5 Ways to Reward Great Performance
When it comes to attracting and retaining talent, small business owners often wonder how to show their employees appreciation for a job well done. Steve-Strauss-155px-Mirror.jpgThe good news is that there is no shortage of ways to reward great performances, and none of them need to break the bank.
1. Money: It is no secret that money motivates employees; we all know that. Holding sales contests, offering bonuses, dangling raises—these are tried-and-true approaches that are effective.
But these things also beg the question: Why does it take money to motivate an employee? The answer is that the possibility of making more money transforms the employee into an entrepreneur, and entrepreneurship is based on the premise that hard work and ingenuity will be rewarded.
Isn’t that how you think? “If I implement that plan, we could increase sales by 10 percent!” Well, that is precisely what an employee thinks when offered a money motivator. “If I sell more than anyone else this month, I win that trip to Hawaii!” So the secret to motivating with money is to tap into this mindset for mutual benefit:
First, you can always link an employee’s pay to performance. That is exactly how commissioned salespeople work.
Similarly, you could link bonuses to desired outcomes. For example, you might offer your director of operations a nice bonus if he can reduce overhead by 10 percent for the year. A manager might receive 10 percent of any increased revenues for his store for the month. There are many ways to structure such a compensation program.
But remember this too: when creating a money-motivated system, it is important that the reward be linked to an outcome that the employee can control. The director of operations can directly affect overhead, but he or she cannot increase sales, so a reward based on increased sales would not be an appropriate incentive. If the reward is based on overall company performance, the employee will be motivated to try harder only if he or she can affect that performance. As long as the reward and the desired action are linked, the motivation will be there.
Click here to read more articles from small business expert Steve Strauss.
2. Contests: The use of contests is closely aligned with the normal money motivation system. Contests are an excellent way to build excitement and create desired behaviors and outcomes. Successful contests use realistic and achievable goals, are limited to a short period of time, have desirable prizes, link rewards to performance, and have uncomplicated rules. Additionally, they reward peak performance directly.
3. Show appreciation: Thanking employees for a job well done is so simple, yet so effective. A “thank you” can take many forms. Mary Kay Cosmetics gives every employee a lunch voucher for two on their birthday. Other alternatives include: a pat on the back from a manager, a call from the president, a special parking spot for a week, a night out with your team, an extra vacation day, a massage and facial or a round of golf. People love to be appreciated.
4. Recognition: Letting everyone in the office know that a particular employee has done something exceptional is another way to reinforce that behavior and reward the staff member at the same time. Making people aware that a team member did a great job works wonders.
A 2011 Society for Human Resources Management study found that 92 percent of employees believed that management’s recognition of employee job performance, in relation to job satisfaction, was important or very important. At Blanchard Training in Escondido, California, praise from customers and managers is reprinted in the company newsletter. What about sending a press release regarding an accomplishment to your
trade journal? How often do you see a plaque naming the employee of the month?
It’s all the same, and it all works.
5. Time off: Employees who do something above and beyond the call of duty can be given an afternoon off, or the ability to telecommute or have flextime. At H. B. Fuller Company in St. Paul, Minnesota, employees get a paid day off on their birthday.