Think about the last time you felt genuinely appreciated at your work. It felt powerful, right? Now, think about bringing that same feeling into your company’s everyday schedule through a well-thought-out incentive program.
A strong incentive program can positively shake the workplace when it starts. It can give your team more energy and even help with productivity. But you might be wondering, “Where do I start? ”
This guide helps you understand the basics of creating an incentive program that successfully gets off the ground and becomes a core part of your company’s culture. Are you excited to jump in and elevate your team’s performance to new heights? Then, let’s dive right in!
#1. Rewards That Are Commensurate With Desired Behaviors
When you give rewards that line up with the behaviors you want to see, it helps to make a new incentive program work more. Employees are much more likely to put in effort that matches up with the company’s goals if they notice a clear link between what they do and the rewards they get. So, let’s talk about how different types of rewards can push employees to behave in the ways you want.
Cash bonuses are probably the simplest reward. A cash bonus system makes it super clear that their hard work pays off in a very real way by linking how well an employee performs directly to the money they take home. This helps to build a company culture that’s fair and open about how things work and gets them motivated.
Then, there are those performance-based rewards, where some employees or teams get recognized for hitting or surpassing certain set targets, KPIs, or other set goals. These kinds of rewards are a good idea for creating a culture that’s all about getting better results. Have you ever seen how a well-thought-out performance reward can turn pretty good results into outstanding ones?
Profit-sharing plans can also be a huge motivator. They link an employee’s financial gain with how well the company is doing overall. When employees know they will get a slice of the profits, it makes them feel more responsible for their own work and for the company’s success. This kind of reward builds loyalty and teamwork – and lifts everyone’s spirits.
Stock options and Employee Stock Buy Plans (ESPP) are also top priorities. These programs allow employees to buy company stock, which creates an alignment between their interests and the company’s success. This close alignment can be powerful in helping a team stay committed for the long haul. Do you think these kinds of programs might make employees feel more connected to the company’s achievements?
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Now, let’s look at a modern strategy: online incentives. These incentives can be customized to what each person likes best. Whether it’s gift cards, online vouchers, or special access to certain services, online rewards are helpful and can be personalized – which makes them a great way to help with employee happiness and engagement! Because they are so easy to send out and use, online rewards also make the whole process of giving and receiving rewards much smoother and more fun for everyone involved.
#2: Give Them a Great User Experience
Make sure you create a strong user experience when you start designing your new incentive program. Think about the times you’ve run into a program that promised amazing rewards but was so confusing that you didn’t bother with it! To avoid this issue, pay attention to designing a program that is easy and fun to use. If the program isn’t user-friendly, people probably won’t engage with it.
Another important thing is accessibility. Your program needs to work well on all kinds of devices – whether it’s a smartphone, a tablet, or a laptop – because people have different preferences and all kinds of tech available to them. Think about a user trying to access the program on their phone during a bus ride home after their work computer – you want the transition to be as smooth as possible.
The foundation of any helpful incentive program is regular and clear communication. You don’t want participants to ever feel like they’re in the dark about main details like how to earn rewards, track their progress, and know when they can get their rewards. Keep your communications timely and proactive rather than making participants hunt down information themselves – this can turn what should be an uplifting experience into something quite frustrating.
And let’s not forget how huge it is for your program to align with what your audience wants and needs. Have you dug into understanding these needs? If participants like a specific type of reward, are most active on the program at a particular time of day, or enjoy certain kinds of activities, customizing the experience to fit their preferences will draw more people and also help with their overall satisfaction.
#3: Use Clear Communication Plan for The Program Rollout
When setting out to make your new incentive wrist a success, you’ll find that having a strong communication plan is absolutely a must. It means getting everyone in the company excited and involved!
First, think about the different ways you can disseminate your information. Sure, traditional meetings, emails, and newsletters are helpful, but think about mixing it up with some online forums or even social media posts. Have you thought about which channel works best for that type of message?
Remember that a one-size-fits-all message usually misses the mark. Why not customize your communication to fit the different groups within your company?
To give you an example, while some new hires might appreciate receiving a welcome packet with details about the incentive program, those close to retirement might value information sessions that can explain how these incentives will help with their retirement plans. These different roles come with different motivators – targeting those can change engagement.
Also, the power of a good story should not be underestimated in your communication strategy.
Remember the leaders in your organization – they play a big part here. When leaders actively participate in spreading the word, it shows the program’s importance and its alignment with the company’s overall direction. Their involvement makes everyone else join in enthusiastically.
#4: Stay Agile and Adjust Incentive Levers as Needed
To make sure the new incentive program takes off and works well, input from the participants involved should be obtained. Have you ever exerted a lot of effort on something that didn’t matter much to you? It’s such a drag, isn’t it? The same applies to your incentive program. When you solicit direct feedback from employees on the incentive plan, they feel invested, and you can customize the program to motivate them. Besides, this could show some unexpected plans into what drives your team, possibly improving the power of the incentive efforts.
Next, pay attention to being clear and steady in your communications. Have you asked if your employees fully understand the new plan? Everyone needs to know the rules if your incentive program is like a game. They must understand how to win, what prizes they are eligible for, and when these rewards will be distributed. Consistency in delivering the promised rewards is equally a must – failing to do so can quickly erode trust and deflate the motivational change.
