“Brains are like hearts,” said Robert McNamara, former business executive and U.S. secretary of defense, “they go where they are appreciated.” Once you’ve assembled a team of experts, it is essential to keep them happy, productive, motivated, and, above all, appreciated. You can do this by promoting a brain-friendly environment and by providing meaningful incentives.
Creating a Brain-Friendly Environment
The protection factors that ensure emotional resilience and regulation and the diversity that is key to a groundbreaking, innovative collaboration come together in a workplace environment that supports the members of your team as a team while accommodating the individual differences that make them unique and valuable contributors. And by “environment” we don’t simply mean the walls, desks, and other amenities that make up a typical office. We’re talking about the overall workplace atmosphere. Since exercise and nutrition are proven stress protectors and learning enhancers, it is crucial to provide an atmosphere that makes these things feasible.
Organizations of the future will recognize that nutrition is as important to success as adequate ventilation or up-to-date equipment. They’ll order in healthy food for meetings, install conveniently located kitchens so employees can address their nutritional needs at work, and hold off-site meetings where the catered meals are as rewarding and enriching as the conversation.
The same approaches can work with encouraging physical exercise. Sometimes the simple inclusion of a reliable shower and changing room will be all it takes to convince employees who live nearby to start bicycling to work instead of driving or taking the bus and instill a general philosophy of wellness throughout your company. At trivago, the world’s largest online hotel search site, wellness and exercise are an integral part of the company’s culture. “Golf, boxing, yoga, badminton. You name it, we’ve got it,” says Malte Siewert, trivago’s cofounder and managing director. “We have a big team in the HR department that just focuses on our employees’ well-being inside and outside of work.”
With a brain-friendly workplace, your employees will want to come to work. And with the right incentives, they will want to remain on the team.
Providing Meaningful Rewards and Incentives
Our basic assumption that we are motivated mainly by money has largely been debunked. And yet, many companies still cling to outdated notions of what drives their employees in order to determine the incentives they provide.
A New Perspective on Incentives
For the most part, money still rules as a universally acknowledged standard for measuring value and for triggering the reward response. But all those dollars and euros definitely have their limitations. They can be subject to the law of diminishing returns and in some instances may even have a negative effect. And in many cases they can be less effective than nonstandard, nonmonetary rewards.
Paying Too Little Can Be Worse Than Paying Nothing at All
If you attach a trivial monetary bonus to something that is usually considered part of a job description (such as arriving on time to work), the incentive is apt to backfire. A chronically tardy person may conclude that foregoing the tiny bonus is worth the value of continuing to arrive late. He likely will see coming to work on time as something optional, a bit above and beyond what’s expected.
Incidentally, the same approach can be just as ineffectual as a stick as it is as a carrot. A day-care center grew tired of having to stay open late to wait for tardy parents. So it instituted a fine for any pickups after official closing time in the hopes it would encourage increased punctuality. As it happens, the fine had the exact opposite effect. The number of late arrivals increased! Apparently, the moms and dads felt the extra cost was worth the convenience of arriving late. What should’ve been part of a social contract—being considerate of day-care employees who wanted to be able to go home to their own families—became a monetary one. Parents who showed up late believed by paying the fine that they were holding up their end of the transaction. In short, when the incentive or the punishment is too small, it can make matters worse.
A Rise in Pay Can Sometimes Lead to a Fall in Performance
You probably won’t have a difficult time convincing whoever holds the purse strings in your company that you want to pay less for a job or a service. But in some instances, lower pay actually delivers better results. Attaching an inordinately high monetary value to a task may increase the perception that more is at stake and thus crank up the level of stress to a point where it interferes with productivity. The culprit in this case is noradrenaline, the fight-or-flight neurotransmitter that encourages alertness when released in moderate doses but can trigger panic when overdone. Although the threshold will vary from one employee to the next, if the stakes are perceived as being too high, a motivating challenge sometimes can morph into a debilitating threat. Granted, for some extreme sensation seekers, the stakes are almost never too high. Nonetheless, we all perform best when we are just slightly overchallenged, not completely overwhelmed (Kamenica, Emir. “Behavioral Economics and Psychology of Incentives.” Annual Review of Economics 4 (July 2012): 427–52.).
