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Allen Schweyer: Incentive Program Design, Communications, Measurement
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What makes or breaks a successful incentive program?
In my view there are three critical elements you have to get right to make a successful incentive program.
The first is design. Planners must spend time thinking about the program. Who is it aimed at? What are the objectives? How will success be measured? The types of questions will lead to better decisions about the kinds of rewards and incentives that should be used. They will also make it easier to adjust the program if objectives are being met and to evaluate it objectively so that the right decision can be made about continuation or termination.
Communications is next. Too often, incentive programs launched for the right reasons create problems for organizations. Sometimes it comes from people who are left out, sometimes senior management, directors or shareholders take issue, the press and bad publicity may even be a factor in some cases. Properly communicated incentive programs can nip these problems in the bud. And of course communications is key to generating the buzz and excitement around incentive programs that makes them so worthwhile when done right.
Measurement is the third element. Every significant incentive program should have a business case that estimates business impact and Return on Investment (ROI). In addition to knowing what success looks like and then capturing the metrics to gauge progress, organizations should analyze the ROI of each significant program so that it knows whether that group incentive travel program more than paid for itself or that meeting for channel partners drove enough incremental sales over the following year that its repetition is justified the following year.
Incentive programs have come under increasing scrutiny for the past few years. The recent GSA scandal in Las Vegas won’t help matters. Yet properly designed, communicated and measured incentive programs can be incredibly rewarding to organizations and easily defended against detractors.
Allan Schweyer is Principal and Partner at Human Capital Innovation (CHCI).