If you ever wanted to create an incentive program to reward your employees who help the business or if you have tired of incentive programs that don’t work as planned (paying for the wrong activities or for activities that did not impact your objectives), this article will give you a process to create incentives intimately tied to employee engagement and business results.
Disengaged employees won’t deliver the productivity to achieve the incentives, let alone impact the business results. What’s the point in structuring the incentives if you have no one who is motivated or engaged to work toward them?
“Watson Wyatt’s 2008/2009 WorkUSA Report, Driving Business Results Through Continuous Engagement, released Feb. 10, 2009, reports that highly-engaged employees are twice as likely as their less-engaged peers to be top performers.
……when employees are highly engaged, their companies enjoy 26 percent higher employee productivity, have lower turnover risk and are more likely to attract top talent. The companies of highly-engaged employees earned 13 percent greater total returns to shareholders over the past five years.
Such workers miss 20 percent fewer days of work, and three-quarters of them exceeded or far exceeded expectations in their most recent performance review.
Additionally, highly-engaged workers tend to be more supportive of organizational change initiatives and resilient in the face of change.” 1
You may already know who your motivated, engaged employees are. So then you need to determine what they value. What would motivate them to achieve the results you are seeking? You also need to look at your remaining employees who appear disengaged, unmotivated. Should you have conversations with them to find out why they are disengaged?
In a recent survey by SHRM – Society for Human Resource Management – in 20092, the top five very important aspects of job satisfaction according to employees in small organizations (less than 99 employees) are:
The top 4 factors are intertwined. An employee’s job security can be increased when they work to increase business results in alignment with business goals. The employer helps employees see the business vision and goals. Employees become engaged when they understand how their skills, abilities and work impact the business vision and goals. Employers and management can continue the engagement of employees by giving feedback and development opportunities. Successful attainment of business goals should be reflected in the various components of compensation and/or rewards.
Identify the top performers – the already engaged employees. In tough economic times, many consultants and employers feel they should not reward all employees equally. Not everyone’s performance warrants a reward/incentive or even a base pay increase. But the employer’s responsibility does not end there.
When you are rewarding employees for their positive, impactful results, make sure the employee is engaged and clear about the business direction, how they can contribute and how they can be rewarded. Get their feedback — do they value these rewards or what else would be valuable?
When the employee is not rewarded, make sure you as the employer and management explain to an employee how they can learn and change their outlook and behavior to share in performance rewards. At this time, some disengaged employees may decide to leave your company if their philosophies and values don’t match yours.
Past experiences and studies have shown that plans fail for some or all of the following reasons:
The shorter duration or one-time occurrence program would involve a shorter process and less steps or components in creating the program.
Financial planning firm wants to change client service model to achieve the following over the next 2 years and for the future:
Client Feedback and discussions determined that a range of consulting services can be offered with specific enhancements to the present client service model. These enhancements are certain follow-up guidelines and deadlines and certain initiatives in ensuring very timely account set-up and transfers/exchanges/rollovers from other institutions.
What are the business’ expectations for:
We need to tie the actions and behaviors to the results we want to see.
Review the duties and standards with the employee.
Show her/him how their actions and behavior should be geared to creating systems to prepare for client service meetings and handle the work after the meetings.
Ask the employees to show how our expectations can be accomplished.
Ask the employees to summarize the process. Make sure that employees understand how their actions and behaviors affect the deadlines for client meeting preparation and follow-up and how that affects our business revenues and expenses. How accomplishing the incentives impact our revenues and expenses.
How and who will track the measurements and results? For actions it is easier to quantify – for behaviors, it may be more challenging.
Client Service Meeting preparation has all the components prepared and done the week before. There is a meeting, communication or physical delivery of the expected items. If there are exceptions, that is clarified in the incentive program as to what they are and how to address in order to continue to be on track to achieving the incentive.
Behaviors can drive the results. Part of a regular briefing can cover what is happening to the process and people involved.
Sometimes in a down economy or for future business changes – you need to reward for actions and behaviors in advance that lay the foundation. This is sometimes challenging for employers who are working with a restrictive budget.
Here are some things to consider:
Many employers rush to complete these items without going through the process just outlined. In some cases you can accomplish both at the same time.
Research and experience suggests that there is a certain amount that catches people’s attention and motivates them. Smaller than that amount and people are not affected or de-motivated.
Someone once called their 2% base salary raise (back in 2005) – “a milk raise” and proceeded to look for work elsewhere.
When to reward is balanced on the nature of the program and how the results are measured and tracked. You should be meeting with the employee to re-emphasize that the incentive program and amount is not guaranteed and financially the employee should not be counting on it as a given. If an employee sounds as if they are expecting it, you need to meet with the employee ASAP to clarify this. If you don’t clarify, you risk losing the employee’ engagement and morale.
Yes – there can and generally are multiple incentive programs.
Typically these programs are:
For more information on incentive (pay for performance) programs and how to use them for impactful, positive results, contact Mary Dunlap CFP®, MBA at Mary Dunlap Consulting. We help financial planning firms attract, develop and retain the best people for their teams.
For more information or specific questions, contact Mary at email@example.com
My team and I are dedicated professionals who through honesty, caring and desire, provide our clients the tools and processes for sensible, appropriate human resource management, for recruiting the right person for the right job, for coaching people to do better and to direct energies for increased business and personal results.
H.R.6201 – Families First Coronavirus Response Act (FFAC)