Click on the name of one of our experts to read their full testimonial:

Susan Adams
VP of Travel & Engagement
Next Level Performance
 
Mark Alt
VP & General Business Manager
Maritz Automotive
 
Dahlton Bennington
Director, Meetings and Incentives
PROfound Planning
 
Rick Blabolil
President
Marketing Innovators
 
Jeff Broudy
President
United Incentives, Inc
 
Min Choi
EVP & Chief Marketing Officer
Germania Insurance
 
Stephen Cook
President & Chief Inspiration Officer
Lorandus Meetings & Communications   
 
Sandi Daniel
Owner
FIRE Light Group
 
Mike Donnelly
President
Hinda Incentives
 
Rick Garlick
Vice President
Magid
 
Jerry Klein
Designer, Executive Director
Animate Growth Partners
 
Mike May
President
Brightspot Incentives & Events
 
Ira Ozer
President
Engagement Partners and Innovation Meetings   
 
Mark Peterman
President & CEO
Cornerstone Solutions Group
 
Adam Presslee
Assistant Professor of Accounting
University of Waterloo
 
Jim Ruszala
Customer and Employee Experience, Strategy and Insights Leader
Financial Industry
 
Dawn Schillinger
Strategist
Maritz Motivation
 
Scott Siewert
President
FAB at Incentives
 
Rodger Stotz
Advisor to the Incentive Research Foundation
 

  

STEPHEN COOK
President & Chief Inspiration Officer
Lorandus Meetings & Communications

The most important elements of effective reward program design are:

  1. Buy-in from leadership – fundamentally supporting the concept that reward & recognition is key to employee/customer retention
  2. Understanding the power & impact of non-cash rewards – vs cash rewards
  3. Clearly defined, understandable and achievable targets, rules and regs
  4. Communicate, communicate, communicate – pre – during – post
  5. Establish KPI’s before the program and measure against them during and after the program

Organizations should design and use incentive programs to help them adapt to and recover from damage caused by the Covid-19 pandemic in the following ways:

I believe that organizations will, first and foremost, need to understand that from an ideological perspective, reward and recognition is not a perishable cultural commodity.

In uncertain times leadership needs to double down on retention. Unfortunately, some organizations see incentive programs as a ‘first cut’ cost reduction/contraction proposition. Re-acquiring your best customers and/or talent can be more costly than keeping them with an impactfully well designed incentive program.

Companies should take another look at goals and targets and re-calibrate them to the conditions and fallout of the covid-19 economic impact on their balance sheets.  Staying in the game no matter what the target channel. The key is to come out of the current crisis stronger and better prepared with whatever the renewed go to market strategy is for the organization.

 

MARK PETERMAN
President & CEO
Cornerstone Solutions Group

About eight years ago, the IRF asked me about the most important principles of incentive program design, my thoughts on design haven’t changed much but my perspective has.

Since leaving the incentives industry I have used what I learned there with my own direct and indirect salespeople. I believe it’s important to have quantifiable targets, clear baseline metrics, and three to five measures (the fewer the better) to motivate performance. Plans should be easy to understand, easy to communicate, and easy to measure. Our company tag line communicates our purpose: “igniting data – empowering people”. So when it comes to incentive program design, we believe in the power of people and the use of data to create program objectives, determine program measures, and make this information readily available to the sales team.

Organizations should design and use incentive programs to help them adapt to and recover from damage caused by the Covid-19 pandemic in the following ways:

Covid-19 disrupted every industry. For some, it created opportunity for those who moved quickly (e.g., the “pivot”, such as breweries making hand sanitizer even as their sales of barrels dropped to near zero due to closing of restaurants and bars). For others, their clients decided to hold on to cash by delaying work to some future point. This happened to me in our software and data analytics business.

How do we adapt and recover? The keys to recovery from this pandemic is to identify new markets for your product or service, motivate behaviors that generate new business for your company, and recognize your team who work hard every day to serve your existing clients.

Identifying clients in new markets or verticals that you’ve not worked in previously requires thoughtful analysis of the data that you have about your existing clients. Scan the broader market for segments that show signs of growth. Dig deep into your customer data and then expand your view to other markets looking for places you can adapt your offering to serve those markets. Quickly engage to test your message and sales efforts so that you can take the feedback (learning) and try again. Agility is paramount.

Motivating behaviors that generate new business for your company requires clarity on the targets and incentives that reward the efforts to pivot the company. For example, you might consider incentives that encourage steps to the sale (e.g. first time meetings) with prospects in new industries as well as sales to those new industries. In our case, incentives motivate a focus on new clients and also for small projects (of a specific revenue threshold) as these engagements often open doors to large future engagements. In short, in our business, it’s important to stimulate hunting in markets that are growing as a result of the current global environment.

Recognizing the team that continues to serve your existing clients is critical. People’s lives are disrupted. They work from home. Many gained an additional job of helping their children through the jarring shift to remote learning. Recognition is powerful. It’s not hard. It’s speaks to the heart of each of us as humans. People power your business. Let them know how much you appreciate them. How? Here’s a few simple ideas. Start each regular team meeting with recognition (you should consider doing this outside of a pandemic as part of every day business). Tie your recognition of people’s behaviors to your core values. Set aside time to send a weekly round of Thank You notes to a few who demonstrate stand out performance. Much has been written on this topic, so my goal here is only to encourage you to do it. It’s never too late to start.

Whatever your situation, now is the time to step back and look at what you need to do, be honest about what you’ve been doing, and if what “got you here, won’t get you there” ... make a change.

 

SANDI DANIEL
Owner
FIRE Light Group

About eight years ago, the IRF asked me about the most important principles of incentive program design. Some things have changed since then.

As we see today’s business environment shift, organizations need to design the program around results that are not measured solely by sales. It is necessary to isolate cause and effect and redirect programs around other behaviors that achieve measurable results like cost savings, improved production, reduced errors, improved bottom line profits and customer satisfaction.

Measurement needs to be adjusted if a company is experiencing rapid growth as a result of being in the right business at the right time rather than as a result of strategically planned growth in a “normal” environment. As many of the unprecedented crises affecting our world today settle down or evolve into new ways of doing business, this growth is likely to slow or stop.

