Controversy Over Incentive Programs
Incentive programs can be controversial, and some have challenged them on the basis that they are ineffective or unfair. Proponents of incentive programs maintain that such programs stimulate employees to stay active, reward those who have demonstrated extra effort, and promote an atmosphere of positive interaction between managers and employees. Others have argued that incentive programs encourage competitive behavior, contribute to feelings of resentment and tend to reward those who are naturally high performers regardless of incentive, which yields no productivity increase and may lead to charges of favoritism. Some also contend that profit sharing leads to a stultifying environment in which only raw productivity is valued, while innovation and creativity are insufficiently encouraged -- this may bolster profits in the short term but cripple the company in the long run. Still others suggest that frequent rewards are essentially self-defeating, and that the more an individual is rewarded, the more complacent he or she grows, leading to an actual drop in productivity. A final danger of incentive programs is that they may encourage dishonesty or manipulation, as in the case of a company that gives a bonus for a year without accidents, which may simply cause employees to remain silent about injuries they have sustained.
Successful Incentive Programs
There are a few widely agreed upon principles that many of the more successful incentive programs tend to follow. Monetary rewards are usually found to be fairly ineffective encouragement. This is because, for many employees, the specific pay rate is less important to them than a company's benefits, social environment, or opportunities for personal achievement. A monetary bonus may thus come off as impersonal, calculated, or even condescending. Numerous small rewards tend to work better than a limited number of large rewards, because feelings of favoritism are thereby eased, and the sense of community is maintained. Most employers agree that this communal sense is the most important factor in encouraging workplace productivity, and that incentive programs which promote this feeling are the ones which are the most successful. One method of reward that is often found effective is simply giving a high-achieving employee a greater degree of autonomy. Finally, allowing the employees input into their own reward system may result in an incentive program which is considered both stimulating and fair by everyone involved.
