Managing Distribution Quality Through an Adapted Incentive Program with Tiered Goals and Feedback

Abstract

The purpose of this study was to evaluate a program designed to improve the work quality of employees at a food distribution warehouse. Participants (n = 23) were responsible for selecting food items to be distributed to restaurants. Selector errors were targeted using an adapted incentive program featuring tiered goals and individualized normative feedback. A pre-existing incentive program, wherein selectors forfeited money for each error, was adapted to allow the selectors the opportunity to earn back their disincentive money upon attainment of weekly goals that were increasingly demanding. The initial goal for the first two weeks was set at 2.0 errors per 1000 cases and every two weeks thereafter the new goal was reduced by 0.1 errors per 1000 cases until the final goal of 1.5 errors per 1000 cases. Weekly graphic feedback included public posting of individual error rates. The mean errors per 1000 cases for the experimental group decreased 10% from 3.16 during baseline to 2.54 during the intervention. The largest decrease in errors was observed in the mid-level performers (with baseline error rates between 2 and 3.5 errors per 1000 cases). A cost-benefit analysis revealed potential savings of $9,799.50.

Key Words:

• Incentives
• employee errors
• changing criterion
• normative feedback