Many organizations are doing their best to demotivate their employees whether they are aware of it or not. Giving out mostly meaningless achievement awards may motivate some, but it seems to rub many employees the wrong way. In an article for Forbes, Dina Gerdeman explains that when companies reward employees for what they consider to be good behavior, the result can be demotivating other employees and creating a decrease in production overall.
Gerdeman looks at a study called The Dirty Laundry of Employee Award Programs: Evidence from the Field by Harvard Business School Assistant Professor Ian Larking and professor Lamar Pierce and doctoral student Timothy Gubler from the Olin School of Business at Washington University in St. Louis. The study focused on an industrial laundry that had an award program for attendance. Any employees who had no instance of being late to work or absent had their name entered into drawings for gift cards. This program seemed like a wonderful idea, Gerdeman notes, because being absent or tardy in this and many other industries can result in a loss of a substantial amount of revenue. However, after taking a closer look at this study, it seems that the rewards program seemed to show an increase in worker turn out, but it also created problems that did not exist before:
First, employees ended up “gaming” the program, showing up on time only when they were eligible for the award and, in some cases, calling in sick rather than reporting late. Most interestingly, workers were 50 percent more likely to have an unplanned “single absence” after the award was implemented, suggesting that employees who would otherwise have arrived to work tardy on a certain day might instead either call in sick to avoid disqualification or else simply stay home because they would be disqualified from the award regardless.
Also, while punctuality improved during the first few months of the program, old patterns of tardiness started to emerge in later months. And once employees became disqualified and the carrot of the award was out of their reach, their punctual behavior slipped back downhill. Larkin says this runs counter to what some people believe—that such an award program might instill a long-term pattern of on-time performance in workers.
What this shows is that many rewards programs do not instill habitual behavior as they are intended to. In many cases, employees learned to trick the system instead of making permanent improvements. Also, employees who met the requirements for the award but still did not receive it because someone else’s name was drawn developed a what’s-the-point attitude. Furthermore, employees who had be exhibiting the desired behavior before the rewards system was implemented became demotivated out of resentment. In their minds, people were being rewarded for what they should have been doing in the first place. The hardest workers were left to wonder why they had not been rewarded for doing what they were supposed to from the get go.
This is not to say that all rewards are pointless and will demotivate. Companies should focus on rewarding employees who go above and beyond what is normally expected of them instead of rewarding people who are just fulfilling their basic job description. Also, employees should receive rewards based on past achievements instead of attempting to temporarily mold behavior for the reward. Motivation may not be simple in the work place, but it is often necessary. If you are going to reward your employees, make sure you aren’t inadvertently harming your own productivity in the process.