Incentive Programs reward employees for reaching work goals, achieving milestones or simply just having a great attitude. These types of programs have proven very successful for motivation and optimal performance of the company. Some benefits of an incentive program can be:
- Motivation: Incentive programs motivate employees by offering rewards for reaching personal targets and company goals. These come in many forms ranging from cash, time off, gift cards or even just acknowledgement in a company newsletter
- Company Morale: Goal setting and targeting objectives helps with focus and purpose. Increases in company morale help to reduce absenteeism and overall company costs.
- Loyalty: An incentive program gives the employee a more personal stake in the company’s mission; if the company excels, the employee benefits.
- Productivity: By offering incentives for reaching or exceeding goals you will motivate your employee to work hard.
- Reduced Company Costs: Company costs being reduced can be measured by less absenteeism, recruitment costs and turnover of staff.
- Team Work: Employees working towards rewards or company goals will pull together to achieve desired results. Teamwork increases efficiency and creates harmony.
There are as many types of incentive programs. Depending on what you hope to achieve, you have to decide which type works for your company and your employees. There are three main categories for incentive plans: individual, group, and company.
- Individual plans reward each employee based on their own merits and can be tailored to suit the employee and can range from cash or gift cards to trips, cash, paid time off etc.
- Group plans are for individual work groups. Each group would meet a set standard. An employee must understand how his performance affects the company’s goals.
- The company wide plan is typically a standard profit-sharing program: if the company meets — or exceeds — its goals for the year, quarter, or month then the entire company gets a piece of the pie.
There are also benefit programs that are mutually beneficial and promote an investment on both sides. For example with an Educational Assistance or Referral Program. With Educational Assistance the company is investing in the employee and gets a more educated and informed employee with a higher skill set in return.