Pay-for-Performance: A Moving Experience

From Vancouver to Hornby Island

My partner, John, and I moved from Vancouver to Hornby Island (one of the gulf islands between the mainland and Vancouver Island) a few days ago. It’s all very exciting and will hopefully allow us to enjoy both the rural lifestyle without losing the benefits of the connected world through the internet for both family and business interactions. (We’ve even set up a website for it: “living out beyond.”)

Kepler in empty Vancouver apartment. Photo: Darren Bond

Shingle spit at Hornby Island Photo: Darren Bond

My topic today, though, is back to the notion of pay-for-performance as it relates to the experience we just had with our moving and storage company.

They’re a local Vancouver company that has been in business for decades – almost a hundred years, I believe – so their strategy must be pretty sound. Their name is Salmon’s. (This is a family name but most appropriate for a city on the Pacific ocean.)

Basic Objectives

Now, thinking about the company as you might think about an individual, you would probably give them annual objectives such as:

• showing up at the customer’s location on the scheduled day
• packing items into a truck
• transporting to the new destination
• unpacking items into the residence
• providing a receipt for a cheque to pay for the move
• getting back to the compound

That’s pretty much the process and is pretty much what you get with a most moving companies. Very transactional. If that’s what was achieved, they might get a 100% performance rating.

Normally: Angst

However, dig a little deeper and see what the customer would give as a rating. Given previous experiences with moving companies, all the above steps were done, but with a great deal of angst and you’re just relieved when it’s all over. A glass of red wine is often warranted.

You waited for them to show up, wondering if you got the date wrong. The actual movers seem to be, well, novices, to be charitable. They don’t put down a mat over your carpet. They seem to dislike each other. They seem to nick corners with your good pieces of furniture. And so on.

This Time: Great

What made Salmon’s different? They did the same steps but the difference was phenomenal.

• They sent an “estimator” a couple of weeks ahead of time to provide an estimate for moving and storage. She remembered us from our previous move and provided free plastic bags to wrap our king-size bed mattresses (even though we were taking them with us rather than having them put into storage with most of our possessions).
• They provided a half-hour window for their arrival time.
• They had three guys for the job: one was clearly in charge, and they knew their stuff.
• They treated every object with care; we didn’t see any trouble at all.
• They plastic-wrapped an old bookcase.
• They engaged with each other with light banter and acted like a well-oiled machine.
• They were fast, efficient and courteous.
• The billing was as predicted and straightforward.

While I’m sure their rates are higher than others, we were willing to pay it, based on our previous move and the same level of professionalism. We didn’t even price-check other companies.

Our property manager asked them for business cards and expressed the wish that all movers were like them.

Pay-for-Performance?

I don’t know what the company’s compensation program is, either for base salary/wages or any potential performance bonuses. But, they’re doing something right. I suspect their attrition (staff turnover) rate is lower than most given their expertise. Culturally, they probably leave the employees to do what’s right for the customer.

If asked for a performance rating input, as a customer, I would give them something like 150% for a rating. It could be that all of the Salmon’s teams achieve the same results and so everyone gets 100%. Or, even if the bar is high based on their results, some teams may still achieve higher scores. (I would love to see what even better movers do!)

Some argue that pay-for-performance isn’t effective as an incentive; that it can actually degrade results over time, especially for those in “creative” jobs. That may be true, but I still have to believe that the principle of differentiation is warranted. Some people are simply better at what they do than others, by effort or inclination, and should be compensated for that, not as an incentive but as recognition for their talents. Their expertise can be shared and learned by others.

For those on my Salmon’s team, I hope the tip we provided was worth it. I hope the company values you. I’m guessing: yes.

Your Thoughts?

What do you think? Should people providing exemplary service receive pay-for-performance (i.e., bonuses), or simply solid salary and benefit packages?

Is it a before-the-fact incentive, or an after-the-fact recognition?