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Copyright 2003, G.A.Marken, Marken Communications
The Effective Employee Incentive Program
By: G.A. (Andy) Marken
|In his nearly 25 years in the advertising/public relations field, Andy has been involved with a broad range of corporate and marketing activities. Prior to forming Marken Communications in mid-1977, Andy was vice president of Bozell & Jacobs and its predecessor agencies. During his 12 years with these agencies, he developed and coordinated a wide variety of highly visible and successful promotional campaigns and activities for clients. A graduate of Iowa State University, Andy received his Bachelor's Degree with majors in Radio & Television and Journalism. Widely published in the industry and trade press, he is an accredited member of the Public Relations Society of America (PRSA).
Downsized organizations, tough economic times, demands to reduce costs
and improve quality and a myriad of other reasons can stimulate the need
for an employee incentive program. Done properly, the investment can be
minimal but it can produce very positive results.
If you want to improve results and morale throughout the organization,
here are some tips on ensuring your employee incentive program meets your
- Realistic Pay for Realistic Performance…Rewards for Extraordinary Efforts
Rewards are no substitute for a decent paycheck. For example the airline
industry shouldn't expect employees to give back benefits and go the extra
mile. Especially in light of reported side deals senior executives received
just for staying on the job. Given the tough economic environment the industry
is operating in today they should expect decent performance should receive
decent pay. At the same time, management - in any industry -- should be
creative in developing programs that will help encourage off-the-chart
performance, even if the rewards are deferred.
- Don't Let Them Strike Out Early
If they are half way through the incentive program and half the team has
no opportunity to be rewarded you have lost half your team. They have no
incentive to push harder and be more efficient/more effective if they are
out of contention. Putting forth the extra effort and winning should be
a team effort, not an individual effort. Keep the team interested and involved
throughout the campaign.
- Prepare the team, administer the program
Don't launch your employee incentive program and then go about explaining
it to members of the team as the program progresses. Plan a promotional
campaign for the internal program just as you would for a product launch.
Spend the time necessary to communicate the program to the employees and
their significant others so that everyone is committed to the goals and
the program. If you don't, don't expect to achieve your target objectives.
- Announce Results with Flair
Make a big deal about the winners and their prizes. Make them feel special.
The way you promote your winners over the weeks following the program will
be as important - if not more important than the prizes. Make certain everyone
gets the message - performing pays big dividends (regardless of the dollar
value of the awards).
- Involve the Family
If you want to get people excited and keep them excited don't overlook
the importance of "selling" the family or significant other on
the campaign. Make certain you send program information and progress reports
to the employee's homes so everyone understands what the individual is
doing and why he or she is doing it. Make the incentive program a household
affair and everyone will win.
- Be Consistent, Uncomplicated
Make the incentive program rules easy-to-understand and simple. Forget
the 4 point type legalities. These are employees that you have entrusted
the success of your company to so be straightforward with the program.
Once the program is underway maintain a steady course even if the program
isn't the optimum program you want. Don't experiment and create confusion
or change the rules half way through the race. If you discover some shortcomings
in this program save the improvements for the next program.
- Post Standings Frequently
Keep employees current on their standings in the competition. At least
once a week let people know where their team stands and where they stand
in their efforts to achieve the program's goals. Chart the progress on
employee bulletin boards or on wall charts.
- Meaningful Prizes
Prizes don't have to cost a lot to be valuable to employees but they do
have to be meaningful. By the same token cheap prizes tells the employees
management doesn't care about its goals. A six-day trip for two when the
family has five kids they have to worry about isn't as attractive to some
people as 2-3 evenings out during the month at a fine restaurant. The cost
is not only less but the couple gets a chance to relax and enjoy themselves.
Remember…value is in the eyes of the beholder.
- Us Vs Us
While sales incentives - usually the most common type of program - does
pit us versus them (other territories, competition, etc) there are a number
of incentive programs you can develop that create team efforts. Achieving
Six Sigma quality, increasing production by 20% over a 3-month period,
going from design concept to finished product in five months are all team
incentive goals. Programs of these types produce not only the desired short-term
goal but also produce long-range results. Promoting team efforts pulls
the organization together and gets everyone going in the same direction.
That camaraderie is hard to change once the program is completed.
- Specific Objectives
Make your goals for the incentive program as specific as possible and as
measurable as possible. For example reducing product rework to .001% is
more measurable (and more meaningfully) than improving production output.
Reducing order errors to 001% of all orders processed is more measurable
than reducing order paperwork by 20%. If possible, give employees benchmarks
for the incentive program so they can see their progress and make the goals
The author assumes full responsibility for the contents of this article
and retains all of its property rights. ManagerWise publishes it here with
the permission of the author. ManagerWise assumes no responsibility for
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