As discussed in in my article “let these visionary business leaders guide us to global sustainability”, business founders started their companies mostly not first to ensure a source of income, but to follow their vision or dream.
Enzo Ferrari expressed this as: “I think of myself as constantly realizing a childhood dream.” He founded his first company Auto Avio Costruzioni in 1939 as he was 41 years old. The company developed and produced the AAC 815. Already in 1938 Enzo left Alfa Romeo, but the agreement with Alfa Romeo forbade him to use his own name for the next 4 years. For this he has founded, together with other formal Alfa Romeo engineers, Auto Avio Costruzioni, first to produce parts for the Italian air force, but then soon to get back to automobile racing. Today exits just one original 815, it can be found in a private Italian car collection.
Even if the separation itself was not in friendship, Enzo had been for 18 years an Alfa Romeo employee; first as race driver, later also as team manager and general responsible for the company’s motor sports activities. In this time, the company offered him enough liberty to grow inside its structures; up to that the “Scuderia Ferrari” became the official Alfa Romeo racing team. The company structure and Enzo’s contract allowed him to execute his tasks on a high motivation level. Only as a new management started to reduce Enzo’s liberties, he preferred to leave and open up his own company.
As each individual is different, it is imperative for a company to find the employee’s motivators, as individuals try to maximize the output in relation to their input.
Employee’s input: Working Hours / Employee’s output: Salary + further Motivators
People who like their work are less tempted to participate in an internal fraud or an external corruption case to not risk their actual position.
Employee’s motivation is not only determined by the relation from his or her in- and output, but also how the individual is doing in comparison to others. A balance is reached if:
E1 Output / E1 Input = E2 Output / E2 Input
John Stacy Adam’s Theory is no mathematical equation, but a social psychological theory, which wants to explain the individual’s behavior inside a group, especially a work-group. Individuals prefer to be inside the equilibrium, if not this can lead to different forms of behavior:
E1 O / E1 I < E2 O / E2 I: Employee 1 receives a lower output related on his or her input that Employee 2. The situation is perceived as unfair and will trigger counter measures by E1, as the individual
- tries to reduce its input, as quantity and quality of its work.
- tries to achieve a higher output. This can be on the official way to request a raise of salary or additional secondary motivators. If this gets declined or the employee perceive that it would be, there is a risk of “self-service”, beginning with minor thefts and can lead up to higher value frauds.
- searches for other job positions, what can be inside the same company, but also outside.
- is not satisfied with actual position, for this less motivated to protect it. As its input should be reduced, shortcuts through internal processes and external laws are tempting.
Further, input and output are no measurable units. As people want to be inside the equilibrium, changes can also occur inside the head. The individual can re-evaluate the input as lower as originally perceived or on the other hand, perceive the actual output as high than in the beginning.
Some people have the goal to start their own-business, but nevertheless most individuals stay inside a company or even prefer this dependency, as it offers a perceived security. Here it is important that the company can communicate the founder’s vision, ideas and dream, so that hopefully, the employees can understand this and feel the same. With raising their motivation level, fraud and compliance risks can be lowered.
Compliance can actively foster this with including the founder’s vision in its training & workshops and then explain how complying with the internal guidelines & external laws ensures to keep this vision alive.
Vision (including Values) + Strategy + Compliance = Sustainability
A second advantage is that including the company’s history into the training makes it more interesting for the employees and the story-telling supports that topics get easier learned and later better remembered.
- Adams, John Stacey (1965): “Inequity in social exchange”
- Henz, Patrick (2016): “Alfa Romeo, Ferrari, Art & History”
- Henz, Patrick (2016): “Business Philosophy according to Enzo Ferrari”