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Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
Employee Rewards Programs: The Formula for Successful Rewards
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Employee Rewards Programs: The Formula for Successful Rewards

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Matt Lundy is co-owner of Rewarding Events & Incentives (REI), a full service incentive agency specializing in the creation and fulfillment of programs to motivate and reward employees, customers and …

Matt Lundy is co-owner of Rewarding Events & Incentives (REI), a full service incentive agency specializing in the creation and fulfillment of programs to motivate and reward employees, customers and distribution channels. for achieving specific goals. Rewarding Events & Incentives was recently announced as one of nine SBA award winners in Louisiana for 2009 .

A graduate of St. John’s University in NY, Mr. Lundy is very active in the local business community, serving on the Boards of both the Jefferson and River Region Chambers of Commerce, and is a member of HRMA New Orleans, the Louisiana Technology Council (LTC), the St. Charles Business Association and Entrepreneur’s Organization (EO).

The presentation will cover how you build a budget, common mistakes and how to avoid them, selecting the right reward option for your program and more.

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  • 1. Employee Reward Programs: The Formula for Successful Rewards
    Presented by Matt Lundy
    Rewarding Events & Incentives
  • 2. INCENTIVE Definition
    • That which moves or influences the mind, or operates on the passions.
    • 3. That which incites, or has a tendency to incite to action.
    • 4. An additional payment (or other remuneration) to employees as a means of increasing output.
    • The action of recognizing or the state of being recognized.
    • 5. Special notice or attention
    RECOGNITION Definition
  • 6. RECOGNITION
    • Thanks for doing “x”
    • 7. Occurs after the fact
    INCENTIVES
    • IF you achieve “x” , you’ll earn “y”
    • 8. Occurs before the fact
    INCENTIVES vs. RECOGNITION
  • 9.
    • Last year American companies spent $50,000,000,000 on merchandise and travel incentives and that doesn’t count the monetary payouts that are untrackable.
    • 10. “There is a direct link between employee satisfaction and customer satisfaction, and between customer satisfaction and financial success”
    The Science Behind Incentives
  • 11. Maslow’s Hierarchy of Needs
  • 12. The Bell Curve
  • 13. Productivity Gains
  • 14.
    • 99% of employees say it’s important to be recognized for good work(Websurveyor, 2002)
    • 15. 85% of employees feel overworked and underappreciated (Dr. Robert Cooper, 2005)
    • 16. 75% of employees say they could be more effective in their jobs (Public Agenda Forum, 2004)
    • 17. 70% of unhappy customers abandon vendors because of poor service(Forum Corp, 2003)
    NUMBERS THAT MATTER
  • 18. Any aspect of your business…
  • 23. What you
    re-enforce is
    what you get
    Incentive RULE # 1
  • 24. STEP 1: Identify Objectives
    STEP 2: Define Target Audience
    STEP 3:Build Your Budget
    STEP 4: Develop Program Structure
    STEP 5: Designate Program Administrator
    STEP 6:Select Rewards and Presentation
    STEP 7: Promote The Program
    STEP 8: Track The Program
    STEP 9: Distribute Awards and Celebrate Success
    STEP 10: Evaluate and Communicate Results
    The Process
  • 25. 1) Incentive programs do not reward
    expected or average performance.
    2 ) You only reward achievement of
    specific, measurable goals.
    Have to measure
    Have to be specific
    Budget Foundations
  • 26. Upfront Costs
    Program Launch Event
    Communication Pieces, mailers/posters
    Promotional items
    Dedicated website
    Ongoing Costs
    Program Administration
    Ongoing communications
    Rewards
    More than Rewards
  • 27. An incentive program is funded by extra profit from increased sales or cost savings.
    In essence, you are trading a portion of the additional profit that you currently do not have. You are giving up a piece of future earnings that you hope to achieve.
    What does self-funding really mean?
  • 28. Look at your best employee in that job/role
    What makes them your best?
    What are the measurable characteristics?
    That “best” person should be your highest rewarded employee in a well designed program.
    Not sure how to Quantify?
  • 29. What you
    re-enforce is
    what you get
    Incentive RULE # 1
  • 30. Objective vs. Subjective
    Objectively. . .
    Company goals
    Payout rates
    Return on investment
    Budgetary constraints
    Subjectively . . .
    Is the earning opportunity significant enough to generate the desired results?
    Is the program the right length to achieve the goals and hold participant interest?
  • 31. Open End
    1) Unknown number of potential winners
    2) Anyone who “hits the goal” gets rewarded
    3) Hard to budget for / maximum impact
    Closed End
    1) Known number of potential winners
    2) Only top “10” get rewarded
    3) Easy to budget for / less impact
    Open End vs. Closed End
  • 32. Dilbert
  • 33. 1) What do you expect to attain in incremental dollars? (This is from increased sales, improved safety (lower insurance, time loss etc.)
    2) Assign a percentage of that to pay for the incentive program; 10 - 40%, depending on the program.
    3) Of that, a traditional breakdown would be 5-10% for administration, 10-20% for communication and launch, and the remainder for rewards.
    Nuts & Bolts
  • 34. If your program is longer than six months, reward potential should represent between 6% and 10% of a participant's salary.
    If your program is shorter, say 60 to 90 days, consider providing participants with the opportunity to earn rewards valued between 3% to 5% of their salary
