This article was originally published on E-Reward on 1st July 2016 – http://www.e-reward.co.uk.
By Jerry Edmondson
Understanding how and why people behave the way they do can give you an advantage in all walks of life, especially in the workplace. Behavioural science offers insights into human psychology and employee engagement and it’s especially relevant for HR and reward managers who interact with employees on the most personal and sensitive of issues.
Reward managers have a special role to play in engaging employees, given that the reward package can be a powerful motivator or de-motivator directly affecting how employees feel about their workplace and indirectly influencing the employer brand of the organisation they work for. But success in achieving the goal of engagement doesn’t just depend on the nature and value of the package on offer – it’s also down to how it is communicated and received.
This is where the principles of behavioural science can help reward managers position changes in the reward package to maximise impact and take-up. It’s something that advertisers have been doing with great success for many years, often by knowing how to connect emotionally with their audiences.
Here’s a quick look at some of the more powerful behavioural ‘biases’:
Action needed? Make it easy!
People generally prefer the status quo as it’s easier and safer. Change usually involves risk and demands energy, and that can be an uncomfortable prospect unless the proposition is compelling.
The lesson here is not to force too many changes or options on your audience. Try and make them appear unavoidable or as simple and painless as possible. Importantly, don’t overload your audience with decisions – that will make them feel overwhelmed, tired and confused and they may well end up refusing to make any decision. If a new range of benefits is in the offing, try and focus on one at a time. And try to emphasise the immediate or short-term benefit rather than the long term.
Play the ‘losing out’ card
A natural human condition is to hate losing – in fact, we’ll often put extra energy into having something when the threat of losing it is strong. That’s why the ‘when it’s gone, it’s gone’ message is so powerful. Deadlines for making flex choices should be positioned in the context of a lost opportunity – not just a target to be met.
Another example is to stress to employees the tax benefits they will miss out on now, rather than the retirement income benefits they stand to gain from being in a pension plan.
Provide some context
If you can frame your reward message in a particular context you can change the way your audience might think about their choices and decisions. So if you’re promoting medical, life or critical illness insurance you might give examples of situations where such protection would provide great peace of mind.
Good visual design can help support your context. For example, bold images and bright colours will project a dynamic and vibrant environment where it is easier to position ideas and services that you want to be seen as innovative.
Appreciate that everything is relative
Whenever we’re presented with something new – a product, person or idea – we immediately compare it to something else we’ve already experienced. If, for example, you buy a product at a bargain price this becomes your anchor for future price comparisons. Should you then see it somewhere even cheaper, the perception of your purchase will change and you’ll no longer feel you got such a bargain. The cheaper price becomes a new anchor even though the absolute cost doesn’t change.
You can’t stop comparisons being made, but you can influence and inform them. Instead of allowing your audience to search for an ‘anchor’, suggest an anchor to the audience. For example, you could promote a risk benefit with a particularly low premium or high level of coverage by comparing it to other schemes or similar products available on the high street.
The principle works more generally, too, when promoting your total reward package to new recruits. You could point to the generous range of benefits offered by your company compared to other typical employers in your sector.
Be on their side
We humans have an inherent tribal nature that is supported by oxytocin, the ‘group love’ hormone. While this helps us form strong bonds with members of our group, it also tends to make us suspicious of members from other groups and what they might be telling us.
You can use this to your advantage by showing your audience that you’re on their side. Empathise with them by demonstrating that you understand their needs and concerns. This might apply to financial planning, for example, and the difficulties of employees making the right choices in how they might save and spend their money.
Provide reassurance
At times of uncertainty it helps to provide reassurance by showing what other, similar employees have done. If you can demonstrate that others have followed a particular course of action and told a positive tale, it gives them the confidence to proceed.
In the same way that favourable online reviews of products and holiday destinations encourage further sales, you can increase benefit take-ups by telling stories of positive experiences from these benefits. Look to play the ‘people like me’ card to remove any concerns about risks and ‘whether it’s right for me’.
Conclusion
So, understanding the principles of human psychology may make you think again about how benefits and rewards can be communicated and promoted beyond the simple statements of fact and benefit features. They can open up a new way of creative thinking, which is particularly helpful in the face of communication challenges: the flexible benefits plan that needs re-launching, the organisational change programme that needs to be supported, or the simple desire to enhance employees’ perception and appreciation of their benefits package. And they can make you think again about how to get more engagement, simply by being more engaging.
– Jerry, London Office
