The Folly Of rewarding A, While Hoping for B Case Study
Overview:
In this case analysis we shall be examining the unintended contradictory results that reward systems bring about and recommendations in solving the issues highlighted
Problem Statement:
Many Problems in Organizations are created because of Faulty Incentives and Flawed reward systems that are setup to accomplish one thing but actually does the opposite.
“While Mangers complain about lack of motivation in their workers, they might as well consider the possibility that the reward systems they’ve installed are paying off for the opposite”.
Directly linked to these Faulty Incentive and Flawed Systems are key issues with
1) Employee Motivation, 2) Reward Systems, 3)
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For doctors there may be some direct financial gain from over servicing. More important though is the possible costs and professional damage from malpractice suits. Over servicing diminishes the chance of facing such suits, or losing them if they occur.
3) Evidence of how a poor decision making Process has stereotyped and created a partiality that prevents objective consideration of an issue or situation is seen in Politics. This is a state of being BIAS
Most of us want honest politicians who tell us clearly what they will do in office, then stick to that once elected. The actual reality is that politicians don’t behave that way, yet they get elected by our vote and we sustain this reward system.
Also, we expect our public service to do the best it can with the community resources available to it. Yet there is usually great mismanagement in the public sector, Yet nobody act to resolve this issue or call the minister to order because it will harm the government’s standing and may cost it votes. This portrays a consequence of a community supported reward system unavoidably biased against good public sector management.
3)Financial incentives are designed to provide direct motivation – do this and you will get that while at the same time can spell doom. For Example giving a Psychiatrist a higher payment for
Pink provides a well laid out case highlighting the gap between what science knows and what organizations do. Showcasing the mid-century work of Harry Harlow and Edward Deci , Pink explains how human motivation seems to run counter to what most scientists and citizens believe. For decades, we have believed that we know what motivates people: rewards. Rewards are supposed to intensify interest and enhance performance. But Harlow and Deci found different results. Deci wrote, “When money is used as an external reward for some activity, the subjects lose intrinsic interest for the activity.” Like a shot of espresso, rewards can give you a jolt of energy, but the boost wears out, moreover, it can erode a person’s longer-term motivation to engage in the task. As we continue to incentivize our staff and students,
The aim of this appointment is use your experience and expertise in reward management to develop a progressive reward system that mitigates the risk of avoiding similar industrial action. You are expected to prepare a report that discusses the components of a reward system and recommends a progressive approach to the practice of reward management. You will be expected to justify your recommendations.
Chapter 12 of our textbook is titled “Motivating Employees,” and it encompasses much of what was in Drive. An extrinsic reward is defined as the “payoff, such as money, a person receives from others for performing a particular task.” Extrinsic rewards are what drive the old economy and still influence management techniques within organizations today. These rewards have many benefits but are becoming more and more obsolete in the twenty-first century workforce. The textbook defines intrinsic rewards as the “satisfaction, such as a feeling of accomplishment, a person receives from performing the particular task itself.” Offering only extrinsic rewards is what Pink refers to as “carrots and sticks.” These rewards work well for routine tasks. However, these rewards often stifle creativity (as seen in the candlestick experiment). Modern jobs are increasingly relying on creativity and innovation. Managers can use this knowledge by acknowledging the importance of intrinsic rewards when dealing with employees engaged in more complex
The author assesses that “the more rewards are used the more they are needed”. People get unsatisfied with what they are getting eventually and the stakes rise. People only perform if there is an incentive for a reward, else they will not try hard at all. Sometimes rewards can be given for wrong reasons, make the judgements of individuals altruistic and even detrimental. If it pays must be good, the better the pay the better the reward, the greater the incentive. The value and purpose of rewards have become destructive for the convenience of the people who want to control behavior.
Economic or the effects of the economy on designing, implementing and maintain a Total Rewards package.
Rewards can be used to obtain power by offering something in return for one’s conformity, but what my colleagues and I have seen far too often is that rewards can also have a way of de-motivating people as well. This can happen if the same people are rewarded time and time again for doing nothing more than what is the considered to be their actual job responsibilities while other people completing their job responsibilities receive no such accolades, in addition, rewards create an unsustainable environment and are not advisable for long-term buy-in. I have found myself feeling de-motivated, bitter, and withdrawn at many different times due to the perception that I have created that I am being underappreciated and deserving of more accolades. This, however, is a negative cycle that only perpetuates because I continually look only for information to reaffirm my
In many cases different type of rewards has different type of effects on different organizations.
The second model does not place the same blame on the individual as the first one does. Instead, the majority of the blame is placed upon the structure of the organization. Individuals work most of the time to better their own self-interest. This is the main dilemma of the second model, as it is very difficult to “structure an organization so that individuals, in pursing their own self-interest, are always working for the organization’s best interest at the same time” (Knott & Miller, 1987, 174). This model contains
Their bosses thought that by giving them a bonus or pay increase would suffice, and they would continue doing a good job. “Sometimes this basic system succeeded in getting the results that were intended; but more often than not, it failed” (Archer North). As researchers dug more into the details, they found that employers really needed to look more into what motivates employees and not to assume that money is the only motivator. From their studies, they were able to see that companies should look more at the morale and self-esteem of their workforce. Once this information was revealed, the use of rewards as the main motivator was pushed to the side. “The general model of performance appraisal, as it is known today, began from that time” (Archer North).
It is not easy to successfully overstate the degree in which the majority of managers and also the individuals who recommend them believe in the redemptive power benefits. Certainly, most U.S. businesses apply certain kind of plan meant to motivate workers by attaching compensation to a single index chart of overall performance. However more stunning may be the seldom analyzed perception that individuals will perform a much better job when they have already been promised some kind of motivation. This presumption and also the methods related to it tend to be pervasive, but an increasing assortment of proof encourages an opposing perspective. Based on many studies within laboratories, work environments, lecture rooms, along with other surroundings, benefits generally undermine the procedures they're meant to improve. The results claim that the actual failure associated with a specified incentive program is attributed much less to some glitch inside that plan rather than the ineffectiveness of the psychological presumptions that ground these kinds of ideas (Kohn, 1993).
The company must keep their goals in mind. The must make sure that quality is still a priority and not second to productivity. There are steps to be considered when designing and implementing a reward system. The
The article titled Why Incentive Plans Cannot Work by Alfie Kohn was very interesting. Rewards offer temporary compliance that can ultimately destroy relationships among employees. It hinders the ability to manage a company. It creates short-term success and does not mean long-term commitment. In this, I find that incentives do not alter the attitudes that underlie behaviors. Incentives hinder creativity and create competition. I concur that incentives also undermine interest.
Q: According to your understanding, why do you think that incentive pay is a good motivator for individual worker?
As a conclusion, not all reward systems is a hundred percent worthy for the company. It is best to know how well is the staffs are. Not only that, it is essential to be diversify so that different methods can be used as reward system and not bound by only one form.
So depending upon the organization structure, the reward system can be designed carefully in a way that it meets the firm's target. The food industry or company should never underestimate the affect a good reward system has on the growth of an organization.