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Five common mistakes that could be hurting your incentive programs
Eli Dile   on Wednesday, June 27, 2018 at 12:00:00 am

Here are some quick tips from Ellen Harpel of Smart Incentives relevant to any EDO thinking strategically about its business incentives. Have you made any of these mistakes?

  1. It is not clear what the incentive program is supposed to accomplish. Vague goals, beyond “job creation,” make it difficult to determine effectiveness.

  2. The portfolio of financial incentives is out-of-date. It’s easier to add new programs than eliminate old ones, which can lead to overlapping and outdated offerings. Economic circumstances change over time, so it’s important to regularly evaluate if it’s time to phase out certain programs.

  3. A focus on doing deals outweighs attention to actual outcomes. Failure to monitor compliance after the announcement is made can lead to headaches down the road. That’s a problem because too often…

  4. Resources are not available for compliance and evaluation. EDOs need staff with appropriate training and the necessary software tools to ensure that terms of the deal are met.

  5. Failure to prepare for transparency as the new norm. Community groups are demanding greater transparency in incentives dealings. Harpel recommends disclosing—at the very least—the terms of the deal, how much it’s expected to cost, and the anticipated community benefits. Those that do not risk public backlash.

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