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A manager wrote to tell me that her company’s point system for recognition doesn’t have the impact that she wanted. The problem, she believed, was that it took too long to earn the prizes. Her solution was to keep a “bucket” of prizes on hand – mostly $10-25 gift cards. She says the immediate ability to hand out those cards has been crucial to her success.
I always appreciate when managers see a problem with recognition and find a solution that meets the needs of their teams, so I included her solution in a weekly recognition tip. Michelle Pokorny of Maritz Motivation read that tip and emailed me to explain what makes points systems effective. She was so articulate on this topic that I asked her if she would like to provide a guest post for the blog.
5 Keys to Effective Employee Rewards
Much time, and many dollars are spent on employee motivation programs. Organizations can convey their vision, set a course and identify the path to get there – but little progress will be made unless they answer the age old question each employee will ask: “What’s in it for me?” Reward elements of employee motivation and recognition programs are a critical and tricky piece of the puzzle. Fortunately, advances in the human sciences provide new insight into what is rewarding to people, and therefore how we can create better reward strategies inside our business initiatives. At Maritz Motivation Solutions, we leverage as a primary framework the comprehensive theory of human behavior from Paul Lawrence and Nitin Nohria of Harvard Business School, outlined in their book Driven: How Human Nature Shapes our Choices, which identifies four biological, human drives that shape our choices and actions:
· The Drive to Acquire—Getting and keeping resources, goods, status and experiences that bolster a sense of well-being.
· The Drive to Bond—Seeking relatedness or security in relationships with other people, communities, organizations, social networks and cultures.
· The Drive to Create (or comprehend)—Learning, satisfying curiosity, understanding how things work, self-expression and contributing to something bigger.
· The Drive to Defend—Protecting and preserving material goods, creations, status, relationships, beliefs and even the status quo.
As human beings – and employees – we innately seek to fulfill each of these drives. Recognition and praise alone are rewarding to employees because they fulfill both the Drive to Acquire status and to Bond with others and the organization. Yet there are times when the level of effort, the progress made, the performance or the impact of employee contributions warrants additional reward.
Thankfully, science and experience also provide insight into what can make rewards most motivating and impactful. Here are 5 keys to an effective employee reward offering:
Make it fair. Well-designed reward and recognition programs have to ensure there are sufficient reward opportunities for employees. Qualification for rewards must be considered fair and equitable to ensure broad-based employee participation, and to avoid negatively activating their drive to Defend. Always seek to balance fixed-sum or ‘competitive’ program reward elements with opportunities for employees to earn rewards for their individual effort, progress and achievements.
Don’t default to cash. Though people will nearly always say they prefer cash as a reward, and it’s ‘easy’ to administer, offering cash tends to miss creating an emotional connection to the reward, and therefore to the recipient’s contribution, goals and the company itself. Non-cash rewards are shown to maintain better attention, foster more social encouragement and discussion and are more likely to be used on something actually rewarding – and therefore more memorable. Further, studies have shown non-cash rewards are more effective than cash in improving performance. Jeffrey and Adomdza’s 2011 study found employees working toward a non-cash reward outperformed those working in pursuit of cash by sixteen percent.
Ensure and extend the reward experience. There is also science that indicates earning (receiving points and the status that comes with that earning), yearning (accumulating, envisioning or thinking about what reward we want) and finally burning (redeeming for an award) are EACH rewarding processes to the human brain. Therefore, awarding points rather than tangible or actual rewards can be a more rewarding experience overall, particularly in programs where there are multiple or ongoing reward opportunities. It is important, however, to ensure that meaningful reward options are available at any point earning level for immediate redemption, including lower value items. To further ensure immediate gratification, we allow reward earners the option to pay for a portion of their reward choice. Let’s say that an employee has earned 25 points and really wants an item that costs 30 points. He or she can use their earned points and personally fund the balance (in this case the additional 5 points in value). This flexibility reinforces meaningful and timely reward options, which leads me to our next key to an effective reward offering – providing choice.
Provide choice. As hard as you try, you cannot pick a single reward that will be motivating and valued by all employees. What is meaningful and motivating is highly personal. Awarding points and allowing redemption from a reward collection with a broad choice of options proves most effective. Being able to choose or create a reward experience fulfills our drive to Create, and gives the chosen reward greater meaning. An optimum reward portfolio should include appropriately valued reward choices inclusive of merchandise items, gift card options, experiential options and smaller ticket items such as movies, downloads, books and such. A reward collection can prove difficult to manage and maintain independently, which is why organizations will often choose to partner with a rewards provider or motivation solution vendor.
Expand your definition of rewards. Remember when planning your reward strategies that people are rewarded by more than just stuff or things of monetary value. Plan ways to engage the drives to Bond and Create. Recognition is a rewarding, bonding, trust-building and status-driving experience! Opportunities to learn, develop, contribute, and self-express fulfill the drive to Create, and broaden the total reward experience.
Rewards are just part of the equation when designing an engagement or motivation initiative. For more thoughts on a comprehensive design approach and reward strategy, check out my recent white paper which describes how to incorporate four-drive motivation across the Four Pillars we believe are vital to effective design:
1. A head turning attention strategy
2. An actionable goal-commitment strategy
3. An effective feedback strategy and
4. A compelling rewards strategy.
Cindy and I would love to hear from you, and get your thoughts on these ideas above.
What types of reward successes or failures have you experienced?
Michelle Pokorny, Solution VP – Employee Engagement and Recognition for Maritz Motivation Solutions
Via twitter: @michpoko
As you may know, I offer free week emails with tips on meaningful recognition. This is an example:
Spreading Positive Gossip
Have you ever noticed how fast gossip can fly through your department? How, within hours, everyone on your team can know “the latest?”
Gossip is generally a bad thing. It undermines morale and destroys team focus. But what if you could generate as much enthusiasm for positive gossip? Maybe you can. Try using a storyteller’s approach to praise. Provide details, context, and characters. Be truthful and interesting. Who knows, you may create the next corporate legend!
Gossip is a powerful, often insidious, form of communication. However, when used properly it can offer a great way to spread a recognition message throughout your organization.
It seems there can be a downside to even positive gossip. This tip generated the following email from a reader:
Hi Cindy, I like this idea, but generally when positive gossip flys in our area, some jealousy ensues. Your thoughts?
Here was my response:
Consider why jealousy typically happens.
1) There too little recognition. Limited commodities inspire greediness. Get better at private one to one praise and appreciation, upping the frequency, before you try positive gossip.
2) Jealousy from underperformers. To draw attention away from performance, underperformers will often try to reframe recognition as favoritism. Keep the positive gossip based on gossip-worthy events, describe the achievement accurately and completely, and then ignore the underperformers’ complaints. Everyone knows who these people are and don’t want you to cater to the underperformer’s expectations.
3) There is an expectation that everyone will be recognized identically. If this is the case you either have to get that gossip flowing about everyone (difficult) or do some work setting expectations (recognition is based on performance and preferences and will look differently for everyone).
Keep in mind that positive gossip is public recognition. Instead of assembling the team, you are telling one person at a time about what a team member did. Positive gossip requires the same skill as any public recognition. You need to provide specifics, and you need to tell the story in an interesting manner. If you need help with this, contact me for ideas on how you can learn this skill.
Tell us about the positive gossip in your workplace!
Copyright 2013 Cindy Ventrice