Employee rewards, and when to give them (it’s not when you think!)

This story originally appeared on the Venturocket Blog.

Employee rewards, like any other reward in life, are unquestionably beneficial to team morale, work ethic, and productivity. Indeed, employee rewards are simply a subset of gifts, engineered to be the causal effect of work well done. After all, the mechanisms behind the human brain reward system are well documented and understood; accordingly, employee rewards are usually presented only after an employee has completed a task, or perhaps, as a carrot when in the home stretch. Weirdly, however, this may not be the best strategy.

Don’t let employee rewards erode an employee’s personal drive and passion for your company

When you first interviewed that stellar employee whom you’d now like to reward with some extra stock options for their exemplary work, or perhaps a surprise day off so they could enjoy a three day weekend, they were sitting in your office for one reason: they liked your company, they liked your products, and they liked you. More importantly, they cared about your company — really, your brand — they cared about your products, and they cared about you; or at least, they respected you, and wanted to help you be successful as a new member of your team. (Yes, of course they cared about a competitive salary, but that was a necessary, not sufficient condition, for having applied to your company in the first place.)

The point is, that prized employee of yours didn’t go through all the trouble to get that job just because they wanted something from you. They wanted that job because they cared about, and really wanted, that job! To wit, their determination to work with you, their superlative work ethic, cheerful spirit about the office, and phenomenal work product — indeed, anybody’s exemplary work — was motivated not by any sort of external pressures, proverbial carrots, or promise of some massive stock option grant.

No, their exceptional contributions as a member of your team were motivated by one thing entirely from within: their own passion and personal drive.

The (potential) problem with employee rewards, is that they (can) undermine this personal drive. Instead of being compelled to produce great work because of one’s internal motivation, one (can) find themselves drawn to something even more (chemically) satisfying: the thrill and uncertainty of a reward. Rather than further driving employee productivity then, these employee rewards risk eroding it.

Unlike one’s personal drive and passion, the satisfaction derived from bonus-type employee rewards is, over time, no different to the human brain than a chemical dependence: eventually, you need more and greater employee rewards to adequately satisfy your employees, until finally, you’ll exhaust all practical methods of rewarding good work, and likely reduced some of that internal personal drive in the process.

All is not well, then.

Employee rewards are like flowers

Thing is, employee rewards are like flowers. No seriously, bear with me here. When I first started dating during my sophomore year at UCLA — yes, late bloomer, I know — I discovered something that most people inevitably learn: surprising your sweetheart with flowers on random occasions is infinitely more satisfying to her than the more expected occasions, like Valentine’s, birthdays, anniversaries, etc.

And so it should be with employee rewards: rather than granting those stock options or a free day off as a motivating carrot or, literally, an ex post facto reward for a job well done, consider a totally unexpected, surprise reward just because! For no reason at all!

It sounds absurd, but just think about the flowers.

Employee rewards should be the cause, not the effect; should be random rather than anticipated

Put another way, employee rewards should be the cause, not the effect, of an employee’s spectacular work product. Perhaps not all of the time; perhaps only now and then. The point is, employee rewards should be random and unanticipated. You should mix it up.

The idea is not to let your employees expect a reward. By removing the uncertainty of a guaranteed — or expected — reward at the end of a task well done, it would seem that the thrill required by the brain’s reward system would be eliminated entirely. Not so; indeed, quite the contrary. By effectively randomizing employee rewards, this strategy actually acts to increase the uncertainty, and thus the thrill, of when one many receive a reward, which effectively leads to an even greater sense of accomplishment and satisfaction.

In this way then, you accomplish the dual goals of (a) appropriately rewarding your employees for jobs well done while (b) minimizing the chances of eroding their own internal drives, passions, and work ethic for excelling at your company.

The best of all worlds? It certainly looks that way.