Last year, a large manufacturing company in the heartland of America implemented a new employee recognition and rewards program.  Two years in the making, there seem to be a slight struggle in the beginning to top executives as to the cost, risk, and return that a rewards program would really bring the company overall.  ”It’s going to be too expensive!”, one executive claimed.  ”We could put a small budget towards a rewards program, but we’ll have to pull the capital from another resource”, another exclaimed.  And a third argued, “what I can promise you, if the rest of you trust me, is that you will see huge returns from this rewards program in how our employees view us as leaders, our company, and themselves because they feel appreciated and valued.”  See, the third executive, while going out on their own limb, is right.  Yes, as more companies are tightening their belts and bracing for more economic challenges in the near future, it’s easy to loose sight of spending more money, especially on your employees.  But when you see through all the clutter and the weeds, you’ll find that the engagement of your employees and the critical role a proper rewards program plays in that is far greater than any number on a piece of paper.

Last week, the executives at this particular manufacturing company got back together to review the results of how the employee rewards program did in the first year of operation, and the results they found were astonishing.

In a company-wide survey conducted by the Human Resources employee development manager, over three-quarters of the entire workforce population responded positively to the statement, “I feel more motivated to do my work”.

In looking at the numbers, sales teams throughout the entire organization had either met or exceeded their targets 96% in each month during 2011.  In 2010, sales managers were pushing for their reps to hit 85%.  What was the difference?  Sales reps had incentives to shoot for - achievable goals with tangible rewards.

But perhaps one of the most meaningful returns the executives discovered, that the company experienced 15% less employees leaving Y-o-Y.  The fact of the matter is, the vast majority of employees will leave a company of their own free will because they did not feel engaged or appreciated by their former employer.

Use the lessons the top executives from above learned, the returns in implementing an employee recognition and rewards program far outweighed any costs involved in setting it up or operating in the first place.

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Just yesterday, online customer loyalty & engagement resource provider, WiseMarketer.com posted a blog that I think bears sharing.  The notion, being, there is research supporting the argument that the more your engage your consumer market in their opinions, they more likely they will feel a loyalty to your brand.  Bluntly put, company’s who invests in market research and gathering consumer opinions will reap the benefits through loyal customers.

According to market insight solutions provider Cint, “62% of consumers surveyed said they are more likely to purchase a brand’s product if they were asked their opinion in a study.

56% of the 1,200 consumers who participated in the Cint survey responded that they tended to feel more loyal to a particular brand that includes them in market research studies or polls.  Additionally, 77% of consumers “felt that brands listen more to what consumers want now than they did ten years ago.”  The trend of listening to the very people that use your products is taking hold, and it’s not going away.

Let this be a lesson to all those companies out there who are struggling with justifying budgeting market research for the next fiscal year.  While you might think the stigma that consumers are annoyed to be approached in answering questions about your products, you’re wrong.  A 1 - 5 minute survey will not only give you valuable information in the betterment of your product, but build a valuable relationship and establish long term customer loyalty.

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In this fast paced and competitive marketplace, it’s critical to always worry about staying ahead and what’s the bottom line.  What will come back, however, to haunt you long-term, is ignoring the level of engagement and excitement of your workforce.  Perhaps, already, you have an employee incentive program in place, but is it really enough?  Is it being monitored?  How is it managed?  Does everyone understand how it works and how to use it?  Far too often, an employee incentive program left unattended, can easily fall by the way-side and neglected.  

When that happens, it has the potential of becoming more of a joke around the water cooler rather than an important piece to the engagement puzzle.

In the past several years, corporate America has seen the critical need to increase employee engagement within their workforces, but scrambled to put something in place as a quick-fix, and didn’t really pay attention to how it was going to work.  What ends up happening is a lot of money spent for not much return.  Doesn’t seem to be such a sound business decision I’m imagining.

All, however, all is not lost.  If you find yourself with an incentive program, but are still struggling on keeping your employees happy, perhaps, just a little tweaking might be the answer.

When in the process of tweaking your employee incentives program, make sure you involve the very people that participate in the first place.  Not only will this give you valuable feedback on what is working and what is not, but it will give them a sense of ownership and will be more likely to be engaged in future projects.

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I recently finished reading Malcom Gladwell’s book, ‘The Tipping Point’ and discovered how top human resources executives at corporations around the country could benefit from it’s teachings.  ’The Tipping Point’, proposed by Gladwell, is “the moment of critical mass, the threshold, the boiling point.”  In today’s society, ideas, messages, and behaviors, are spread similar to a virus - very quickly and over mass quantities of individuals.  The reason Gladwell’s ideas are relevant to human resources is once you can harness the power of influence, you can greatly affect the success of your company’s employee program.

