Rewards. Don't. Work.

At the risk of being extremely controversial, businesses need to rethink the benefit of their Reward and Recognition (R&R) programs, and arguably, they should be thrown to the scrap heap in their current formats.

In the interest of full disclosure, over the last 20 years, I’ve spent my fair share of time developing and introducing R&R programs into the teams I was responsible for leading. But in each and every instance, I knew that the program being developed (be it an in-house program or an external third party application being deployed for prize selection) was not going to endear itself to all participating in the program. 

But I still did it. 

And my managers were also extremely keen in such programs being implemented.

But as the years went on, and more attempts were made to refine programs which never seemed to hit the heights imagined, I started to myself the following questions:

Was it really for the staff?  

Was it for management up the chain who wanted to give the appearance that they were listening? 

Was it because we felt that we just had to do something to appease as many people as possible? 

Or was it because thats just what you did?

As I started to ask these questions, I started to find it increasingly interesting that the overwhelming belief was that people would do a better job if they received some level of incentive or reward. 

So here’s the question - do rewards really work?

Well, that depends on your definition of ‘work’. Research suggests that rewards only succeed in accomplishing one thing - temporary compliance. Reward programs will move from one hot topic fix to the next and over time, once the rewards run out, people reverted to old behaviours and the areas you were trying to remedy through rewards or incentives pretty much went back to where they were before you started.

The other interesting behaviour is that throughout the course of the reward/incentive campaign, individuals who fell behind the pace setters would become disengaged, as the reward being offered was no longer within their reach. The remaining few who still had a chance would continue to press for the goal. So, by default, it becomes a reward for the few, not the many.

Furthermore, what psychologists call ‘extrinsic motivators’, do not alter the attitudes that underlie our behaviours. They do not create an enduring commitment to any value or action. Rather, incentives merely—and temporarily—change what we do.

Now, I can already feel some eyebrows being raised as this is being read. But allow me to add something else to the thought process. Employee Engagement.

When you look at recent Gallup research on the state of employee engagement, it reports that a “staggering 87% of employees worldwide are not engaged”. From an Australian perspective, 76% of employees are either disengaged or actively disengaged. Other sources go even further. officevibe.com displays a realtime live feed on the state of global employee engagement. Officevibe is used in 157 countries and over 1000 organisations globally use this online platform as a means to measure engagement. As of February 1, 2017, the following results were reported in real time:

  • 63% of employees feel like they don’t get enough praise.
  • 32% of employees have to wait more than 3 months to get feedback from their managers
  • 56% of employees believe that they don’t have any career advancement opportunities
  • 60% of employees notice that their job is taking a toll on their personal life
  • 15% of employees do not see themselves in the same company one year from now
  • 57% of employee would not recommend their organisation as a good place to work

So if this is the state of play, how can anyone argue that the current way rewards are being conducted as beneficial?

Why Rewards fail

The question therefore remains, why do so many senior managers rely on these programs? The simple answer is that rewards buy temporary compliance, so it looks like the problems are solved. The more complex answer is that few people really take the time to examine the connection between incentive programs and the problems with workplace productivity and morale. 

It’s harder to spot the harm they cause over the long term and it does not occur to most of us to even question rewards, given that our own teachers, parents, and managers use them. 

(“Do this and you’ll get that”)

We need to start to investigate the root cause of disharmony in our workplace and begin a dialogue that provides real outcomes. We cannot continue to fine tune these programs hoping that the outcome will be different. 

Albert Einstein famously defined insanity as doing the same thing over and over again and expecting different results. 

In my opinion, rewards discourage risk taking. People will do exactly what they are being asked to do, if the reward is significant - and no more. And this is the root of the problem. Whenever people are encouraged to think about what they will get for engaging in a task, they become less inclined to take risks or explore possibilities. 

In a word, the number one casualty of rewards is creativity.  

Tell people that their income will depend on their productivity or performance rating, and they will focus on the numbers. And by focusing on the numbers, you will inevitably have people find ways of manipulating the system to achieve that number…..as that is the reward. The numbers are outcomes, therefore by only focusing on the outcome, you miss the big picture.

Excellence pulls in one direction; rewards pull in another.  

Some managers insist that the only problem with reward or incentive programs is that they don’t reward the right things. But these managers fail to understand the psychological factors involved and, consequently, “do the same thing over and over again and expect different results”.

Managers who insist that the job won’t get done right without rewards have failed to offer a convincing argument for behavioural change. Promising a reward to someone who appears unmotivated is a bit like offering salt water to someone who is thirsty. 

Bribes in the workplace simply can’t work.

John Stavrakis