The Impact of Non-Cash Rewards and Self-Set Goals

Want to boost employee performance? A study, conducted with a global telecommunications firm and BI WORLDWIDE, offers compelling insights.

Our findings show non-cash rewards and individual goal-setting can lead to greater performance gains than cash incentives and tiered goals.

The Study

We partnered with independent academic advisors from top universities to design a study examining how rewards and rules impact performance. Participants in various groups were unaware of what was happening in other groups to maintain data integrity. We even included a control group with no additional incentives or rule changes to establish a performance baseline.

• Reward Test: We compared merchandise sets (with retail values equivalent to cash amounts) and cash rewards (via debit card)
• Rules Test: We compared self-selected vs. assigned goals (tiered rewards earned wherever the participant landed).

The Startling Results

• Control Group: Performance declined 4% (the baseline we measured against).
• Self-Selected Goals + Merchandise Rewards: 87% performance increase.
• Self-Selected Goals + Cash Rewards: Performed only slightly better than the control group.
• Assigned Goals + Merchandise: 13% performance increase.
• Assigned Goals + Cash: Shockingly, a 35% performance decrease!

Why the big difference?

Behavioural economics helps explain these results:

• Rainy Day Mentality: Like a New York City cab drivers leaving early when earning their daily wage during rain, cash-incentivised employees may have worked less once a certain target was met. Check out the full paper HERE.
• Visualisation is Powerful: The merchandise group saw tangible rewards, fueling motivation.
• Cash Deteriorates Social Fabric: Cash can create a calculative mindset rather than fostering commitment.
• Justifiability and Sociability: "Earned" merchandise feels less guilty and generates positive social chatter.
• The Power of Self-Selection: Setting your own goal yields greater commitment, planning, and a forward-thinking mindset.

Key Takeaways

• Carefully consider your chosen rewards. Tangible items may outperform cash equivalents. To get a sense of inspiring rewards, head to the BI WORLDWIDE EMEA Global Rewards Marketplace.
• Empowering employees to self-set goals can have a dramatically positive impact on performance.

This study offers valuable insights for leaders seeking to drive motivation and results. The best way to achieve this is by leveraging the power of non-cash rewards and goal-setting structures to unlock significant performance gains.

What impact would an 87% increase in performance have on your team and business?

To learn more and get access to resources to support employee performance and motivation, visit BI WORLDWIDE EMEA now.