Effective motivation is one of the key enablers of successful transformation. As director of the Business Transformation Agency (BTA) within the Defense Department, I'm always looking for ways to generate that kind of motivation for changing the way we do business in more efficient and effective ways.

One of my biggest adjustments in coming from management positions in industry has been to find ways to offer incentives for desired behavior within government constraints. In government, we often lack sufficient tools, flexibility, metrics and even a common language necessary for motivating our workforce to drive toward transformational outcomes. One of those tools has been the soon-to-be-terminated National Security Personnel System.

As I've listened to the debate about NSPS and the other performance management systems in government, the focus is almost always on individual performance — individual objectives, individual evaluations, individual ratings and individual payouts. My private-sector experience has taught me that incentives geared to groups are often more powerful than those targeted at individuals in achieving organizational objectives.

As baseball legend Babe Ruth once said, "The way a team plays as a whole determines its success. You may have the greatest bunch of individual stars in the world, but if they don't play together, the club won't be worth a dime." It is with this perspective in mind that I focused much of our performance management energy at BTA this past year around what NSPS calls "Element 3" — the pool of funds used for bonuses — and created a structure that would reward, or not, our employees based on the performance of the agency as a whole.

Here's what we did: At the beginning of the year, we identified four agencywide goals. Each goal had quantifiable targets; in fact, each goal had five specific targets, each linked to a rating of 1 to 5. The ultimate size of the agency bonus pool would be determined based on the results against these targets. Scoring a 3 would equal the size of last year's pool. Lower ratings would reduce the size, and higher ratings would yield an increase and a significant boost for an overall score of 5.

To ensure that we were motivating the desired behavior, we selected goals that were at the heart of our business transformation mission. The goals encompassed our own internal operations, our leadership in the area of enterprise standards and our support for business process improvements for our war fighters serving in Iraq and Afghanistan.

Each goal required active participation from across our entire agency, as well as collaboration with a number of other entities across DoD. To achieve the highest ratings required significant improvement against initial expectations. Finally, we brought transparency to the process, reporting status for all four goals on a monthly basis.

How did we do? Well, it came down to the wire. We were running a solid 4 heading into September, when we had a rush of activity that just put us over the top to an overall average rating of 5. The enthusiasm and productivity that was generated was better than I had even hoped.

I see this approach as a win-win-win scenario. The agency and Defense Department benefited by us overachieving against objectives that were core to our mission. The employees benefited financially based on the increased size of the bonus pool. They also achieved a greater awareness of their personal connection to the organization and its potential for success. Finally, we all benefited by succeeding as part of a team, which has that intangible value for all of us who strive to be an integral part of something larger than ourselves.

Performance management is complex and challenging. There is no perfect system. My hope is that whatever we end up with at the Defense Department provides the flexibility to encourage the team as much as the individual. I couldn't be more pleased with our results, and have already announced even more aggressive team targets for fiscal 2010.

Coach Vince Lombardi once said, "Individual commitment to a group effort — that is what makes a team work, a company work, a society work, a civilization work." I believe it is also what makes government work. Whatever performance management system we end up with, it should always allow for the ability to offer incentives to the team as a whole to achieve optimal results.

David Fisher is director of the Defense Department's Business Transformation Agency.