Supercharging Your Risk-Takers

hut v2The people in most organizations span the spectrum of risk inclination. Talented leaders adapt their management methods based on an individual team member’s risk inclination and tolerance.

There is some interesting new research that gives insights into how to better motivate the people you lead who happen to be more risk inclined. The research was conducted in the small African country of Lesotho. The country suffers by a devastatingly high level of AIDS cases among its populace. The study focused on more risk inclined people on the premise that they would be more inclined to engage in risky behaviors that could lead to AIDS infection. Their risk inclination was determined based on how they approached games of chance that were orchestrated by the researchers.

The research showed that the risk-inclined participants were more likely to change their behavior when they were offered a chance to win a large reward as opposed to a smaller but certain reward.

One group was given a monetary reward if they met certain criteria. A second group was given a ticket in a drawing in which four people in their village would win twenty five times as much as the first group. Obviously, this meant that only four people in the second group received a reward and most did not.

What was the result? People in the second group that had only a chance at a reward were 21.4% more likely to adopt the desired behaviors than the people in the group who received a certain but smaller reward. That is powerful when you consider that most of the people in the second group received no reward.

So, what does this tell you about how to better motivate some of your team? Well, first identify the parts of your organization that are dominated by people who are more comfortable taking risks. To advance the idea, let’s assume your sales people fit this description. Sales professionals often have higher risk inclination than some people in other roles.

The research tells us that risk-takers are more responsive to a chance at a larger reward than a certainty of a smaller reward. So, let’s say you are structuring a sales contest. As with most such efforts, performance beyond a certain threshold yields a reward. Often the size of the reward increases as results increase.

Here is the insight from the research. In addition to the financial incentives you would usually offer add an opportunity for some of team members who exceed the performance threshold to be entered into a drawing for a significant prize, bonus or trip. The research suggests you will get significantly more performance. Why? Risk-takers like taking risks and appear to be excited by the opportunity to receive a larger though uncertain reward. It is a bit of the gambler’s mindset.

Please note that we are not suggesting that the drawing for a single reward be your only incentive. That could actually be demotivating with time. We are suggesting instead that the drawing opportunity be an additional incentive.

Give it us a try and let us know what results you get.


More information on the research is available at:



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