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Incentives That  Don't Work


If you want to boost worker productivity, don't make the common mistake of handing out "recognition awards" to one or two of your star employees in hopes that others will take the hint and follow their example.  It doesn't work.  "To improve productivity, you have to foster teamwork." notes Bonnie Donovan of the American Productivity Center, "and singling out the superstars tends to undermine team spirit. If you really want to improve performance, then the rewards have to go to anyone who attains a given level of performance, and that level should be within reach of a lot of people."

This doesn't mean that recognition awards serve no useful purpose.  You can use them to create role models and to give employees a sense of the company's priorities - provided you use objective, clearly defined criteria.  Most companies don't.  As a result, "people don't know what they have to do to receive [a recognition award]," says Donovan.  "You've set up a target that nobody knows how to aim at."

 
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