How Do Top Performing Companies Handle Incentives and Recognition? – New Research
We’re always on the lookout for the latest research on employee engagement and performance motivation. In fact, I’m honored to serve on the board and as the Research Committee chair for the Incentive Research Foundation (IRF) so that we can be sure we’re guiding our clients with the most relevant and recent information available. Every once in a while, a real game-changer comes along and I think the IRF’s new research on top performing companies does just that.
The IRF Incentive Benchmarking Study set out to understand what the most successful companies are doing differently than their competitors. It turns out that the way they engage with their employees has a lot to do with it. You can find the full study here, but the IRF has drilled it down to 10 takeaways. Top performing companies have:
- Strong belief in Recognition and Rewards
- Strong executive buy-in
- Consolidated program
- Income based budgets
- Higher payout
- Goal-focused design
- Focus on reach
- Leveraged analytics
- Integrated communications
- Excellent support
Of these, what I find most surprising is the essential nature of executives’ belief in the program and their buy-in. IRF notes, “Top performing companies were also over 30% more likely to believe that their non-cash reward and recognition programs effectively influence behavior.” We all know that no program runs effectively if senior leaders and managers aren’t on board, but it’s not enough to do a program because everyone else is doing it. Authentically believing in and promoting the principles of recognition and rewards matters to the outcome.
Additionally, organizations investing the time and resources to design a goal-based program, with desirable rewards do better. It makes sense. But it doesn’t always happen when budgets and competing priorities are at play. The research shows that “55% of average companies used goal-based programs for their employees, [but] almost 70% of top performing companies did.”
One important point to consider is that it’s not just about rewarding top sales performers. It’s about reaching across the organization to encourage engagement at every level. IRF found that “When asked whether their non-cash program design was structured with the goal of rewarding and recognizing the truly exceptional performers (exclusivity) or if it was structured with the goal of each participant receiving a recognition or reward in the program (reach), top performers were statistically more likely to say ‘reach’ regardless of program type.” To be competitive and to rally the entire organization around your goals, it’s important to integrate sales and non-sales teams into the program. After all, sales can’t deliver on the brand promise alone!
If you have questions on how to design effective programs, we’d be happy to help. Just email us at [email protected] for more information.