They say the carrot is more mighty than the stick, but which rewards work best for your employees hard work, effort and dedication? And how do you keep your top performers engaged and loyal over the long term as precious assets in your business?
Conventional wisdom means that business leaders tend to assume that employees are only motivated by financial incentives and this tends to be the go-to way to drive long term productivity increases. Well buckle-up, as we go on a tour of the best ways to reward employees.
Boredom - yes, plain old boredom is the biggest killer of productivity in your workplace and no amount of cold, hard cash is a cure for disenchanted, disengaged people who are not enjoying what they do. Let’s be frank, no matter the industry or sector, everything becomes repetitive in time and even the most exotic, most enthralling of roles have the potential to leave people feeling out of step. What every business needs is a way to encourage the natural competitiveness that is built into the DNA of every human that walks on this Earth. That - plus strategies and tactics that make people feel engaged and respected for their efforts.
Financial rewards are important, but as extensive studies show, there is a point where additional earnings plateau in terms of the added value and satisfaction they bring to our lives. Beyond this, other factors like recognition are the keys to high performance and loyalty.
Recognition is key
Giving employees recognition is probably the very best ‘not so secret’ weapon to reward your people for their higher productivity. The good news is that giving positive feedback either 1-2-1 or publicly costs almost nothing. All you need is a mouth and something relevant and motivating to say. In all seriousness, as many as 50% of employees say in exit interviews that a lack of engagement and recognition is the key reason for their departure. Recognising and praising individuals and teams on a regular basis reminds people that they are continuously making a contribution and adding value, not just in terms of performing their own specific role, but ultimately the higher level goals and purpose of your organisation overall. Make time to share personal feedback little and often. You’ll only get out what you put in. So as a senior manager, avoid emails that are blatantly lazy and generic. Get out there - connect with people face to face and give a heartfelt thank you and words of encouragement. This kind of reward is priceless and is the ultimate ‘pat on the back’ for delivering productivity.
Challenge, challenge, challenge then promote, promote, promote
We talked about boredom being one of the biggest killers of workplace productivity. Well, boredom and ‘the lack of a challenge’ is one of the biggest reasons that people look for other opportunities. Therefore, it’s key to reward employees with the opportunity that they seek, in return for their productive efforts. It doesn’t mean that you need to be constantly giving employees a salary increase. However, it’s critical to hold regular performance appraisals as part of employee performance management. Use your performance management software to schedule and capture the detail from regular 1-2-1s. Be open and frank; are your people feeling engaged? Does their work stretch and truly challenge them? Do they look forward to coming to the workplace, or does it fill them with dread? By noticing increased levels of performance and productivity, you’re showing employees that you recognise their ability to perform well. You’re noticing their talent and abilities. Tell them! - and make them understand the career development opportunities available. Agree a career and development plan - and make clear the investment that you’re willing to make to get them there, so they’re equipped with the life-long skills they’ll need to succeed long term. Promote people regularly, so they feel like they’re making progress in their lives. After all, feeling static and stale is one of the number one reasons people will look outside your business for other opportunities.
‘Money can’t buy’ experiences
Humans are a funny old species. What motivates and feels like a reward to one person can be different to the next. For some, you just need to dangle them a bundle of $20 notes to get them to aim higher. But most people are more complex than that. In today’s TikTok, Instagram and Facebook crazed world, what people want most is opportunities to show-off unique experiences, especially exclusive or special ones that ‘money can’t buy’. With that in mind, think about special or very unusual rewards that would mean the world to your people. Instead of a cash bonus, what about concert tickets to their favourite act, complete with a meet and greet backstage. This could be life changing stuff! To go a step further - give employees rewards that they get to share with their immediate or wider teams. In return for smashing this month’s sales target, they get to host afternoon tea with their whole department. ‘Judy from Sales’ will feel as proud as punch as she pours tea and serves scones, finger sandwiches and the most delectable cakes.
Rewards often taste sweeter when they can be shared - and the public nature of this recognition makes the recipient feel special whilst allowing colleagues to join in the fun (and driving THEM to push to get their own special productivity reward). Be creative - nothing should be off the cards.
There’s nothing more exciting than a new laptop or a bag of swag
You’ll be amazed at how gifts at work can make people feel special. LinkedIn is full of photos. You know the ones; where people show off their new iPhones, Airpods and that extra special laptop. Make gifting personal, thoughtful and not wasteful. You can truly make somebody’s day, week, or month by sharing a carefully thought out gift, with a hand-written note explaining why their performance was so special. From time to time, special gifts like a new laptop or tablet can turn even the most cynical employee into a raving fan! It’s not just about the big ticket items. Think about small gifts like a tray of personalised cupcakes that can be shared around the office. A coffee gift-voucher with enough money on it so they can treat the team to a round of lattes. Or a gift card that lets them treat themselves or their loved ones. Branded company swag also works well - we just think that if you are going to give merchandise, try and keep it thoughtful, useful and sustainable. Nobody wants to be gifted something that they would normally get in the office as a matter of course. “Here Steven - we’re really impressed so here’s a notebook featuring our company logo.” That’s going to go down like a lead balloon. However, a bluetooth speaker that they can take to the beach is certainly going to be memorable and gratefully received.
Time off and flexible days
For some people, the perfect reward for higher productivity is more time off to spend with friends and loved ones. Can you imagine how much more motivated people would be if they knew they had a chance to win extra days off. Weekends could turn into long weekends. Extra quality time for rest, wellbeing and personal development can be the perfect reward for hitting targets and for those who truly live the values of the organisation. Whilst this may not be possible in every industry, if you can make it happen, prepare yourself for thankful employees who recognise that they have an understanding compassionate employer who really understands their needs.
Share options
The ultimate incentive and reward for an employee is the opportunity to become a partner in the business, sharing in the company’s future growth and success. When you have share options, you are truly invested in the future performance of the business and have a real tangible stake in maintaining productivity and high performance. In the future, should the business be sold or receive outside investment, employees will receive the value of those shares. Share options are a real incentive to stay; after all they are only granted to people if they are still employed at the time of the business event (e.g. the round of investment, IPO or buy-out). At the end of the day, people are motivated to build for their future and that of their children. The prospect of being granted share options gives people a real reason to commit for the long term, sealing their loyalty. Those with share options tend to push hard, become ambassadors of the business and are likely to motivate those around them. After all, the more successful the business, the greater the value of those share options in the future.
In Conclusion
As business leaders, we want to give our teams a real incentive to push themselves to the highest possible levels of performance and productivity. By using a mix of incentives and rewards across the organisation, you’ll engage your people in a way that’s motivating and relevant. Through active engagement and performance evaluation, rising stars can be given the added challenge and responsibility that will bring out their best. There’s no one size fits all strategy for rewarding your people, so test a mix of approaches and feel free to reach out to us with feedback on the ideas suggested above.
