the bonus as a binary gate. If these are not healthy, you miss the bonus.
Team goals, single or cross-functional, are never bonused. These are executing your strategy and pursuing operational excellence and require new, innovative thinking, experimentation, and some risk-taking.
The cheap half, which matters more
Most recognition in a company is unplanned, which means it goes to whatever is most visible. Usually, that is heroics: the person who worked the weekend, the rescue, the save.
This teaches people that the way to be noticed here is for something to go wrong near you.
So write down what you will recognise, and then actually do it. Six things, out loud, by name, every cycle.
An idea tested cheaply, before it made or cost a quarter.
An outcome was reached. The easy one, and the only one most companies do.
A goal was stopped early for good reason. The hardest culture to build.
Help that was given across a team boundary, where nobody's own number improved.
A step-change or a play that can be exploited. Your future advantage.
A team working excellently. The team function and BAU, managed really well.
Then keep the record. A year of that list shows you exactly what your company has been teaching, and it is the cheapest diagnostic in this book. Read it back and ask what somebody would conclude about how to get on here.