Company Incentives: Mind over Matter

Some have been lucky enough to be rewarded through a company incentive; others just grind their teeth in envy about how unfair the program is. When one thinks that in an organisation, only a few staff actually get an opportunity to participate, there is a danger that those who miss out could out-number the so-called achievers. Let’s be honest, when you see the 20 “winners” all heading off on that all expenses paid cruise to the Caribbean, what is going on in your mind?

  1. Wow, I am so proud of my fellow workers, and they are geniunly deserved their achievements and reward, or
  2. Oh dear, I really must pull up my sleeves and put in a bigger effort next year, I wanna be like them, or
  3. This is “bulls…t”! I worked my butt off and the system is just so unfair. It’s obviously not what you do but more about who you know that counts.

As a business owner,  we would want our staff to respond as per 1 or 2 but definitely not as in 3.

So how do we ensure our incentives generate positivity across the whole company and not just with a selected few? Here at HiSide Incentives, it’s not just about organising the outcome of the incentive, its more about ensuring the incentive does what it was set out to do in the first place and doesn’t backfire. There are a series of essential checks and balances that we follow to ensure management are keeping their head above water when planning an incentive program.

Firstly, the most important phase of the development of an incentive program is in the BIG WHY?

  1. Why do you need to have the incentive?

The reasons could be many, some short term others longer.

This needs to be discussed, documented, measured and understood by all. If there is any ambiguity at this stage, chaos will prevail! Whatever incentive is put in place, its success or failure needs to be reviewed in respect to these reasons.

  1. Is the qualification for such an incentive objective and fair?
  2. Do those not on the incentive understand why not and are they compensated in other ways that they understand?
  3. What impact will the incentive have on all aspects of the business and how do you deal with this?
    • Other employees and departments
      • Some will be resentful
      • Some will see it as unfair
      • Some will see it as a reason why they don’t get a larger increase

 a. Shareholders

        • Do they see the value is expending their returns on this?


          • They look for a discount on prices they pay, and we can be seen as giving this away to staff for fancy incentives?

d. Overall company performance

            • Look at aspects where performance can be counter-effective on the company
            • Short term profitability vs Customer Relations
            • Short term production vs Poor Maintenance
            • Short term sales vs Customer Relations

Incentives should do what they say, provide impetus to do better. As long as it’s kept that simple,  all is usually OK, however, in the many years of structuring and running incentives, I have seen both the good and the bad effects of both and have learned to approach the subject with a very objectively and with caution. Incentives have a monetary impact, but more importantly,  they impact the mind, something we aren’t experts in!

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