Social science and behavioral economics provide a wealth of insights on motivation, recognition and rewards. Without getting too academic and scientific, it is helpful to know some of the theoretical principles that have been discovered so we can use rewards and recognition more effectively. Here are the top 10 scientific principles to put into play with your recognition and reward practices and programs.
This universal behavioral economic principle of give and take flows in two directions respectively for either rewards or recognition. Employees are more likely to perform well in return when recognition is given to them. Employers reciprocate in kind to performance from employees by giving rewards. Use the two directions of both items for their reciprocity and maximum effect.
We see this principle over and over again. When best performers are acknowledged or rewarded, these standout players unknowingly influence those not recognized or rewarded. These unrecognized employees desire to conform to the normative behavior of high performers and thereby please the employer. By making rewards and recognition public, you also impact non-recipient performance positively.
When recognition is given, you are actually sending positive messages to employees that are, hopefully, communicating kindness from the employer to the employees. This positive feedback reinforces the power of positive pro-social behavior occurring. Take special care with the words you use in your communications.
An important principle with rewards and recognition is the need for individuals to feel validated for their good deeds. That is why it is important to highlight the best performers, to acknowledge the valuable contributions that these individuals have made, and to validate the worth of people. Focus on the contributions and the differences that people make.
With rewards, there is a perceptual difference between cash and matching-value non-monetary rewards. People are more inclined to say they would prefer cash over a tangible reward. But they typically work harder for non-monetary rewards that they could not normally justify spending their own money on. Design your programs well in terms of what you actually give to your employees.
“Research repeatedly shows that cash has a lower social utility over non-monetary rewards. Make your rewards items or experiences that people will want to talk about.”
Rewards, whether in the form of currency or tangible items, can always be exchanged with others and they can choose to transfer them to someone else’s ownership. Recognition, on the other hand, is nontransferable, and it fills a person’s emotional and psychological bank account — something that can never be exchanged. Add a strong recognition association or component with any rewards that you give to your employees.
7. Social Utility
Ask yourself what the social acceptance and satisfaction of a particular reward is, and the ease of being able to talk about it. The easier it is to talk about a reward that someone has received, the more positive performance elevation obtained. Research repeatedly shows that cash has a lower social utility over non-monetary rewards. Make your rewards items or experiences that people will want to talk about.
With reference to cash rewards, keep in mind it is a lot harder to separate a cash reward from just being an incremental increase in salary versus a meaningful reward. People can more easily think about a non-monetary reward than they can think about cash. Strive to stay clear of cash for small- to medium-size rewards.
Recognition is totally unexpected and is always a surprise expression of acknowledgment with spoken or written words alone, or with a token of appreciation. Rewards, on the other hand, are always expected and follow the “if-then” formula of “if” you do this “then” you’ll get that. Understand the differences between recognition and rewards, and use them in the aforementioned manners.
People are motivated extrinsically and intrinsically by fairness. Be careful to establish the rules of rewards equitably with performance expectations. Neuroscience has found that when an extrinsic reward is removed, the residual intrinsic motivation is less than when no rewards existed. Create decision rules for rewards carefully and know that if they are removed, motivation will wane.
Used with permission from Incentive Magazine. Incentive columnist Roy Saunderson is author of Giving the Real Recognition Way and is Chief Learning Officer of the Recognition Management Institute, a consulting a training company which helps leaders and managers get recognition right. He can be reached at firstname.lastname@example.org. Also, tune in every Tuesday to his radio show, Real Recognition Radio.