To keep with the analogy of a virus, you must first create an ‘epidemic’ within your workforce to get everyone excited about the employee program and its benefits.  Gladwell describes that there are three distinct groups critical in the success of creating an ‘epidemic’.

There are Connectors - connectors are individuals who seem to know everyone.  Don’t ask how they know everyone, just accept the fact that they do.  Connectors are critical in the process of creating an epidemic because they “have the ability to span many different worlds”

The second group are what Gladwell likes to term, ‘Mavens’.  These individuals are ‘information specialists’.  There are employees within your organization that have that talent of knowing everyone’s name, what department they’re in, their roles / functions, a perhaps, personal information.  As Gladwell states, “Maven are really information brokers, sharing and trading what they know.”

The last group are the ‘Salesman’ (a.k.a. ‘persuaders’).  These are your rockstars - employees that everyone looks up to, model themselves after, of have great working relationships with.  These individuals are your key group to go out and ’sell’ the ideals of the employee program to the masses using their keen ability to influence.

The take-a-way from all of this is better understanding your employees in what specific roles they may play in creating an ‘epidemic’ will yield massive results in the success of promoting your employee program to the organization.

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As of December, 2011 the current unemployment rate in the US is at 8.5%, which is the lowest it’s been in the past 5 months, but the general workforce population could still use some comfort.  Many companies, to tighten their belts have had to do massive reduction in force to just keep in business for some.  The damage of a company-wide RIF can leave the rest who are standing uneasy and afraid that they may be next in round 2.

This is where having a solid employee incentive program within the fabric of your company’s culture is uber-critical.  Offering those employees a little something of appreciation, recognition, not only will incentivize them to work harder, but will also decrease the probability that they, themselves, will start to look elsewhere.  Employee incentives can take many forms, but it’s important to keep in mind that you don’t go overboard and destroy the year’s worth of budget in the first 30 days.

Plan your employee incentives carefully and consider those who will be participating in the program in the first place.  Survey your workforce to gather information on what their thoughts are.  What are their biggest concerns - is it the uncertainly of having a job tomorrow, or perhaps it’s that they’ve been working 80 hours the past 4 weeks straight with not even an extension of a hand in thanks.  What you’ll soon discover is that the challenges that are revealed by your employment staff directly affect the performance and longevity of the company as a whole.

Also, don’t be afraid to seek outside consult or invest in a 3rd party provider who might be better equipped to run your employee incentive program for you.  This not only will streamline to processes into one centralized solution, but in the long-term will return huge dividends to your company and to its bottom line.

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Sure, it’s been widely understood (and embraced by a growing percentage of corporate America for that matter) that when you extend the hand of employee recognition in the form of a tangible gift or a reward, that it will yield positive returns in a happier workforce.  What cannot, however, be overlooked, is the other side of employee recognition, which is knowing those who work around, or for you.

Now, for smaller companies, say less than 100 employees, it’s really that difficult to get to know those whom you work with on a daily basis along with how their role or position fits into the overall corporate picture.  Larger companies, however, may find this to be a never-ending struggle.

One such large company that is paving the way for innovative thinking with regards to employee visibility is online apparel and footwear shopping giant Zappos.com.  With approximately 1,800 employees, CNNMoney ranked Zappos this past year as 6th (up from 15th in 2010) in the ‘Top 100 Best Companies To Work For’ listing.  Why?  Perhaps one of their secrets is their continuing commitment to have everyone get to know each other.  For example, when an employee goes to access their internal database systems, as part of the login procedure, they are required to view a photo of another employee (selected at random) and identify who the person is before  getting access to the company’s mainframe.

For those of you who may work for a company with 1,500+ employees, I have a challenge for you right now.  Think of those employees in your company who you really are familiar with; how many names do you really know?  I’ll bet you the number that you come back with is lower than you think.  And if it is one the high side, then cheers to you!

The point I’m want to make is that visibility needs to be part of a company’s employee recognition plan.  The more people know about each other on a personal level, the easier it becomes to have a better understanding of each other and appreciation for what each employee brings to the table.

