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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In September, 2011, social media giant Facebook reported they have 800 million active members using their service. Let’s just put it this way…if Facebook were a country, it would be the third largest country in the world. Marketers can no longer deny, avoid, or work against the movement of social media and its profound effects on today’s culture, trends, direction, and history.
One way marketing executives have begun to harness the power of social media is through setting up Facebook profiles per brand and embracing the notion of loyalty programs through the digital community.
In the beginning of October, digital intelligence firm eMarketer released an article addressing what Facebook users expect from today’s brands. The article reported that “58% of Facebook users within the United States expect “to gain access to exclusive content, events, or sales after ‘liking’ a company, while 58% also expect to receive discounts of promotions”.
For those involved in the Facebook world may know that ‘liking’ a company or brand is a pretty simple task. It’s not hard to search for the brand (i.e. Coca-Cola) click on their profile page, then click ‘like’. But what’s surprising is the profound expectation that just by doing that - ‘liking’ - consumers are expecting exclusive perks over the general public.
In working with this phenomena, marketers are going towards a more tiered system to their online social media loyalty program.
- Tier 1 involves those loyalists who just ‘like’ the brand access to content, small discounts, or interactive games that others would not have access to.
- Tier 2 is a little more where consumers are encouraged to blog, post comments, forward emails to their friends, etc about the brand. Marketing executives have discovered they can build a virtual ‘marketing army’ through this online medium by offering small rewards to it loyal market.
- Tier 3 is the top tier where now these loyalist are hooked, and their not only pushing the marketing efforts to their friends and family, but are buying the product themselves on a regular basis.
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The past two or three years has certainly been a test for the American economy of how to work more with less - trimming in every area possible to keep the company afloat and heading toward a successful future. Employees are working even faster, longer, and harder to produce infinitely greater results with less resources than ever before. There is something to be said about those employees who sacrifice so much of their own personal lives for the betterment of the business - it’s loyalty. Loyalty, however, can have a short shelf life if not attended to properly with appropriate employee recognition and rewards program.
I’m not saying you as the employer have to go out and buy 7-day cruises for all your employees just for doing the things their supposed to do in the first place. What I am saying, however, is recognize those employees who have decided to sacrifice their personal lives, their comfort zones, and for some their family lives for your organization appropriately.
Bringing an employee recognition program into the corporate culture will show your employees that you value their loyalty, recognize their sacrifices, and want to reward them for their efforts.
Once you have implemented an employee recognition program, you’ll start to see a dramatic shift in employee confidence in their work and how their performance directly affects the future success of the business overall.
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In today’s workplace environment, companies are realizing that ‘one size fits all’ does not apply when it comes to implementing an effective employee incentive program. The more flexible the set of tools you have access to, the more effective the incentive program, and the more engaged your employees will be.
Incentive programs may come in many different vehicles ranging from online websites, to all access smartphone apps. Incentive programs may address a variety of different initiatives including:
- Milestone Service Awards
- Retirement Awards
- Employee Peer Recognition
- Manager Spot Awards
- Safety Incentive Programs
- Sales Incentive Programs
- Health and Wellness Incentive Programs
- B2B Channel Sales Incentive Programs
These various initiatives can be done as individual incentive programs, or combined together thus streamlining resources and allowing a more universal solutions strategy.
Whatever form the incentive program may take, once implemented, your company will see dramatic returns with:
- Increased employee ‘buy-in’ towards the corporate culture
- Greater positive attitudes of how employees perceive themselves as PART of the business
- Larger percentage of your top performers are more likely to stay
- Drives faster results through engaging reinforcements
The clear message to take-away from all of this is just having some sort of employee incentive program within your human resources strategies will engage your employees to want to perform at the best of their abilities and enjoy doing so in the process. What form that incentive programmay take - well that’s entirely up to you.
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For those loyal readers to this blog, by now you should’ve caught on to the notion that there might be something to all the noise being raised in Human Resource departments around the country when it comes to employee recognition. You simply CANNOT ignore the fact that it is indeed employee recognition that will keep your company successful and remain competitive within the new market landscape. It’s critical issue #1 to have an employee recognition program in place that shows appreciation for hard work ethic, rewards for continued excellence, over-achievement, and continued teamwork.
