Business of Well-being

Could Incentives be Harming Your Health Culture?

Could Incentives be Harming Your Health Culture?

"We want a better culture of health" is a phrase echoing coast to coast (68 percent of CFO's agreed or strongly agreed improving health culture was a key company goal in a recent IBI report). It's an amicable goal, but unfortunately many people asking for this outcome are not sure how to gauge success, much less how they'll achieve it.

To many, culture is abstract, a presence felt, so how does one successfully influence it? Culture boils down to social influence and group expectations; a pattern of behaviors and values which are inherently accepted and encouraged by peers.

With a strong culture your employees will be socially drawn towards consistently making better health behavior choices as they become the expectation and norm of their social environment.  

To achieve a culture of health, it is essential to have buy-in from a majority of your population (or at least the strongest social influencers) as well as consistency between company values and work environment.

Contradiction between the messages a company promotes and their actual actions creates a fracture between what employees see and hear, leading to distrust and lack of conviction towards pursuing common goals. That fracture is what some incentive structures can create.

Many wellness programs are stuck in outdated approaches. They replicate what they feel are the best aspects from approaches they've heard to be successful with others, and try to build a suite or menu of mini-programs in an attempt to appeal to the different interests of their employees.

But trying to please everyone is a flawed strategy. Firstly, you'll never please everyone. Secondly, by attempting to create a series of small activities for specific sub-populations, you are dividing your group and setting a path that leads away from strengthening your collective group culture.

In his 2009 book, Zero Trends, Dee Edington said "The focus needs to shift to programs for populations, which translates, when successful, into total population engagement," and if you seek a strong health culture, he's right on - you need to engage your workforce as a whole rather than targeting individuals or sub-groups.

Although the goal is for population engagement, there's currently a lack of consistent success in achieving it (industry surveys show participation relatively stagnant at around 40-45 percent). It's precisely this gap that's spurred the explosion in wellness incentive programs.

The logic is not lost on me. If everyone participating or reaching some achievable "health goals" puts health in the spotlight and elevates the level of program awareness within a group, then a monetary boost to get them over the hump towards involvement will be well spent, right? Not always.

Paying employees to participate in a program that was flawed to begin with doesn't eliminate the flaws, it just covers them up. It's like sweeping dirt under your lounge; it's still there if you look for it. In 2008, respected industry experts Ron Goetzel and Ronald Ozminkowski conducted a detailed review of workplace health promotion in the U.S. and determined that less than 7 percent of employers implementing wellness programs incorporated all the comprehensive elements considered necessary to achieve the greatest outcomes.

You can't buy a mule and expect it to win the triple-crown. No matter how many carrots or sticks you use for incentives: it's still a mule. The situation in our industry is that ninety plus percent of organizations are riding mules and expecting to win the triple-crown.

Engagement rates are about half what they need to be and confidence is beginning to fall with as many as two-thirds of employers not believing that vendors are effective in changing member health behaviors. There's clearly a massive gap between where we are, and what we are striving for.

Do you really think that gap will be sustainably filled by gift cards and premium reductions? Rather than rushing to join the projected 80 percent of employers expected to implement or increase incentive strategies this year, why not make more significant gains towards building a strong health culture by moving away from the industry's "incentive culture" and investing that money in a more comprehensive program?

How sustainable are incentives? Behaviors and behavior changes are influenced by a number of both internal and external sources including motivation, environment, social culture, education and skill acquisition. The most successful wellness programs achieve widespread change by exerting influence in all areas, capturing employees at all stages of readiness and progressing them towards internally motivated change.

Incentive structures are obviously aimed at boosting motivation. However, motivation is only one aspect of a sustainable change process, and even then, they are external motivators. While studies show that incentives can increase initial participation, their effectiveness on long term behavior modification is much more dubious.

Do incentives get you "true engagement" or merely "attendance" and "submissive compliance?" Which do you think will have a greater positive impact on sustaining behaviors long term? What happens when the initial buzz of receiving an incentive wears off?

Is it cost effective to continue increasing the incentive value over time in order to sustain employee buy-in? Ever heard of Operant Conditioning? When incentives become a routine "complete X', and receive Y'", they quickly lose their appeal. The value of 'Y' needs to continue to increase to sustain enthusiasm.

