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Writer's pictureMichael Lanahan

How to Build a Culture of Accountability | Part 5: Four Key Principles for Effective Consequences




Accountability is critical at every level of every organization, whether you lead a startup, nonprofit, or government agency. In this series, we discuss each element of accountability, why it matters, and ways to build it on your team.


Today we’re closing out our accountability journey with the final element - consequences. As a reminder, the five elements of accountability are (1) clear expectations, (2) clear capabilities, (3) clear measurement, (4) clear feedback, and (5) clear consequences.



Honest Answer: What consequences do you and your organization use in the following situations?


  • Situation 1: One of your front-line teammates figures out a way to speed up her work by 25% with improved quality, and she teaches it to her supervisor and teammates, which scales up the positive impact. To celebrate, do you:

    • A) Reward the front-line teammate with a cash bonus, a cool trophy, paid time off, or something similar?

    • B) Recognize the front-line teammate by highlighting her example in a mass email or newsletter?

    • C) Tell yourself you’ll find a good way to celebrate, but get sucked into the fire drills of the day and realize weeks later that you forgot?

    • D) Do nothing?


  • Situation 2: One of your direct reports frequently gossips and distracts his teammates, and several of your other teammates have complained about it. To address it, do you:

    • A) Address the teammate privately soon after you learn of the concern, share the issue and feedback with him, listen to his perspective, and coach him for future improvement?

    • B) In your next monthly 1-on-1, indirectly suggest that he needs to spend more of his time on his work and less talking with other colleagues?

    • C) Tell yourself you’ll address it with him, but get sucked into the fire drills of the day and realize weeks later that you forgot?

    • D) Do nothing?


You can likely tell which of these answers is better than the others. But as busy leaders know all too well, designing and delivering effective consequences is easier said than done.



What are Consequences?


Consequences are a critical part of your organization’s culture. In basic terms, consequences are how you respond to certain behaviors and outcomes across your team. They form the ultimate intersection of people leadership and performance management - they reflect how you (and by extension, your organization) treat your people amidst the good, the bad, and the ugly.


There are two main types of consequences:

  • 1) Reward and recognition to celebrate positive behaviors and outcomes

    • This includes large recognition programs like company award shows, mass communications, and the coveted “Employee of the Month” parking spot.

    • Reward and recognition doesn't always need to be complex. In many cases, simple praise for a job well done can make an outsized impact. Gallup includes recognition as one of the 12 core factors of employee engagement, and it is correlated with increased quality of work, trust, and purpose.


  • 2) Corrective measures to address poor behaviors and outcomes

    • For relationship-centric leaders, this category is often hard. As a leader, you are ultimately responsible for identifying poor performance, discussing it with your teammate, and determining the best path forward for your team and the teammate in question.

    • Examples include 1-on-1 discussions addressing poor performance, tailored improvement plans, and sometimes termination.


Why Do Consequences Matter?


Consequences are more than just a “carrot and stick” mentality. When done well, consequences help build stability and trust across your organization, and they energize and equip your teammates to do their jobs better. When done poorly, they erode trust, increase stress, and make work a miserable experience for everyone.


Effective consequences improve engagement and performance.

  • On the positive side, increased recognition leads to higher employee engagement, which often leads to better organizational outcomes.

    • One Gallup study of many companies that improved employee recognition showed an average improvement of 6.5% greater productivity and 2% higher customer engagement (which, for large organizations, might equate to millions of dollars in additional revenue or savings).

  • On the corrective side, prompt consequences for poor performance or behaviors can make a struggling teammate aware of their shortcomings and enable them to improve and contribute more.

    • And in many cases of separation, teams do just fine (and sometimes better) after a poor performer leaves the team. (See, e.g., Rebecca Knight, “How to Decide Whether to Fire Someone”, Harvard Business Review 2019.)


Effective recognition can increase retention.

  • According to a SHRM survey of HR leaders, 68% of respondents agreed that recognition led to higher employee retention. And this is especially true for Millennials and Gen Z, who represent a growing majority of the workforce.

  • Additionally, Gallup research shows that employees who do not feel adequately recognized are twice as likely to consider quitting their job.



Four Key Principles for Effective Consequences


Not all consequences are created equal. For maximum effectiveness, make sure that your organization’s consequences follow these four principles:


  • 1) Make Them Meaningful

    • The best consequences connect the desired behaviors and outcomes to your organization’s overarching values and goals. This connection helps your teammates better understand how to put macro-level values into action through their day-to-day work.

    • Make sure your consequences are something your teammates actually care about.

      • For example, which reward would they care more about - getting a fancy company-branded pen, getting extra vacation days, or something else? (If you're not sure, ask them!)

      • On the corrective side, will they be motivated to improve performance if the only consequences are vague, inactionable feedback on an annual performance review months in the future?


  • 2) Make Them Clear

    • You need to make your consequences transparent. Especially for corrective consequences, if your teammates are not aware of the possibilities, they may perceive them as arbitrary or reactive. This can damage their trust in you and the organization.

    • If your teammates don’t know what the consequences are for good or bad performance, your consequences will come across as a surprise. And consequences can’t encourage positive behavior if no one knows they exist.


  • 3) Make Them Fair

    • Consequences should apply equally to similarly situated team members. This is critical to protect against unconscious bias or a perception that leaders “pick favorites," which can lead to toxic office politics or even lawsuits.

    • Standards of conduct should generally apply to yourself and other leaders on your team as much as front-line employees.

      • Though you may not share the same job duties, expectations like integrity, honesty, and excellent work ethic should apply equally across the org chart, and you need to lead by example.


  • 4) Make Them a Priority

    • Leaders must be intentional and timely when delivering positive or corrective consequences.

    • For busy leaders fighting all kinds of fires, consequences tend to drop down the list of priorities.

      • For example, a leader might launch a new recognition program with lots of mass emails, internal promotion, and maybe even a custom-made trophy, but it slips away in mere months as they get busy with other things.

      • But not every leader has that luxury, especially in smaller organizations.

    • Here are a few practices that can help busy leaders prioritize consequences:

      • Create a standing 15-minute calendar item each week for you to identify and recognize your team’s stellar accomplishments.

        • This can be as simple as a call or written note, or you can devote some intentional time to building a robust recognition program.

      • Adopt a 24-hour rule to address corrective behaviors.

        • Within 24 hours of becoming aware of a teammate’s poor behavior, meet up with the teammate to discuss it 1-on-1, or take steps to get additional information if needed.

        • When you correct negative behavior quickly, you greatly improve the odds that it does not become a bigger issue down the road. Don’t let it fester until your teammate’s next regularly scheduled 1-on-1, which could be far in the future.

      • Designate another teammate to serve as point person for the program, including identifying star performers, scheduling communications and awards ceremonies, and clarifying the best way to involve you and other leaders.



Wrapping Up Our Accountability Journey


With consequences and the other four elements now in your toolkit, you can start building a culture of accountability in your organization. Accountability is the backbone of high-performing organizations. It may look a bit different from organization to organization, but its core is the same: clear expectations, capability, measurement, feedback, and consequences.


When your team is highly accountable, you can achieve incredible results. And when you build it firmly into your culture, it is much more likely that those results will continue long after you’re gone.



Michael Lanahan serves as Founder and Principal of MBL Ventures, a management consulting firm that helps business, nonprofit, and public sector leaders navigate issues of strategy, structure, and government.


To learn more, please visit www.mblventuresllc.com.


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