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professionals, they should not be reduced to something that reminds them of a plaque
used by fast food companies to motivate their staff. De gustibus non disputatum — of
some tastes there is no disagreeing. In other words, the reward should fi t the person
being rewarded — personalization is very important. At a minimum, employees should
be allowed to choose their reward from a list of possibilities. At Buckman Labs, this
problem was resolved by polling the employees. The top choice turned out to be a
fully equipped laptop computer to be conferred to the top KM citizens, fl own in to
headquarters for a public remittance of the prize by the President himself.
It may be helpful to look at how incentives can be classifi ed according to the dif-
ferent ways in which they motivate agents to take a particular course of action. The
common and useful taxonomy developed by Callahan (2004) divides incentives into
three broad classes:
• Remunerative incentives (or fi nancial incentives) are said to exist where an agent
can expect some form of material reward — especially money — in exchange for acting
in a particular way.
• Moral incentives are said to exist where a particular choice is widely regarded as the
right thing to do, as particularly admirable, or where the failure to act in a certain
way is condemned as indecent. A person acting on a moral incentive can expect a
sense of self-esteem, approval, or even admiration from her community; a person
acting against a moral incentive can expect a sense of guilt, condemnation, or even
ostracism from the community.
• Coercive incentives are said to exist where a person can expect that the failure to
act in a particular way will result in physical force being used against him or her (or
her loved ones) by others in the community — for example, by punishment, imprison-
ment, fi ring, or by confi scating or destroying their possessions.
These categories are not an exhaustive list of all types of incentives. For example,
personal incentives are related to preferences and personal objectives that may moti-
vate actions of individual people. The reason for setting these sorts of incentives to
one side is not that they are less important to understanding human action. Personal
incentives are essential to understanding why a specifi c person acts the way he or she
does, but social analysis has to take into account the situation faced by any individual
in a given position within a given society, which means mainly examining the prac-
tices, rules, and norms established at a social, rather than a personal, level.
Quite intuitively, if there is no economic, social, or personal incentive for any
individual to do work, it will not get done. Therefore, a society must provide incentive
for the work necessary for its own maintenance. Likewise, a company or organization