To revolutionaries in the Incentive Industry, such as Ben Thompson, CEO of Power2Motivate, the conventional business approach to R & R is no longer feasible, nor should it be advocated. ‘Now, more than ever before with the economic constraints those businesses face, the incentive industry needs to take a long hard look at the way it charges its clients. With businesses seeking to drive their dollar further and find value in their reward initiatives, providers that charge exorbitant fees for system related externalities are doing wrong by their clients’ states Thompson. ‘Our industry needs be adaptable and move with the times. No longer is the traditional business model of R & R at all acceptable; providers need to be savvier in what they take to market and how they partner with organisation’
There are murmurs of change occurring in an industry that has up until now largely stuck to a system/consultative fee structure. The revolutionaries are developing substantially more attractive and cost-effective ways for organisation’
Whilst the incentive industry is in need of an overhaul of its business approach; the value of reward and recognition as a mechanism for effecting positive behavioural change in employee and customer cannot be denied. In the United States, the incentive industry is worth approximately $46 billion and in Australia the industry has grown substantially to an estimated $2 billion. The incentive industry is becoming more and more legitimate because well organised employee and customer loyalty programs work. They are proven to enhance employee performance and engagement, and improve consumer loyalty with the Incentive Marketing Association indicating that incentive programs in the workplace lead to an average increase in performance of 22% per employee when compared with non-incentivised employees. What is also clear to those in the know in the incentive market is that there is a burgeoning number of incentive programs which are non-monetary orientated, using gifts as a way of further amplifying the productivity and loyalty of reward recipients.
The power of non-monetary rewarding cannot be underestimated. In a major study prepared for the Forum for People Performance Management and Measurement in late 2005 it was determined that non-monetary reward tactics in the context of employee incentivisation faired better than cash-based structures across a number of organizational objectives including customer service, teamwork and employee retention. The reason for this is simple: cash based rewards are not tangible nor motivating for a lengthy period of time, as they are easily forgotten by the recipient when placed on the mortgage or used to pay things like the mobile phone bill.
Thompson supports the power of non-monetary rewarding, and believes that there are psychological reasons for its greater legitimacy on the R & R map. ‘More and more organizations are realising that people react positively to being recognized by their Manager’s for the good things that they do. It gives them a sense of purpose and a feeling of being valued whether they are an employee or loyal customer. But there is more to it than that. Non-monetary rewards are additionally beneficial in an emotional sense as the recipient is motivated by something more intrinsic than just monetary gain or income; they are inspired to achieve something tangible and memorable. This kind of inspiration adds to the feel-good factor around the reward initiative, which lifts performance and loyalty even further’.
Few savvy companies in the incentive market have entrenched non-monetary rewarding into their service offering. Those that have however, such as Power2Motivate, offer a points based approach to reward and recognition with extensive functionality including peer to peer and spot recognition, as well as the additional benefit of an open rewards gallery that allows reward program participants to choose their gift. The offering of choice in reward, Thompson argues, is of paramount importance in the world of non-monetary rewarding. ‘Every individual has differing wants and needs from the next. Not every individual will be excited by the prospect of winning dinner at a leading restaurant such as Tetsuya’s, some people are meat pie lovers. Understanding this, offering selection in reward as part of an incentive initiative heightens the value proposition to participants. They can work towards their ultimate goal’.
Furthermore, smart providers with a SaaS offering have managed to incorporate into their system-free incentive platforms additional functionality including e-learning and automated sales measuring. The unification of e-learning and reward and recognition excite Thompson. ‘I recently read an article which found that 80% of e-learning undertaken by employees is not completed. So businesses that are investing in learning and development are not getting the desired outcome, a more skilled and better trained workforce. Knowing this, it just makes sense to incentivise and motivate learning completion by offering reward for completion of learning outcomes, as more people will take up and learning opportunities and see it through’.
The revolution in R & R is on the doorstep, led my clever people such as Ben Thompson and the team at Power2Motivate, who have done away with the unnecessary system costs often associated with online non-monetary reward programs. Organisations who are not accessing a system that comes with no administrative and IT development costs, nor are accessing a system that has fully integrated additional incentive functions such as peer to peer rewarding, e-learning and automated sales measuring must question the motives of their provider. The benefits of all of these elements of R & R are well publicised. In current economic times it makes sense to seek out systems that allow for the highest levels of investment in program participants. Such systems do already exist and are the way of the future. Viva La Revolution.
