Reward Systems

Step 3: Create Reward Systems That Work

Let me begin this section by asking you two questions:

• In a typical organization, who gets more money—high performers or low performers? (Most people say the high performers.)
• In a typical organization, who gets more performance feedback—high performers or low performers? (Most people say the low performers.)

According to the dictionary, rewards are anything that increases the probability of a future response. Viewed that way, money is obviously a good reward. If you offer people money to do something, you increase the likelihood that they’ll do it. Feedback is also a good reward. In the absence of feedback, it’s impossible for people to systematically improve their behavior. Now, if I told you there’s ...