Instills Confidence - I challenge you to go out of your office right now and into the hallway, find a random co-worker (just pick the closest one), and pay them a heart-felt compliment. Don’t be general with your comments, rather choose something more specific, like, “You really did a great job yesterday in presenting the end-of-the-year numbers to the rest of the team. Those numbers provided much insight into how we should focus our strategies for this upcoming calendar year.” Now once you give the compliment, observe what your co-worker does. Did they smile? Blush? Say ‘Thank You’? Of course they did. Everyone wants to feel that they are appreciated. Now comes the confidence part - watch them walk away. I bet they have a bouncier spring in their step. It’s because just by recognizing someone, even if only by verbal comment, builds confidence.
Productivity - now let’s take that same experiment from above and fast forward about a week from now, or a month from now. How is the performance of that employee now? Better? Faster? My bet is that they are working more productive than ever before. Why? It’s because the last time they produced good work, they received recognition for it, and felt good about what they were doing. Since the employee tasted recognition once, they want to work hard to receive more recognition. The more recognition the employee receives will lead to greater productivity because they WANT to do the work, rather than HAVING to do the work.
Loyalty - the happier your employees are, the less they want to leave you. This is really the most simple lesson of all in employee recognition. Letting your employees know that they are appreciated and they are a valuable asset to the overall company’s success and growth will decrease attrition ten-fold. Who really wants to work for a company that under-appreciates, devalues, or mistreats their employees? If that is happening, how long do you think that employee would stay? Not long, I bet.
It’s that simple really - instilling good employee recognition practices into your company’s culture can yield lasting effects to the overall success.
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It’s true. I don’t think there is a single employee out on the workforce today that would say, ” don’t need to be extended appreciated to feel valued” or “You know, offering rewards is just not going to motivate me to perform better at my job.” The fact of the matter is, is that EVERY employee needs to be recognized and rewarded if the organization is to thrive in the workforce marketplace of today.
But you as the company don’t have to reward all of your employees with trips to Tahiti either. Employee programs offering recognition and rewards can be extremely effective if you consider the following points:
Set Goals - what is it you want to reinforce? Make a list of the various activities, behaviors, values, or performance measurements you would like to include within the employee program. Once you have a good list of variables, decide what the importance of each of them are. As an added note, the only way you’ll get everyone to participate in the employee program is if they ‘buy in’ or believe in the program in the first place. Gather feedback from your workforce as to the values they feel they should be rewarded for.
Offering The Right Type of Reward - this can be a little tougher of a task as there are seemingly an endless supply of options now-a-days to include as reward in employee programs of recognition. The key message is not to decide for the employee how they would like to be rewarded. Remember, much like the talent that each employee brings to your company, so too is the diversity amongst what motivates each individual. It’s ok to set some cost boundaries so that your employee program’s reward budget does not get out of hand, but at the same time, does not pigeon hole the recipient into choosing something they don’t like in the first place.
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Marketers of the world listen up! So most of you by now have a wonderful sophisticated loyalty program in place to keep your customers coming back for more. But did you remember that is just as equally important to continually manage the loyalty program as it is to have one in the first place? Yes, for every season, there are differences in volume, tastes, demand, and yes, moods. Especially during this, this Holiday season, due to the cut-throat pricing of competitors, it is critical to keep your customers engaged. Here are a few companies (whom you may of heard of) and what they are doing during the Holidays in an effort to ’sweeten the pot’:
1) American Airlines (Double Elite Qualifying Miles) - between December 14, 2011 and Jan 31, 2012, AAdvantage program members will earn double elite qualifying miles for traveling on any of their associated carriers.
2) Wyndham Hotel Group (My Horrible Holiday Gift) - disclaimer: I’m not making this stuff up. Last week, Wyndham Rewards launched their “My Horrible Holiday Gift”. Rewards members who are willing to trade in “their less-than-desirable gift” Wyndham will reward them for two million points and / or other prizes including $50 and $100 gift cards.
3) Kmart (Shop Your Way Rewards) - Kmart, through its ‘Shop Your Way’ loyalty program this season, is offering its customers up to 10% back in award points. Starting at the beginning of December and running through Christmas Eve, purchases of $250 - $500 of certain Kmart merchandise will earn customers a maximum of $50 in rewards.
No matter what form (or how creative) your loyalty program may be, the take-a-way is to be generous this Holiday season. Yes, the economy is tight, and corporations are having to tighten their belts as much as possible, but don’t forget…so are your customers. A well thought out loyalty program will keep your customers coming back for more.
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