Incentives Aren't Just For Sales People...

Incentives.  The word brings up a variety of images in most people's minds.  From "cash back" at the dealership to sales bonuses for getting more people to buy your products - most people immediately go to the "sales" arena as if the only place incentives have a place is when pushing something.

Nay, nay I say.  Expand your mind.  Incentives (and by extension - rewards and recognition) belong anywhere you have people.  Incentives aren't goal specific - they are people and behavior specific.  Incentives can and should be applied anytime you have a goal that isn't being attained, and people and their associated behavior are some of the reasons the goal is being missed.

I have presented the chart below many, many times and each and every time the response is..."gee... I never thought about it that way before.  You're right - I can use incentives and rewards in a variety of ways."

I now share my secret weapon with you. Here's the chart.... (click for a larger image)

The way to read the chart is to start at the left and go to your right. 

As a business manager, you have pretty much one goal in mind - increase the value of the shareholder (or stakeholder for private companies) investment in that company.  That's the one measure everyone can agree on.  I know, I know, there are other goals and objectives - employee satisfaction, engagement, etc. that are important.  But, I submit they exist to drive profit for the company and those that have invested their money/time/capital.  But I digress.

As you move from left to right you can see that there are a variety of ways that a company can increase its value to the shareholder... from increasing sales, decreasing costs, making better use of the investments already in the pipeline.  Each of those areas can then be subdivided, and ultimately you arrive at something people can do to influence the output/success of that area.

Need more cash - look at receivables - is there a way to motivate the teams to work a bit harder at collecting owed money?  Need to get that new software online - can you influence the behavior of the employees to adopt the new tool faster - you bet!

If you print off the chart and keep it handy you can probably add 10-20 other areas where people have the ability to impact results.  It's not always sales. 

Think differently about where and why you apply incentives, rewards and influence - you'd be surprised where a little nudge to the right people can help you hit those elusive goals and objectives.

Comments

[Marie Adams]

Don't forget that a great incentive can be as simple as saying 'thank you.' Sometimes that's all it takes for an employee to know they're appreciated.

[Marie Adams]

Don't forget that a great incentive can be as simple as saying 'thank you.' Sometimes that's all it takes for an employee to know they're appreciated.

[chhaya sehgal]

While the improvement in shareholders' value creation is the ultimate economic goal of any business, in the days of tripple bottomline reporting where social and environmental obligations of a business are increasingly gaining equal importance it may be interesting to develop the incentives which will promote these causes too.

besides any incentive brings the desired results only when the organisational culture and environment nurtures productive relationships to boost team spirit and thereby attainment of team targets with as much commitment as individual targets for goal congruence.

[Paul Hebert]

Chhaya - Agree totally! Your point about other goals/objectives such as social and environmental is a good one. I'll have to update my chart.

Your point about team incentives/recognition is valid as well. I'm seeing more organizations looking for ways to include teams vs. individual performance.

One of the things I work with companies on is making sure their influence programs (reward, recognition and communication) reflect the culture they want. Great insight - Thanks!

[Kate]

Hi there,

Totally believe in the power of incentives, saying a simple thanks and the difference it makes to the individual's confidence and commitment to the company strategy.

We specialise in the reward and recognition and incentive space over in Australia. What we have found is that whilst cash has it's place as an incentive, people don't want more 'stuff', they want something that is personalised. Experiences, things they wouldn't normally buy for themselves, thing they can do with others (for e.g Racing v8 buggy's, doing a rockstar singing challenge and recording session, barbeque cook offs and circus skills sessions)

Experiences, we've found are about social connectedness, they resonate with people and are memorable and this really works for your employer brand as the giver.

Have a look to see a few different ways you can reward staff:

http://corporate.redballoondays.com.au/