There are many times a company wants to provide an effective employee incentive program. Many believe that such a program has to be expensive and very complex. There are employee incentive programs that are complicated by necessity. Other types of employee incentive programs can be simple things. Some can consist of everything from a day off, to a nice box of chocolates and more. Incentive programs have been used to motivate workers and improve their performance for many years.
According to an article in Entrepreneur Magazine, “Incentive plans in the workplace, most of them are home-grown, and many business owners insist they produce positive effects.”
The most effective incentive programs are ones that can be communicated in a few sentences. It should only cost enough to be offered regularly. Companies have offered things such as instant performance bonuses, promotional items and more. The programs that seem to be the most effective offer incentives to all employees. All workers who accomplish should be rewarded, and not just those who do the most.
One of the most important things for a company to determine is what performance they will reward. When one activity is rewarded, it could cause less attention to other important work tasks. Rewarding production volumes, may cause a decrease in quality. The best sales numbers may only be as good as the profits received from them. It’s important for a company to carefully set a combination of standards for an employee incentive program.
There are many different ways to structure an employee incentive program. This will often be determined by the goals of the program. Many companies base their incentive programs on performance targets. It could be a problem if the target is so difficult, many employees fall just short of it. The most successful incentive programs provide staggered goals. Having staggered performance targets with different payments will provide more motivation for employees.
An important aspect of designing an employee incentive program is having a way to measure its success. Performance needs to be regularly measured and verified. It should be simple to determine results, and easy to understand their impact. The goal is to make the target performance reachable, but difficult enough that it requires extra effort. Effectively measuring an incentive program will indicate when adjusts are required.
After a specified amount of time every employee incentive program should be evaluated. The level of a company’s performance, as well as employee satisfaction, needs to be determined. If employee performance has not changed, there may be problems. If employee performance has improved, but the company’s has not, it may need to be altered. It could be a result of an employee incentive program not being properly in sync with the goals of a business. There are also times when the employee’s performance improves, the company’s performance is better, but workers are not satisfied with the program. Regular evaluations of employee incentive programs can make them more effective.
Having an employee incentive program can benefit a company in many ways. When done correctly, it will create employee loyalty. These programs will provide employees with something to focus on, and make a company’s success more personal. It has successfully decreased turnover rates. Successful employee incentive programs have improved moral, and created a better working environment.