As a performance improvement company, it is important to see the value of non-cash awards, whether it is a sales program, employee recognition program or contractor rewards. Non-cash awards get greater results for the same funds invested.
Here are 7 reasons why non-cash beats cash incentives every time:
1) Trophy Value – non-cash awards are tangible and work as a lasting reminder of good performance being rewarded, while cash is short-lived and goes towards everyday expenses.
2) Recognition – non-cash awards can be discussed with friends, neighbors and relatives, i.e. how they were earned and goals accomplished. Cash is a taboo topic to discuss in our culture.
3) Guilt – non-cash awards only allow redemption from pre-selected items, participants order items to be enjoyed as there is no other option. Cash is evaluated by what can be done with it, i.e. savings, college funds, etc.
4) Family Involvement – non-cash involves the family by allowing spouses and children to shop in the book of awards and help the participant set goals. Cash programs are seldom mentioned in the home.
5) Promotability – non-cash awards engage emotions, participants imagine themselves earning and enjoying the awards. Emotions drive behaviors which produce results! Once the amount of cash is mentioned, communications of award opportunities is finished.
6) Flexibility – non-cash awards can be changed, added or deleted with little reaction within the organization; once cash awards have been placed, any changes are viewed as altering basic compensation and will be met with resistance.
7) Final Award Cost – non-cash awards have an element of non-redemption. Award points are issued, but not all participants redeem the entire amount (anywhere from 6-20% of issuance). There is no non-redemption with cash.
Overall, the single-most important reason to for non-cash awards in any incentive program is the higher Return On Investment!
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