Why Incentive Plans Cannot Work Paper
Lauren Hartigan
Human Resource Management
Professor Ferrari
M/W 3:50
Why Incentive Plans Cannot Work
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.
We see in this article that incentives don’t alter the attitudes that underlie behaviors. We think the behaviorist theory and pay for performance will increase performance but it doesn’t. Rewards succeed at only temporary compliance. Once the rewards run out people go back to their old behaviors. We call incentives “extrinsic” motivators, and they temporarily change what we do. Studies show that people, who expect to receive a reward for completing a task or for doing that task successfully, simply do not perform as well as those who expect no reward at all. I will use the example of the Welders at Midwestern manufacturing company. An incentive system had been in effect for a long time then was eliminated. At first production dipped but then over time production quickly rose, and eventually reached a level as high or higher than it had been before. Financial incentives were virtually unrelated to the number of workers who were absent or who quit their jobs over a period of time. Training and a goal-setting program had a far greater impact on productivity than did pay for performance plans. (Kohn)
The topic of incentives are part of American culture as our parents had them in their workplace. We read that the “Do this and you’ll get that” is part of American life. However these reward driven compensation systems can become a problem in the
Human Resource Management
Professor Ferrari
M/W 3:50
Why Incentive Plans Cannot Work
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.
We see in this article that incentives don’t alter the attitudes that underlie behaviors. We think the behaviorist theory and pay for performance will increase performance but it doesn’t. Rewards succeed at only temporary compliance. Once the rewards run out people go back to their old behaviors. We call incentives “extrinsic” motivators, and they temporarily change what we do. Studies show that people, who expect to receive a reward for completing a task or for doing that task successfully, simply do not perform as well as those who expect no reward at all. I will use the example of the Welders at Midwestern manufacturing company. An incentive system had been in effect for a long time then was eliminated. At first production dipped but then over time production quickly rose, and eventually reached a level as high or higher than it had been before. Financial incentives were virtually unrelated to the number of workers who were absent or who quit their jobs over a period of time. Training and a goal-setting program had a far greater impact on productivity than did pay for performance plans. (Kohn)
The topic of incentives are part of American culture as our parents had them in their workplace. We read that the “Do this and you’ll get that” is part of American life. However these reward driven compensation systems can become a problem in the
Cited: Kohn, A. (1993). Why Incentive Plans Cannot Work. Harvard Business Review, 71(5), 54-63.