The success of your organization heavily depends on having high-performing, driven employees. While respecting your employees is a large part of the formula to keep them engaged, a structured incentive program can help set, meet, and exceed company goals. In fact, a recent survey found that 85% of employees who participate in a company-driven incentive program feel more valued and 60% achieve better results.
However, it is important to do your research before implementing an incentive-based pay program. A poorly executed program can damage office morale and cause unnecessary negative competition. Here are some important guidelines to follow in order to ensure you create a successful program.
1. Determine your objectives ahead of time.
The goals for the program should be the first thing determined when creating the incentive plan. These goals should align with your business strategy. Having the program in line with previously set objectives ensures that employees are working towards achievements that matter to the organization. Employees will be in a position to gain personal rewards while focusing on improving the business as a whole
2. Make the program available to all employees.
It’s vital to engage all levels of business in the incentive program. Providing incentives for certain groups of employees and not others will negatively impact productivity. The group without performance incentives will feel underappreciated and become lazy, while the group with incentives will either see no point in putting in the extra work or become over competitive. Opening the program to all employees motivates everyone to work towards the same goal.
3. Top level management support is crucial.
Employees won’t get fired up about the incentive program if their supervisors are not excited about it. It is important to make sure supervisors clearly understand the incentive pay process and support it. Supervisors must be trained on how to properly implement the plan and measure performance, or the plan won’t be standardized throughout the organization. It’s up to key stakeholders to place high importance on the program and to hold employees accountable.
4. Communicate, Communicate, Communicate.
It’s essential to clearly communicate the details of the program to all participants. Employees need to know what is expected of them and how they will be measured. One of the main reasons incentive plans fail is from lack of communication causing morale problems. Have an open door policy for your employees to express any concerns about the program, and send out an explanation if any of the incentives are going to change. This will keep from fueling the rumor mill with misinterpretations.
5. Choose appropriate rewards.
An incentive program is only good if it offers valuable rewards. When selecting rewards, consider what your employees are most motivated by and what drives performance.
The amount of incentive should depend on current income, equity of reward and contribution, and industry standards. Many companies use point based rewards programs that allow employees to spend their points on the things they feel mater most.
When done correctly an incentive based payment program will increase productivity, employee loyalty, and overall company performance. We at RealStreet Staffing hope you find these tips helpful when building your incentive plan. Already have a plan in place? Use the comment box below to share what has and hasn’t worked for your company.
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