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Incentives and the DMV

Note from Jim Stoeckmann: It's always a pleasure to welcome back an old colleague even if only for a few words. Our guest blogger today is Jason C. (JC) Kovac, former WorldatWork practice leader who is now a sales compensation professional with a large cable entertainment and broadband services provider. Welcome back to our blogosphere, JC. It's great to hear from you!

July 26, 2010 — This is a perplexing question, and it always amazes me how polarizing this debate actually is. In one ear you have people like Alfie Kohn and Prof. Jeffrey Pfeffer, informing us that incentives are bad or should not be used to motivate behavior. In the other ear are Ken Abosch and Dow Scott providing us surveys that show incentives are effective means of compensation.

So what do we believe? How do we know if incentives are powerful motivators or foolish "tricks of the trade"?

Usually, there is an impetus that starts me on a path to thinking about these things. A trip to the local DMV got my mind racing last week, as I sat in the waiting room with about 30 other people and 7 open tellers. About 75 minutes later my number was called, and 75 seconds after that I was out the door.

The entire structure of the DMV got me thinking about incentives and behavior modification. Albeit, I have never worked for the DMV (or government for that matter), but I started to wonder how the DMV would change if their employees were placed on a sales compensation-type plan structure. What if people/customers were the commissionable items and there was some sort of multiplier based off order accuracy? Would the DMV change? Would DMV employees be more motivated to get people through the lines and help ensure they were accurately assisting customers? Would this be a bad thing?

I'm not sure I have a solution. However, I pretty strongly believe that incentives motivate behavior and it is up to us, as compensation professionals, to ensure the incentive programs we create incent the appropriate behaviors. Without this oversight incentives can either become demotivators, or even worse, expected.

I guess we can test this, if anyone works for the DMV.

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The opinions expressed are solely those of the author and do not necessarily represent those of WorldatWork.

Reader Comments
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Tue August 10, 2010 2:55 PMReport Abuse
Randy Maharaj
Sr Manager Sales Compensation
Member Since: 3/1/2002
Comments: 1

In my experience and as a general rule incentive compensation can drive results. However, I am cautious saying that incentive comp can drive behaviors (we will all like this to be true) but behavior modification is an evolution and not a revolution. With the DMV it may take a combination of : changes to the processes, accompanying policies, skills/competency of the staff, environment and culture to get incentives to work. Incentives act as the lubricant for this change which in turn will ultimately drive the required behaviors which in turn gets the desired results. The DMV, like most organization, needs the desire and readiness for change in order for incentives to work at their best.

Tue August 3, 2010 5:46 PMReport Abuse
Shawn Miller
Compensation Specialist
Member Since: 3/1/2000
Comments: 14

I'm thinking DMV must be Department of Motor Vehicles (but not sure because of 'tellers' -- are theseservice reps...would you please verify?  In Indiana, it is the BMV (Bureau of Motor Vehicles) and in Michigan, it is the Secretary of State's office where this type of business is transacted.

Tue August 3, 2010 11:20 AM (edited 8/3/2010) Report Abuse
John Rubino
Member Since: 4/29/1982
Comments: 5

Hey JC --- welcome back to the Blog!

I use a small DMV office in Carmel, New York which is close to where I live. I was extremely surprised (pleasantly) on a recent visit: I was in and out in twently minutes, and the clerks that served me were courteous, gratious and efficient. I doubt whether this is indicative of other DMV's across the country, but my experience in the Carmel, NY office has definitely renewed my faith in government operations! (Of course, I let them know).

 While I am a strong believer in the motivational power of incentive plans (I have seen many work very effectively), this experience re-affirms my thinking that when management creates and reinforces daily a positive and collegial work environment, the sky truly is the limit!

Mon July 26, 2010 1:43 PMReport Abuse
E Brennan
Senior Associate
Member Since: 4/19/1979
Comments: 590

Right now you have a perverse incentive system in place that assures that taxpayers will continue to approve tax increases that promise to cut the long waits you encountered.  Without the long lines, would you have been motivated to speak up about the need for improvement? 

Last time I was at DMV, I got a special Enhanced Drivers License that facilitates surface border crossings to contingent nations; no passport required now when you have it.  By appointment only, so when I showed up there was no line for the sole agent who initiated the special process which then cycled through another three Federal and State employees so efficiently I was in & out within 30 minutes during which I experienced an "intensive" multiple set of document reviews, a personal background "stress interview" by a Fed security agent and a new photo.  At least four new workers were employed to thus smoothly efficiently process me.  So I did not complain; although I may when my next tax bill comes in.  Instead, I have been positively reinforced to praise the new process... so far.