Is your incentive program sticky enough?
Does your company’s recognition program have the right touch? Does your incentive program help them keep a handle on employee morale and motivation? Unfortunately, as history shows, many program managers often find lasting results slip through their fingers.
It doesn’t have to be that way. Whether touching up an existing reward structure or feeling your way through your first incentive program, start by asking the questions: What’s the “texture” of the reward? Sticky or slippery?
Sticky rewards are memorable — they stick in the recipient’s mind and reinforce the relationship between the reward-earner and the reward-provider. Slippery rewards have fleeting impact and often slip the recipient’s mind.
Understanding the difference is crucial. Most companies provide rewards with the hope of affecting behaviour. Companies want to change or encourage a behaviour, reinforce corporate culture, improve perception of the work environment or strengthen corporate relationships. All these goals hinge on the reward-earner positively associating the reward with the company that provided it.
The sticking point for program managers? Finding the right reward to affect behaviour and generate lasting results. This is particularly challenging given today’s diverse workforce, where staying in touch with everyone’s individual motivators seems impossible. So how can an incentive program manager provide all things to all people? Look beyond the obvious.
Cash: A slippery slope?
When it comes to rewards and incentives, the knee-jerk reaction for many companies is to offer cold, hard cash. Many companies only give cash because they feel it’s what their employees want. Research by American Express Incentive Services (AEIS) verifies this.
One survey conducted in October 1999 determined that nearly 70 per cent of employees who expected a year-end reward anticipated receiving cash versus a non-cash reward. And later, in an AEIS-sponsored reward-earner survey, cash was the preferred reward again.
However, respondents admitted that cash rewards soon slipped their minds. In fact, among the rewards mentioned, only a reserved parking spot was more forgettable. Cash slipped to the bottom of the “unique reward” rankings as well.
The moral is clear: Just because employees say they want cash doesn’t mean they will remember it. This notion is supported by another AEIS survey conducted in March 1999. The survey found 29 per cent of employees who received a cash reward spent it on bills. Another 18 per cent couldn’t recall how their cash rewards slipped away. While the results may surprise some employers, they validate what incentive buyers have long suspected: incentive decision-makers ranked cash lowest as a memorable incentive.
Another potential “slip-up” associated with cash rewards is that frequent cash rewards can backfire by “commodifying” behaviour.
You don’t want to convey that a specific behaviour is worth ‘X’ dollars. Instead, you want to communicate that productive behaviour is valued and rewarded by the company providing the incentive. When a specific dollar amount is linked to a behaviour, employees often begin to make judgments as to what they value most at a given time; receiving ‘X’ dollars or exhibiting the proper behaviour.”
Commodifying behaviour may explain why cash did not rate well among reward-earners as being effective in motivating performance. In a February 2000 AEIS study, of those participants who received a year-end reward, 32 per cent said it didn’t improve their work performance.
If cash doesn’t pay, then what’s the answer? To see a lasting impact on behaviour, companies should investigate sticky, non-cash rewards. Non-cash incentives are viewed as special rewards that are separate and distinct from compensation. This makes non-cash rewards more memorable and more likely to create behaviour changes that will stick around.
Stick with rewards that offer choice
Individual travel, universal gift certificates and universal point-based stored-value cards (see sidebar) ranked highest in motivating employee performance. These types of incentives provide a lasting impression. For example, a company could provide reward-earners with stored-value cards that allow them to create their own custom travel rewards. By allowing reward-earners to decide where they want to travel, when and with whom, companies provide a reward that is sure to be what recipients want and will remember. By combining individual travel with a travel access product, companies can create a powerful reward that passes the stickiness test.
An additional idea is to ask reward recipients to take photos of how they used their rewards and place them on a bulletin board to share with others. This further increases the reward’s stickiness and motivates other team members to reach their goals.
In their rush to the finish line, savvy incentive buyers today are developing creative rewards that deliver the flexibility of cash with an impact that sticks long after the program ends. These successful incentives help employees help themselves. Memorable rewards can provide fuel for employees’ internal engines. These rewards spark the drive to aggressively pursue goals — and that contributes to the company’s long-term success.
Darryl A. Hutson is the chief executive officer of American Express Incentive Services, L.L.C. AEIS is headquartered in Fenton, Mo., a suburb of St. Louis. For more information, visit www.aeis.com. The Canadian offices of AEIS can be contacted at (905) 702-9001 or [email protected]. This article was prepared with the insights and assistance of Janelle Brittain, a certified speaking professional, motivation expert and president of Dynamic Performance Institute in Chicago; and, Charlie Battista, vice-president of Savitz Research Solutions in Dallas, an AEIS survey partner.
