The Super Fantastic Leadership Show: Dumb Incentive Plans


076: Incentive Plans Are Stupid


This week we discuss incentive plans and why they really don’t work to change long-term behavior or get us what we ultimately want. Now, if you want to hear a previous show on a similar topic you can also listen to Episode 38. This week we build on that conversation and bring in some of the data that again, reinforces that incentive plans at work do very little to change overall behavior and actually, do more to squelch collaboration and positive behaviors too. Also, this week I take a moment to appreciate my mom; which has nothing to do with incentive plans but has everything to do with positive emotion. Ok, now more about this week’s show.

Incentive plans are the opposite of the stick; they are the carrot. In other words, do this and you will get that. And the truth is, they have a very, very short shelf-life when it comes to changing behavior. Increased pay is usually the way that this shows up for doing something. This runs very close to a “bribe” if you think about it. Most of this basic premise comes from the psychology of behaviorism and the use of rewards with mice in laboratory studies. Unfortunately, the behaviorist view often doesn’t apply when it comes to humans because we are likely one of the only species that can truly plan for our future and not be in reaction to our average instincts. Therefore, the basic psychological constructs of how humans come to the choices that they make and what truly motivates them is not reflected in incentive plans. It isn’t the incentive plan itself that is the issue, it is the fact that incentive plans miss the entire psychological framework of how humans function. Essentially, our own intrinsic motivation is always a greater than extrinsic motivators.

So listen in this week and tell us what you think about incentive plans? Do they motivate you? Do they help you enjoy your work more and do it better?

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