Types Of Incentive Programs
Incentive programs are everywhere today — and with good reason. Designed to promote or encourage measurable outcomes, incentive programs can be powerful motivational strategies that indirectly move your business forward, while also benefiting your staff. That’s why, when you want to better engage employees — from millennials to baby boomers — boost business productivity and/or encourage your team toward a specific goal, it’s time to explore employee incentive programs.
What Is an Incentive?
In the world of employee motivation, incentives are variable types of awards, rewards and recognition given in response to performance. They may or may not have financial value. Because they are earned through specific achievements or behavior, they motivate workers who wish to earn the given rewards.
Kinds of Incentives
There are a variety of incentive options available. To help you decide which type would work best for your company — or, as an employee, which type has the most to offer you — here’s a look at some possibilities:
- Public recognition: Never discount the value of honoring a job well done. When an employee is recognized among his or her peers, it communicates affirmation that is powerfully motivating. Public recognition might mean an “employee of the month” program, or it might mean displaying achievements on a public bulletin board in the office. You could honor someone on social media or via a company newsletter. What’s important is that when someone hits a certain goal, meets certain criteria or does something noteworthy, it gets noticed publicly.
- Cash: Whether you’re talking about a company bonus or an actual cash reward, giving a financial bonus is something anyone can appreciate. This is why commissions tend to be so motivating in the industries that use them. Some ways to use a cash incentive program include providing bonuses for meeting certain milestones (such as retirement with the company), and cash rewards for referring new hires who complete a certain probationary period.
- Gift cards: The top choice for companies hoping to motivate employees, clients and partners, according to the Incentive Research Foundation, is gift cards. While gift cards offer the same appeal as cash (the opportunity to buy what you like), they tend to be perceived a little more meaningfully. For employers, they’re easy to buy and easy to give, making incentives convenient.
- Points programs: Similar to credit card rewards programs, points programs are incentive programs that allow employees to earn points toward various rewards. The employer sets the qualifications for earning points, and those points get totaled and calculated somewhere online. As the participants meet goals, achieve accomplishments, log years with the company, etc., they earn points for rewards they can pick.
- Retention bonuses: Commonly used when a company merges or goes through transition and wants to retain key staff members, retention bonuses offer some reward — usually cash — for staying through the specific period.
- Company stocks: Stock options are incentives that can be beneficial for both employees and employers. To the employee, company stocks are an investment with potential to pay off down the line. To the employer, giving partial ownership of the company to employees gets them on the same page with you, wanting the company to succeed.
The bottom line with incentive programs is that motivated employees are more productive employees, and more productive employees mean a more productive business. While not every type of incentive works for every business, finding the right one for you is vital. Explore the six options above and consider what might serve to incentive your staff! When you want to drive measurable outcomes — be they higher sales numbers or better service rankings — implementing an incentive program can make all the difference.
Author bio: Julie Feece is Vice President North America – Marketing for RPG Card Services, a sales and marketing organization specializing in offering gift card program services to nationally recognized retailers for their B2B and B2C programs. She has held various leadership roles in the incentive gift card industry for over 17 years.