Intermittent Rewards Are More Effective Than Scheduled Ones
In a mid-size, family owned company we know, the managing partner and his team regularly go out for lunch. Although it would be relatively easy for him to pay for every lunch, he just foots the bill from time to time. Otherwise the team usually splits the check. Because this treat is unscheduled and unpredictable, it feels like a genuine reward, unlike the free food many companies provide in the communal kitchen that quickly gets taken for granted. His staff enjoys the unexpected savings, as does the CEO who saves money in the long run while also making everyone feel better. It’s a win-win! This is a classic example of the power of an unexpected reward.
Personalized Incentives Can Cost Less and Mean More
Very few of us object to more money, but to trigger a reward response, it helps when the incentive is personalized. After all, money is a universal means of exchange. There’s nothing inherent in a big fat bonus that says “this was designed especially for you.” On the other hand, a weekend getaway for an employee and his or her spouse to their favorite destination or a pair of tickets to a popular play or a sold-out sporting event may cost less than a typical bonus and yet mean much more. In addition, researchers at Cornell University and the University of Colorado at Boulder found that people get more retrospective enjoyment from experiences than they do from material purchases. In other words, well-chosen experiential incentives, such as the variety of sports opportunities that companies like trivago provide, may even be cheaper, but their positive motivating effects on performance probably will last longer (Van Boven, Leaf, and Thomas Gilovich. “To Do or to Have? That Is the Question.” Journal of Personality and Social Psychology 85, No. 6 (2003): 1193–1202).
Even something as small as a bunch of flowers or a carefully chosen book can have a longer-lasting impact than a cash bonus. Providing an incentive that is custom fit to the employee’s distinct personality sends a very strong signal: that you’ve been paying attention and you care. How much is that worth in dollars and cents? In many cases, the impact can be priceless.
Employees Are More Likely to Compare Than to Count
Often, the amount of money someone receives is not as important as how much he or she makes in relation to comparable colleagues or to counterparts in other companies. One study found that respondents would rather earn $50,000 a year while their coworkers made $25,000 than earn $100,000 a year while the others made $250,000 (Shermer, Michael. “It Doesn’t Add Up: When It Comes to Money, People are Irrational. Evolution Accounts for a Lot of It.” Los Angeles Times, January 13, 2008, http://articles.latimes.com/2008/jan/13/opinion/op-schermer13). This is fundamentally an issue of fairness. The perception of fairness triggers a reward response, while an employee who feels unfairly treated will react with an even more powerful threat response. It’s also a matter of status. Money may not always be the most effective incentive, but it is definitely one important way we measure value. If an employee feels as though she is receiving less than her colleagues, then it’s not unreasonable for her to conclude that her work isn’t valued as much. Whether her conclusions are justified or not, this can inflict a level of social hurt that is every bit as painful as a physical blow. Sometimes, even more.
Adapted with permission from “THE LEADING BRAIN: Powerful Science-Based Strategies for Achieving Peak Performance” by Friederike Fabritius, M.S., and Hans W. Hagemann, Ph.D. © 2017 by Friederike Fabritius and Hans W. Hagemann (TarcherPerigee, an imprint of Penguin Random House LLC, 2017).
Friederike Fabritius, M.S., is a pioneer in the field of Neuroleadership. A neuropsychologist by training and a leadership expert by profession, Fabritius worked at the Max Planck Institute before honing her business expertise at international management consultancy, McKinsey and Co. She has extensive experience working with top executives at Fortune 500 companies, leveraging her scientific background to create actionable insights.
Hans W. Hagemann, Ph.D., is managing partner/co-founder at global leadership consultancy firm Munich Leadership Group. He is a global expert on leadership and innovation who has led seminars, coaching sessions, and in-depth workshops with top executives in more than 40 countries. The firm counts Allianz Global Investors, Bayer, BMW, EY, Expedia, Montblanc, SAP, Siemens, and thyssenkrupp among its clients. Learn more about their work at https://www.amazon.com/Leading-Brain-Science-Based-Strategies-Performance/dp/014312935X/
