The typical model for incentives is to offer individuals a bonus or benefit once they attain certain conditions or outcomes. It projects to a future state and is likely not evident in the current moment. When individuals perform well, they will benefit, but they have not lost anything if they do not achieve their goals.
Research confirms that we as individuals are more concerned with losing something than gaining something. This is because the fear of losing something is a driver and motivator for action and behavior, while the idea of gaining something less often pushes people to make changes and act.
If we want to incentivize people, give the bonus or reward upfront, and should they achieve it, all parties win. If they don’t, they pay you back, but then it has been shown it is unlikely that will occur since we do not want to lose what we already have.
