Having Your Cake & Eating it Too (On The Timing of Gratification in Rewards)

It's no secret to most of us that people appreciate and respond well to more frequent rewards.  That shortening the timeframe between an achievement and its reward amplifies the reinforcement power.

We're all about the compressed feedback loop.

My friends at Hinda Incentives made that point today on their blog with a discussion of Instant versus Delayed Gratification in Rewards.  They cite a USAToday poll which confirms that Americans prefer instant gratification and results. (And don't go blaming the Millennials for this; the poll shows that older Americans can be even more impatient than younter ones.) Then they pose the question: Which is the best reward?  Smaller and quicker to earn?  Or larger, longer-term?

Their answer: Both, of course.  And they're right.

Employees do respond to more frequent, smaller rewards.  But that doesn't mean you have to design every element of your reward program to deliver immediate gratification.  Only that you should consider it for a few.

For some programs, like recognition plans, tightening that feedback loop can make sense.  For others, like a cash incentive plan based on improvements to net income, it may not ... and it may even encourage inappropriate and counterproductive choices.

We've all witnessed the results of too much short-term thinking.  To serve all their stakeholders well, most organizations need to balance the here and now with a long term time horizon.

That's why balance should be the operative term in designing and managing your reward "portfolio".  Balance in financial versus non-financial outcomes, Balance in individual versus group performance.  Balance in time horizon.  Etc., etc.

So when the question is posed whether rewards should be quick or longer-term in nature, the answer - absolutely - is yes.

Which means you do have the opportunity to have your cake and eat it, too.

Image: Creative Commons Photo "Cake" by KSDigital

Comments

[Drew Hawkins]

First, that was a quick response!

Second, I think you hit the keyword that I couldn't quite get out when writing our post was "balance." One isn't always better than the other.

Appreciate the insightful follow up!

[Ann Bares]

Drew:

Thanks for the inspiration!

[E. James (Jim) Brennan]

Suspect there tends to be a general see-saw equilibrium between size and frequency. A lot of money awarded once a year is more dramatic and more conducive to behavioral changes than the same pot divided up to be served out in daily increments. Just like a bucket of water thrown at one moment makes a bigger impression than the same volume dripped out one drop at a time. But a small steady daily reinforcement can deliver the message earlier, accumulate for a more enduring persisting impact and have a more powerful retention effect. Maybe there's an inverse relationship here: the larger the reward, the less frequently it should be awarded and vice versa. Speed of feedback can make up for some size deficiencies and the other way around.

Hasn't that been written up in the ABCs of rewards by our Early Masters long ago? Think so. Otherwise, it's pretty obvious from observation, anyway.

[Ann Bares]

Jim:

It is indeed all about equilibrium and balance - from all these angles. I think the Early Masters did, in fact, figure this out long ago, and life and reinforcement haven't really changed that much.

Thanks!

[Derek Irvine, Globoforce]

Great points, Ann (and Hinda). Balance is, indeed, the key. Employees need to know that their efforts are noticed, appreciated and relevant - especially in a project that takes months or years to complete -- as they do that the outcome itself is valued. If your goal is to keep people focused, motivated and innovative throughout a months/years long project, recognize and appreciate their efforts along the way. Recognizing the process is as important as outcomes as I wrote about more in-depth in response to very interesting studies conducted among various school districts in America (http://blog.globoforce.com/2010/05/rewarding-outcomes-or-process-which.html)

[Geof Wilkens, Doherty HR]

Definitely agreed on the importance of having both short and long term rewards. I've seen a couple of people close to me get burned out on long term projects when they have no sense of progress and no appreciable recognition for their efforts.