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I recently had lunch with a friend who just recently (this last year) started up her own business.  The concept her company brings to the market has been wildly successful, but demanding, so she’s hired 15 employees by the end of this year.  Having trouble keeping up with all it takes to run a successful and fast-paced business, my entrepreneurial friend just experienced the loss of 5 of her employees.  For those of you reading that belong to large corporations, you might think that losing 5 employees is not much, but when you put it perspective of percentage of total workforce, then losing over a third of your workforce is certainly significant.

When I asked my friend what she thought the reasoning was, she responded that while the company was growing in leaps and bounds, she totally forgot about tending to the needs of appreciation and value and morale her employees were desperately seeking.

The lesson she learned is that no matter how young the company may be, or how fast it grows, without the employee incentives hard-wired into the culture, there is no real generator for motivation, or tie-ins to performing to the best of one’s ability and being recognized for those achievements.  For those who are in the midst of starting their own business for this next year, just keep in mind…just as it is critical to have a solid business plan to present to investors to get your company off the ground, so too is it equally as important to have a solid employee incentives program to keep your workforce around.

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At the beginning of 2011, a mid-sized company in the health-industry here in the mid-west, decided to take the plunge and implement an employee program to reward for employees’ committed years of service, outstanding performance, dedication, attention to detail, finding cost saving measures, and continued teamwork.  Now that it’s been almost 1 year since the employee program’s launch, it’s amazing to sit back and look at all the benefits that it has brought not only to the corporate culture, but also in maximizing the returns on investment as well.

The company had never done a formal employee program before, so they wanted to start small at first.  They worked smarter in making sure all employees’ views and ideas were heard FIRST, before sitting down to design what would ultimately become a widely successful employee recognition initiative.  Keeping top-of-mind, budgets were a little tight, employees were surveyed and asked what they thought would motivate them the most.  And a mutual understanding between upper management and direct reporting employes on goal expectations was accomplished.

When the rewards program was launched the first week of 2011, the employees were not only already aware of the new recognition initiative was in place, but everyone was already on board and excited of the arrival because they themselves had a say in how the rules were to be written.

Since then, the company is reaping the benefits of a successful employee program for year 1 and looking into ideas of expansion for year 2.  More interactive elements will be added into the employee program’s online application along with more sophisticated communication elements and exciting functionality.  The rewards offered are also being increased into higher valued merchandise. allowing employees a wider array of choices.

The take-away from this case study is two fold in the fact that you should always involve the audience whom the employee program is for before you start building one, along with the notion that it’s ok to start off small - you can grow over time.

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Trust me, everyone wants to be rewarded for positive behavior.  But did you know that there is a direct correlation between the time of the positive behavior and when they received the award.  The probability of the participant doing the same behavior again is directly related to the quickness of receiving the reward.

Consumers, for example, who sign up for a rewards program with their favorite super market do not want to have to wait a year to earn enough points for a baseball hat.  Even more-so, consumers also don’t want to spend hundreds of dollars in the department store to receive just a keychain.

Consumer insights and market research firm, Mintel conducted a survey in 2010 of customer behavior and current loyalty trends.  Almost 1/2 (47%) of those consumers surveyed indicated that the faster the gratification, the more likely they would participate in that rewards program.

If this 21st Century has taught us anything as of yet, it’s that everything comes at consumers at such a fast pace.  Those company’s that cannot keep up with the current trends, innovation, and applications will sure to be left in the dust.

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You’ve heard over and over again of the importance of having an employee incentive program integrated into your corporate culture.  And, for my fellow blog followers, understand the key positive points to operating a successful incentive program.  But keep in mind, that there are just as many points of failure to be aware of as there are points of successes.  Below are some reasons that many professionals overlook in designing their own incentive program for their employee base.

Poor Communication of Objectives - not properly communicating the incentive program’s objectives and how the employees are to use the application is fast road to failure.  It’s important to clearly spell out the reasons for the incentive program, what behaviors are being rewarded, and what types of rewards are available.

Improper Training - more often than not, a big point of failure in an incentive program is that the users in the program don’t know how to participate in the first place.  Make sure there is adequate training, documentation, and support services available should your employees have questions on how to use the system.

Un-Achievable Expectations - when starting an incentive program, start out walking before running when setting goal expectations of your employees’ performance.  Yes, the increase in your workforce’s morale, productivity, and engagement will increase over time, but it certainly will not double within the first 10 days either.  Make sure that the goals and objectives tied with incentives are attainable for each particular employee’s abilities, and level.

The best approach is to design an incentive program for your employees that  dynamically adjusts to changing culture, objects, and budget constraints.  Don’t get so tied down to an out-of-the-box solution that may become insignificant in 6 months time or never addressed the objectives in the first place.

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