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On the Edge: The Curse of Unlimited Incentive Choice
April 02, 2008
Does offering unlimited choice when it comes to incentive rewards—in the form of award debit cards, or through an ever-expanding choice of certificates and items in typical incentive catalogs—do more harm than good? How might the results of your incentive program benefit by going on a rewards diet?
By Paul Hebert
"We want it all" may be the mantra you envision your employees shouting from their cubicles when it comes time to choose their well-deserved incentive reward. Happily, you hand over a huge booklet of possible tier options. Of course you are pleased at the quantity, maybe you even take pride in it. But just because employees have a wide array of choice, it doesn't ensure they'll be happy with their reward and stay motivated.
What?!
Let's look at it this way: When given the option of choosing one item from a group of many items or choosing one item from a smaller group, which would you want? A better question may be: Which would you feel better about after you've made your choice?
This inquiry is precisely the basis for a spurt of recent publications on the topic of choice—in particular, the "When Choice is Demotiving: Can One Desire Too Much of a Good Thing?" study and a book, entitled "The Paradox of Choice." These two works center on the position that while people by nature desire more options from which to choose, we are becoming increasingly unhappy in those choices.
The report and the book propose that while many choices are initially attractive:
• People enjoy making choices more when the selection from which to choose is limited;
• People are more satisfied with their choices when chosen from a limited selection; and
• People perform better when asked to do something from a limited choice of options.
This is truly a paradox—and potentially a problem—for any incentive program. And, if the research is correct, it will have huge impact on the way in which incentive and performance improvement programs are developed in the future.
Perhaps the biggest insight the study provides is that a majority of participants don't know that they will be unhappy if given unlimited choice. People are conditioned by society to believe that more is better, but they aren't prepared for—and don't understand—the implications of choosing from the "more." Therefore, programs must be designed in a way that do not overtly limit participant choices while still providing the impression that employees' choices are unlimited.
It's All About the Process
So how can we offer a large selection of awards AND have happy participants?
The answer lies in the process. If the participant is required—or encouraged—to make successive choices from the "unlimited" pool of options beforehand, it may be possible to provide more choices and eliminate the dissatisfaction and frustration of having to actually make that choice from a large number of options. That way, when the time to make the ultimate choice arrives, it is from a limited pool of pre-selected options.
Here are some suggestions…
1. Manage the Choosing Process
Expand the "wish list" functionality to help participants choose items for other members of their family (extended or otherwise) by asking for birthdays and gifts they'd like to give. Once the "wish list" is completed, the system can remind the participant prior to the birthday and ask for shipping instructions. The system can also ask the participant for permission to ship once the appropriate number of points is reached and send a confirmation email when completed.
Asking for gift ideas further reduces negative feelings about the choice made since they are giving a gift and the receiver rarely is ungrateful for the thought.
2. Provide Opportunities for Limited Choice
Throughout the term of the program, "offer" participants limited choices for limited times to redeem their points. The limited choices could be taken from historical trends on redemption and also provide a discount from the point values in the general ongoing catalog. This process would encourage redemption, reduce the stress associated with choosing an award and ultimately provide greater motivation to the participant. All of these benefits will drive program performance, which is what you are purchasing for in the first place.
3. Ask First, Assemble Later
Each participant could be asked to list their desires and needs for the next three to six months at the program onset. From this list, a custom catalog—limited by the choices they made up front—would be assembled and electronically delivered to the participant. This would be the "main" catalog from which they would redeem. During the course of the program, additional special offers could be provided to expand the choice if necessary.
This option would require a very astute understanding of the program rules and earnings potential in order to ensure the awards are meaningful, yet attainable. In this scenario there would be no "merchandise" catalog or travel options. It would simply be "My Catalog" based on the employee's desires and willingness to work toward a goal.
Limited Options, Unlimited Returns
Having unlimited options can lead people to dissatisfaction with the choices they make and actually reduce motivation. Try reducing your incentive catalog and see what feedback you get. After all, your employees have enough decisions to make without having to scrutinize and worry about choosing the right reward.
Paul Hebert is currently the Executive Director at Excellence In Motivation, Inc., (www.eim-inc.com) and is responsible for new client solution development. Over the past 20-plus years, Paul has worked with many Fortune 100 clients to develop non-cash reward and recognition strategies within an overall audience engagement plan. Paul writes a monthly online column for Incentive magazine on incentive industry trends, and he blogs about the incentive industry and how to best engage your target audiences at his own blog, Incentive Intelligence.
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