The Power of Incentives and Rewards
How can managers maintain a team that is constantly firing on all cylinders? Goal congruence and commitment to the task at hand is hard to achieve day in and day out. How can you manage a high performance team when energy starts to flag?
In a tight labour market, employers must get creative in order to attract and retain quality staff. The salary package alone won’t do it. Well structured incentives and rewards programs are increasingly an element in the motivation equation.
Let’s be brutally honest. Money talks. The most powerful incentive for the majority of workers is financial. Bonus payments. Additional employer contributions to superannuation. Well targeted financial incentives have the power to motivate and generate higher output from staff.
The key word here is ‘target’. The demographics of each workplace are different. Managers must analyse the profile of their staff and tailor the incentives to suit.
A worker nearing retirement is more likely to be motivated by additional contributions to superannuation than a bonus payment of which half will be lost in tax. Know your staff. The most powerful incentives are those that hold the maximum value for the individual.
Similarly, workers with young families respond to incentives differently from singles. The family-oriented employee may not be enticed to achieve productivity goals if the reward is an all expenses paid holiday to a far-flung destination with colleagues.
Investing in the professional development of aspiring employees is also a powerful incentive. Professional development fosters loyalty to an organisation, builds on the talent pool and has taxation and succession benefits for the business. PD used as an incentive makes good business sense.
Helping staff find the elusive work/life balance is another strategic tool in the incentive sack. ‘Employers of choice’ take proactive steps to help staff manage the competing forces of work and family. These employers recognise the incentive for staff in a workplace with reduced stress levels. They accommodate a degree of flexibility for parents of young children. They allow staff access to greater periods of personal leave. Their ‘lifestyle friendly’ policies are a valuable incentive for employees to achieve their goals and remain loyal to the employer.
The message is to understand your staff and know which buttons to push to motivate them. Get creative and really target your incentives to achieve the maximum effect. Tax effective financial rewards will always wield great power. But in the current economic climate, it’s the non-financial incentives that can sometimes spark the greatest interest in employees.
And managers should also bear in mind the power of job security as an implicit incentive. When the employment cycle turns and the skills shortage is finally addressed, the balance of power in the employment market will shift back to employers. Downturns in economic prosperity inevitably create a more productive and less transient workforce.
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