Designing a powerful employee incentives program to reward superior performance requires very careful thought. Don’t underrate the importance or value of this step, employee benefits programs work!
An effective employee incentive program must link your business goals with the right performance levers, then reward people for using those levers (inputs) as well as for what they achieve (outputs).
For example, salespeople should be rewarded for both inputs (like the number of phone calls made, the number of appointments completed, the number of proposals sent etc) and outputs (like the number of new clients signed, the number of widgets sold, the value of those widgets etc). Perhaps they should be rewarded and given employee benefits on those measures only for achievements above certain thresholds. Or over-achievement should be rewarded with bonus points.
Note too that the points-earning parameters in an incentive program for a widget manufacturer’s sales team will be quite different from the points-earning parameters in an incentive program where the sales cycle is long e.g. where a consultative sales approach with many contacts / meetings over several months is normal. And these will be quite different from the points-earning parameters for a benefits program rewarding customer service / call centre people for superior performance.
Don’t design a benefits program only for the top performers. Taken to its extreme, a “winner takes all” competition would be dangerously de-motivating for 95% of your team. The greatest opportunity lies in encouraging the “middle 60% – 70%” of your employees: when you motivate them to perform better, the whole organisation advances.
Remember that…
- re-calibration of the rewards parameters may be necessary as the employee benefits program matures.
- hurdles should be neither too easy nor too tough.
- terms & conditions must be simple. Complicated rules and regulations and qualifications will doom any program, even if other aspects are excellent.
- using a points currency gives you greater flexibility, and facilitates equity across divisions / departments/ functions. Participants can obtain rewards quicker if they are offered “points plus pay” rewards options.
- a wide choice of rewards is vital. Good quality brands of merchandise, from technology to household and garden items, “green” goods, sports and exercise equipment etc etc. All good value. Price points from low to high. Tickets to sporting events and shows. Travel including flight and accommodation bundles. Avoid cash which gets lost in household funds and has no “trophy value”. But some like the negotiability of cash, so we suggest VISA Universal Gift Cards should be in your rewards catalogue. You don’t want anyone to be de-motivated – “I don’t want any of those things!”