Employees who have been fortunate enough to retain their positions are working harder than ever for the same or even less pay. A company that does not recognize and show that they value their employees will face the consequences when the economy swings back to some sort of normal growth. Much like the recession of 2009, those employees that don’t feel valued will jump ship at the first opportunity. We should learn from the past and recognize that if they don’t feel rewarded for their efforts to help their companies through these fragile times they will burn out and look elsewhere. This is an opportunity to build loyalty with staff rather than tell them they are just lucky to have a job. I think design may change around the behaviors recognized, the rewards offered and the human side of management.

Organizations should design and use incentive programs to help them adapt to and recover from damage caused by the Covid-19 pandemic in the following ways:

Programs that recognize good will, care and concern for others and more “human and soft skills” should be developed. Most organizations have based recognition on the bottom-line financial improvements that employees make for the organization. If you recognize employees for serving not only the organization, but the “greater good” you will see a trickle-down effect, not just for the employees, but for the customer base. For example, we have an insurance client that cannot base next year’s sales incentive on sales for 2020 – that is just not measurable in the current environment. It will not track against past results in a meaningful way. The CEO decided to move forward with recognition in a different way for next year’s program, but it will not result in a group travel program.

When these programs are suspended, an organization should develop other ways to recognize, such as merchandise and gift card programs, charitable donations, time off and a host of other perks that can be earned based on the criteria for this time. For example, an insurance company might recognize retention much more than new sales. You see it in our industry, salespeople working the front desk at hotels, meeting planners working on merchandise programs, etc. As the workforce is redirected, recognizing these efforts needs to be incorporated into the design are reward offerings.

 

MIN CHOI
EVP & Chief Marketing Officer
Germania Insurance

The most critical elements of effective reward program design are the following:

  • Overall program design - Who is your audience, what is the end goal, guidelines/rules structure, does it work for the end user? For the corporate executives? Build a win/win for all parties.
  • Communications - It must be consistent, engaging and centralized. Graphs, leader boards, and badges can be helpful in keeping the engagement strong. People need constant reminders of what they are striving forand the rules have to be simple to follow. Communications are most pivotal, the longer the contest period. Many incentives skimp on the communications, but this could lead to poor results even with a great program.
  • The Reward - What is the reward, and is it perceived to be attainable/valuable by the end user? The value of the reward can help reduce flaws in other aspects of the program design.
  • Analytics - Cannot be a set it and forget it, it needs constant tweaking. Measure your communications engagement, as well as when you see the lift in your measurements. Moving the goals to reward a broader base is a sound strategy to move from a 20% to a 50% engagement rate. One ongoing problem is constantly increasing the numbers for your top winners or having set numbers that only reward the same people. Segmentations help in these situations, but you will need to assess additional structural changes to reward the true top performers. This is not a sprint; a great program develops and improves over time.

Organizations should design and use incentive programs to help them adapt to and recover from damage caused by the Covid-19 pandemic in the following ways:

Consider that Cash and gift cards will become prominent players; travel should come back in late 2021.

    • Team incentives can also be created to improve morale/recognition at a low cost. (e.g. top performing team participates in a zoom cocktail mixing class) It is important to understand your audience and the current environment to know what would be most motivating to them.
    • Contests may need to be on a short play basis (30-day incentives versus 6 month or annual).
      - Many people will be reluctant to hold points due to fear of layoffs. May need to incorporate PTO or additional sick days as reward options, especially if it is convertible to cash.
    • Consider creating new baselines for program design metrics, pre and post COVID
    • Most companies have some sort of recognition/rewards program, if budget is cut, reallocate program dollars to reward higher performance metrics.
      - You could also include non-monetary rewards (Hand-written note by C Level, published as top performer in company publication, Team zoom meeting recognition)
      - Low cost rewards/recognition can include gift cards for the family at a local restaurant, or send cookies that they can share with family.
    • Incentives and employee recognition in general should be high on corporate minds at this time. With unemployment at a high, and wages most likely being stagnant for most industries, this is a crucial time to cultivate brand loyalty with your employees. This may require spending a little more now or re-allocating dollars, but will create dividends when the job market returns to normal.

 

MARK ALT
VP & General Business Manager
Maritz Automotive

I view the top three elements of effective reward program design as the following:

  1. See Salespeople as people first. Driving any behavior means solving a motivation problem. And engaging any person is an insights problem. It’s critical to understand how people are unique, what their individual motivators are before configuring design. So, it's important to understand that salespeople are complex people.
        Their motivators are as diverse as any other group
        Their values are as diverse as any other group
        But, the best of them do have some shared and rich personal traits
        A high-risk appetite
        Highly resilient and loss-tolerant
        Strive to be sophisticated problem solvers
        Empathetic with customers, requiring a high EQ
  2. Design needs to become deliberate and insights-driven. The design of sales incentive strategies needs to build on a nuanced view of salespeople to create more impact. Motivation design must take into account the audience, behaviors, motivators, rewards, experience, and measurement.
  3. Align strategy to drive towards the one critical sales motivation outcome: relationships. Help build stronger relationships between your salespeople and your brand – and your salespeople with their customers.

Organizations should design and use incentive programs to help them adapt to and recover from damage caused by the Covid-19 pandemic in the following ways:

         A. Meet people where they are.
             •  Keep it simple, keep it often
             •  Consider new motivations to drive behavior

         B. Connect through communication.
             •  Share what you know when you know it
             •  Understand the participant perspective
             •  Make room for personalization 

         C. Maximize the motivation.
             •  Consider COVID-19 impact on program behaviors
             •  Promote and leverage your community
             •  Maintain a future focus

DAHLTON BENNINGTON
Director, Meetings and Incentives
PROfound Planning

About eight years ago, the IRF asked me about the most important principles of incentive program design, and eight years later I still agree with my thoughts, they seem just as true today as then.

