What Are You Incentivizing?

Pointing at gold stars on a chart - What Are You Incentivizing?

People do what they’re incentivized to do.

In this series, I’m going to talk with you about sales bonuses, discounts, “free memberships,” salaries and other ways we incentivize our staff to create value.

Some of them work and some of them don’t.

As an entrepreneur, you’re not rewarded for the time you spend or the units you produce. You’re rewarded for the value you create.

Creating value for your clients creates wealth for yourself. But what about your staff?

In the old industrial model, employees were paid to act like machines. They were taught how to conform in school. Then they earned a regular shift doing a repetitive job. They got a raise every few years as a reward for being the same. The best models of conformity and sameness were rewarded by being put in charge of everyone else. Sometimes, going above and beyond spec resulted in a commission or bonus. Licenses were a barrier to earning more money. And unions kept everything cemented in place.

But that model doesn’t work anymore.

Doing a job for a long time doesn’t necessarily make you better at it. Seniority doesn’t create value. Sales bonuses and commissions don’t grow your service business. Unions and licensure can’t hold back the tidal wave of change created by the leverage of new technology. The emerging gig economy and untethered workday mean our children have huge opportunities, and so do our staff members if they’re the best and if they demonstrate their value.

If they grow the pie, everyone wins.

If you cut into your profit margin to pay them more, everyone loses.

People do what they’re incentivized to do. For our parents’ generation, security was the primary incentive. For our generation, wealth is the primary incentive. So how do you create wealth—the freedom of finances and time—for your staff? By growing your platform and allowing your staff to grow with you.

Other Media in This Series

“Should Your Gym Pay a Salary?”
“Should Your Gym Pay Sales Commissions?”
“How to Give Your Staff a Raise”


One more thing!

Did you know gym owners can earn $100,000 a year with no more than 150 clients? We wrote a guide showing you exactly how.