The flexibility of the rewards you have is a big deal. Different incentives motivate different people: some may like cash bonuses, while others may value extra days off or personalized gifts.
Promoting the program is essential for engaging and maintaining the enthusiasm of everyone involved. Even the most well-built incentive programs might not succeed if they are not well-known or understood. How will you keep the excitement and make sure that all employees are aware of the benefits of participation in the program? Keeping the program prominent in everyone’s mind through regular updates, eye-catching visuals, and communication strategies like playful messages or themed games can help with its appeal!
What Risks Can I Avoid?
To reduce risks in your incentive program, make sure that your performance goals align with your company’s long-term goals.
Sometimes, incentive programs focus too much on quick wins rather than sustainable growth. Have you thought about how to make sure your goals help achieve long-term success? Check these targets first to support your company’s bigger goals, and avoid setting goals that only benefit short-term financial results.
Communication is a must for a successful incentive program. Have you seen times when people had a different idea of what the targets were compared to what they actually were? Such mixups can mess up even the best-laid plans! So, make it a priority to explain all the performance goals and criteria to everyone in the company – from front-line employees to top executives – to prevent this. When everyone knows exactly what’s expected, it builds a sense of unity and job satisfaction, which is important for driving collective success.
You should also make it a habit to monitor and update your compensation policies. Think about this: Are our latest rewards still lined up with our strategic goals? Businesses change over time, so your incentive programs should change, too, to stay relevant and helpful. Regular reviews allow for adjustments to changing market conditions and changing priorities, which means that your incentive structures continually encourage the right behaviors.
Finally, simplicity is huge when designing an incentive program. Complicated compensation plans can confuse and demotivate your team. Also, simplicity in plans makes them easier to manage and monitor – improving oversight and compliance. But make sure that your program’s simplicity still meets the different needs of your employees and your company’s goals.
Each of these steps plays a main part in creating an incentive program that motivates your employees and goes hand in hand with your company’s broader financial and strategic goals. So, keep these points in mind as you review or build your incentive plans!
What Are The Typical KPIs for These Programs?
When you’re creating a new incentive program, it’s a must to find the right Key Performance Indicators (KPIs) to make sure everything runs efficiently. Think of KPIs as the core signs of your program – they tell you how healthy and successful it is.
Now, there are usually two types of KPIs you need to monitor.
The first type is what I call leading indicators. These metrics give you a heads-up about how things are going right now and can predict future success. To give you an example, you might want to check how quickly people are signing up for your program – usually referred to as the average time-to-enrollment. Another powerful one is the number of times people log into the rewards site, which shows your level of engagement with your platform. Remember to keep an eye on how many points are awarded and redeemed – this suggests who’s actively participating and helps you spot any patterns in engagement!
You should also look at how well your messages are getting through. Check the bounce rates for your emails and direct emails to see if they’re even reaching people in the first place. Then, look at the open rates for progress reports and those electronic direct mails (eDMs). These numbers help you determine if your messages are resonating. Are people excited to see what you have to say? Are your sales reps involved with customers in their areas?
On the other hand, we have lagging indicators. These are a bit different because they look backward to tell you what has been achieved. They’re mainly to find out how well your incentive program is working over time. Think about metrics like overall sales growth, sales increases for particular products, changes in how frequently and how much customers are ordering, and customer satisfaction and retention rates. Tracking referrals is another important one – if more people are recommending your program, that’s usually a big sign!
When it comes to incentive programs for employees, you’ll want to pay attention to metrics like retention rates, employee engagement, job satisfaction, and any improvements in productivity. These figures help you see if your program is helping to keep people happy and motivated and if it’s lining up with your bigger company goals.
And for rewards programs, the same kinds of metrics are useful. Are your top staff sticking around? Are they more involved and productive for rewards? Are people usually happier at work and more lined up with what the company wants to achieve?
Take Your Business to The Next Level
As we wrap this up, I just want to remind you how powerful a well-put-together incentive program can be. The right strategy also cements a culture where achievement and recognition are part of everyday life in your organization. If I’m talking about exciting online rewards, all-encompassing profit-sharing plans, or personalized shout-outs, each part has to line up perfectly with your company’s goals to get the team involved and drive that success.
Pay attention to the small details when you’re planning and rolling out these programs. You want to think about how easy it is to use, how you explain everything, and how well you can change things based on feedback – these are all huge for making your incentives work.
So, have you thought about how ready you are to look over your latest strategies and see if they hit these marks?
Here at Level 6, we’re all about helping businesses like yours reach new heights with custom, powerful incentive programs. Why not contact us today for a free demo? I’d love to show you how we can help with your team’s performance and get that sweet return on investment. Let’s make your company’s next success our shared success!
Claudine is the Chief Relationship Officer at Level 6. She holds a master’s degree in industrial/organizational psychology. Her experience includes working as a certified conflict mediator for the United States Postal Service, a human performance analyst for Accenture, an Academic Dean, and a College Director. She is currently an adjunct Professor of Psychology at Southern New Hampshire University. With over 20 years of experience, she joined Level 6 to guide clients seeking effective ways to change behavior and, ultimately, their bottom line.