I feel Communication is MOST imperative to a successful incentive program from beginning to end. It begins with communicating clear and concise performance criteria that’s aligned with the overall company’s objectives. Next, and throughout the incentive period, it’s consistently communicating participants’ rankings, keeping each up to date on their performance towards their goals. ¨These communications should not only highlight participants’ performance but also details of the incentive to be obtained to drive performance higher. As the contest period draws to an end, celebrate the success of those in line to qualify and encourage those that are close to strive further and reach their goals.

At the end of the contest, recognize winning performance with valuable incentives. With most incentives, communications after the contest close are just as critical as the reward. Announcing winners and sharing all the necessary details of the incentive won and highlighting the next incentive opportunity is key. In closing, inconsistent or poor communication throughout an incentive contest is a missed opportunity, whereas consistent, timely and relevant communication will enhance any incentive program and drive results higher.

Organizations should design and use incentive programs to help them adapt to and recover from damage caused by the Covid-19 pandemic in the following ways:

For post Covid-19, I would suggest Flexibility and Adaptability will be key to be able to recognize and motivate talent. Let’s face it, many organizations look very different than they did at the end of the 4th quarter in 2019, initial program metrics may no longer be applicable or attainable in light of these changes. Regrettably, some program participants may no longer be in the organization. However, the need to recognize, motivate and retain workers remains strong. Assess the current status of the organization and adjust any criteria to meet the current business needs and develop recognition that fits within the boundaries of participant perception for feeling safe, valued and rewarded and what is achievable for the organization.

RICK BLABOLIL
President
Marketing Innovators

About eight years ago, the IRF asked me about the most important principles of incentive program design, my advice remains the same.

The factors that will increase the probability of success for an incentive program are:

  1. Making sure objectives are clear and concise;
  2. Constantly communicate; and
  3. Move the middle 60% of your workforce.

Organizations should design and use incentive programs to help them adapt to and recover from damage caused by the Covid-19 pandemic in the following ways:

In today’s crazy uncertain times, the three factors above remain important, but I would add a twist – we need to generate and maintain constant connections with our workforce. It’s more than just communications, it is a human connection.

Here’s what I mean. Sales and non-salespeople interact formally and informally. Formal meetings, calls, conferences, and events; and a myriad of informal hall conversations, sharing at the proverbial water cooler, trading stories to and from work or even over a beverage. These natural and spontaneous human interactions have been temporarily removed from our day-to-day information gathering processes. These interactions refine, filter, expand and develop our skills at work.

Today’s incentive programs – affectionately referred to as, elevating the employee experience – must include ways to create human connections that foster personal information sharing, storytelling, data gathering, idea generation, problem solving and feel good moments. It’s the unstructured flow of collaboration. It is the time needed to be brilliant (or not so brilliant), take risk and know that it is all safe. It is how people grow and companies prosper.
The current environment makes it much more difficult to have these sharing moments, so we need to be vigilant in creating new ways to allow them to percolate through a remote workforce.

Clarify objectives, give feedback and communicate, and move the middle, but add social interactions, phone calls, texts, emails, video conversations, “open mike” sessions, one on ones or in groups. Make it personal and keep the human connections the undercurrent of a thriving business.

 

DAWN SCHILLINGER
Strategist
Maritz Motivation

The most important elements of effective reward program design are:

  1. Effective design must start with the people you’re motivating. Not just their performance in revenue or their status compared to others, but who are they as a person and what motivates them. Poor reward program design reduces individuals to a mercenary mindset, a singular focus on cash or cash-like rewards. But starting with the people and who they are in totality corrects that reductive thinking and avoids dangerous assumptions that don’t serve the business or the participant.
  2. Turning a program into an experience. So often, I see programs that are made up of a rule structure like a scarcity-focused competition, a cash reward and communication at the launch and end. That’s it. It’s unsurprising that these don’t create long-lasting engagement and alignment to business priorities. A program needs to be part of an experience that is so much more than a simple rule & reward. It’s in the upfront design to ensure the program feels tailored to the individual instead of unachievable and demotivation. Communication is often overlooked, in pacing (missing triggered communication), content (needing more personalization) and vehicle (more variety to capture attention). And ultimately, it’s the full strategy the program fits into – the combination of short-term and long-term goals that are set and communicated, the use of intrinsic and extrinsic motivators, the complexity of behavior that is embraced and embedded into the strategy instead of only focusing on a single finish line – having that strategy articulated and centered at the core of any program or solution ensures a more effective, sustainable approach.
  3. Measurement & more importantly – prediction. Effective program design isn’t built on instinct, it’s built with data. Data uncovers what behavior is most important, who acts on that behavior and what the opportunity is to grow. But more than just data analysis, now effective program design requires predictive analytics – using all the information to know what likely will happen after deploying a program and what and how to adjust to optimize the investment. Effectively designed programs should be also focused on the data they will produce and the new insights that will be surfaced about the people and behaviors targeted and the different elements of the experience that impacted the outcome.
  4. It’s also in measuring success, not just on the short-term shift in behavior, but the long-term value of the relationship. Reward programs run a risk of creating dependency on prompts to drive every behavior and causing extinction of any other motivator to act. Thus, while effective in capturing immediate discretionary effort, it damages the long-term vitality of an organization. Effective program design has to consider the strength of the relationship its supporting and change accordingly.

Organizations should design and use incentive programs to help them adapt to and recover from damage caused by the Covid-19 pandemic in the following ways:

    • The number one thing I feel is being overlooked with design and implementation of incentive programs right now is what they are at their core: a tool for learning. Incentives highlight behaviors and reinforce each action to teach individuals what is valuable. In this time of COVID-19 and the continued recovery, organizations should be structuring their incentives to show people how to be successful. An organization can learn from the masses of people it connects with much faster than one individual can learn on their own, so I hope to see organizations leverage those connections to identify what works and what doesn’t in the new normal. Then, an organization can deploy programs to show salespeople how to be successful in the “new normal”, as the economy continues to change.
    • It’s also more critical than ever to take a people-centric focus. Society is exponentially more isolated than probably anyone considered possible. The lack of regular social connection is so damaging to people – we are social creatures! Many incentive programs relied on the incentive travel reward as the main activator of social connection in the program or strategy, and it’s unlikely that will be returning in full force or with full participation this year. Without this tool, there’s still so much room for organizations to use their programs to enable social connection. Create virtual events to allow organizations to network and share their success stories, share stories that are grounded in the human element to foster connection – doing this can serve the purpose of building connection with stakeholders within a program and also serving a larger purpose of making this crisis a little easier to weather.
    • Finally, organizations should be rethinking design that launches only every year and runs without interference. This leaves organizations open to issues like our current crisis – where big changes have occurred, and the program is too rigid to adapt. Many organizations are just waiting until the end of the year to see what happened, and that’s losing time and missing out on motivation. Going forward, incentive design needs to be a living organism, adapting and changing easily to meet current demands. A clear strategy will be key, where the incentive can adapt as long as it’s aligned to the larger mission. This was a weakness before the pandemic, but COVID-19 has made it clear that a lack of flexibility will not be sustainable for companies.