When incentives or rewards are included as random rewards within a program, where all participants have an equal chance of winning, they become more powerful motivators. Operant Conditioning is the science explaining that intermittent or variable ratio reinforcement is far more powerful and exciting as a motivator than a fixed ratio reward.

It obtains higher response rates and lower resistance to extinction of the response. It's akin to the reward and drive observed in gambling addiction - the thrill is not knowing if you will receive a specific payout for a pre-designated number of actions, the excitement is that it's possible you may win a payout at any given attempt, but not always.

Wellness programs that include incentive prizes or rewards as a fun addition to the program are more effective at sustaining engagement and driving motivation than set achievement based incentive structures over the long term. Another potential pitfall of strategies with a heavy reliance on incentives is Psychological Reactance.

Most people don't like to be controlled. When we perceive that someone is trying to make us behave in a certain way, we may be motivated to actively behave in the opposite way just to prove to them (and ourselves) that we possess our own free will and cannot be controlled. We conform to society in so many ways yet cling to the illusion of free will.

Letting ourselves be controlled by others or constantly being told or coerced (incented) to behave in a certain way is dissonant with our desire for free will. Suddenly bringing a plate of donuts to the staff meeting isn't just a poor health behavior, but an acceptable form of rebellion - just to see the look on your HR manager's face as you essentially say "s&@w you wellness!"

Incentives seem like a simple solution, but their long term effectiveness and the impact on the culture of your workforce should not be overlooked for short term gains. At its core, workplace health promotion is to an employee's personal benefit. When employees embrace and participate in programs and make changes to their lifestyles their health and quality of life is enhanced while their satisfaction  in their work and employment improves.

Employees are quick to see through tokenistic or self-serving approaches. When it's clear that employee wellness is purely a business interest, their attitude towards their employer and their motivation to go out of their way to participate drops dramatically.

By incentivizing health you risk dehumanizing it, sending employees the message that their health and wellbeing is a business metric, and the value to the business is approximately that of the incentive amount. How would that make you feel? The average annual cost of wellness incentives is $220 per person.

What if that money was invested in the development of better quality programs? What if these programs were better integrated into the work environment and daily operations of employers, with equal availability and exposure to all employees as a single group?

It's the belief of genuine commitment by employers to the wellbeing of their people, along with the consistent social influence of visible group participation which helps to drive a change in culture. Consistently reinforcing both environmental and social cues is critical.

It's not unrealistic. Some of the most successful and sustainable programs I have seen (the five-percenters) with outcomes that far exceed industry averages use no incentives. Einstein once said that insanity was doing the same thing over and over while expecting a different outcome.

What makes you think that replicating traditional approaches to health promotion, or joining the masses in a new incentive culture will get you results any different to the norms they are already achieving? Following average action steps will get you average results.

Creating an elite program requires rethinking some of the flaws in the existing level of thinking, and if we want to move forward as an industry, I think rethinking the flaws in the current approaches of most programs will pay higher dividends than trying to fill those holes with incentives. Will you be a leader or a follower?


Dee Edington, Zero Trends: Health as a Serious Economic Strategy, HMRC University of Michigan, 2009
Multiple Industry Reports, including Price Waterhouse Cooper, 2009/10; Bucks 2010/11; Towers Watson 2011/12; Integrated Benefits Institute 2011; AonHewitt 2011 (contact author for specific references) Ron Goetzel and Ronald Ozminkowski; “The Health and Cost Benefits of Work Site Health Promotion Programs” Annu. Rev. Public. Health. 2008.29:303-323

Iversen, Iversen, Bloom and Roth; Introduction to Neuropsychopharmacology Oxford University Press, 2009

About The Author

Andrew Stephenson heads US Operations for HBD International, an award winning custom health and injury prevention program provider. Working in the health industry in 3 countries over the past 8 years has provided abundant educational and professional development experiences. With insight into effective practices from across the globe, Andrew is well qualified to help review your current health and productivity management approaches and identify areas where you can add real value.

HBD International is a branch of Health by Design Australia who have been leaders in providing sustainable, integrated workplace programs for almost 20 years. Consistent high performers in engaging and changing work populations, they tailor programs to address Health & Wellness, Injury Prevention, High Performance or all three at once. To contact Andrew or learn more about HBD's comprehensive approaches email or view the website at

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