This article highlights the key learnings from Kurt’s presentation at the “2020 World at Work Spotlight on Sales Conference”. The original slide deck is available below.
Rewards Programs are a Key Driver of Sales Behavior
In 1937, paleontologist Gustav von Koeningswald was working on the island of Java in Southeast Asia, searching for new evidence of our early human ancestors. To achieve this goal, he needed to find fossils, and the apex of fossils was the skull. With an intact skull, paleontologists are better able to distinguish between ape and human.
But skulls were rarely are found
intact.
Instead, paleontologists needed to piece together a multitude of small skull fragments in a complex 3D puzzle. It was difficult work – difficult to find all the pieces and difficult to fit them together in the right way to reform the original skull.
To help alieve the burden of searching and finding the skull pieces, von Koeningswald enlisted the help of people from the local village. He did this by giving them an incentive. He paid them 10 cents per skull fragment that they delivered to him.
Organizational friction is not a common term, yet it could be one of the biggest reasons that your company is not performing to its full potential.
How much is friction costing you?
Friction in human terms is the unnecessary resistance that a person encounters when trying to achieve a task. Organizational friction is the resistance created by policy, social, or environmental factors within a company.
Bad organization friction creates unnecessary resistance within an organization and impedes performance. It causes wasted time, wasted energy wasted resources, and overall frustration. Good organizational friction creates positive resistance that discourages negative behavior, sloppy thinking or risky shortcuts.
A study conducted
by Gary Latham PhD, replaced 12 words in an e-mail from a company president to his
employees to demonstrate the power of word choice.
A Powerful Reinforcement Loop With a Common Thread
Half of the company received the president’s original e-mail and half of the company received the same e-mail with 12 achievement-focused words added in. The result? After a week, objectively measured performance showed an increase in effectiveness by 15% and efficiency by 35% for the employees who received the achievement centric email.
Imagine getting the chance to earn $2 for doing absolutely nothing. Would you turn this down? Most people say no, yet study after study shows that people often refuse the $2 payout, sometimes more.
You’re probably wondering, “why?”
This strange behavior comes down to how we perceive fairness
and retribution and can be observed in a simulation behavioral scientists call “the
Ultimatum Game.”
The New Year is rapidly approaching. If you are in the IC world, the pressure is on you to formulate and calculate budgets for next year’s incentive and rewards programs.
Like most, you need to balance: rewarding top performers, targeting the right motivators, harmonizing cash and non-cash incentives, and staying aligned with your corporate philosophy. All the while, fitting these factors into your overarching financial budgets.
The Lantern Group recently had the pleasure of attending one of Nancy Duarte’s workshops in Santa Clara, CA – led by facilitator Mike Pacchione. The workshop was a one-day event called “A Visual Story” and focused on how to design and deliver persuasive presentations.
In today’s hyperconnected technology-driven world, it can be easy to overlook the simple time-tested solutions of the past. This holds true for communicating with and motivating your sales force.
With the consistent advent of new communications, new sciences, and new methodologies – shaking things up with a new (old) method can be a refreshing way to tap into your teams’ motivators.
Let’s take a little step back in time and talk about direct mail. Simple, well designed, customized mailers that tap into key behavioral insights can be just as effective as the newest technologies or communication tools when utilized correctly.
Think about it, we are flooded with messaging all day every day – both personal and business. With each organizational department trying to get their message out on top of that, it can be hard to manage all of the information. Technology can get lost in the fray, but unexpected personalized direct mail can disrupt the norm and grab back that attention. Combine this with behavioral science and you have a simple yet powerful tool.
Let’s take a look at an example, a postcard series we designed to help top achievers keep achieving and to nudge bottom achievers to end the plan period on a high note.
One customized to a high performer:
And one customized to a moderate performer:
While these may seem simple, there are some key behavioral insights that are being strategically targeted to drive performance.
In both versions we utilize:
Idiosyncratic Fit: We have higher motivation if we think that a program is customized to us. By adding the employee’s name, stats, and a customized message to help them improve we tap into this drive. Each message is framed for the greatest impact based on their performance and adding the physical component of the postcard further personalizes it.