 

RICK GARLICK
Vice President
Magid

The most important elements of effective reward program design are:

  1. Understanding that no single reward is valued equally by all. Work I’ve done in the past shows that there is no single reward that is valued equally by more than 40% of the workforce. If you put together a reward program that reaches 70% you are doing well. In this regard, offering a variety of rewards is going to be much more effective than a single approach.
  2. Along with the previous point, make sure that any reward offered has flexibility. If it’s a gift card, make sure it can be used for a wide variety of purposes. If it’s merchandise, give the recipient a choice. If it’s incentive travel, design experiences within experiences from which people can choose according to their own preferences.
  3. Make sure that everyone feels they have an equal opportunity. Some reward/recognition programs are disregarded because people feel the same people are recognized time after time. Some feel that only certain people in certain offices/positions/locations, etc. are eligible. When there are peer nominated awards, remote workers often get left out. Make sure there are clear guidelines for recognition/rewards so everyone feels they have a chance.
  4. Offer a mix of tangible and intangible rewards. There is often too much focus on tangible rewards at the exclusion of things like developmental opportunities, the opportunity to work on an interesting project, or a certain amount of freedom from management.

Organizations should design and use incentive programs to help them adapt to and recover from damage caused by the Covid-19 pandemic in the following ways:

Incentive programs have never been more important. Overall morale in the country has been impacted by COVID-19. With layoffs, pay cuts, and everything that’s been necessary to survive, anyone remaining has likely been affected at an emotional level. For essential workers who have been forced to work through the pandemic, it’s a particular issue since they’ve likely been forced to distance themselves from both their customers and peers. There's distrust to even get close to people for fear of spreading the virus. Incent people for the behaviors you want them to achieve. Make sure rewards are desirable and flexible. Offer choice to maximize desirability.

 

RODGER STOTZ
Advisor to the Incentive Research Foundation

About eight years ago, the IRF asked me about the most important principles of incentive program design, I believe that an effective reward program still needs to be built on the basic fundamentals.

The fundamentals include fully understanding the “context” and environment in which it will operate. Today’s society, business, and organizations are constantly and quickly changing, so to must the reward program. Too often these reward programs are static and “administered” versus “managed.” In other words, these programs require on-going monitoring, periodic assessment, and at least annual renewal.

Organizations should design and use incentive programs to help them adapt to and recover from damage caused by the Covid-19 pandemic in the following ways:

In today’s fast paced environment, the program goals and measures, participants, desired rewards, etc. need to be re-evaluated to ensure they are relevant. For instance, the selection of rewards, and their communication and promotion, need to reflect the current participant demographics, economic environment, and now the impact of Covid-19. Desirable travel experiences are normally very motivating except when many such experiences are either closed to the public or create a potential health risk due to the pandemic.

Previous data on reward programs verified that many programs had no or only minimal adjustments year to year. Additionally, these “static” programs tended to reduce their communications and promotion since “it is essentially the same (old) program.” This lack of renewing/refocusing and minimal communication and promotion are critical deficiencies and key factors in why programs fail. The significant economic, workplace disruptions, and health concerns as a result of Covid-19, are the ultimate triggers for a total review of reward programs. Make the changes that will make the program relevant and effective.

Effective reward programs are organizational tools to communicate, focus, measure, and celebrate desired accomplishments. Therefore, during this period of Covid-19, reward programs are an effective way to refocus participants to the “new normal requirements,” provide feedback, and celebrate incremental and goal accomplishments. By identifying the new organizational behaviors and outcomes now required, the reward program becomes a positive way to communicate these changes, provide feedback, and reward results as they are achieved.

One example relates to the new required “work from home” status of many employees. This Covid-19 related work situation disrupts many of the normal “in office” social interactions, in-person communications, and the resulting personal/social reinforcement. In essence we now need to focus on the ROE (return on experience) as much as the ROI.

The reward program design can support managers to connect with their employees during this unusual time and share how individuals and teams are assisting each other and how managers are supporting employees. These contacts (calls, email, Zoom, webinars, etc.) can be tracked and assessed as to their effectiveness. Managers can use the program to reinforce employees for their daily commitment to the organization and celebrate and reward periodic accomplishments. This period of health concerns and personal stress is a perfect time to refocus, redesign, and update award options for reward programs.

 

ADAM PRESSLEE
Assistant Professor of Accounting
University of Waterloo

I view the top four elements of effective reward program design as the following:

  1. Clearly stated objectives/goals: Many engagement and motivation issues result from employees simply not knowing the bigger purpose of their job/task or what management expects of them.
  2. Congruent and controllable performance measures: Performance measure(s) should be highly consistent with stated objectives/goals (congruent) and measured performance should highly depend what employees can control (e.g., effort) instead of what they cannot control (e.g., other employee effort; unforeseeable events).
  3. “Goldilocks” of performance standards: It is important to use legitimate rewards and recognition that are based on good employee performance. The standard used to define good performance should not be too easy such that rewards and recognition do not motivate employees and should not be too difficult such that few employees get rewarded or recognized.
  4. Use rewards and recognition that employees (not management) value most: Crudely, value comes from two features: symbolic meaning and usefulness. These features of value are highly subjective such that it is important for firms to know their employees and appeal to what they find meaningful and useful.

