Big data. Bigger expectations. Shorter attention spans. And the list goes on. Channel and employee incentives are growing more complex by the minute, it seems. Companies are struggling to run them efficiently; worse yet, effectively. All that work and the needle won’t budge. That can be frustrating.
So what gives? There are a number of contributing factors. Here are a few we believe are changing the game.
Gone are the days of the yearly sales contest—sell X amount, get a cash bonus at the end of the year. There’s no more “doing what we’ve always done.” This type of structure just isn’t as effective, with people staying on the job an average of only four years (the churn rate is even higher for millennials). Just this shift in mindset alone can be tough for some organizations.
Even if companies have embraced the new age of incentives—agile and flexible—the operational tasks mount quickly. And when your people are already being asked to do more with less, that’s a big problem.
Another big problem? BIG data! You can almost know too much these days. One of the biggest hurdles for companies when it comes to data—aside from just the pure volume of it—is accurate, reliable analysis. Any company can collect it. It’s taking that data and finding truths in it—creating that compelling story—that gives companies fits. Organizations lack the incentive strategy expertise to look at all that data through the right lens.
The ever-changing face of the workplace also makes things tricky. Generational differences—up to five generations at work at once—have companies pulling their hair out trying to hit a moving target for program strategy, communication and awards.
Knowing how generations will engage takes research. How do they talk to each other? What are they shopping for? How do they view discretional effort, and more importantly, what will inspire them to part with it to go that extra mile?
Bring Back Simplicity. And Fast.
More companies would probably be operating incentives to drive business results if they weren’t so difficult to get up and running. Ideal results require an outside partner with a deep well of knowledge in incentive structure, technology, awards, communications and measurement. Companies have to look at incentives holistically—a series of moving parts that are 100% dependent on each other—or you might not see the results you’re after. But if you choose to go it alone, there is a framework of best practices.
1. Be Specific
Analyze and assess your objective. Historically, what’s worked? What specifically do you want to see? Increased sales for one particularly profitable product? Increased revenue dollars overall? The more focused your goal, the easier for a participant to understand and achieve.
2. Get Personal
Give each person a goal that’s attainable, yet challenging. Seems like an oxymoron, but it isn’t. Just make sure your participants feel like their goals are within reach with some hard work.
Biggest bang for the buck: Give employees and channel partners an individual incremental goal over their previous year’s production. Don’t pay out until your participants bring more business to your company than they did last year.
3. Talk About the Goal
Over and over. And over again. Share the goal (individually and overall). What does success look like? Individually: What is my goal? How was it created? Overall: Define program success. If everyone reaches their goal, X happens for the company. Communicate shared goals across your organization—clarity is critical here. So is repetition, so communicate often. (Studies show you have to repeat yourself at least 10 times before people take action.)
4. Ignite the (Friendly) Competitive Spirit
Sales teams are generally very competitive. Tap into that by publishing results in some way. Percent-to-goal is a good method if you don’t want others seeing personal goals.
Peer recognition is a powerful thing. Announce winners and overall goal achievement throughout your company. Recognize winners—research shows public recognition paired with individual, trophy-value awards is most effective.
You’re rewarding participants for successfully changing behavior, but also inspiring them to reach for next year's ambitious (yet attainable) goal!
At the end of the day, incentives are about people. What drives them and how to ignite their passion. More and more companies are partnering with experts who know how to connect a bottom line to employee engagement. Because those companies understand that once employees are aligned with an organization’s mission and fully engaged, they are unstoppable.