10 Tips for Creating Successful Employee Incentive Programs

Who doesn’t love a good incentive? That extra little boost of motivation can help even the best of us to be healthier, more productive or achieve any number of goals. And in the workplace, employee incentive programs are a huge part of employee rewards and recognition. 

Keeping employees motivated and engaged at work is an ongoing challenge for organizations everywhere. Right now, according to research from Gallup, only one-third of employees are actively engaged at work. About half are looking for a different job, either actively applying or dipping their toes in to see if the grass is greener elsewhere.

Employee engagement is one of those sticky problems that you can’t just throw money at to solve. Cash bonuses are a common incentive, but it’ll only get you so far. A study done by the Incentive Research Foundation found that 80 percent of reward program participants prefer non-cash awards as part of their “total award experience.” The foundation also found that non-cash incentive programs are up to 150 percent more likely to improve employee performance, retention and satisfaction than cash-only incentive structures.

It’s a balance. Here are ten tips to create an effective incentive program that works.

Tip 1: Understand Your Employees' Motivations 

You can’t motivate someone if you don’t understand what makes them tick. While the Incentive Research Foundation survey found that a majority of employees prefer non-cash awards, one in five would choose the money. And there’s no one incentive type that will win everyone over. 

Some people prefer financial incentives – cash or quasi-cash, such as gift cards – while others appreciate travel vouchers, event tickets and other experiential rewards. For some, perks that improve work-life balance like extra vacation days or flexible hours are the priority. For others, career growth or public recognition are the goal. 

To figure out what drives your employees, ask them! Gather data on what will incentivize employees with surveys or feedback sessions. 

Tip 2: Set Clear and Achievable Goals 

Be clear about what you’re trying to achieve with your employee incentive plans and set goals that align with overall company objectives. Make sure those goals are specific, measurable, achievable, relevant and time-bound (SMART).

And communicate those goals to employees! If you are trying to encourage specific behaviors like teamwork or leadership, say so. If you want to improve customer service or innovation, make those expectations known. If your goal is to increase sales by 20%, explain that and explain why. Make sure your employees understand the goal, how they can contribute and how success is being measured.

Tip 3: Offer a Variety of Incentives 

Following Tip 1 will help you better understand what motivates your team, but the follow-through is what moves the needle. 

Offer a variety of incentives that cater to these individual needs and preferences. Need some creative incentive ideas? Here are some popular options:

• Monetary incentives: Bonuses, commissions, raises, stock options, profit sharing, gift cards, allowances, discounts or tuition reimbursement. 
• Non-monetary incentives: Flexible work arrangements, professional development opportunities, additional time off, experiential rewards, mentorship programs, team retreats, company lunches and events, extra leave, development days or recognition programs like Employee of the Month.
• Health and wellness incentives: Gym membership reimbursements, fitness program subscriptions, on-site fitness classes, counseling sessions, meditation classes, Employee Assistance Programs (EAPs), mindfulness training apps or resources, free on-site healthy snack options, on-site farmers' markets or CSA (Community Supported Agriculture) program, quiet rooms or meditation spaces in the workplace.
• Team-building incentives: Team outings or retreats, luncheons, dinner parties, workshops, company-sponsored sports leagues or fitness challenges.

Most importantly, though: let employees choose whenever possible! 

Tip 4: Ensure Fairness and Transparency 

Employees need to trust that the incentive and rewards program is fair. Even a whiff of bias can derail recognition efforts. 

Establish clear criteria for earning incentives that are communicated to everyone and offer the same tier of incentives for similar achievements. 

Tip 5: Regularly Review and Update Incentive Programs 

Employee feedback isn’t one-and-done. Continue to collect feedback about the incentive program for insight into what’s working and what needs improvement. 

This allows you to adjust your program as needed, based on that feedback and any changes to company goals. Plus, what’s popular one year in the world of incentives may be old news by the next so make sure your reward offerings are kept up to date. 

Tip 6: Recognize and Reward Team Efforts 

Incentives tend to focus heavily on the individual who accomplishes something but don’t overlook the value of the team. Collaboration and cohesion are powerful. 

Recognizing teamwork means that more employees are brought into the fold and are rewarded. No one is left out, which can be incredibly demoralizing. Beyond that, big successes are team efforts! Give recognition when and where recognition is due. 

Tip 7: Integrate Incentives Into Company Culture 

Effective incentive programs aren’t a side project. They are an integral part of company culture and should be treated as such. It’s so much more than just an HR initiative.

Encourage leaders and managers of all departments to be involved, actively participating and promoting the program. Empower them to reward employees with the tools needed to recognize employees and provide those incentives themselves (see Tip 8). 

Don’t overlook rewarding employees for displaying key elements of your company culture or exhibiting behaviors in line with the organization’s mission or values.

Tip 8: Use Technology To Track and Manage Incentive Programs 

Managing an incentive program shouldn't be a manual task anymore. Technology like the Inspirus Connects platform makes it easy to recognize and reward employees.

For instance, through Inspirus Connects, managers are able to give employees points which can then be redeemed for a wide range of rewards. Managers and peers alike can show appreciation with messages including eCards or GIFs. Advanced data analytics and reporting capabilities – combined with feedback surveys in partnership with The Happiness Index – provide insight into the effectiveness of the program. 

Tip 9: Provide Timely and Meaningful Recognition

Immediate recognition is essential. Otherwise, it can come across as insincere or hollow. 

Show appreciation as soon as possible. This may be with a personal note or verbally right after the success, followed by more formal recognition and a reward a few days or a week later. And, of course, make sure the messaging is personalized and authentic to truly boost employee morale.

Tip 10: Encourage Peer-to-Peer Recognition

Employee recognition isn’t just a top-down project. Encourage peer-to-peer recognition among colleagues to help foster a wider culture of appreciation and better team morale. 

One way to do this is by using a recognition platform like Inspirus that allows employees to recognize each other in fun and genuine ways that help build a supportive work environment. 

Implement These Tips To Boost Engagement

While there’s no one single way to create an effective employee incentive program, following these ten tips will help lay the foundation for success. 

Looking for a way to streamline implementation, while boosting engagement and fostering a culture of appreciation? Inspirus, a leader in employee recognition and engagement solutions, offers an all-in-one digital recognition platform that can revolutionize your employee incentive program. Get started today!