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03/21/2017

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One boss personally led instant ice-cream shop visits. Another invited top performers to share private CEO-access time on elaborately conducted ocean fishing trips. Some global firms issued prize checks for intra-employee awards and another gave stars lunch with the COO.

Anything precious to the worker is effective, especially if the winner's commercial mercantile monetary income is not currently deficient. Many incentive techniques gain motivational power as pay passes adequate levels.

A pleasant surprise is a stronger reinforcement than an anticipated consequence. Positive recognition also can be personalized, publicized and appreciated without any risk of denial anxiety. Unexpected honors shared with the work group resonate with all, not just the direct beneficiary. Medals are frequently valued more than certificates of graduation.

All elements have their flaws and no one element is better than another universally. The best approach I have found is to have a balanced approach that uses multiple elements.

You should never look at reward elements as an either or. I've always found the better answer to be a combination of elements.

At the risk of sounding inhumane, shouldn't we also recognize that variable pay programs have purely economic returns?

Lack of measurable results create smaller variable pay costs to the company; and measurable results fund larger variable pay costs.

Suspect I'm missing your point, Paul. I've designed and installed variable pay programs that consciously lost money in order to inspire, engage and enthuse the workers to (for example) improve output quality without reduction of quantity, waste of time or loss of productivity. The most significant results were non-economic, at least not in the short term. The pay was properly applied to serve long term policy.

I have no problem with what you are saying Jim.

All I am suggesting is from a purely economic standpoint variable pay programs produce variable costs based on variable results.

If variable pay programs can also be designed to "inspire, engage and enthuse", all the better.

But lets not overlook the basic economic results.

Still trying to see the "inhumanity" in paying more for better output results. While fixed costs for consistently uniform results might please accountants, recognizing variable talent producing variable output with variable pay has both economic and psychological benefits. I think ...

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