Traditionally, incentive programs were designed around the idea of “do this get that.” It’s been an axiom of program design. Give people a reason to do something and they will do it. Mostly, we’ve focused on our inner Gordan Gekko and assumed participants are rational and will do the things that maximize their personal ROI on the effort required to earn an award.
And, except when badly designed, these programs work pretty well. Actually, when badly designed they work even better – but to the detriment of the whole versus the individual… again I’ll cite Wall Street as our cautionary example.
But new research is showing that maybe, just maybe, awarding people with stuff they can’t ever use or own is better for the person earning it – and better for the company offering it by actually spurring higher levels of performance.
Yeah, you read that right – a new term that I’m sure will be bantered about with the same frequency as “gamification” – is an incentive that, to quote a recent article in the Washington Post on the idea, is
“a novel type of bonus spent on others rather than on themselves”
The article highlights a study done by Harvard Business School, the University of British Columbia and the University of Liege. To pull from the Washington Post article:
First they researched how the recipients “felt” about themselves after earning the proscocial award and the results:
“…Compared to people who did not get the charity vouchers, the employees who donated $50 said they were happier and more satisfied with their jobs. (The opinions were unchanged among those who got the $25 donation.)"
They then looked at actual performance (‘cuz hey, we don’t really care how they feel do we, we just want to know if the results were better)…
"They decided to study the effect in both sales and sports, giving Belgian pharmaceutical sales teams and Canadian recreational dodge ball teams money. Some were told to spend it on themselves, while others had to spend it on a specified teammate. The researchers found that those who had to spend the money on other teammates performed better, in terms of sales made or games won, than those who spent the incentive on themselves."
The author does note (as I do in a lot of these cases) that this is an academic study and didn’t really control for the myriad of variables within a larger organization but it is an interesting guide post for program design.
Something for us to consider – if not implement.
I’d recommend you do both – create a win-win-win. Award the individual with something for themselves – and add a little sumptin’ sumptin’ to the award they can then use on someone else.
Recipient wins, the social target wins, the company wins.
Pret A Manger Has a Different Take On Prosocial
The article also references Pret A Manger’s unique recognition strategy which I think is pretty cool too…
"And 'when employees are promoted or pass training milestones, they receive at least £50 in vouchers, a payment that Pret calls a "shooting star,"' Clifford reports. 'But instead of keeping the bonus, the employees must give the money to colleagues, people who have helped them along the way.' The message? You didn’t do it alone, and need to recognize those who helped you get there."
Nice way to really cement the idea that “we’re all in this together.”
Ask yourself – could you do this in your company? Should you?
How would this impact your next channel incentive program? If your company has a charity they support – or if your client has one – why not tie some of the awards earned in the program to that charity or cause and connect the earner to it through awards.
I’m not talking about just throwing up an “option to redeem” for charity contributions – I’m talking about you being prosocial and making it an automatic thing – 5% of earnings go toward a charity.
Is this something you’d be willing to do? Would taking 5% from a budget allocated to awards and moving to social causes really cause a program to fail?
Or, as this research suggests… cause it be more successful?
I’m in the latter camp and think you should be too.
And a video treat for those that might want to consider social responsiblity and including "prosocial" incentives... (video embedded - RSS and email subscribers may have to click through to see video.)