What Impacts Employee Performance?

Performance = (Motivation x Ability) – Situational Constraints

Math never was my favorite subject, but I have found a great deal of value in this equation. The equation causes us to consider a more comprehensive view of what actually impacts performance. Without the broader view, we tend to engage the underperformance of those around us with a too simplistic and reactionary response.

I often ask leaders to look at this equation and tell me what part of it they have the most control over. This always leads to a lively discussion, with varied points of view. They usually ask me to break the tie and tell them THE answer. Most are dissatisfied with my response, because I don’t think the “correct” answer is as important as being able to hold the complex question: “How can I, as a leader, best support those around me?”

Can a leader change the motivation level of an employee?

This question is the “seed” from which Industrial/Organizational Psychology grew at the beginning of the industrial revolution. One of the first recorded studies took place in a textile factory. The problem: workers kept allowing the spools of thread to run out and it hindered productivity. The solution: the organizational psychologists brought kittens into the factory so they could play with balls of yarn on the floor. It was enough to keep the workers more engaged, which led to them refilling the spools before they ran out and everything shut down. Kittens? Really? Why didn’t they just threaten to fire them or give them another speech?

Here’s what I know: motivation at its best is an inside-out process. It happens when we can locate within ourselves a deep inner desire to contribute. Our perception of our environment will make it easier or harder to locate it. This is where the leader comes in.

As leaders, we can create a motivational environment.

The first and most important ingredient is who we are. Sure, we can remodel the office, provide state-of-the-art technology, put ping-pong tables in the break room, and even dangle a generous bonus program. But all of these measures will fail to create an optimal motivational environment if people don’t want to be around us. It’s not a good sign when I hear employees say, “this is such a better place to work when the boss is away.”

Having a remodeled leader is far more motivating than having remodeled offices.

I will continue to break down this equation in the next couple blogs…stay tuned!



As an organizational psychologist, Dan McArthur has worked with owners and top executives in a variety of organizations for 30 years. He is at his best when the obstructions to growth and harmony are not readily observable. He has an amazing ability to quickly build trust with all key players and support them as they move toward better self-management, leadership, healthy team dynamics, and increased productivity. (Learn more about Dan…)

copyright 2018 McArthur Executive Development