Tuesday, August 08, 2006


I was reading an article the other day (which I think was in the Economist although I can't find it on-line) about gambling and how you are more likely to win by backing the favourites than the rank outsiders (which is what most people do) - although what the statistics showed was that your net losses were less which isn't quite the same as winning.

In the article they puzzled over why people persist in betting on outside chances, but seemed to miss the obvious answer that people would prefer to risk a small amount on the chance of a big win (e.g. 100/1 odds) than to risk a bigger amount on the better odds of a much smaller win (e.g. 2/1 on).

I thought that this
item on the BBC News about people being encouraged to recycle by the offer of prizes was the same sort of thing; however unlikely the win, it provides motivation for the small effort involved which the marginal benefits of an individual act of recycling do not.

There are always mundane tasks to be done in a job, e.g. filling in timesheets so client's can be billed, and the usual way of handling these things is to send out entreaties urging staff to do the right thing or reprimands telling them off for not doing it. Would it not be more motivational for employers to offer entry into a prize draw for those staff who make the effort?


dB said...

I'm afraid I'd view such a scheme in the way that I viewed the news item about the Post Office Scheme where posties could win a car for making the tremendous effort of turning up for work on a regular basis or Anti-Truancy Schemes where you give prizes for kids that bother to attend school.

These schemes are all designed to give a reward to barrel-bottom dwellers to stop them being so idle.

In any sort of, ahem, professional services-based organisation, the argument would always be that this reward already exists and it's called a 'salary'.

HistoryElephant said...

The examples you give are about offering prizes for people to come to work, I would argue that this is different to a situation where people are juggling competing priorities.

All tasks have costs in terms of time and effort as well as benefits (usually in the negative form of avoiding hassle from irate users or clients but theoretically in a more positive form such as achieving a bonus target).

If the task you're asking them to do will either mean not doing something else equally important or working longer then people will make a choice based on the relative benefits to them.

Offering prizes, as with bonuses, is a way of structuring remuneration to include incentives, in other words it's a way of witholding salary if people don't do everything you want - which sounds a little bit more effective than paying them anyway and then clutching your handbag tightly in indignation when they don't do what is asked.

dB said...

So you would withhold part of my salary and then, depending on the results of a random process (if I can trust you) potentially pay that money to one of my colleagues?

No thanks.

HistoryElephant said...

It would be scraping off a small amount of everyone's salary in order to make a prize - so it would be more like a sweepstake. It would be suitable for companies that don't have enough money to pay bonuses or pay rises, as it allows them to create an incentive at little cost.

The fact that the idea of having part of your salary witheld doesn't appeal to you shows how it would motivate you to do something to get it back.

dB said...

Not if I were the sort of person that had good time management skills and had always, up until that point, got my timesheets on time.

Back to the Post Office scenario, how motivated would you feel if you'd been a postman for 10 years and hadn't had a day off sick (there must be a number of people like this) and some skiving layabout who pulls 1 or 2 sickies a month likes the sound of the scheme and does buy in to your motivational words so he straightens up and flies right and wins the prize draw. He, almost immediately, will think 'well, that's my luck up - not likely to win twice in a row' so can quickly backslide whilst the 'good guy' probably wonders why he bothered being diligent in the first place and quits to get a job in Sainsbury's.

HistoryElephant said...

so some fine-tuning would be required to ensure that the perceived chances of winning a prize and the nature of the prize were sufficient to keep people on their toes.

dB said...

With your use of the phrase 'perceived chance of winning' are you suggesting that the layabout postie in my example should only think he has a chance of winning but not actually have one?

HistoryElephant said...

I'd sugggest that, in your new career managing the Post Office, you should deal with work-shy posties via an appropriate disciplinary procedure (perhaps with report cards and how-sick-are-you-really phone calls), rather than by the prize draw scheme outlined here (which ought to be reserved for those who aren't work-shy - who I assume are called work-extrovert).

JP said...

Damn, I wish I got in on this sooner; if issuing a completed weekly timesheet is part of your role then you do it or get disciplined for not doing it.

I'm with db on this one.

HistoryElephant said...

I shall keep the prize for myself then