| The conventional wisdom holds
that cash is the ultimate incentive for improved performance: "Give
me the big bucks, and I'll not only work harder, but I'll turn over my
first-born and any of his siblings within reach."
However, BI Performance Services argues that—to
borrow a Gershwin song title—"It Ain't Necessarily So." They say once
people have satisfied their basic needs, the promise of more money might not
do as much to encourage performance improvements as, say, travel and
gifts.
One example—Goodyear Tire & Rubber Co., debating how
to boost sales on one of its high-end tire lines, assumed that cash was the
magic wand. But a Goodyear marketing executive disagreed and suggested they
run a test for six months. They split 900 company-owned stores into two
groups, one offered a cash bonus of $8 per set of four tires sold.
The other was offered an equivalent value in "points"
that could be accumulated and applied to the acquisition of merchandise
offered by BI's 180-page catalog (of nearly 1,700 items).
The bottom line: The Goodyear stores using cash
bonuses boosted sales of the expensive tire line by 22 percent, compared
with the previous six months. But those stores offering merchandise and
travel awards lifted their sales even more—by 32 percent over the earlier
period.
Why? There's no solid evidence, but BI's research
indicates that "the best way to change behavior is to somehow engage the
emotions." And the best way to do that is with the visualization involved
with working toward a specific merchandise or travel goal.
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