Organizations should design and use incentive programs to help them adapt to and recover from damage caused by the Covid-19 pandemic in the following ways:

We’re in uncharted waters in terms of motivating and engaging a newly remote workforce. Unfortunately, there is not much research that directly speak to this issue. That said, applying broader understanding of rewards and recognition to this issue, firms might:

    • Communicate/Connect: Employees are use to daily, informal communication with other employees and their boss. Remote working poses significant challenges to maintaining these connections. Instead of having discussions through email, have a quick video call. Importantly, research shows people’s attention span in video meetings is far less than in person. So, firms should encourage employees to have more frequent, less formal video meetings rather than fewer, longer meetings.
    • Involve and support employees: Ask employees about how they are doing and what workplace changes could be made to make their life easier/better. This is an opportunity for firms to invest in their employees, giving them the support they need during this difficult time. This support will foster a greater sense of employee-firm identity, which will increase the meaningfulness of any rewards and recognition. It will also increase employees' feelings of reciprocity, which will have positive long-term benefits such as reduced turnover and greater engagement.
    • E-vouchers and recognition: It is likely counter-intuitive during these tough economic times to encourage firms to continue to reward and recognize employees. Reward and recognition systems are often the first area that gets cut when firms are trying to save money. However, a well-designed reward and recognition system should be value add (it should pay for itself) such that any cuts are likely myopic.

      Rewards such as trips or tickets to events are likely less valued by employees given the current state of the world. However, e-vouchers to purchase products/services that are fun and enjoyable (hedonic) are likely to be very attractive. The good news is that these affect-rich rewards don’t need to be ‘big dollar’ to pack a punch. People tend to largely value these rewards based on the emotion such that they are less sensitive to the increase in dollar value. For example, the difference in employees’ subjective value between a $50 vs. $500 affect-rich e-voucher is less than the difference between $50 cash vs. $500 cash. So, firms might consider more frequent, smaller dollar e-vouchers to places that sell employees items or services they want, but might find difficult to justify purchasing. Also, a simple email expressing gratitude or an e-newsletter celebrating successes can go a long way to increasing employee engagement. 

 

JEFF BROUDY
President
United Incentives, Inc.

About eight years ago, the IRF asked me about the most important principles of incentive program design, and eight years later my advice would remain the same.

Communication among all parties must be coordinated because “it’s not the roughness of the water but the skills of team on the boat.”

Organizations should design and use incentive programs to help them adapt to and recover from damage caused by the Covid-19 pandemic in the following ways:

Distrust, business continuity and uncertainty have paralyzed the decision-making process for all parties. While safety is on everybody’s mind, the real issue is one of trust. Employees and customers feel adrift, businesses can’t use their usual instruments to navigate, and every solution does NOT include an incentive. The solution moving from our state of fear and paralysis is in rebuilding consensus around realistic solutions and demonstrating trust. Trust in the framework, trust in the execution, trust in the partners, trust in the outcome.

Start with the objective. In the current environment are you really looking for a conditional relationship, an “if, then” call to action, to your participants? Do they have that much control or is success dependent on uncertain goal setting? Or, are you looking to recognize with a “thank you” and its many iterations beyond tangible non-cash rewards. Strategically, are you confident that the course you set is achievable? Are you willing to bet your money on it? If you are willing to commit funding, great! What will you need to trust that the funds will be utilized for their purpose, who will have custody of deposits and what will contracts look like? Tactically, what can you do to your program to engage participants and a low cost of sale while still delivering an experience worthy of the achievement?

  • Transparent “Smart” contracts may be necessary. These are blockchain ledgers where there is full transparency and immutability.
  • Costs and friction need to be removed from existing processes. Costs like funding float and intermediaries that do not add value are a quick start. Certainty that there is transparency through all parties will be necessary.
  • In the past, the design was on portal to portal confidence in the program goals and delivery. Now that goals and rewards are based more on the perception of safety, trust must be reestablished, the incentive industry will have to rework its objectives and strategy, not just traditional tactics. The traditions of the past are now history; it’s time to make now the good old days.

 

MIKE DONNELLY
President
Hinda Incentives

When the IRF asked me about the most important elements of an effective reward program design, I began reflecting upon the most successful programs I had seen over the years.

For me, a successful incentive, loyalty or recognition program must achieve both the organization’s goals and inspire the target participants. Some common elements immediately jump out to me in three very specific areas.

  • Goal-Setting
  • Implementation Planning
  • Rewards Strategy

Each of these three areas is equally important in the overall program design, and all must be carefully considered as critical elements to the program’s success.

Goal-setting begins the process of designing an effective program. But without an effective implementation plan and rewards strategy, setting goals is simply a planning exercise. An effective process results in meaningful, measurable and movable goals. Meaningful because they are important and considered fair by the people you want to engage. Measurable and movable means the person you’re asking to achieve those goals can impact them and objectively see where they stand.

The implementation plan consists of the activities that keep the program moving forward and engaging the target participants. I find truly effective implementation plans answer these participant questions:

  • What do you want me to do and why?
  • How do I do it?
  • How am I doing?
  • What’s in it for me?

Combining communications, training, tracking, feedback and rewards are how we answer these and encourage people to take the right actions to achieve the goals of the program.

A rewards strategy should be designed with a focus on the participants. Exceptional programs offer an inspiring awards selection by creating ease, choice and value. That means making it easy for your participants to understand and redeem. Engaging programs offer a wide selection of choices to appeal to the different individuals, demographic segments, and the various interests and tastes of the people who make your target participants. Finally, the rewards in these exceptional programs offer a value from the perspective of the program participants. The value may be saving time or providing the quality brand-names they desire or allowing them to indulge themselves with something they may not buy for themselves.

Organizations should design and use incentive programs to help them adapt to and recover from damage caused by the Covid-19 pandemic in the following ways:

The COVID-19 pandemic has touched every business. Most have seen disruptions in their supply chains. Mandatory shut-downs proved devastating to some industries. Mitigation efforts have meant new safety procedures, adjusted work schedules and even new remote workers. Now is the time to leverage your most valuable assets. Now is the time to engage the creativity and expertise of your people to move the business forward and recover from this crippling epidemic.

