Derek Pangelinan, owner of Derek Rey Consulting LLC

The Competitive Edge: Motivating Employees to 70% and Beyond


There’s a labor standard that’s well known in corporate America: You can only bank on about 70% of the potential productivity of your employees.

Small business leaders know this to be true from their own experiences. You’ve seen it in your employees, and you’ve even seen it in yourself.

The best leaders and managers see it as an opportunity for a competitive edge. If they can motivate their employees to perform beyond that 70% average, they will, by definition, be better than at least half the competition out there.

Motivation – that’s the key and the question all wrapped up in one. As a business leader, how do you motivate your employees beyond the 70% mark?

In Daniel Pink’s book, Drive, which was published by Riverhead Books in 2011, he describes motivation quite succinctly and it’s worth a read if this topic interests you. He explains that business leaders can motivate their employees in two ways. They can provide external motivators such as financial bonuses, competitions, or fear of punishment; or they can inspire internal motivation by creating a belief in employees that the work they’re doing is important and worth effort.

Although both approaches may work, internal or intrinsic motivation lasts longer, costs less, and comes with loyalty and desire to deliver quality, not just quantity. It is, however, harder to do. Giving out bonuses, pizza parties, and threatening that you’ll fire someone is a lot easier than inspiring a change in employees’ beliefs so that they’ll choose, on their own, to perform better and work harder.

So, inspiring internal motivation is the way to go. But how to do you go about it? Luckily, there is a long-practiced process for building internal motivation. Business leaders build internal motivation by constantly talking about three things. They:

• describe the work to be done as important and explain why;

• describe how the work to be done has an emotional impact on the lives of people (inside or outside the company); and

• describe how the work to be done has a measurable impact on business results.

Imagine two bicycle repair shops. The first is run by Margaret and the second by Sara. Margaret comes in to work each day with a box of donuts for her staff. She smiles at everyone. She says, “If you need me, I’ll be in the office. My door is always open to you.” True to her word, she can always be found her in the office with the door open, ready and willing to have a conversation with any who drops by. She is described as “a really nice person.”

In Sara’s shop, she runs things a little differently from Margaret. Sara comes in to work with a plan to connect with all her employees about the work to be done. Every one of her mechanics expects at least one moment a day where Sara will come to them to see how they are doing, if they have all they need to do their work, and if there are any concerns they have to share with her. She’s often heard saying three things:

• “All repairs need to be done right the first time, on time, so that we can keep our prices low, our paychecks high, and our customers happy.”

• “We never know why someone needs a bike repaired. It might just be a bike they love and have had forever. Maybe it’s a gift for someone they love. Maybe it’s their only way to and from work or school. If we do a poor job, it might mean that someone is left out in the cold and the rain, stuck halfway between home and work. Treat every repair like it matters to someone—because it does.”

• “When we show up on time, work hard, and work right, every repair is worth at least $23 to our bottom line, but only if we do our best. Let’s make money together folks!”

Sara is described as driven but caring, and she has your back.

Which shop do you think does better work? Of course, this was hypothetical, but it’s also undeniable that if you knew this kind of insight about these shops, you’d go to Sara’s repair shop every time. It’s easy to see that the employees in Sara’s shop are much more likely to want to do a really great job. That’s internal motivation. She explained to her employees why their work was important, the emotional impact, and the measurable impact.

So, here’s something to think about: What would you say in your three-part conversation with your employees?

Derek Pangelinan ownsDerek Rey Consulting LLC. He is a management/leadership coach for small and medium business owners in Oregon and Southwest Washington, and runs a variety of workshops to help them build their teams and improve communication and commitment in the workplace.


For more information about coaching or workshops for you company, contact him by email at or visit his website at