Curiosity, on the other hand, is a better motivational tool. Curiosity is an intrinsic motivator because the employee generates it. It creates its own reward system.
In the past, doomsday scenarios or calling people out for behavior was thought to be a way to change their behavior. Fear based techniques for changing behavior, recent studies show, have a dramatic impact on behavior but their shelf life is atrocious: for physical health, fear-based techniques only changed behavior for six months. After that, participants went right back to their previous behavior. In the context of encouraging employee saving for retirement, a six-month behavior change couldbe enough to get employees to enroll in your company’s retirement plan and work with an advisor (or their program) to determine risk allocation and initial account settings. If your company uses an auto-enrollment program, motivating your employees to enroll may not even be an issue.
If you want to motivate your employees to do other retirement readiness activities (like monitor accounts, rebalance or save for emergencies), then knowing the science of motivation could be helpful. Before digging into the science of motivation, you might be asking yourself how motivation and encouragement differ. One definition that could be helpful here is that motivation is related to inspiration that increases eagerness or willingness to complete a task. Encouragement, on the other hand, is constant persuasion or monitoring to continue a task. In the retirement readiness context, encouragement would be what an advisor does while an employee is enrolling in the retirement plan. Motivation, on the other hand, would be what an employer could do to help employees revisit personal finance budgets, set reminders to check on accounts to be rebalanced or enroll in the retirement program at all.
Intrinsic motivation is an internal willingness or desire to accomplish a task or goal. It’s usually based on something positive, like a pleasurable sense. Extrinsic motivation is a response to an external factor, where someone besides the employee is compelling the action. Put a different way, shame and fear are extrinsic motivations. Employees who change their behaviors based on fear (of being in poverty in retirement) or shame (that they aren’t keeping up with what they should be doing) are changing it based on extrinsic motivators. Those extrinsic motivators have less power over an employee over the long term. Instead, action that focuses on the internal motivation will have more staying power. This might include actions that help give employees confidence that they can perform the task, as well as encouragement during it.
Motivation also drives how someone learns the information given to him or her. Positive motivation, one based on intrinsic motivation, will influence the learner to retain the information longer and in better depth.
Rewards can motivate employees to start investing or change other retirement readiness behavior (like budgeting), but only to some extent. Just like fear, rewards are extrinsic and only keep employees motivated for short periods of time. That means an employer might not want to use money or bonuses as an incentive to get their employees to engage in retirement planning, if the goal is for employees to continue to do other retirement readiness activities later (like rebalancing, budgeting, etc.).
One area of motivation science many study is how competition impacts motivation. Surely athletes work harder towards a goal if they are focused on winning a prize. Yet, in other areas, competition may have little to no impact on motivation because some people may be competing to beat others (outperform) whereas others may be performing to not be beaten (avoidance). In the retirement area, employees would have to be told how they were doing against each other, and doing so could violate so many privacy rules that it is virtually infeasible from the start.
Curiosity, on the other hand, is a better motivational tool. Curiosity is in intrinsic motivator because the employee generates it. It creates its own reward system. Employees get a spike in their reward centers when they engage in activities where they are interested to see how the results will turnout and whether they can influence those results. How can plan sponsors and employers use curiosity as a key motivator? A key part may be the idea of focusing on confidence building activities and educational workshops.
Before leaping into the unknown, we recommend a thorough examination of your plan. Because we are experts in the field, we know the marketplace and know what your existing vendor is capable of offering. Through this examination, we can help you optimize the service you receive.
get xpress proposal
