In working with a prospective client just this afternoon, we had a wonderful conversation surrounding employee incentive programs and what he had learned in trying to run one in his company last year. He was in a bind, seeing that his employees were gradually becoming disgruntled and disengaged. To quickly respond to the problem, he developed an incentive program into the culture to which it failed miserably six months later. Why did it fail? For several reasons.
Not Thought Through - he thought implementing an incentive program was easy and could happen at the snap of a finger. Incentive programs can be as easy or complex to implement, but without a proper strategy or knowing your objectives in the first place, what’s the use? An entrepreneur would never go into an investors meeting unprepared and without a solid business plan, right? The same applies to creating the right incentive program. Know who you want to incentivize, what you want to get out of the program and how much you want to spend.
One Size Does No Fit All - the other point of failure was that there was no segmentation or distinction between various departments, employee abilities, or personalities when it came to dolling out incentives. It’s important to keep in mind that each employee has their own individualities and their own idiosyncrasies. What motivates an employee in a management role might not motivate another employee who is in a customer service role.
Be Willing To Switch Up - lastly, it’s important to keep the incentive program fresh and exciting so that employees remain engaged and excited to continue participating in the program. You could add interactive games with prizes as an example. Another idea is to keep the rewards fresh and relevant to what’s on the market today.
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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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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 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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In today’s marketplace, what’s easier? Keeping the customers (or employees for that matter) that already exist, or trying to create new ones? I’ll give you a hint: it’s always cheaper to retain than than to gain.
This is exactly the reason why, in the past 3 years, America has seen an exponential amount of incentive programs pop up in almost every corner of country. According to Frederick Reichheld of Bain & Company, and author of The Loyalty Effect, “customer spending tends to accelerate over time.” Interesting.
Further research on incentive programs conducted by Deloitee Research found that “manufacturing companies who tracked customer retention, set loyalty goals, and made efforts to exceed their loyalty goals, were 60% more profitable than those manufacturers who made no efforts to track customer loyalty.”
Just in case you’re still not convinced that it’s a good idea to implement an incentive program for your ‘loyal fans’, I’ll throw one more piece of information into the mixing bowl for you to nibble on. Sales & Marketing Magazine reported that the “number of sales calls required to sell a product to a new account was more than twice the number required to sell the same product to an existing account”.
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A recent survey conducted by Staples Advantage, the B2B division of Staples, Inc., found that “70 percent of employees at companies that do not currently offer incentive programs said they would love to work at a company that does”. Further, “40 percent would be in favor of foregoing the company holiday party to implement an incentive program.”
What does the data show us? That there has become greater need for employees to be a part of an incentive program than ever before.
So, if the data is right there in black and white, there should be a nearly 100% buy-in from every executive who wants to see their company succeed right? Not so fast. There is still a staggering percentage of companies not offering incentive programs even though they acknowledge the responses from their workforce. One executive has commented, “Sure, I’d love to give each and every one of my employees a flat screen TV at the end of the year, but we just don’t have that kind of capital laying around.”
A key factor, however, this executive is missing, is that it doesn’t have to be a high ticket reward item to get the engagement flowing within your workforce. Try starting with a simple incentive program is better than nothing.
Whatever form your incentive program may take, it’s important to keep in mind that:
Some type of program, no matter how big or how small, should be started as soon as possible
Encourage your employees to use and recognize others as frequently as possible
When recognition does occur, that a reward is received as immediate as possible.
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The incorporation of incentive programs and recognition into corporate culture has become a powerful tool for today’s companies to keep their employees engaged while staying ahead of competition through increased performance.
Where many incentive programs fall short, however, is the fact that the majority of employees will primarily change their behavior and motivation when the right incentives are put in front of them.
The right intentions is not enough as a sole incentive - anyone who has pronounced to the world their New Year’s resolution has the best intentions, but rarely follow through because they failed to set up the right incentives once they achieved their goals.
And throwing ideas onto a dart board laced with cash isn’t the best approach either. Before designing an incentive program for your employees, take a minute to think about the people who work for you - what will motivate them the most? Is it more money? Or perhaps it is cool and popular merchandise rewards. Offering the right type of reward is key to having a successful incentive program. Don’t go overboard however - be consistent that the incentive matches the action. For example, if your finance manager finds a way to save the company over $1 million in the next year, don’t just offer them a keychain as their reward. Conversely, if another employee completes a project on deadline (a task that should be accomplished anyway), then perhaps offering them an LCD Plasma TV is not the way to go either.
Whatever shape your incentive program may take, the key is to take into account the people you are looking to motivate and what makes them tick first and foremost.
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The days of the proverbial plaque on the wall saying, “Sales Employee of the Month” is over. For a sales incentive program to be motivating, companies must recognize and reward their top-performers, empowering the recipient to choose their reward.
It’s not ‘all about the Benjamins’ any longer. Cash alone isn’t enough to motivate people. If you want to really motivate employees for exceptional job performance, remember that not everyone is looking for money. Consider giving them an experience they won’t forget, even if it’s just for one day.
Rewarding your sales force with cash doesn’t have the same impact of sales force engagement in the way that non-cash awards do. When a sales employee receives cash, it just goes into their bank account, and they forget quickly why the reward was given in the first place. Rather, if they were given a tangible reward, for example an HD television, every time they turn on that television or have friends over for that big game, they’ll remember why they received the television in the first place – it’s a ‘trophy’. The most important thing to remember is that the reward leaves a lasting impression on the recipient and motivates them to continue to perform.
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Earlier this spring, the non profit organization WorldatWork, reported on their findings of a survey dealing with employee recognition programs. They surveyed about 5,600 members across the US, and Canada, and measured their responses to their views as to where the trends are going with regards to employee recognition.
Of the 677 members who responded to the survey, WorldatWork reported that over 80% of their employers offered one or more type of employee recognition programs within the last 2 years.
With a median program budget 1% of payroll between the employers, over 50% of surveyed members responded that they felt their recognition programs had a positive impact on employee recognition, motivation, and engagement. Retention, however, feel short at only 42% of respondents indicating a positive shift.
No matter what your budgets may be, its important to remember that just by offering any type of recognition to your employees will have a positive impact on your workforce.
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Over the past several years, many companies in the US have seen dramatic increases in the ROI of their existing wellness programs. Much of the success can be attributed to a well designed health and wellness incentive program interwoven into the corporate culture.
Smart companies are realizing that overlaying an incentive program solution onto your existing wellness program not only engages employees with an increased program participation, but saves a huge amount of money in health care expenses due to a healthier workforce.
For health & wellness programs to be optimized, companies must celebrate with their employees for achieving their goals through exciting experiences and meaningful rewards.
One idea is to implement an activity tracker where employees may list the specific goals they would like to achieve for themselves against a period of time. Perhaps a group of employees wishes to stop smoking within the next several months. They may set a date within the tracker as to when they would like to be ’smoke free’ and monitor how they are doing along the way. If they achieve their goal, you as the employer should celebrate with them by offering a reward.
No mater how large or small the incentives that are tied to healthy goal achievements are, its important to create a culture of engagement and celebration for employees wanting to live a well rounded lifestyle.
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