It doesn’t have to be that way. Whether touching up an existing reward structure or feeling your way through your first incentive program, start by asking the questions: What’s the “texture” of the reward? Sticky or slippery?
Sticky rewards are memorable — they stick in the recipient’s mind and reinforce the relationship between the reward-earner and the reward-provider. Slippery rewards have fleeting impact and often slip the recipient’s mind.
Understanding the difference is crucial. Most companies provide rewards with the hope of affecting behaviour. Companies want to change or encourage a behaviour, reinforce corporate culture, improve perception of the work environment or strengthen corporate relationships. All these goals hinge on the reward-earner positively associating the reward with the company that provided it.
The sticking point for program managers? Finding the right reward to affect behaviour and generate lasting results. This is particularly challenging given today’s diverse workforce, where staying in touch with everyone’s individual motivators seems impossible. So how can an incentive program manager provide all things to all people? Look beyond the obvious.
Cash: A slippery slope?
When it comes to rewards and incentives, the knee-jerk reaction for many companies is to offer cold, hard cash. Many companies only give cash because they feel it’s what their employees want. Research by American Express Incentive Services (AEIS) verifies this.
One survey conducted in October 1999 determined that nearly 70 per cent of employees who expected a year-end reward anticipated receiving cash versus a non-cash reward. And later, in an AEIS-sponsored reward-earner survey, cash was the preferred reward again.
However, respondents admitted that cash rewards soon slipped their minds. In fact, among the rewards mentioned, only a reserved parking spot was more forgettable. Cash slipped to the bottom of the “unique reward” rankings as well.
The moral is clear: Just because employees say they want cash doesn’t mean they will remember it. This notion is supported by another AEIS survey conducted in March 1999. The survey found 29 per cent of employees who received a cash reward spent it on bills. Another 18 per cent couldn’t recall how their cash rewards slipped away. While the results may surprise some employers, they validate what incentive buyers have long suspected: incentive decision-makers ranked cash lowest as a memorable incentive.
Another potential “slip-up” associated with cash rewards is that frequent cash rewards can backfire by “commodifying” behaviour.
You don’t want to convey that a specific behaviour is worth ‘X’ dollars. Instead, you want to communicate that productive behaviour is valued and rewarded by the company providing the incentive. When a specific dollar amount is linked to a behaviour, employees often begin to make judgments as to what they value most at a given time; receiving ‘X’ dollars or exhibiting the proper behaviour.”
Commodifying behaviour may explain why cash did not rate well among reward-earners as being effective in motivating performance. In a February 2000 AEIS study, of those participants who received a year-end reward, 32 per cent said it didn’t improve their work performance.
If cash doesn’t pay, then what’s the answer? To see a lasting impact on behaviour, companies should investigate sticky, non-cash rewards. Non-cash incentives are viewed as special rewards that are separate and distinct from compensation. This makes non-cash rewards more memorable and more likely to create behaviour changes that will stick around.
Stick with rewards that offer choice
Individual travel, universal gift certificates and universal point-based stored-value cards (see sidebar) ranked highest in motivating employee performance. These types of incentives provide a lasting impression. For example, a company could provide reward-earners with stored-value cards that allow them to create their own custom travel rewards. By allowing reward-earners to decide where they want to travel, when and with whom, companies provide a reward that is sure to be what recipients want and will remember. By combining individual travel with a travel access product, companies can create a powerful reward that passes the stickiness test.
An additional idea is to ask reward recipients to take photos of how they used their rewards and place them on a bulletin board to share with others. This further increases the reward’s stickiness and motivates other team members to reach their goals.
In their rush to the finish line, savvy incentive buyers today are developing creative rewards that deliver the flexibility of cash with an impact that sticks long after the program ends. These successful incentives help employees help themselves. Memorable rewards can provide fuel for employees’ internal engines. These rewards spark the drive to aggressively pursue goals — and that contributes to the company’s long-term success.
Darryl A. Hutson is the chief executive officer of American Express Incentive Services, L.L.C. AEIS is headquartered in Fenton, Mo., a suburb of St. Louis. For more information, visit www.aeis.com. The Canadian offices of AEIS can be contacted at (905) 702-9001 or [email protected]. This article was prepared with the insights and assistance of Janelle Brittain, a certified speaking professional, motivation expert and president of Dynamic Performance Institute in Chicago; and, Charlie Battista, vice-president of Savitz Research Solutions in Dallas, an AEIS survey partner.
