You Will Get What You Pay For

One of the responsibilities of service providers in performance industry is to look for unintended consequences of creating incentives for behavior change.  As this post in Compensation Force highlights - you do get what you pay for.

A very important part of any program design engagement is to work through the "possible" outcomes of a program structure.  Never assume the people in a program will act the way you intend.  Assume they won't.  While most program structures will influence the appropriate behavior there are always those who will want to scam the system.  Once that flaw is known....many more will follow. 

This analysis and understanding is part of the value a true professional consultant provides.  Too many times companies will ask a marketing or sales person within their own organization to put together an incentive program only to find that in the end, many people earn awards, no increase or result was realized, and money was wasted.  Take time to think through the "unintended consequences."

Comments

[Ann Bares]

I agree that thinking through the unintended consequences is critical, but this can be more difficult then people realize. Sometimes the problems that I encounter with incentive plans "gone awry" is that they are, in fact, driving people to do exactly what the plan designers intended. The issue is that the plan designers didn't think through these intentions carefully enough, asking questions like "are we sure we really want that improvement or change?" and "might that particular improvement or change possibly come at a cost that we aren't prepared to pay?".

It reminds me of something a colleague in Info Technology used to tell me when I was experiencing issues: "the problem you're having is that the computer is doing exactly what you told it to do, rather than what you really want it to do." Incentive plans often work in the same frustrating way!