5 Ways to Incentivize Your Employees to Grow Revenues and Profits
A successful business is nothing without its employees. However, far too often businesses fail to incentivize their team and recognize them for their efforts. Unfortunately, this can lead to poor performance and an increased turnover rate.
Implementing an incentive program at work is a cost-effective way to generate revenue and boost employee morale. In fact, studies show that incentive programs actually boost employee performance by 25-44%. While you may not be able to offer on-the-clock nap times like Google, there are several ways you can incentivize your employees to grow revenue and profits. Let’s explore them below.
1. Recognize Employees for Their Efforts
The most effective - and easiest - way to encourage your team is to recognize them for their efforts, particularly when they go above and beyond the typical scope of their employment. Recognition in the workplace, whether it be in a one-to-one conversation or in front of the team can have numerous positive effects on an employee’s productivity. When an employee is recognized for their work, it confirms that their employer sees value in what they bring to the table. In turn, they will be more likely to go above and beyond and work harder to meet their designated goals.
While there are scientific reasons as to why people work harder once they’re recognized, the bottom line is that people like to be rewarded for their actions. When you’re recognizing your employee, remember to provide specific examples of what they did to earn the recognition. This will motivate them to continue this behavior moving forward. You can also show your token of gratitude by taking them out to a company-paid lunch, giving them a thank-you note, or sending an email blast to the whole department.
2. Provide A Good Work-Life Balance
In the era of COVID-19, employers have to be more cognizant of the importance of providing their team with a good work-life balance. While it may seem harmless to shoot a text message to your employee after work hours or on the weekend, it can be a sign that you don’t respect their personal life. The COVID-19 pandemic made having an appropriate work-life balance difficult; A study conducted by staffing firm Robert Half found that 45% of the remote employees surveyed worked longer hours than they did before the pandemic began.
While it’s easy to assume this had to do with the limited opportunities for travel and activities, it highlights how the dynamic between managers and their employees shifted over this past year. If a manager is working into the evening or on a weekend and needs help, they might contact their team members for assistance, ultimately breeding an expectation that employees have to be accessible 24/7. This is why business managers need to implement a schedule that allows for flexibility, while also adhering to their employees’ boundaries. By allowing employees to work remotely if they can’t come into the office, setting strict work hours that discourage after-hours communication, and providing ample PTO, business managers can see an increase in employee morale, productivity, and motivation - not to mention flexible work schedules are a big selling point when it comes to onboarding new team members.
Profit-sharing gives employees a percentage of the company’s annual or quarterly earnings, which is why it ranks as one of the most beneficial incentive programs among employers. When employees have a stake in their company’s success, it incentives them to work more efficiently and productively because their success is directly tied to the amount of additional revenue they will receive.
While the percentage employees receive is up to the company’s discretion, this is a great way to ensure that your team is incentivized to work efficiently and go the extra mile to meet the company’s goals.
4. Free Vacations and/or Getaways
Companies that offer free vacations and/or getaways to employees who reach certain milestones can be incredibly beneficial. Vacations are essential to our mental health, with those who take them often exhibiting lower stress levels and increased motivation to achieve their goals. However, vacations aren’t always feasible due to financial constraints and other non-work-related responsibilities. With this type of incentive, you’re not only offering employees an opportunity to get away and recharge, but you’re offering them one that’s not coming out of their pocket.
While flipping the bill for employee vacations is certainly costly, the benefits of it can’t be overstated. According to a study conducted by the Incentive Research Foundation, travel incentives not only breed “healthy competition,” but they’ve been linked to a 112% increase in sales. Furthermore, employees who can snag this reward often stay at their company longer, which means less turnover rate and recruitment/onboarding expenses for you.
While this all sounds fine and good, you have to be careful about this type of incentive program because it could lead to a toxic workplace environment if certain employees fail to meet the threshold. One of the potential problems with incentive programs like this one is that it could cause employees to work against one another as opposed to together.
5. Wellness Programs
Implementing a wellness program incentive can be a huge selling point for companies combating the COVID-19 pandemic. In 2020, approximately 50% of all US employees were concerned about exposure to the novel Coronavirus. With rising Delta cases and loosened restrictions, employees’ concerns about returning to work are bubbling back up. In many ways, this is the perfect time to roll out a wellness incentive program.
Incentives in a wellness program often include discounted insurance rates, access to mental health care services, and/or a lower deductible or co-pay. This type of incentive program shows your employees that you value them and their mental and physical well-being. As mentioned above, incentives that improve employee well being have a positive impact on an employee’s attitude about the company. Plus, employees will prefer staying at the company if they’re paying a lower insurance rate or co-pay.
Employee fringe benefits such as health insurance are a key component to employee satisfaction and retention rate. A survey conducted by Clutch found that 53% of employees surveyed cited health benefits as one of the most important aspects of their overall satisfaction with their employer. However, fringe benefits include much more than health insurance. In fact, they can cover everything on this list.
While most fringe benefits include tuition assistance, life insurance, and retirement plans, anything that can boost employee morale such as having a dog-friendly office or offering free tacos every Tuesday can be considered a fringe benefit.
How to Implement an Incentive Program
When it comes to implementing an incentive program that WORKS, you need to tie it to a measurable goal. In other words, you need to have the desired outcome that deserves the reward. Second, you need to keep your word otherwise you risk employee mistrust and decreased morale.
Here are a few tips to help you successfully implement an incentive program at work:
Make sure incentives have long-term benefits
Be transparent about what the incentive program includes, who qualifies, and how it works. Never leave anything up for interpretation.
Ask your employees what they’re concerned about or would like to see in a potential incentive program. The best incentive programs include rewards that your team genuinely wants (or needs). Taking your team’s concerns into account can help them to feel valued.
Offer incentives that foster teamwork and collaboration as opposed to those that can solely be achieved on an individual level.
Determine Which Incentive Works For You
While these are all certainly good places to start, this is not an exhaustive list. When it comes to determining which incentive works best for your company, you have to listen to your team and decide how much you can afford. A small business owner isn’t going to be able to pay for vacations for his or her staff, whereas a larger company with more resources may be able to.
Remember, incentive programs can be customized to fit your company’s budget and resources. If you’re not sure where to start, the team at Equiturn Business Solutions can help. We offer an array of business solutions for small, large, and mid-sized companies. Contact us here to get started.