In a time when a virus has caused unprecedented turmoil in businesses around the globe, you and your people must make changes to survive and grow. Incentive programs are designed to change human behaviors. They can focus people on rethinking the business to change the customer experience, or to reduce costs, or find new suppliers. By defining the situation and the immediate problem, you can solicit employee expertise to offer ideas to help you recover. The issues the business is facing due to the virus will determine the incentive program your business needs.

But let’s look at some of the most common ways incentives can address issues many businesses now face. Here are two areas programs can impact right away

The most effective programs I have seen in the last 30 years have three things in common: clear and compelling goals, a detailed implementation plan to show people how to succeed, and an inspiring rewards selection designed to engage participants.  Programs with all of these exceed even the most ambitious expectations of their sponsors because they are designed to mobilize the people most important to their business.

  • Employee Stress and Engagement
  • Sales Skills in a the New Normal

Employee Stress and Engagement. This is a stressful time for everyone, and employees who are returning to newly re-opened businesses are likely to see some dramatic and concerning changes. From regular temperature checks to new social distancing rules and mandatory mask wearing, the workplace looks much different now than just a few months ago. Safety and wellness programs can help. These traditional programs are already in place in many companies. Adding COVID-19 mitigation elements to these existing programs can help employees understand the new procedures and maximize compliance. Gamifying safety programs can also be helpful to engage and protect an employee’s family members, too. Remember, the Families First Coronavirus Response Act (FFCRA) and Coronavirus Aid, Relief, and Economic Security Act (CARES Act) require emergency paid leave for workers who become ill or must care for sick family members. So, it is in a company’s financial interest to extend the program communications to help educate and protect an employee’s family from this disease as well.

Don’t forget about those remote employees either. Creating incentive and recognition programs to keep them engaged and productive can reap benefits today by keeping them focused on the right behaviors to drive the business forward. These programs can also create loyal employees that are less likely to leave tomorrow by demonstrating the organization values their contributions.

Sales Skills in the New Norm. The virus has changed sales calls, too. Business travel is at an all-time low, and companies are actively discouraging visitors. Dealing with this situation requires salespeople to master technologies that may feel uncomfortable and leverage marketing assets more effectively. Sales incentive programs can do more than simply reward sales. These programs can encourage people to improve skills with meeting and presentation tools like Webex and Zoom. Steps-to-the-sale programs can provide a roadmap to show reps how to use marketing assets to move opportunities into and through their sales funnel. And make sure you recognize those who are adjusting to the new norm most effectively. Tell their story in detail to help others understand the steps that led to their success.

In a new world that demands businesses change, incentive programs can lead the way. These programs are designed to encourage humans to change their behaviors. Effective programs can maximize safety compliance, encourage salespeople to learn and master new skills and even engage the creativity of personnel to completely rethink the way a business operates.

 

MIKE MAY
President
Brightspot Incentives & Events

The most critical elements of effective reward program design are essentially the same, indeed more so, as when I was asked this question during the financial crisis one decade ago:

Promotional communications continue as the most neglected element of incentive programs.  The sponsor makes the mistake of thinking the target audience is as equally engaged with the sponsoring manager’s pet project.  The sponsor has brainstormed with peers, created PPT decks, pitched the executive team, and modeled budget scenarios for finance approval.  But often, the audience merely gets one email, and that’s it. 

My first two points from the last downturn ago are doubly true now.  Incentive communications are massively underfunded.  It’s the most common budget cut.  Companies observe that email is free, but good email is not free.  Good email includes graphic design and copywriting.  Email is over-used and poorly-used.  Print and video are under-used.

Creativity in graphic design and copywriting gets left in the dust of today’s shoot-aim-ready world where managers are running fast and multitasking with too little focus.  Creativity requires time and breathing space.

Organizations should design and use incentive programs to help them adapt to and recover from damage caused by the Covid-19 pandemic in the following ways:

For 2020, I’d add to the communications list – simplicity.  The importance of simplicity emerged from IRF’s Top Performer Studies.  Attention spans have continued to shrink, so simplifying incentive rules and incentive communications are more important than ever.  Participants want the Cliff Notes summary.    

To help drive simplicity, I recommend a “1-3-1” technique with one core message, three supporting points, and one call-to-action. 

Far too many incentive programs are the company’s best-kept secret due to weak communications that are underfunded, infrequent, lack creativity, and overly complex. 

  

IRA OZER
President
Engagement Partners and Innovation Meetings

The most important elements of effective reward program design are:

  1. ROI - more than ever, we need to design incentive programs so that they deliver a return-on-investment (ROI). Company leaders – CEOs and CFOs – are now evaluating all programs and eliminating ones that can’t prove a measurable return. There are a number of methods to plan, track and analyze ROI, such as the Master Measurement Model and ROIpro, a tech platform that includes all of the direct and indirect benefits and costs of incentive programs in all areas of the company that are impacted by it. A sales incentive program has an effect on marketing, operations, finance and distribution, not just on sales performance.
  2. Teamwork – more than ever, revenue targets and other business objectives are achieved through teamwork, not just the extra work of salespeople in “hunter” roles. During the past few years, customer buying patterns have changed to where the vast majority of customers research prospective solutions and vendors on the internet before ever speaking with a salesperson. This is true of B2B as well as B2C customers and this trend has accelerated with the vast increases of the remote workforce, which has resulted from Covid-19.

Organizations should design and use incentive programs to help them adapt to and recover from damage caused by the Covid-19 pandemic in the following ways:

    • Address remote Work – as a result of the Covid-19 pandemic, most companies have needed to shift instantly to having remote workforces. Therefore, incentive and engagement programs need to be reoriented to these “virtual” workforces, for example, taking into account that in-person client and employee meetings will not occur. So the way we recognize people needs to occur through the use of technology, where in some cases before, companies could recognize people through postings at employee workstations and in company break rooms. There are many platforms on the market which provide tactical solutions such as employee recognition programs and a growing group of others that integrate multiple types of tactical solutions – the “levers” of engagement – into one “umbrella” system, thus making the overall process more efficient and effective, with improved communications and collaboration, use of artificial intelligence (AI) and machine learning (ML), analytics, enhanced reward earnings opportunities and reduced costs of using multiple platforms.
    • Move from aspirational to useful awards – we normally recommend that programs use products that are “wants” vs. “needs” because these will have an increased motivational effect from not being used as a form of compensation; now with Covid-19, this best practice should be modified to offer needs/necessities such as food and service related products.

