Employee Incentives Aren’t Just a Nice Extra Anymore
Do you take employee incentives seriously? Or do you just treat them as a “nice to have”? More and more research demonstrates that successful companies will do the former.
In a recent blog post, the employee recognition experts at Achievers summarize how the conventional wisdom on employee incentives has evolved over the last century-plus. When research first began on employee incentives, workers were typically paid for what they produced, rather than the time they spent on the job. In fact: “When the innovation of pay by the hour or day was introduced, it was controversial. A widespread fear existed that if you paid workers only according to the time they spent, that they would ‘take it easy’ and not try as hard.”
Later, it became common to offer employee incentives that depended on one worker outdoing their colleagues. But that kind of heated competition produced its own problems — for instance, it can lead workers to focus more on winning than on serving customers properly. And research found that “pitting workers against each other for rewards often causes team-minded players to scale back their efforts in order to equalize things.”
Today, businesses have learned that employee incentives need to be thoughtfully designed — they must reward workers for going above and beyond, and also for effectively executing the company’s mission and values. While this kind of incentives program takes some time to put together, the evidence shows it will also have a clear positive impact on a company.
How Much Do Employee Incentives Matter? Here’s the Data
Here are a few relevant findings, gathered by Achievers, that make the point:
Workers who don’t feel recognized are two times as likely to say they’re going to quit.
- Businesses that have created meaningful incentive programs see 31 percent less voluntary turnover.
- 69 percent of employees say that recognition and rewards would keep them at their current jobs.
- 55 percent of employees say the quality of their company’s recognition program affects their job performance.
And finally: “Corporations that implemented an employee rewards program found that their overall profits increased by an average of $123,600 per week.”
The trend is certainly moving in this direction. A study last year by the Incentive Research Foundation found that 81 percent of American companies now use more than one type of non-cash reward to recognize their employees, as well as partners and customers. And 70 percent use gift card incentive programs. We know a bit about that!
It’s a commonplace for business leaders to say that their most important asset is their people. A meaningful employee incentives program is material evidence of that sentiment. And now there’s abundant evidence that it’s just plain good business, too.
The Secrets to Successful Employee Incentives
Wonder how successful workplace leaders build loyal, happy workplaces through employee recognition and incentives? Download gThankYou’s free eBook, “The Ultimate Guide to Employee Gift-Giving” and learn how easy it is with thoughtful planning and a commitment to appreciating employees.
Why not start today?
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