This week most of the sporting world will turn its attention to Brazil and the start of the 2014 World Cup. These are the world’s best players playing the world’s most popular game. Besides providing us with several hours of entertainment, the World Cup can actually teach us something about incentivizing employees.

Incentivizing the right behaviors

Depending on the outcome of a game, teams earn a certain number of points, and those points determine the team’s standing in the overall ranking. Teams earn three points for a win, one point each for a draw, and none for a loss.

The idea behind the "three points for a win" system—started in soccer, but used in other sports—is to motivate the players to win. Instead of simply gaining a point for winning, the extra two points over a draw helps create distance in the standings and moves them quicker toward a championship. The incentive for winning is greater, and therefore so is the motivation.

Compare that to the world of competitive chess. In traditional chess tournaments, a win is worth one point. A draw is worth half of a point.

There is little motivation for a player to go for a win in chess when a draw is nearly just as good. A win does not create enough separation in the standings, and, as a result, many players do not play for a victory. They play not to lose—and draws are commonplace. That is especially true among the elite players who can figure out within just a handful of moves whether or not a game is going to result in a tie.

Keep employees engaged

One sport encourages winning. The other encourages mediocrity. If your employee incentive program is not working, it is likely doing the latter. That is why it is so critical to make sure that you are putting a greater focus on three-point incentives, which encourage your "players" to go above and beyond in order to "win."

Does your company need innovation? Instead of simply offering one-point incentives for simply showing up and getting the job done, give three points to the employee who comes up with bold ideas for new products or new processes. Those three points may be a limited profit sharing plan for a new product or a percentage of savings for finding an efficiency. But by creating a culture that says "We reward our employees for being innovative," employees will be encouraged to be aggressive in coming up with new ideas. They know that the reward for their new idea outweighs the risk.

The right incentive program is not a cure-all for a company struggling with performance, but it can help in a few key areas: culture and engagement. Employees want to do good work, but they also want to be challenged. Offering extra incentive for meeting those challenges can help redefine your culture and stave off boredom and eventual disengagement.

So when it comes to incentivizing employees, are you playing soccer, or are you playing chess?

12 June 2014

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