Guy Kawasaki has posted an interview with Jeffrey Pfeffer, Thomas D. Dee II Professor of Organizational Behavior at Stanton University's Graduate School of Business and author/co-author of 12 books, and I thought that Professor Pfeffer had some worthwhile wisdom to share on the specific topic of incentives:
Incentives should be large enough to provide an occasion for celebrating success but not so large as to distort behavior. And incentives can include recognition and things other than money. Companies get themselves into trouble all the time by being too clever with their incentives.
Words worth noting!
We recently followed this idea when we designed our draft employee referral bonus structure. One thing we considered in the design was making the awards high enough to encourage/reward employee efforts while not so high that we get applications for the sake of the bonus. I am really enjoying your blog. Thanks!
Posted by: Lisa | July 15, 2007 at 04:57 PM
Lisa:
Thanks for reading and for the comment! It is a delicate balance - finding an award level that is high enough, but not too high! Good luck with your referral bonus plan!
Posted by: Ann Bares | July 16, 2007 at 07:36 AM