The Jackpot theory of incentives

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The Jackpot theory for incentivizing workers--where you randomly award a nice prize to the pool of people who are eligible to win it--appears to work for the Royal Mail in England. An excerpt from the Financial Times:

...I was reminded of this last week when I read about a brilliant new

scheme developed by Royal Mail, whose postmen skive and malinger more

than the national average (though I would like to make clear that my

own postman, Mick, is healthy, hardworking and generally an example to

us all). It has told them that if they show up to work every day for

six months, they will be entered for a prize draw and could win a car

or a holiday in the sun. The effect has been incredible. Absenteeism is

down by about 15 per cent.

It's funny, though, that when Madeleine McGrath posted something about it on the TomPeters site, the comments are all pretty negative--as in this post from one person:

using exactly the same principle now established by the Royal Mail,

do they extend into rewarding staff with prize draws for: wearing their

uniform instead of their jeans whilst delivering letters; driving royal

mail vans through the streets instead of their own pick-up trucks;

answering the phone with politeness instead of surliness; emptying the

post boxes every day instead of when they feel like it... etc etc

the royal mail have now, inadvertently, altered the psychological

contract with their employees - it now communicates "although we say

you do a day's work for the reward of a day's pay, we don't really mean

it and to prove it here is additional benefit in the form of prizes"

and "although we don't condon not turning up for work when you like, we

secretly accept that a lot of you will not and because we recognise

this we will reward you with prizes".

I don't know about humans, but this is a basic in dog training. Random jackpots get much better--and much more consistent--results than constant rewards, no rewards at all, or punishment for not doing something right. And if they see other dogs getting rewarded when they're not, they go crazy trying to earn the treat. Nice to know it works for postal employees as well...

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