Motivation Through the Right Incentives

Let’s consider a case history: The company has asked two departments to computerize their paper files. In department A, the change goes smoothly with everyone pitching in to help. In department B, the process drags out, chaos ensues, and everyone starts pointing fingers. What motivated team A, but not B? The right incentives.

The first question anyone asks when confronted with a change they didn’t request or a task they never anticipated is “why?” Even the best incentives fail if the “why” is unclear. But truly great incentives begin even earlier, with your own expectations and definitions of rewards.

The right incentives for your team:

Take into account that people want to succeed. Everyone has intrinsic motivations, personal goals that press them on. For example, a recent survey of over 1400 employees at 310 workplaces found that over a third of employees leave jobs because of a lack of career growth and a lack of support from their managers. Other reasons that frequently come up in surveys are underappreciation from the manager (a simple “thank you” qualifies as appreciation), the lack of connections with other employees, low pay, and the common stressors of overwork, long hours, poor communication, and company failure.

If you withhold incentives because people should be doing their jobs anyway, you are ignoring this basic need to grow, be appreciated, and a member of something large than one’s self.  You are, in fact, creating the disengaged and unmotivated workforce you fear.

Match your company goals. Is the company interested in quantity or quality? Does it want to increase customer satisfaction or decrease customer complaints or both (improving one does not necessarily improve the other)? Is the primary financial goal profit or cost savings? The right incentives reward people for achievements that matter to the company and hopefully will matter in some way to the team.

TIP: One of your goals should be an incentive program that is easy to understand. Complex requirements for eligibility, performance assessment, and size or type of reward frustrate and stress employees instead of motivating them.

Are the right incentive for each person. During the interview and your onboarding process, you might ask a new employee what drove them to excel at their past job, what part of their job they enjoy the most and their career goals. Gain some insight into how they like to be managed (more direction, feedback, or independence, for example) and what motivates them. When it comes time to offer rewards, you might offer a variety: a gift card, vacation day, certificate of appreciation, or chance to accompany the team to the next trade show, for example. Not everyone values a 5-year pin.

When you gain a reputation for offering the right incentives, goal-reaching increases, turnover decreases, and more talented people want to join your team and your company. A team that regularly meets its goals is a testimony to you as the team leader.

Are tied to a clear goal. Your team needs to understand the goal you are working toward, and incentives must align with that goal. SMaRT goal setting is an agreement between you, your team, and the company around a purpose and the results desired.

For example, if your goal is to computerize files, then you must make it clear why that change is important both for the company and for the team. What benefits will ensue? What problems will be eliminated?

It’s equally important to listen to your team when they react to that goal. In our example, team A complained about the time it took to find old files and organize new ones. Team B, however, was used to the paper system, had a person dedicated to organizing and maintaining them, and was never trained in the new software.

You need an acceptable reason why you and your company’s goal should overrule the team’s preference. You need to address the objections because most people raise obstacles to change or to a decision not through obstinacy but through the genuine concern.

Are realistic and doable. No one benefits when a team leader reneges on an incentive, whether that is more pay, time off, better software programs, more training, or more comfortable workstations. Broken promises and broken trust are remembered the next time someone is asked to help. Moreover, incentives must be applied fairly and uniformly—so that, for example, you do not excessively reward an underachiever or disgruntled employee for a small improvement when everyone else has been happily overachieving all along without any reward.

TIP: Don’t neglect your average performers. Multi-tier incentives reward the top performers but give the average performers a stretch goal. 

Are tied to measurable results. Unless you measure the results that you aim for, you will never know whether your incentives are working to motivate your team. You may find yourself in an endless and expensive loop of offering the wrong incentives to achieve the wrong outcomes.

In our example, let’s that computerizing files were supposed to increase customer confidentiality. If team B refuses to shred the old paper files, then confidentiality is still compromised. So one criterion for success might be that team B shreds 100% of its paper files as soon as the software has been up and running for one month.

Are attached to a due date. “As soon as possible” is not a due date but an invitation to put off change as long as possible. Due dates should be realistic and agreed on by both parties, but they should be exact, and they should never pass without remark. Regularly meet with your team to discuss progress and anything that is impeding progress, express concerns, and share strategies—and express appreciation.

TIP: Present rewards as close in time as possible to the moment of achievement, so the connection is clear. If you save up all your thanks until the end of the year, you are likely to overlook someone; and the long wait for recognition decreases your team’s motivation. 

Have both financial and non-financial elements. Financial incentives are appreciated, but so are appreciation, opportunities for professional growth, and better working conditions.

Among the top nonfinancial incentives are celebrations (a team lunch, for example), leadership training, more challenging work, an award or a shout out on social media, your time and mentorship as the team leader, and flexible scheduling.

Make sure you know what the team being rewarded values most at that time. A gold cup for a team that has been stressed and burned out by overwork—and expects to be again—will fail to provide motivation.

Conclusion

The best incentives are tied to a clear, realistic, and measurable goal, have both financial and nonfinancial elements, represent value to the individual, team, and company, and motivate each person in the way they most appreciate. Under the pressure of reaching a goal, a team leader may forget that setting goals cooperatively is different from driving them—and that the wrong incentives may be worse than no incentives at all. If you have difficulty creating incentives that work for everyone, reach out to a professional coach for help.