December 17, 2014
Why Incentives Plans Cannot Work
The vast majority of US corporations use some sort of program intended to motivate employees by tying compensation to one index of performance or another. However, the majority of companies do not examined the belief that people will do a better job if they have an incentive in place.
Researchers suggest that, rewards succeed in the short run; they are comparing them to punishment. They both work in the short run but if you want to achieve a lasting change you should not use a reward system and use others. Once the rewards run out, people usually revert to their old behaviors.
When researchers have look to the quality of the work, people that are working on rewards usually get a poorer quality of work because they try to use the same resources to accomplish more work, usually without any big change.
Pay is not a motivator, as we have seen on the book, people that make more than $40,000 a year usually are not that motivated by an increase in payment than people under $40,000 a year. The difference is that people who make more than $40,000 usually can get the basics necessities with their salary and the increase in payment will just improve their way of living.
Rewards usually punish the employees because in order to get the reward employee should behave on a certain way and do things that they do not usually do. Making the bonus will contingent on employees achieving a certain goal, some