EverydaySpy Podcast - The Undeniable Power of Positive Incentives

Episode Date: March 21, 2023

There is no super power more powerful than getting people to do what you want. Every comic book hero and villain struggled because at some point someone resisted them. In this episode, you learn how to use the one power most people never understand. Whether you use it to be a hero or a villain is up to you... Learn more about your ad choices. Visit megaphone.fm/adchoices

My name is Andrew Bustamante, and this is everyday espionage. I'm super excited to jump into part two of the conversation we started last time about consumers, producers, and how you can use both to gain a massive advantage in your business, in your career, and in your everyday life. Now, as a refresher, in our last conversation, I told you that all people break down into two basic categories. consumers, the fuel that runs the economy, and producers, the engine that drives the economy forward. If you are in business or management, or even if you're on the hunt for a new job, then you are very familiar with the unprecedented recruitment and retention crisis that the world has been struggling with since 2022. At the heart of that crisis is the fact that governments and businesses are failing to recognize a simple truth I learned at CIA, that people are more likely to

to take action when they are rewarded rather than when they feel threatened. Whether you're dealing with consumers or producers, customers or employees, wealthy or broke people, every age, every gender, every education level, all people react in consistent, constructive ways when they are given a positive incentive, a reward that makes them want to try. And likewise, all people react in unpredictable, often destructive ways, when they feel threatened, like something might be taken from them. Now, if that sounds obvious to you, I'm glad, because clearly that truth has not been so obvious to the government and business leaders trying to manage the current economic crisis. Now, during the Great Resignation, 4.5 million people left their job, contributing to a 3% increase

in overall unemployment and a 2% drop in the value. of a dollar. This massive change increased the cost to both hire and retain talent and drove a drop in national salary levels. So to put that simply, companies had to pay more to hire people, and as a result, they paid the people they hired less once they were actually brought on board. Now, because of all this change in the workforce, in an effort to retain employees, employers from the U.S. government to major tech industries and everywhere in between, stopped using positive incentives like bonuses and promotions for two important reasons. One, there was so much new available talent on the market, it was actually cheaper in the long run to hire a new person

and simply pay them less. And reason number two was that all the extra money that these employers had was actually being used just to hire new people, which left no money. And to promote or reward current employees. Now, you've probably seen this play out in your own career or your own business, especially if you've seen your salary stagnate or even decrease, or if you've seen your annual bonus drop the last two years consecutively. If you're a business owner, you've likely seen your cost for new hires skyrocket, only then to watch those same new hires leave or even get fired not long after they were hired.

At the core of both employee, aka consumer, and owner, aka producer frustration, is the simple fact that positive incentives drive positive performance, while threats drive negative performance. Like, let me give you two current personal examples to help show you exactly what I'm talking about. I have a client that manages a team of national salespeople. Now, just as the great resignation was peaking, he came to me for help retaining his top sales. staff as a competitor was trying to poach them away. Now prior to 2021, his company offered an annual sales reward, a week-long all-expense-paid family trip to the top grossing salesperson. But as the economy started to tank in 2022, the company actually stopped paying that incentive in order to save costs. Now, killing that incentive sent a message to the sales team that the company didn't

actually care about their skills or talent. It only cared about company profits. So the sales staff chose to shop their talent around somewhere else. Within a few weeks of working together, my client was able to get approval from his executive staff to restart the sales award, now for a cheaper, shorter trip, but still all expenses paid. And within a month of starting, their staff actually stopped leaving and multiple salespeople who had left for the competitor were submitting job applications to come back to work for my client's company. This outcome is predictable because positive incentives make people want to work hard. It makes people want to stay in place. It makes people want to win the incentive. Now, if you're a business owner out there and you're wondering how this applies to you,

let me tell you about a customer experience that I had in Everyday Spy. Now, a customer sent me a message, an email to my customer support address. And in that email, he said that he liked my podcast, he liked my message, he liked my appearances on other podcasts and on YouTube, but he would never buy anything from me because he already knew everything I was teaching. Now, when I got the message, I kind of laughed and promptly forgot about it until a few months later when I saw the same email address pop up as a paying customer for a new product that I was launching, a live competition called Operation Real Time Conspiracy. That challenge, that competition, had a $49 registration cost,

but I also created an award package for the folks who finished in the top three slots at the end of the challenge. By the end of that live competition, this customer, who had only a few weeks before, said he would never buy anything from me, had finished in the top three spots and got his part of the award package. Since then, that same customer has spent more than $5,000 with my company and become both a friend and a loyal customer. In fact, he's probably listening to this story right now, laughing to himself and saying, that was me. Positive incentives are powerful because they turn customers into loyal customers. They make customers excited. They make customers permanent.

When you try to bully employees or customers with deadlines or expiration dates or threats, you have very little control over their behavior. You actually push them away from you and towards your competitors because you send them a message that they are not appreciated and not valued. But when you can excite your employees, when you can excite your customers to take action with a positive incentive, like an annual award or a prize, or even just a, simple pat on the back, you actually make them feel like they are part of something bigger. Every consumer and every producer wants to be part of something larger than themselves.

So do you. So do I. CIA knows that. And now you do too. And that is everyday espionage. Everyday espionage is dedicated to one thing, educating everyday people. I know that not everyone will listen, but those who listen will learn. If you learned something new today, click subscribe, review, and share the podcast with a friend. Find me on social media at EverydaySpy or on my website,

everydayspy.com. If you are up for a special challenge, visit Everydayspy.com forward slash operations and join me for an authentic spy training mission. And above all else, remember that knowledge is freedom.