    Traditionally…
  • 35.
    • Your program = your rules
    • 36. You balance the reward vs. the increased productivity or cost savings
    • 37. Good programs pay for themselves
    • 38. No achievement of goals = NO payout
    • 39. The budget is already there in most cases, it’s just going to an insurance company or lost in low productivity
    The “Cost” of Incentives
  • 40. Some art, some science
    Look at your demographics, what works for your culture and audience?
    If you ask people what they want they will tell you 100% of the time - they want money.
    They say money, because they really want the choice of how to spend it.
    Picking the right rewards
  • 41.
    • Research has demonstrated repeatedly, cash rewards don't motivate extra effort
    • 42. Cash is thought of as compensation and is spent on necessities. 
    • 43. In a recent survey people were asked how they spent their last cash reward. The top 4 responses were:
    • 44. Bills - 29%
    • 45. Do not remember - 18%
    • 46. Never received cash reward – 15%
    • 47. Household items - 11%
    • 48. CASH HAS NO VALUE TO THE SPONSORING COMPANY
    MONEY
  • 49. Money
    Stored Value Cards
    VISA or AMEX Cards loaded once with a specific dollar value (use it and lose it)
    Custom VISA Cards that are reloadable
    Restaurant and Retail Gift Cards
    Merchandise
    Brand Name
    Imprinted / Promotional Merchandise
    Travel
    Reward Options
  • 50. Tough to change that
    Custom debit cards
    Keeps funds out of the checking account
    They see your name when they spend the money
    If you are giving Money…
  • 51. No Fee Gift Cards
  • 52. MERCHANDISE
    Visibility of the reward – every time you use it you remember where it came from
    You can brag about merchandise while it’s not cool to brag about $$
    Stronger link to sponsor company than something you went out and purchased
    Online Catalogs today that are totally customizable
    Choice is critical to participants
  • 53.
  • 54. Great reward - creates memories and unique experiences for participants
    I saw grown men turn into little boys at the Superbowl and the Masters
    Drawbacks are that they are expensive and take your top performers out of the office
    Also fewer companies want their top performers in the same place or on the same plane
    TRAVEL
  • 55. Cash – covered that
    The Contest with 1 or 2 winners
    Group goals w/o individual element
    Unrealistic Goals
    Goals set w/o employee input
    Was the reward worth the effort?
    Who got to choose the reward?
    Gray areas – subjective calls
    Failure to communicate
    Common Mistakes
  • 56. Were the rules of the program communicated effectively to the participants? Everybody enrolled in the program must know precisely what's expected of them during the course of the program.
    Did you keep your participants aware of their progress throughout the program period? If not, they probably lost interest somewhere along the way. Participants tend to contribute extra effort when they know they're close to a reward.
    Communication
  • 57. Communicate – talk to your employees
    Do they have what they need?
    Is there a better way to do their job?
    Are all existing programs aligned with company goals?
    Do employees know your company goals?
    Do employees know their part in the whole?
    Survey them - Small companies are terrified to ask, because they may actually have to do something.
    Things you can do today
  • 58.
    • Process Improvement / Safety Committees
    • 59. Titles – Director of first impressions
    • 60. SME – subject matter expert
    • 61. Mentors
    • 62. Time Off / Flex time
    • 63. Sports Tickets
    • 64. Day at the Spa
    • 65. Sponsor company teams – bowling, volleyball, softball etc. team building outside the office
    • 66. Golf Tournament Sponsor – Invite top performers or customers
    Recognition – Make it Public
  • 67. OFFICE SPACE
    Peter Gibbons: It's a problem of motivation, all right? Now if I work my butt off and Initech ships a few extra units, I don't see another dime; so where's the motivation? And I have eight different bosses right now. So that means that when I make a mistake, I have eight different people coming by to tell me about it. That's my only real motivation - not to be hassled; that, and the fear of losing my job. But you know, Bob that will only make someone work just hard enough not to get fired.
    So if you are getting this…
  • 68. But Really want this…
  • 69. Increased Sales
    Increased Loyalty - Reduced Employee Turnover
    Increased Safety
    Process Improvements Implemented – costs savings
    Improved Customer Service Ratings
    Better Trained Employees
    Employees who treat it like their own business
    Benefits of Incentives
  • 70. It costs between 5 and 7 times more to find a new customer than to retain one (S&MM, August 2006)
    A 5% reduction in lost customers can increase profits by up to 75% (S&MM, August 2006)
    Domino’s Pizza and Ford Motor estimate a loyal customer is worth $5000 over 10 years, and $142,000 over their lifetime (S&MM, August 2006)
    67% of consumers change their place of business for little or no reason (S&MM, August 2006)
    Customers
  • 71. quick and easy things
    Referral Program
    Robust POS system can create your own gift cards.
    POS can track customers purchases
    Send a personal hand written thank you
    Customers
  • 72. “There is a direct link between employee satisfaction and customer satisfaction, and between customer satisfaction and financial success” – Forum Corp. 2005
  • 73. CULTURE SHIFT
    Show of hands, how many of you have any of
    the following?
    Winn Dixie or Save a Center card
    Frequent Flier clubs?
    Points on credit or debit cards
    Points on Hotel stays
    Points on Car Rentals
    Points on Starbucks
    So do your employees

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