Incentive Theory for Long-Term Success

30 people from my team stared at me. As their manager, I had nothing to motivate them.

Our day-to-day work didn’t make any logical sense to my team. The company designed the incentive theory to deceive the stockholders. The results of the incentive made the company’s growth look faster than it actually was.

The incentives drove the team to do things that weren’t in the best interest of the client. Over time, our team’s morale declined as the wrong incentives made us unproductive.

A decade later, the company got a class lawsuit and forced to chang their incentives.

How Does Incentive Theory of Motivation Works

Every day, we make 100 plus decisions in our personal life, work, and social settings. Our teachers, bosses, friends, or even our parents never talked about the importance of incentive theory. Most of our decisions in the day depend on incentives. Let’s look at an example as a great motivator to use the right incentives.

FedEx is a $40 billion-dollar company. In their earlier years, they were on the brink of shutting down. FedEx couldn’t find a way for their night shift to prepare the packages for morning delivery.