Article Summary of Why Incentive Plans Cannot Work by Alfie Kohn

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Article Summary of “Why Incentive Plans Cannot Work” by Alfie Kohn

Article Summary written by: Rahim

In the article “Why Incentive Plans Cannot Work”, Kohn discusses the negative impact of the widely popular reward system in organizations to motivate employees. The author begins by stating that most of the studies on this subject suggest that rewards and incentives typically end up with different outcomes than it was originally intended. Although rewards within an organization result in employees’ temporary compliance, they do not create any lasting effect and in the long run are completely ineffective. Most of the Americans do not realize this as they are so much used to the reward systems in schools and at homes where both teachers and parents tie the rewards to the daily work being performed. The author cites examples of losing weight, quitting smoking and other short lived activities that are mostly performed by people with short term rewards in mind and that they revert to their previous behavior once those rewards run out. The author also talks about a couple of dozen studies that have shown very little difference in the productivity between the people who expect some form of rewards and the people who do not expect anything.

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The author goes further on to mention the research performed by Jude T. Rich and John A. Larson in which they examined 90 major US companies and found no difference in the shareholders’ return between the companies that had incentive plans and the companies that had none. Further, several meta-analysis researches on this subject, discussed by the author, indicate some relationship between financial incentives and productivity from the quantitative perspective but reveal no significant effect from the statistical analysis.

The author identifies the six point framework to explain the reasons why the rewards system does not work. First, the author ...

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