It’s common for businesses to hand employees rewards—it’s considered the done thing to do, a great incentive to get employees working to the best of their abilities. Financial incentives are often the go-to reward of choice, with the belief it’ll push staff on to new heights of creativity or effort. Whilst rewarding hard-working employees is important, cash incentives isn’t always the best way to go about it. And we explore why in this guide to long-term employee productivity.
Why cash incentives aren’t a motivator
The thinking behind a financial reward is it’ll make employees happier and more motivated. Money helps employees to pay their mortgage, rent, bills, or fund the likes of holidays.
And the general consensus in the business world remains that rewards are a great way to encourage employees to do their best.
However, there’s a school of thought suggesting a cash reward scheme can only ever promote temporary compliance. This is under behaviourist theory, as highlighted in the Harvard Business Review:
Once the rewards run out, people revert to their old behaviors. Extrinsic motivators, do not alter the attitudes that underlie our behaviors. They do not create an enduring commitment to any value or action.
If a cash rewards system is overrated, what then can businesses do to ensure talented employees stay with them?
Well, it’s more important to focus on long-term prospects. A developmental programme can look to keep improving and developing employees towards new career heights.
In itself, that brings financial and professional rewards. And that can offer all the incentive many employees need—working towards personal achievements and goals.
Consider reward and recognition programmes
Implementing new ideas to reward your employees can take place through small or large gestures.
But crafting the right sort of prizes or recognition strategies can be difficult.
Popular choices by businesses often aim at rewarding employees with long service. Other times it may be for a career achievement, such as if an individual is celebrating a promotion.
It’s possible to innovate a step further and use technology to provide recognition mailboxes or even social recognition software.
These will lead to customers flagging excellent work from employees. This can lead to some impressive morale boosts across your business.
Reward recognition is a good business practice as it acknowledges staff. With the variety of options available, you can easily find a feature that suits your company culture.
Creating career development opportunities
It’s also important for employees to see their efforts with a business rewarded with progression opportunities.
If they stagnate in a role over several years, with no sign of any development opportunities, that can lead to them leaving for a new role.
A career path is essential. So, if your business still wants to use some form of incentive package, then there are beneficial approaches to take. You may want to offer:
- Training opportunities: Provide free courses to employees so they can develop their skill set, which can lead to new opportunities in and around your business.
- Hire from within: Instead of looking to bring in new talent with a recruitment strategy, offer the likes of management roles to existing employees.
- Salary reviews: Have a clear policy on this so employees have something to work towards—many businesses still offer no transparency on this, meaning
- Career progression: Create opportunities for employees, offer new roles to them, speak to them about how they’d like their career to develop with you. This transparency can open new doors for them and your business.
- Flexible working: Consider work-life balance perks alongside their career progression, such as remote working opportunities. If that’s not possible with their role, then flexible start times also help to ease the drudgery of the daily commute.
Your business can be creative in how you go about engaging with your employees. There’s no right or wrong approach to engagment. Although, it’s a good idea to move away from simply handing over cash incentives as a reward.
It’s an increasingly hollow gesture. Instead, focus on providing a future for your workforce—goals to aim for, and a wealth of opportunities that provides them with real focus.
Guest post by David McDermott, Peninsula Group Limited