If you want to understand how best to use behavioural economics to motivate employees – then you are in luck. A new study from the IRF, Using Behavioural Economics Insights in Incentives, Rewards, and Recognition: The Neuroscience, applies scientific findings to employee motivation and rewards and comes out with some striking results. For example, it reveals positive, verbal recognition and monetary or travel rewards are treated equally in the brain. It’s basically a fast tracked scientific survey. Here’s what the IRF said about it. “Neuroeconomics provides an additional powerful layer of proof by exploring the biologic underpinning of decision-making. In many ways behavioral economics and neuroeconomics are like a tag team trying to wrestle neoclassical economics out of the ring for its failure to accurately capture how real human beings think and make decisions. Technological advances allowing researchers to probe the brain in unprecedented detail are powering an explosion in neuroeconomics research. For instance, brain-imaging technologies now allow us to see which brain areas are active during economic decision-making and which are not. The most powerful neuroeconomics finding is that all forms of reward – monetary or otherwise – are processed in the brain’s master reward center, the striatum, and are experienced as rewarding feelings. For example, when research subjects are offered various forms of reward – ranging from their favorite food to a compliment to a monetary gift – neurons in this structure fire. This means rewarding employees intrinsically by treating them better or rewarding them extrinsically with money are treated equally in the brain, with both causing rewarding feelings emanating from the striatum and the dopamine reward system. This important finding is at the base of helping organizations craft more effective, rewarding environments. ” If you skipped that – read this – “Technological advances allowing researchers to probe the brain in unprecedented detail are powering an explosion in neuroeconomics research. For instance, brain-imaging technologies now allow us to see which brain areas are active during economic decision-making and which are not.” In short, they have been tinkering in the grey matter to challenge long-held traditional economics assumptions such as: People tend to act rationally and in their own best interests when making decisions and Money is the most effective motivator of all employees It found that: -All forms of reward are processed in the brain’s ‘master reward centre’, the striatum, meaning rewarding employees intrinsically by treating them better or rewarding them extrinsically with money or trips, are treated equally in the brain -There is a Halo Effect, which informs us that more highly positive, emotional experiences increase positive emotion associated with the company -Employers shouldn’t ignore Emotional Stamps, which help us retrieve the memory, reinforce necessity for incentive and recognition programmes – Frequency Bias suggests the more reward and recognition that happens in a company, the more it will become a normal part of the business. Melissa Van Dyke, IRF president, said: “From studies on oxytocin to dopamine to the pre-frontal cortex, there is no shortage of emerging neuroeconomics research on what makes humans tick. Using Behavioral Economics Insights in Incentives, Rewards, and Recognition: The Neuroscience curates and explains the research so that incentives, rewards, and recognition professionals can use this knowledge to better understand what motivates employees and ultimately create more engaging and productive work environments.” There are also some great tips there based on how people are driven. Drive to Acquire: Employees are driven to acquire tangible goods (money, property, cars) as well as intangible skills (expertise, new abilities) and status, so make recognition spontaneous, personal, and heartfelt (not on auto-pilot or auto-schedule) and provide group goals and celebrations Drive to Bond: Employees are driven to have authentic caring relationships not just with family and friends but with their workmates and supervisors (their tribe) so have employees create online profiles that are socially available for all to see Drive to Innovate: Employees are naturally driven to learn about the world around them and create new thoughts, systems, process, relationships, so give all employees at least a small amount of time to innovate within their sphere of knowledge Drive to Defend: Employees are driven to feel safe and secure and to defend the objects, people, and ideas they hold dear, so gather employee input on incentive, reward, and recognition efforts to ensure they are perceived as fair This is an absolute must read and another smash out of the park study from the IRF. You need to bookmark their stuff and keep it under your metaphorical pillow – they are jammed full of insights. You can go here to access the new study from the IRF More Incentive and Motivation News: Take a look at other categories across our site to find out more about employee engagement, rewards and benefits. Employee Engagement | Employee Benefits | Employee Reward and Recognition | New Launches | Interviews and Case Studies | Marketing and Loyalty Don’t forget we’re social too! Find us on Instagram, Facebook, Twitter and LinkedIn. Post navigation Understanding the biology behind customer loyalty Half of office based employees fear replacement from AI