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Creative reward solutions required in tough times

Posted By Natalie Singer, Thursday, 06 June 2013
Updated: Thursday, 06 June 2013

The concept of incentives has been pretty simple over the years; a cash bonus or luxury holiday has often been the norm. But, in tough financial times, companies are also trying to balance their financial situation with the need to keep their employees motivated, especially if they’re expecting them to do more, for less.

Want employees want

In good times, employees would often look to their incentives to provide something exciting that would allow them to do something outside the norm, such as buy a new car or take an overseas trip. Today however, their immediate challenges relate to "making ends meet”.

Incentives by nature only work if the person who is being incentivised wants what you’re offering. So, it’s high time that companies research what the real pressure points are for their employees and devise creative incentives that will ease their real burdens. Some companies have been known to offer vouchers for their local grocery store, petrol for a month or time off to spend with family.

Determining what to offer

The simplest way to find out is to ask. Survey employees to learn what they would prefer and go from there. And don’t feel compelled to make the same offer to every employee. If you determine what the value of the incentive is, why not consider having a range of options available for employees to choose from? This way, you’ll be able to incentivise each employee in a way that speaks directly to their needs.

Do incentives work?

This is a difficult question to answer, and seems to depend on the reason for implementing an incentive scheme in the first place. According to employee and recruitment guru Bill Boorman, it has more to do with when you offer the incentive. He says that in cases where an incentive was provided upfront and employees were given a clear expectation of what was required to be achieved going forward, a 90% success rate was achieved, compared to just 20% for those that promised a reward after the fact. Bill’s conclusion; people are more likely to deliver when they feel they have to repay a reward.

Daniel Pink also cautions against using incentives randomly, and especially in roles or environments that require cognitive skill or creativity. His research shows that people will amend their behaviours over time, from enjoying the task and being proud of an ideal outcome, to only being motivated to reach the reward. Pink believes that incentives cannot achieve the true outcome desired by most companies, that is, to foster a more motivated workforce. Rather than simply dangling carrots, he believes companies should focus on encouraging and empowering their employees to find creative ways to do better business, to improve productivity and performance, and to reward this kind of creative thinking, rather than simply achieving a targeted outcome.

Pink believes that intrinsic factors exert the greatest influence on employee motivation, in particular, he identifies three: autonomy, mastery, and purpose.

Incentive success

Consider the following when creating your incentive programme:

  • Ensure that the desired outcome is within the individual employee’s control
  • Group bonuses can have a negative effect on performance if high achievers are denied their incentive despite their over-achievement, due to the poor performance of others. Equally if poor performers are rewarded due to their peers, this leads to feelings of unfairness and a likely drop in the overall performance of the team.
  • Establish specific accomplishments and clear criteria for achievement. Be sure that you clearly explain what the incentive will be rewarding, i.e. the exact results desired. It may appears to be a "gift” (something that happens regularly, irrespective of achievement) if linked to an unclear, non-specific target. Remember too that the criteria for being awarded the incentive should be clear to all and then fairly applied so that those who meet the agreed accomplishments are seen to be rewarded.
  • Keep rewards regular, rather than delayed for maximum impact. People respond best to rewards that immediately follow their achievement of the desired goal. This is especially true of Generation Y who are used to immediate gratification. Annual bonuses just seem too far into the future. Why not consider smaller, more regular incentives to keep momentum and achieve specific targets related to a project or desired outcome?Incentive programmes should be as unique as the company (or even department) that is offering them.

Don’t feel pressured to follow the age-old traditions, discuss the concept openly with your staff and then brainstorm with management how to achieve the desired output with maximum positive impact for employees and minimum financial burden for the company.

Tags:  Bill Boorman  creativity  Dan Pink  employee  incentives  remuneration  rewards  work-life balance 

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