Reward power refers to the ability to deliver rewards or benefits to influence others. These can be financial, material or psychological rewards. Reward Power is the fastest way to persuade.

This power is the opposite of coercive power. With coercive power you punish, and with reward power you offer incentives. Reward Power is based on utility, which is the understanding that there is potential for exchange in every transaction. Basically, the power utility recognizes that there is always something I want and something you want. We can satisfy the needs of others by exchanging what we have for what the other wants. Rewards are a form of utility power. They are a way of rewarding people for doing what you want them to do. The reward becomes the incentive for compliance action. Examples of utilities include sales bonuses, paychecks, incentive clauses in contracts, airline bonus miles, and credit card bonus points.

It is important to understand that some incentives will work well for one person, but not for another. For some people, money is the reward. For still others, recognition is the reward. As a persuader, you must find the motivating force or reward for each person you work with; You must understand the wishes of the person or group. Reward Power is extremely effective in changing human behavior and increasing your persuasiveness. You get what you want with minimal effort. Let’s face it: everyone has their price.

However, there are several inefficiencies to be aware of when using rewards. First of all, the law of diminishing returns quickly takes over when you employ this kind of power. Diminishing returns means that the more you use the reward, the less powerful it becomes. When people get used to an incentive, they may get bored and expect more or lower performance standards if the incentive is removed. One example is the common practice of offering children prizes for reading in primary school. They win pizza or other prizes after they have read a certain number of books. These incentives often backfire because many of the children think they need a reward for reading. Reward Power ultimately leads to the desired result, but the incentive usually needs to be repeated each time to get the desired result. The reward is only effective as long as the person does not see a “better deal.” Your incentive will always be matched against the next person’s offer. Rewards reinforce behavior, so as long as you use them, expect your prospects to continue to demand them.

Reinforcement theory has a lot to do with reward power and coercive power. Basically, if a person knows that a certain action will follow a positive consequence, then he will perform that action. Consequences influence behavior. The type of consequence involved influences what actions people will take and what actions they will avoid. There are three main rules of consequence. They are:

(1) Rewarding consequences increase behavior.

(2) The consequences that punishments give decrease behavior.

(3) Consequences that are neither rewarding nor punishing extinguish the behavior.

Remembering these basic rules can be an excellent guide in deciding what to do in certain situations, depending on the desired outcome. Just be sure to keep in mind some of the limitations of reinforcement theory. Some examples of such limitations are listed below.

Limitations of reinforcement theory

1. What is considered reward or punishment will vary depending on who you are working with and what the exact circumstances are.

2. As mentioned above, rewards can lose value over time. Instead of feeling rewarded, the person will feel like you owe them something.

3. Other sources of reward or punishment may interfere. For example, an employee may value the reward of esteem and friendship from other less productive employees more than what you have to offer.

4. If a person is only responding to a reward, then there really hasn’t been an internal change. They will revert to their old behavior if the reward is no longer part of the new routine.

5. Punishment is difficult to apply well. It is a powerful tool, but it must be executed properly. Punishment must have the following elements to be effective: a) immediate, b) strong or firm, c) unavoidable, and d) consistent.

6. Punishment can generate anger, fear and hopelessness. These negative emotions will be associated with the person inflicting the punishment.

The challenge you face when using rewards is decreased internal motivation. Once you condition them to expect something for your compliance, your prospects will always look for external rewards for their behavior. This causes them to do it just for the reward and not for any other reason. We have found that even if the person were willing to exhibit the desired behavior without the reward, once the reward was given, the subject would not perform the desired behavior without the reward. An experiment demonstrated this concept. The subjects, seated together at a table, worked on a puzzle for half an hour.

After the half hour was up, the experimenter told the subjects that the resolution session was over and they needed to leave the room. The experimenters then began monitoring the behavior of the subjects as they entered the waiting room. What would they do during their free time? Would they play with the puzzles? Would they choose other activities? The study found that those subjects who were paid to do the puzzles were much less likely to play with them for fun during their free time in the waiting room. And those who did not receive an external reward for their efforts were much more likely to play with the puzzles during their free time in the waiting room. Persuaders know that a freely chosen behavior lasts longer than a behavior rewarded by an external reward.

Learning to persuade and influence will make the difference between expecting better income and having better income. Beware of common mistakes presenters and persuaders make that lose the deal. Get your free report 10 Mistakes That Still Cost You Thousands and explode your income today.