If you’re wondering how to reduce turnover and make your employees more satisfied at their jobs, look no further than implementing a company incentive program. However, just having an incentive program in place doesn’t automatically make it successful — the key to doing so is ensuring that you offer incentives that your employees actually want. This effectively motivates employees to continue to show up to their jobs happy each day.
Today, we will share more information about how employee incentive programs work. The great news is that there’s something for every company, so you can pick and choose which you’d like to enact in your business. Employee incentives programs are a great way to boost employee morale and reward employee performance.
We’ll share types of employee incentives, the best practices, and finally, ways to incentivize and reward employees. To kick things off, let’s walk through the three types of incentives you should know about.
There are three main types of incentives you can offer employees to bolster satisfaction and keep your team members at their job for a longer period of time. Reward employees with cash, gifts, and experiences.
While these are similar, you may find that your organization tends to prefer one over the other. Alternatively, you may allow employees to select which type of incentive they would like to receive.
Let’s dive deeper into these three different types of employee incentives.
You may be familiar with the saying ‘cash is king,’ and when it comes to employee incentive programs, that often rings true. Cash incentives are exactly what they sound like: offering additional compensation to employees with outstanding achievements.
For instance, if your sales team reaches a certain quota, you may offer them a $1000 cash bonus. Or perhaps you reward your team members with a $5000 bonus once they’ve reached five years with the company.
Whatever the case, the reasoning is the same: you are using cash rewards as an incentive to keep people in their roles.
And just as some employees prefer receiving cash incentives, others would rather receive a well-timed gift. Gift incentives are attractive because they may cost less in the long run than cash does.
The gift doesn’t necessarily have to be huge or complex — it can be something as simple as sending a branded backpack to your team as a reward for a job well done this quarter or a quarter-zip featuring the company’s logo to your team members once they’ve surpassed the one-year anniversary mark.
Lastly, there’s the option to implement an incentive program centered around experiences. Within this category, there are two subcategories. Do you want to offer your employees an experience at work (such as a pizza party for a successful quarter), or do you want to give them an out-of-office experience, such as going to an amusement park and giving them a paid day off and tickets?
Experience is a highly effective incentive because people will create lasting memories thanks to this incentive. Whenever they look back on the experience, they’ll fondly remember the company's role in bringing it to fruition.
Now that you know the different types of employee incentive programs, let’s dive into the best practices you should follow when setting up your own.
Once you’ve decided you’d like to move ahead with the employee incentive program, set a budget where you can allocate how much you will spend on your employee incentive program. If you have to pass this budget by senior management, you can provide a list of why investing in employee satisfaction is worthwhile.
To gauge the success of your incentive program, it is necessary to set goals. What are you aiming to achieve by implementing this employee incentive program? Is there a certain percentage you’d like to reduce turnover by? Do you want employees to report higher satisfaction levels thanks to employee rewards?
It’s necessary to involve employees. Suppose you continue to invest in incentives that don’t appeal to your team members. In that case, you’re throwing away money that could be reallocated to providing employees with the incentives they need! Get feedback on what incentives resonate with employees and which do not.
Furthermore, by getting employees involved, you’re making a statement that their opinions on the incentives matter, which could boost your connection with the team. Employees that are listened to feel cared about, and employees that feel cared about stick around.
You’ve learned more about the different types of incentives and the best practices for rallying employee engagement with your incentive program. Now, it’s time to discover some of the unique ways you can incentivize employees.
Is your team passionate about a particular professional development opportunity, such as a yearly conference? Send the team (or at least a few representatives) to show that you're committed to their growth. Alternatively, you can offer employees the opportunity to take an online course to improve their skill set.
Remember that sales team example we gave you before? It’s an excellent demonstration of what incentivizing hard work looks like in practice. If you show your team that you’ll reward them for going above and beyond, they’re more likely to do so with a smile on their faces.
If your company has multiple branches, commit to prioritizing interoffice camaraderie by having an annual mixer or meetup where people can mingle with colleagues they may have never met. This encourages employees to get to know the peers they don’t engage with daily. The result is a more connected workforce.
Make it easier for your employees to take care of themselves with a robust lineup of health and wellness incentives. You could offer yoga classes in the office if you’re hybrid or in-person, or you can offer remote employees a virtual course. Alternatively, you could give employees an incentive for taking care of themselves.
If you are a purpose-driven organization, it is excellent for employee morale to offer team members the opportunity for paid time off for volunteering. This reveals to employees that you care about giving back.
Having paid time off is great, but what’s the use if your employees are uncomfortable requesting their days? By setting a mandatory minimum paid time off, your company is going beyond simply encouraging time to rest — you’re requiring it. This could help fend off employee burnout.
If your business asks employees to return to the office, providing commuter benefits effectively demonstrates how much you care for employees’ well-being. Commuter benefits are an excellent way to make commuting easier for team members.
If you want your team to perform exceptionally well repeatedly, show them that you’re willing to compensate them with incentives if they do so. By giving tangible rewards for meeting quarterly goals instead of a shoutout or pat on the back, the team is more likely to perform well.
Keep employees around by offering perks they can only get the longer they are in their role. For instance, some companies provide additional vacation time the longer you’ve been with the team or a paid week of vacation. Whatever your company offers, make sure it’s compelling enough to motivate employees.
By offering tuition reimbursement, you show team members that you want to invest in their professional growth and are willing to put your money where your beliefs are. This could boost employee satisfaction as people can get another degree or certificate that they may not have been able to pay for otherwise.
Profit sharing is an effective way to ensure your employees feel invested in the company — just as invested as the leadership team is. Profit sharing can help employees feel they have a stake in the business.
Offering additional time off in case an employee needs it is a powerful way to demonstrate to them just how important they are to you and the rest of the team.
Few things make employees quite as excited as getting a raise or bonus. By offering this to them, you can boost the chance they’ll stick around because they know that financial growth is possible with the organization.
Offering a mentorship program is another effective way to show your employees how dedicated you are to their growth. Whether virtual or in person, allow your employees to meet with mentors that show them the possibilities of growth at the organization.
If you’re looking for another way to boost camaraderie, entertaining is an excellent way to do so. If your company can bring in a stand-up comedian or singer to perform at a yearly function, this could work wonders for incentivizing employees to stick around and enjoy their job.
No one wants to spend time out of the office sick, so offering unlimited sick time is an excellent idea. This helps ensure that your employees don’t have to use their PTO on days they’re under the weather.
The cost of working from home adds up — between office furniture needed to create a relaxing and workable space, the amount of WiFi each month, to the purchase of other supplies you’d have access to in a traditional office space. A work-from-home stipend can incentivize employees to create a space that enables them to do their best work.
An end-of-year function is perfect for boosting employee morale and reminding the team why they love working at your company. Be sure to provide food, activities, and all the things your employees love!
The longer your employees are with the company, the more they should get. The idea of a retention bonus is to give employees monetary incentives for sticking around. They’ll love getting extra money in their paycheck, and you’ll love less employee turnover.
Employee incentive programs help retain good employees and keep costs associated with onboarding folks down. If you’re ready to learn more about how you can create an employee incentive program your team loves, sign up for a free demo with Bucketlist.