Designing an effective incentive program is about more than simply offering cash for engaging in a certain behavior or meeting a goal.

That point was made in a recent study from the University of Michigan Health System that compared two approaches to incentives for weight loss. A sample of 105 obese workers from the Children’s Hospital of Philadelphia were divided into three groups – one in which individual workers received $100 each month if they met their individual weight loss goal, another in which workers in groups of five split $500 evenly if they met their goal, and a control group that received no incentive.

After six months, workers in the groups had lost almost 3 times as much weight as workers in the individual program. In fact, the individual workers who received $100 basically lost the same amount of weight as workers in the control group.

Lead author Jeffrey T. Kullgren told me that last bit surprised researchers and has relevance for employers. “I think that should give employers a lot of pause for thought to think critically about the ways in which they’re designing their incentive programs,” he said.

Kullgren is a research scientist at the Veterans Affairs Ann Arbor Healthcare System and assistant professor of internal medicine at the University of Michigan Medical School. He noted some reasons groups may have worked better include the potential to earn more money if others did not meet their goals, and knowing that reward money would go to someone else if you did not hit your target.

Beyond application in wellness programs, these findings may show how incentives can work with safety. Kullgren used the example of motivating workers to wear a hard hat. The benefit of wearing a hard hat accrues in the long-term with the off-chance the worker gets hit in the head. However, in the short-term, the worker may see wearing the hard hat as costly in terms of being hot or uncomfortable, and those perceived costs present a barrier to wearing one.

That is where incentives can help “shift the balance in the direction of doing the behavior that is consistent with what people want for themselves in the long-run,” Kullgren said.

It should be noted that last year OSHA expressed concerns about incentive programs that may discourage injury reporting by offering a reward for going a certain period of time without an injury. In the agency’s view, the better approach is to offer incentives for safe behavior, such as identifying hazards.

The immediate reward of money motivates the worker to wear his hard hat, and over time, the inconveniences matter less, the worker becomes used to performing the safe behavior, and he or she continues to do so even when the incentive is no longer offered. As Kullgren said, “The habit-formation piece of it can be really powerful.”

At least, it is in theory. Kullgren acknowledged that people often stop the behavior when the reward disappears. He takes that to mean we still have a lot to learn about how incentives work and the optimal way to design a program.

The opinions expressed in "Research Spotlight" do not necessarily reflect those of the National Safety Council or affiliated local Chapters.