Companies are still finding it difficult to create a robust incentive or rewards program for their employees that is more impactful and strong enough to increase talent retention in their organization.
Some practical solutions:
We are all aware of how powerful employee incentive programs are. Implementing an incentive program is one thing, but measuring its impact is also important. If we do not measure the impact of our employee incentive program, it would be difficult to fix existing bugs, manage resource allocation, and improve. All that will remain is a ‘tick in the box activity.’
Before measuring the incentive program’s ROI (Return On Investment), we need to define what we want to achieve out of this incentive program. Was it about increasing sales, enhancing productivity, improving customer satisfaction or reducing employee turnover? We have to set SMART (specific, measurable, achievable, relevant, and time-bound) goals to measure the overall impact.
Giving quantifiable metrics depicting the impact of any program makes it more relevant. After all, we are all in a business, and measuring the impact through numbers builds credibility. For instance, if the goal of the incentive program was to reduce employee turnover, then we can measure how many employees left the company after the program was implemented.
Any designed incentive program will not just deliver quantifiable results. It also impacts the workforce in various other ways. For instance, it affects overall employee engagement levels, which companies can measure through employee surveys. Moreover, it can also lead to behavior change, such as increased collaboration or skill-building activity.
We can also measure how much the company invested in the employee incentive program and what exactly we were able to achieve with that investment. For instance, if the goal was to reduce employee turnover, how much cost could the company save on retaining key employees and compare that to the investment? In the same way, one can do this cost analysis process with respect to other defined goals.
Implementing an incentive program can be explained in multiple stages. It is important to follow a flow when implementing an employee incentive program.
Before implementing an employee incentive program, one should know why they are doing it and what they want to achieve. The objectives or goals can range from reducing absenteeism and employee attrition to increasing productivity and boosting sales revenue. One should have at most three objectives or goals.
When building any program involving engagement, we should know our target audience. Knowing the audience and identifying their preferences sets the tone for whether the program will be successful or not. For instance, in the case of an employee incentive program, what should be the reward? What can really drive someone? One needs to find these answers by doing thorough research.
In this stage, we should decide upon the program’s design. Would you like to gamify it by adding leaderboards and making it transparent for all? Or would you like to manually collate the data and announce the winner after the program ends? Moreover, the program’s budget depends on how it is designed and structured and what elements are used to make it more successful.
Deciding upon the communication channel on how one wants to announce the winners. Will it be through personalized mail or more like a social recognition where the winners are recognized in front of their colleagues?
Tracking the success of the program through pre-decided metrics on the objectives of the program is one way to evaluate the success. Moreover, what was the engagement level and the response of the participants in the program are other metrics that can give an initial mood of the program.
As part of the designing process, one can consider implementing digital tools such as an employee recognition platform like AdvantageClub.ai, where companies can develop various exciting incentive programs with the help of digital points which can be redeemed for the reward of choice. This would add a gamified element for more engagement, and moreover, digital programs would also provide better metrics to evaluate the success of the program, which would be more accurate.
Sometimes, the approach to implementing an employee incentive program may not be sound. We sometimes forget that we are dealing with humans and their emotions, not robots. There are some things we should keep in mind that can fail our employee incentive program.
At times, we think that money is the only thing that motivates an employee. But in many cases, when we are dealing with a knowledgeable workforce, money is not a primary driver for them. For some, it can be flexibility or work-life balance. For instance, we can look at reducing absenteeism by reducing sick leaves. As a reward, we can rather give extra day-offS or remote working opportunities instead of a monetary reward.
We cannot be bullish when it comes to driving an incentive program. It is not about driving revenue. As HR professionals, we should encourage employees to do their best to participate in employee incentive programs, but we cannot be too aggressive. This way, the program becomes more stressful and fails to attract more engagement.
Yes, the ones who win and receive rewards are motivated. But what about those who did not get anything? We should recognize their participation and support for the program. We can do this by having participation recognitions such as certificates.
Though it is a competition, it needs to be driven by a different approach. Employees should be encouraged to give their best and perform well. Pinning employees against each other may not be a good idea. It can lead to heartburn and toxicity.
Retaining good talent and rewarding employees for their performance are serious issues that companies are concerned about today. Many progressive companies have realized that talent or their people are one of their greatest assets. And to retain them requires a robust incentive program.
