Better Performance Plans: Think Like An Economist
Thursday, December 14, 2017
Interested in learning how performance plans can lead to strong performance results? Curious as to why so many well-intended and scrupulously designed performance incentive systems disappoint or even backfire? This session explores how to use the fundamentals of behavioral economics to get better business performance results. Many businesses suffer adverse effects from compensation and incentive programs that should have worked for the benefit of all, but somehow didn't. However, if evaluated through the lens of behavioral economics, inconsistent and even damaging employee responses to apparently well-structured compensation incentive programs are not mysterious. Behavioral economics uses elements of economics and psychology to expand conventional organizational theory. It explains why real-life employee behavior sometimes doesn't make sense when viewed through traditional 'carrot and stick' management theories. This session introduces and applies concepts such as anchor points, the endowment effect, the status quo effect, the ultimatum game, and more to help financial professionals spot or prevent weak links in employee incentive programs.
*Become acquainted with behavioral economics and how it relates to management finance and performance management
*Learn why applying behavioral economics concepts can improve your organization's performance management discipline
*Gain an appreciation of how apparently logical compensation incentive programs and metrics can lead to illogical and perverse results
*Learn how behavioral economics can improve business performance
*Behavioral Economic Techniques