Alfie Kohn in his groundbreaking book, Punished by Rewards, quotes study after study, which show that rewards actually inhibit things such as creativity, risk-taking, information sharing, quick problem-solving, and encourages directive command and control type behavior from supervisors.
Dissatisfaction and poorer performance can often result from reward programs. For example, when an expected bonus level is not achieved, even though a great deal of effort was made. Or, when there is a belief that only the 'chosen few' will be acknowledged and rewards are distributed in an uneven or discriminatory manner. See Punished by Rewards for many studies that show the link between rewards and lowered performance.
Rewards work best for short-term behavior changes. If you want lasting change a rewards program probably won't work - as soon as the reward stops the behavior will probably cease as well.
Rewards generally don't change people's values, attitudes and feelings. You may get short-term behavior change, but not long term commitment.
Reward programs don't get to the root cause of, why people may be apathetic or performing at a mediocre level. Which means you will probably need to find more and more goodies to induce people to continue to perform.
Rewarding everyone equally, can lead to conflict and resentment between team members. For example, award nights can, in an instant, transform the vast majority of people there into losers. And consequently, can create competition, envy, hostility and distrust between groups and group members.
Rewarding employees for results over which they have limited control can lead to cynicism.
They become an expectation rather than a reward. For example if each week a gift certificate is given for achieving a safety standard, it is no longer viewed as a reward but rather an expectation.
What you reward is what you get - so be very careful about what you reward. For example, there is a huge difference in organizational results between rewarding people for gaining knowledge, and rewarding people for sharing knowledge.
Finally, if you feel you must have a reward program then keep these guidelines in mind.
The program is straightforward and easy to understand and with little emphasis given to it (i.e minimize the fuss!)
The people have confidence in the basis of the acknowledgement i.e. they know exactly what it takes to receive acknowledgement
Each person has a role in judging his/her own performance
The individual is clear about the manner and techniques that they used to achieve the outcome (and that the leader/organization would like to see re-enacted in the future).
The person contributes to the reward process, and decides upon the type of reward that s/he would most like to receive. One of the best things you can do, is to give the receiver the choice of reward that suits his/her specific circumstances.
The reward follows closely to the actual performance.
Ultimately you need to decide: "Will the program we've decided upon, destroy or build our culture?"
An effective and well thought through rewards program enables you to find ways of rewarding employees and saying thank you, whilst encouraging more of the behavior, thinking and attitudes that enable your business to be successful.
Come away with an enhanced sense of self-determination and control over what they do.
Are not being controlled or manipulated.
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