Discrete Choice/Conjoint Analysis

How do you really determine what is most important to your employees? What factors impact their decisions to stay with your organization, to accept a stretch assignment, or to engage in their jobs more fully? For example, what is the marginal impact on retention of a 1% pay increase versus a 2% pay increase? Or, is a better manager relatively more important than better training? To determine what these factors are, we use an approach originally developed in the economic, transportation and marketing sciences, which falls within the general framework of “conjoint” or “discrete choice” analysis.

In a discrete choice, or “Realistic Choice Modeling™” (RCM), survey, respondents are presented with a set of job alternatives that contain various attributes that might differentiate jobs, such as pay, training, manager quality, paid time off, etc. By comparing the choices that employees make from a series of these job sets, we can reverse engineer employee preferences to determine what matters most to each individual – and to groups of individuals.

By looking at groups of employees with similar preferences, we can test the impact of various interventions on these groups. For example, you might have one group that strongly prefers frequent career advancement opportunities and incentive pay, whereas another group might strongly prefer greater work/life balance flexibility and additional vacation time. How might particular interventions impact each of these groups? Through this “segmentation” approach, you can implement changes that have the greatest impact on those groups that matter most to you.

Contact us to learn more about this segmentation approach and how we can help you assess the impact of particular changes.