Personalized Incentives, Precise Results
Try as you might, you’ll never get a square peg to pass through a round hole. You’ve probably played with one of those simple wooden toys; learning to match shapes, pair colors, make connections. It’s a kid’s toy sure, but it’s designed to teach a lesson that will become valuable as you grow older, and in this case specifically, how personalized incentives can lead to greater results.
If you pay attention to who your employees are and what personally motivates them, you’ll be able to apply a similar principle to the matching game in order to craft a program that inspires incredible performance and growth.
Dyed in the Wool
Learning the systems of this childhood game was, for many of us, our first lesson in the power of personalization. Matching like with like was a sort of training for the creation of incentive compensation tools and intelligently targeted rewards. If I have learned anything from engaging with a multigenerational workforce, it is that there are several distinct personality types that prevail within any organization, and that each one is motivated and inspired by very specific incentives. Trying to apply a rigid, one-size-fits-all compensation system to your organization is unlikely to elicit the engagement you’re looking for, because you’ll always be missing that one element that really grabs someone’s attention.
Rewards programs and incentive compensation plans do not work well when they are not diversified, and until you have a system that gives you the flexibility and data insights to target specific desires and generational needs, you will not be able to effectively drive and encourage behaviors, or ensure that the efforts of your employees are aligned with the company’s goals. To make the most of your comp spend, you need to find an agile system that will allow you such freedom.
Strategic compensation incentive structures and techniques are powerful tools in the fight for employee engagement and retention. According to a study conducted by the Aberdeen Group, best-in-class companies are 45% more likely to leverage special incentives, such as rewards, to drive improved sales rep behavior and business results. To avoid difficulty when trying to effectively motivate top performers and keep them aligned with sales goals, keep these best practices in mind:
1. Set Expectation and Frequency
Are you creating a rewards program or an incentive plan? Rewards recognizes outstanding behavior; incentive plans drive behavior. Do you want your team to chase the prize, or would you prefer to give rewards to your top performers at the end of a defined period? Your answers must be clearly communicated to your team.
2. Keep Your Best Reps Around
Xactly research shows that turnover rates for top reps are the highest on the first and last months of a fiscal year. Incentivize during those months to make your rainmakers feel valued. While every rep appreciates cash rewards, offering personal rewards instead will show them they’re much more than just a means to the company’s bottom line.
3. Set the Right Bars
If you set the bar too low, your workforce is unlikely to reach higher. If you set it unrealistically high, they might feel discouraged and give up. Use historical data to determine attainable goals, and then set stretch goals that can be met.
4. Make it Worthwhile
You have to provide desirable enviable motivate your organization if you want them to perform beyond your expectations. When they weigh the cost (effort) against the benefit (compensation), the benefit must stand out as the clear winner.
Mother Knows Best
As a final note, you can always employ the Mother Test to any employee incentive or reward program that you want to drive behavior and inspire growth: if you explained the reward to your mother, would she think it was thoughtful? That may sound like a joke, but the point is to create a system that you would be proud to unveil.
A personalized reward system takes more thought and effort to create and maintain, but the rewards are astounding – increased productivity, decreased turnover, and the kind of employee engagement and loyalty that only comes from inspired design.