Using Behavioral Economics to Drive Performance & Engagement – Social Drives

This is the first of a three-part blog series based on Michelle Smith’s article in PPAI Magazine titled Behavioral Economics. Read her entire article here.

Traditional economics suggests that money is the most effective motivator to drive your employee’s performance. This idea has been challenged by Behavioral Economics, which shows that 70 percent of human decision-making is emotional, not guided by practicality. Tapping into this emotional energy through motivation programs will give your company a competitive edge and foster higher levels of employee productivity, engagement and retention.

One way to tap into emotional energy is by harnessing a person's social drives. Humans have four social drives that can create pleasant and painful feelings that guide our choices over the course of a day. These drives serve as motivational hot buttons, and when pressed simultaneously, motivation rises exponentially. Incentive and recognition programs provide organizations with a powerful tool because, in a single intervention, they help activate all four drives.

1.       Drive to Acquire

While people want to acquire tangible things like money, property and cars, they also want to acquire the intangible. They want status and skills, to become experts and to feel proud. This is beneficial for companies because they want their employees to be competent, confident experts in their fields.

Reinforce this drive to acquire by rewarding employees who gain needed skills and knowledge. Provide tangible rewards to supplement intangible recognition from managers and peers, and make sure recognition is spontaneous, personal and heartfelt.

2.       Drive to Bond

People crave authentic relationships, not only with friends and family but with coworkers and supervisors as well. When companies have quality relationships with their employees, the worker experiences warm and friendly feelings toward the company as a whole.

Foster this drive by ensuring that each instance of reward and recognition has a face-to-face element. Be sure to have a program that rewards employees for group achievements, thus giving the team an accomplishment to bond over and increasing positive feelings for the organization and one another.

3.       Drive to Innovate

Humans are naturally driven to learn and create based on our discoveries. It feels good to satiate curiosity, think up a new idea, or solve a difficult problem, so give employees time and space to innovate within their field.

Ensure instances of reward and recognition help employees learn the behaviors that are valued and important to the organization.

4.       Drive to Defend

We as humans are driven to defend the people and ideas we hold dear. This does not always mean defending in the literal sense but openly speaking positively about people and the causes we support. Organizations that are able to harness the drive to defend will be rewarded with loyal employees who are vocal about their affection for the organization.

Reinforce this drive by asking employees for their input on initiatives, maintaining openness and transparency in all communications, and reminding employees often of their importance to the organization.

By giving an employee an award, the company allows the employee to acquire status – and potentially goods and services, to bond with their team or the person giving the recognition, to more deeply understand what is important to the company, and to defend the very deeply held belief that they are good at what they do and have chosen the right organization to work for. This, in turn, collectively activates all four social drives, compounding their positive effects to keep the employee engaged, productive and happy with their position.