Social Proof: We look to others to see how we should behave. There are two elements at play here. One: the messaging addresses the performance of their peers, pushing them to stay with or ahead of the pack. Two: this can be shared with a spouse, partner, or family member who can provide an additional level of support – for example, the reminder of a chance to partake in an awards trip with a partner can be very impactful.
Now, note that in the high performer card we tap into:
Loss Aversion: The pain of loss is greater than the pleasure of a similar gain. For high performers, the idea of having something valuable and then losing it is far more motivating than a “carrot” on a string.
And in the average performer card we use:
Gain Messaging: Framing the statement to focus on what can be gained from increased performance. With the moderate performers, where the perception is that there is more to be gained than lost, the gain messaging can drive a higher participation rate.
Try this with your sales force or reach out with the form below for help customizing and implementing this simple, effective technique within your team!
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Back in September, I partnered with Tim Houlihan to start “a monthly gathering of curious minds” which we called Behavioral Grooves. We thought it would be interesting to get like-minded people together to talk about applying behavioral science to life and work.
We had no idea if others would be interested in this…
We announced the meetup and were hoping to get at least a few of the friends that we had contacted to show up. We ended up with 24 people for that first session where we talked about habits – how they are formed and what people can do to improve them.
We were thrilled!
From there, it took off. We have over 180 members signed up to our meetup group and it is growing fast. We have had three monthly sessions as of early January 2018 and our fourth is lined up for two weeks from today. We have over 20 people who have made it to two or more of the sessions.
I guess we struck a nerve.
For our second session, we invited Professor James Heyman to speak and thought, hey, since he’s here, why don’t we interview him and make a podcast out of it. Thus, our Behavioral Grooves podcast was born. Tim and I both loved that so much that we decided that we didn’t want to wait for the next Behavioral Grooves session to record our next one – so we started to invite people and interview them – both live and over the internet.
To date, we have seven interviews recorded and three more in the works. These podcasts mirror the Behavioral Grooves sessions in that they are conversational in nature where we geek out over behavioral science and how we can apply behavioral science insights into our daily work and lives.
They have been a blast!
In reflecting on this, it appears to me that these two outlets provide us with a way of both learning and sharing. We want to be advocates for good, ethical use of behavioral science. We believe that there is much to learn and we can improve our work and lives by understanding and by applying these principles in a thoughtful and deliberate manner.
We also realized that we love the community that this is creating. A community of curious minds who are interested in science and the application of that science. A community of people that we can bounce ideas off of. A community of people that can push us to think about things from new perspectives.
This is ultimately what we have been building and hope that it grows and provides a place and outlet for others, as well as ourselves.
If you are ever in Minneapolis on the third Thursday of the month – please come and join us at our meetup (find out more info here) and if you can’t make that, please listen in to our podcasts (click here to find the latest).
At the IPMI Institute HR conference in Miami we sat down with 10 HR executives from various industries and exchanged insights. We discussed what was going on in their world and how behavioral science can help the HR community.
We noticed three overarching themes:
Organizations are finding cultural change hard
Organizations have not had significant success at engaging their employees
Organizations don’t have the bandwidth to prioritize employee communications—although they know doing so is important
So far in our design series of blogs, we have touched upon the concept of applying behavioral science to graphic design, and how reducing cognitive load can increase understanding, reduce myopic focus and drive home the key points you want your audience to grasp.
Today we are going to dive deeper into the visual element and explore “why graphics matter.” We utilize the concepts we will lay out in our employee communications, but the value does not stop there. Whether you are in communications, marketing, advertising, or trying to engage employees through internal Communications, this will apply to you. So, sit back, relax, and absorb.
Graphics are fun, graphics are pretty (well some are, beauty is in the eye of the beholder), graphics make information less boring – but there is far more to graphics than one might expect. When properly used graphics:
Back in September, I partnered with Tim Houlihan to start “a monthly gathering of curious minds” which we called Behavioral Grooves. We thought it would be interesting to get like-minded people together to talk about applying behavioral science to life and work.
