Effective Employee Rewards on a Budget

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Everyone likes to GET A PAT ON THE
BACK FOR A JOB WELL DONE,
especially if that pat includes some
type of bonus.
The task can seem impossible when
you are trying to figure out how to
incentivize employees to perform well
while staying within a tight budget.
However, rewarding employees and
motivating performance DOES NOT
ALWAYS REQUIRE A TREMENDOUS
AMOUNT OF MONEY.
You may be surprised, but surveys
have found that some workers actually
prefer a more personal "thank you"
note, being singled out in front of
colleagues, or other forms of
recognition.

In tough economic times, small and mid-sized
businesses must keep in focus WHAT THEY
WANT TO REWARD while being creative in
coming up with ways to keep the troops
happy.
"The goal of any rewards program should be
TO ENGENDER THE LOYALTY AND TEAM
SPIRIT and have a good workplace where
people feel appreciated."
"It's also likely to help you MEET BUSINESS
GOALS especially with small to mid-sized
employers."
Nancy M. Cooper

The purpose behind a recognition program is
to help motivate your employees to earn the
rewards and ultimately help you MEET
BUSINESS GOALS.
Here are steps you can take to design an
EFFECTIVE EMPLOYEE REWARDS PROGRAM.

STEPS TO DESIGN AN
EFFECTIVE EMPLOYEE
REWARDS PROGRAM

The first step you need to take is identifying the activity or activities you want to reward. You can choose
to reward behavior, such as exceptional customer service, team work, or leadership.
DO YOU WANT TO REWARD:
• positive performance so that employees will strive to succeed?
• stellar behavior that serves the best interests of the company?
• employees who put forward suggestions that improve functioning or save the company money?
• individual employees or teams?
ONCE YOU ESTABLISH WHAT IT IS YOU WANT TO REWARD, THOSE THINGS SHOULD
BECOME THE FOCUS OF THE PROGRAM
IDENTIFY WHAT YOU WANT TO REINFORCE

The goals of your employee rewards program CAN ONLY BE MET IF YOU GET STAFF "BUY IN" OR
PARTICIPATION.
"Let the employees know that you are establishing a recognition program, let them know that the
budget is tight, but it is important to you that there be recognition of their good work and top-of-the-line
efforts."
Nancy M. Cooper
ONE OF THE BEST WAYS TO FIND OUT WHAT MOTIVATES YOUR EMPLOYEES IS TO ASK THEM
MOTIVATE YOUR EMPLOYEES

There's NO POINT IN STARTING A RECOGNITION PROGRAM that is not going to motivate employees or
help you achieve business goals.
So in addition making it work for employees, you have to make sure that it works for the good of the
company.
That's why it's so important to put thought into the methods of recognition you use, as well as how
effective and practical they are for the company. What works for one company may not work for another.
YOU SHOULD CUSTOMIZE THE REWARD TO MAKE SURE IT WORKS WITH AND
IS ACCEPTED BY YOUR COMPANY CULTURE
MAKE SURE IT WORKS FOR THE COMPANY

During a recession or prolonged economic downturn, financial
rewards may be highly prized by your staff.
However, when people feel that they are being fairly compensated,
then the best rewards for performance or behavior don't line your
pocketbook or wallet.
People like recognition. PEOPLE ENJOY BEING THANKED FOR
THEIR WORK. There are a number of ways this can be done, with
little or no financial investment.

Sometimes the most
meaningful form of recognition
involves some type of
opportunity as proof that an
employee is valued by an
organization.
“Opportunities can range from
being asked to sit on a panel
discussion on your manager's
behalf, an educational or
mentoring opportunity, or
being sent to an industry
conference,” Ventrice says.
OPPORTUNITIES

Something as simple as writing
a personal THANK-YOU NOTE
to an employee for a job well
done can leave a lasting
impression.
Personal thank-yous can be
very powerful. Some people
keep them for 10 years. Other
people have taken a bar napkin
featuring scribbles form the
boss and had it framed.
PRAISE

Sometimes the most sincere
form of flattery is being trusted
with more challenging work.
"I've heard a lot of people say
they were given a new
responsibility or they were
taking on another customer as a
new challenge," Ventrice says.
If the company trusts you with
new challenges, or tells you that
you're too valuable to take
vacation at the same time as a
senior manager -- that may be
all the recognition you need.
EXPERIENCE

Another meaningful form of
employee recognition is giving
that PERSON EXPOSURE TO THE
REST OF THE STAFF, TO
IMPORTANT CLIENTS, OR TO
OTHERS in their field.
This can include everything
from being pointed out as the
most creative software
developer of the month on an
in-house bulletin board to being
invited to lunch with the boss
and one of the company's key
clients.
Create an employee-of-the-
month parking space.
EXPOSURE

Other meaningful ways of
rewarding employees involve
customizing a personal sign of
appreciation.
Show an employee that his
work is extremely important to
you, assure him you see
everything he is doing, and tell
him you really appreciate how
much he is trying.
PERSONAL
APPRECIATION

Extra efforts can also be
rewarded with understanding of
the family/life balance that
many workers are trying to
achieve.
That can range from allowing an
employee to telecommute one
day a week in exchange for high
performance, to allowing them
flexibility to start earlier and
leave earlier.
ALLOW FLEXIBILITY IN AN
EMPLOYEE'S SCHEDULE

Use a limited budget for
employee rewards to buy a
series of gift cards at popular
coffee shops, book stores, or
online retailers and let the
employee choose one when
they have done something
positive or noteworthy.
These can also be administered
by co-workers to employees
who have exhibited positive
behaviors, either helping other
staff members, going the extra
mile in serving a customer or by
their team work.
GIFT CARD
REWARDS

There are both legal and moral minefields to try to avoid when starting an
employee rewards program.
You need to really think this through, understand your motivation, and
communicate to managers how to distribute rewards so that every
employee has AN EQUAL CHANCE.
Be sure you train managers TO NOT
GIVE THE AWARD TO THE SAME
PERSON time after time.
DEVELOP GUIDELINES that outline
how often rewards are given out,
and the value of them. Be sure that
the system DOES NOT TURN INTO A
POPULARITY CONTEST.

DO'S AND DON'TS
WHEN STARTING AN EMPLOYEE
REWARDS PROGRAM

If co-workers are able to nominate each other, you need to take
steps to make sure that the same clique of friends isn't just
always nominating each other.
DON'T LET IT BECOME A POPULARITY CONTEST

If the nominations are coming from management, be careful to
spread the joy around.
If an employee is prone to think they are being treated differently
based on some factor other than work performance, this may feed
that insecurity and suspicion.
DON'T GIVE THE PERCEPTION OF PLAYING FAVORITES

When advertising the program to employees, make sure you spell
out very clearly what the rewards are based on, what criteria is
used to choose winners, and how everyone in the company is
eligible.
DO COMMUNICATE THE CRITERIA

Put together a recognition team made up of managers and
supervisors in different roles throughout the company. Get the
team to come up with ideas, survey employees, and monitor how
the program is working.
Make sure managers are trained in how to administer the awards
so the program works to improve overall performance.
DO YOUR HOMEWORK WHEN BUILDING THE PROGRAM

The safest types of programs that don't get a company into
trouble are programs that start small, such as distributing gift
cards worth $5 or $10 as spot awards.
You may want to focus on one goal initially, such as boosting
service, and reinforce when rewarding employees that they helped
the business meet this goal.
DO START SMALL WITH GIFT CARDS OR A PROGRAM TO
REWARD A SPECIFIC BEHAVIOR OR GOAL

Effective Employee Rewards on a Budget

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