 

JERRY KLEIN
Designer, Executive Director
Animate Growth Partners

The most critical elements of effective reward program design are the following:

  1. First, establish very specific program objectives. Too often the program, its communications and its rewards are not tied to a clear set of business goals or objectives. In fact, skipping the step where a company defines a goal for the program is the most frequent example I see of companies failing to set up their reward program to be successful. It’s kind of like dieting without first weighing yourself and setting a weight loss goal. If there’s no tangible and quantitative objective, it’s going to be really hard to determine if the program is on track or has been successful.
  2. Come up with a meaningful communications strategy. Once a company has defined the goals of the program, embed those goals in the program messaging. Effective program communications will constantly let people know three things:
       I. What’s the “why?” What’s the bigger mission to be accomplished that supports the company’s broader vision and values?
       II. What they are being asked to do? What are some specific behaviors to help them reach the destination?
       III. How are they doing individually? What’s their individual progress toward a specific defined objective? In addition, how is their group, division or overall company doing relative to the macro goals of the program? Individual progress updates are important, but equally important is letting people know they are part of a larger effort.

  3. A program communications strategy should not just be the old “sell big, win big,” do-this, get-that play to rewards only. It also needs to be more than just a series of emails that get overlooked. It’s important to communicate with compelling images and messages so that you get people’s attention and give them a goal around which they can rally.
  4. Don’t just reward the top performers. If a company is sending the top 5% of an audience on a trip, they will probably reach at most 20% of their audience. Everyone else will perceive they don’t have a chance to win and will stop paying attention. To involve more people, utilize a combination of performance-based or milestone rewards; second-tier rewards for growth or objective attainment; and status-based or social rewards that don’t require a lot of budget, but are an opportunity to recognize people for doing the right thing.
  5. Finally, it is important to continuously use data to make programs better. Measurement is the key to building programs that aren’t “one size fits all,” that reward more than top performers for appropriate achievements and behaviors. Measurement and analysis help program owners recognize things like regional or divisional challenges or lagging product lines within a program, so the incentive can be dynamic enough to respond to changing business needs. For that to happen, it’s important to take a strategic look at the data during the program, and not just once the program is over.

Organizations should design and use incentive programs to help them adapt to and recover from damage caused by the Covid-19 pandemic in the following ways:

Incentive, recognition and reward programs will play a leading role in helping organizations recover from the COVID-19 pandemic. Right now, there is an immediate need to engage members of the workforce who are working remotely and may feel disconnected from co-workers. Recognition programs need to step up from spontaneous, on-the-spot recognition mechanism, because “on the spot” suddenly doesn’t exist. Too often, employee recognition programs don’t give enough focus to the purpose, mission and behaviors that underlie the “on-the-spot” component. Communicating and acknowledging behaviors that are living examples of a company’s mission and values is more important now than ever before.

Likewise, the imperative to make people feel valued for living the company’s values has not gone away. Because this recognition mechanism can’t be in person, new methods for recognizing specific employee behaviors need to be created that are both authentic and personal. No online experience can replicate that personal recognition moment, whether it be on a stage in front of one’s peers or in a personal conversation, but there can still be mechanisms to celebrate people online. The key is that recognition programs can’t just be “personality contests” anymore but need to be more closely aligned with strategy and behaviors.

Likewise, once we’re over the current hump, there will be a huge need for incentive programs that help people connect in person. There will be high pent-up demand not only top performer travel, but also for business meetings and events. Organizations are going to need to make sure these events bring people together to reinforce personal connections and rally them around their business purpose by laying out a clear path forward.

So, while there’s a lot of short-term pain, the current situation is an opportunity for firms to focus on their strategy and on what makes them special, so that they can rally both employees and selling teams to get behind that message when the world re-opens for business. Incentives and recognition will be key elements to helping organizations focus on the most important aspects of their business.

 

SCOTT SIEWERT
President
FAB at Incentives

Effective reward program design is critical to ensure a positive Return on Investment (ROI) or as we like to say Return on Incentive! Effective programs should focus on the following elements:

  • Communications – Promoting an incentive program is very important to the success of any incentive program. Ensuring every participant is aware of the program’s objective(s), start date and end date, what the participant needs to do to earn the reward, and in easily understandable terms what the reward being offered consists of (i.e. a trip to Bora Bora or a new kitchen mixer, etc.). Often incentive program designers do not have all of the promotional materials available at the start of a program - say January 1, 20XX. That is a big miss! Why have an incentive program if the participants do not know they are in an incentive program? It happens more than one would think. Thus, getting the word out timely, effectively, and consistently through mixed media (a program website, Social Media, emails, videos of executive encouragement/support, print collateral, and promotional products) will help produce a higher ROI.
  • Analytics – In today’s data driven world it is incumbent upon all program designers to use analytics to develop the best rules structure based on factual, real time data. Technology is our friend in developing the correct, best rules structure. Looking at past history, analyzing trends, developing financial/program models, and understanding your audience’s preferences will do wonders for an incentive program.
  • Reward’s Perceived Value – When an incentive program is launched a participant immediately makes a judgement on whether the reward is worth the effort. Participants could be pretending to want to earn the reward when deep down they feel the perceived value of the award is not worth their effort. Therefore, it is critical that a reward touches the participant in a manner that makes the participant salivate for the reward. If you are offering a group travel program how can you have your participant experience be customized to ensure that each participant is salivating for a particular activity or experience? The more you can tailor the reward to your participant’s deep desires, the better your motivation factor!
  • Budget Maximization – CFO’s are tasked with results. They need to be a part of your program design. By nature, CFO’s are financially-oriented and welcome detailed analysis and budgeting processes. In essence, they want to know your plan on producing a positive ROI. Successful programs ensure the program design is in alignment with the CFO’s objectives. If the CFO is a program’s advocate, the incentive program will typically be an ongoing budgeted item. Planners need to respect the program budget allocated and maximize it to ensure long term CFO support.

