Employee Incentives AdviceEmployee Incentives Research

“Free” Versus Earned Rewards

By March 25, 2013 No Comments

Question:  What do employees appreciate more, a “free” gift from their employer or a reward that they knowingly earned?

Answer: A reward that they knowingly earned.

A study at Emory University conducted in 2004  by renown psychologist Dr. Gregory Berns, clearly showed that the human brain is more stimulated when a person earns something as opposed to having something given to him/her. Dr. Berns and his team of researchers measured brain activity in the striatum (the part of the brain associated with the processing of rewards and pleasure)  in 2 groups of volunteers. One group was rewarded money without having to earn it, the other had to work to receive money. The study clearly demonstrated that the brains of those who had to work for their money more stimulated.

Dr. Berns states: “When you have to do things for your reward, it is clearly more important to the brain.” As an example, he goes on to say, “There is substantial evidence that people who win the lottery are not happier a year later.”

A similar conclusion was reached by a recent Snowfly survey of 500 users. People responded to this open-ended question: “What do you like about the Snowfly reward system?” There were 361 respondents who recorded something to the effect, “I like it when I earn a reward.” This is opposed to only 25 respondents who made comments such as “I like getting prizes.”

So in terms of effective employee incentives here are some best practices that can be derived from this resarch:

  1. Try to avoid giving out employee rewards “just because.”
  2. When an employee does earn a reward, be sure that they know exactly what they did to earn it.

As Dr. Berns says, “This (earning things) is a natural process of the human brain….. I don’t think it (the human brain) evolved to what it is today because people sat on a couch and had things fall into their laps.”.

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