Business Motivation: Key Issues
Every target audience has its own considerations, as you will see on this Web site, but motivating them have 10 key steps in common. Any external or internal marketing strategy whose costs can vary based on performance warrants careful consideration, since few other marketing or management strategies afford this level of financial accountability. In many properly structured programs, your costs reach budget only if your performance does too.
1. Strategic planning: Many companies do not approach their incentive programs with the same discipline they apply to other strategies. This is not a simple do-this, get-that proposition. If you wish to get the most measurable results out of your program, you will want a written plan with clear goals, measurable objectives, and with a clear plan of action. The process should also involve laying the groundwork for measuring results against clear objectives.
2. Involvement: Your program will fare better if you listen to the people whose behaviors will have to change. Many companies overlook this critical step to identifying obstacles or opportunities related to goal accomplishment.
3. Program structure: Planners have two basic options: Open-ended programs that reward everyone who achieves incremental performance, and closed-ended programs that reward a pre-chosen number. While closed-ended programs make it easy for planners and the accountants, they generally reward the perennial top performers who’d accomplish their goals anyway. Today, many programs combine elements of both.
4. Communication: Many organizations overlook the essential need to make sure people understand overall objectives, their specific objectives, and how their efforts contribute to the whole. This process should include an enrollment step that engages the participant, and then continues with a series of multi-touch messages (via print, e-mail, Web site, etc.) with useful information and reports, so people can see how they’re doing during the course of the program. Many companies use their intranets or a private Web site as a portal to their programs, and include communications, awards, and training information all on one platform. Awards and promotional products play a key role in communication, because they help get attention. Incentive programs work better if people know about them and what they can do to accomplish the goal.
5. Training: No incentive in the world can make someone do something they are incapable of doing. The involvement and planning process should detect the knowledge or skill deficits standing in the way of success and include a clear plan to address them with in-person training, print communication, or on-line training. Incentives and recognition can help bolster involvement in these efforts.
6. Awards: These are the key “media” of your program. They convey your organization’s commitment to achieving its goals; they create fun, enthusiasm, and a buzz about the program; they help break through the communication clutter; and they make a statement about your company’s own brand. Organizations should approach award selection with the same care their advertising agency would take with any media selection – understanding the role these powerful motivators can play in the success of the program, whether you are using merchandise, travel, gift cards, or recognition.
7. Measurement: Since most incentive programs are highly targeted at a specific audience, they have a high potential for measurement. Yet many organizations overlook this step. Those that believe in incentive programs often do it as a matter of faith. Given today’s increased focused on performance metrics, incentive and recognition planners alike will confront an increasing need to justify their efforts. Fortunately, the process for designing programs described in this Web site provides ample ways to meet this challenge. In fact, today’s Web-based incentive program technology makes it possible to get almost real-time performance data so that you can adjust your efforts accordingly before it’s too late.
8. Legal and tax issues: Depending on the audience, incentive programs can involve federal and state regulations, as well as tax issues. Consumer promotions in certain industries such as alcohol, pharmaceuticals, financial services, guns, and children’s products might be governed by certain state, federal regulations, or even industry association guidelines. Channel partner programs can run into lottery laws if they require purchase for participation. Any type of employee program can be affected by union contracts or state compensation and equal opportunity laws and regulations.
On the tax front, it’s important to note that employees have to receive 1099s for awards with a fair market value of over $600, and that a motivational meeting must have a business justification in order to pay for attendee participation without requiring a 1099. A complex set of I.R.S. regulations provide favorable tax treatment for qualified programs to promote safety and productivity. It’s not enough to be ethical and hope for the best; it makes sense to consult an attorney or tax consultant if you have any doubt about any legal or tax aspect of your program.
8. Feedback: One of the great benefits of undertaking a written plan lies in seeing what happens at the end. These programs can provide invaluable business intelligence if you feed it to the people who can put the learnings into action.
9. Administration: As with any other external or internal marketing program, these efforts need tender-loving care. Putting someone in charge of implementing the plan who has a stake in the results can make a huge difference in making sure every element works to accomplish the organizational goals.