Organizations should design and use incentive programs to help them adapt to and recover from damage caused by the Covid-19 pandemic in the following ways:

In the Covid-19 environment we find ourselves operating in, the rules of engagement have changed. Incentive participants are more distracted than ever. Now is the time to keep incentive programs simple, digestible and on-point. You will have one virtual chance to provide a tremendous first impression on any new incentive program. Therefore, an effective communication strategy is the number one tool in a designer’s toolbox in the Covid-19 environment.

Given participants have potentially dropped down a level or two on Maslow’s Hierarchy of Needs pyramid, program designers need to ensure the lower tiers of safety and security are all met before reaching for self-actualization. Incentive programs that are truly motivating focus on producing self-actualized winners. This is the sweet spot for incentive programs to produce the highest ROI. Look deep into your participant’s eyes to make sure you are in alignment with what will make them feel self-actualized.

Now that travel programs are on pause, we believe there will be a pent-up demand for unique, safe, exotic trips in the future post Covid-19 vaccine world. If you believe in future travel, now is the perfect time to consider contracting for discounted luxury resort accommodations, on-sale five-star cruise cabins, etc. This will allow your program to provide the largest bang for your incentive program dollars.

  

SUSAN ADAMS
VP of Travel & Engagement
Next Level Performance

The top 3-4 elements of effective reward program design are the following:

While successful programs often target multiple audiences with complex rules and rewards, a few simple guidelines will help to keep it all in perspective:

Begin with the End in Mind

Be very clear about what you are trying to accomplish with the program and who you are trying to motivate or influence. Once you are certain about your specific sales or behavioral goals, it becomes more straightforward to work backwards to identify the people and activities that will help you get there, lining up the program to have an impact.

Keep It Simple

Nothing is less engaging than a program that’s overcomplicated, with rules that are unclear and goals that seem unattainable. Ensure that every eligible participant is clear on the goal, believes in the goal, understands what they need to do to achieve it, and knows that achieving it is possible.

Communicate

No one knows about your program if you don’t tell them. And in most workplaces, when things get busy, it’s easy to lose focus on the goals. Earn and keep mindshare with frequent, engaging communications that help program participants envision themselves already enjoying the rewards of success. It makes it harder to lose with bird-in-the-hand thinking. Check out the IRF’s Nudge Guide for other thoughts on influencing behaviors.

Be Ready to Adapt

2020 has been an extraordinary example of a changing landscape, but actually, major shifts in business happen all the time on a smaller scale. From a new competitor to supply chain challenges, businesses are constantly faced with new obstacles and must adapt. It is essential to be ready to adapt incentive programs and their goals, as well. Had a tough start to the year this year? Try a sprint program instead of a longer-term incentive to reboot. Relied on incentive travel to meet networking needs and reward top performers? Use points this year and hold a Virtual Recognition Event instead – complete with celebrity entertainment. This is when incentive partners are absolutely vital. They have the tools and resources to help you turn on a dime.

Organizations should design and use incentive programs to help them adapt to and recover from damage caused by the Covid-19 pandemic in the following ways:

There are three steps organizations should take now:

    1. Don’t Neglect Your Incentive Audience. Whether your incentive is focused on channel partners, customers, or direct sales reps, it is essential to keep them engaged now so that they are working towards recovery. And more than ever, it’s important to broaden your reach with your rewards programs. Remember the office workers behind the scenes, who no longer have offices but still have to support your success. Be sure you have rewarded their performance with recognition, points, and a mix of rewards, even if an incentive trip was cancelled. Many companies are turning to points programs or individual travel as a way to continue to engage, motivate and retain the team members who matter most to their business.
    2. Recalibrate Your Goals. Many organizations have lost weeks – or even months – of sales. The incentive program you set up at the end of 2019 may no longer be relevant. It’s okay to recalibrate and give your team new, achievable goals that will get you back on track.
    3. Help Your Customers. By providing great products and services, we are all actually helping our customers recover, as well. Consider designing your program to emphasize how your team can find solutions to your customers’ problems, creating a winning combination for all involved and strengthening essential relationships. Partnership counts.

 

JIM RUSZALA
Customer and Employee Experience, Strategy and Insights Leader
Financial Industry

Seven years later, would you change or update any of your advice regarding effective reward program design?

The thoughts I shared about the “Different Math” stand the test of time as they are as important today as they ever were historically.  Reward and Recognition programs need to be designed for the audience, not for the sponsors of the program.  But, I will add that larger, broader reaching programs alone are not enough.  It’s a big carrot, but a long journey too.  Plus, when you wind up with disruptions (such as COVID-19), the ability to adjust is severely limited.  “Engagement” is a key word for modern incentive programs.  

If I’ve learned anything since my original comments several years ago, it’s that “Engagement” with your people has to be a paramount focus.  Open the doors to engagement, with your team members, their peers, cross-functionally and vertically.  In normal times, whatever that might be, engagement can fan the embers that incentive “yearners” are drawn towards.  They not only want to know “what’s in it for me”, but “what’s in it for our customers, partners, organization and peers.”  They want to know, “How have my efforts contributed towards our collective achievements?”  Being a part of your own success is one thing, being a part of a broader success story takes it to a whole new level.

So, how do we inform, guide and fuel the broader power of incentives?  Engagement.  Engage formally and informally.  Scheduled and impromptu – emphasis on the impromptu.  Break tradition; send a thank you card in the mail to your team member working from home during these COVID-19 times.  Or, better yet, send a box of chocolates or order them delivery of their favorite fanfare foods.  Schedule a one-on-one or group- based skip level session.  Host a birthday party online with named entertainment. 

Engage, engage…engage.  At the end of the day, sure you want your incentive program earners to be rewarded and recognized, but it’s more so about the achievements experienced that everyone had a hand in helping realize.  The incentive is the carrot, but it’s also about achievement.  Engage to drive that point home, learn along the way, focus on it, communicate, foster inclusive design thinking to optimize, think about the journey step-by-step and broaden the destination so everyone is drawn towards achieving it together, go beyond the incentive itself.