Improving Workplace Performance through Incentive Programs

Dr. Purushothaman
December 6, 2013

During the Great Depression, improving workplace performance was a non-issue for managers; workers were largely motivated by self-preservation and survival, well aware that a line of unemployed was waiting at the door, ready to take over if they failed to perform. Fast-forward 80 years, and the issue of how to improve workplace performance is far more complex. Relative economic security and job protection, together with broader career options, have presented a number of challenges. Effective leaders today have therefore recognised the need to deal with the issue of employee motivation on a number of levels.

The most basic level relates to treating each individual on his or her merits. There will always a set of base expectations and requirements employees must adhere to, but the more astute leaders provide an element of flexibility in recognition of employees' various personal commitments outside the workplace. As long as a goal is achieved within the required time frame, how, when, and often where an individual achieved that goal is largely irrelevant. This lays a solid foundation for leaders by demonstrating trust in their workers.

Workplace performance can be further improved by setting performance and/or behavioural objectives and actively rewarding employees through recognition or incentive programs. Financial incentives are extremely commonplace and are indeed an expectation of many workers, however in isolation they have regularly proven to have limited impact on workplace performance, particularly among higher paid workers.

When non-cash incentives are also offered, the impact on workplace performance has in many cases proven far more profound. Again, the effectiveness of this approach relies heavily on understanding - and catering to - each individual's tastes and preferences. That is why for some workers a simple 'thank you' from a manager will suffice, while for others it maybe something more substantial or tangible, such as an iPod or a Plasma TV. For perennial top performers, a 'money can't buy' experience or career development opportunity may do the trick.

Just as performance objectives need to be clear, so, too, do the motivators or rewards. In some cases companies will change or abandon recognition or incentive programs due to a perceived lack of engagement or results. This can cause frustration and disappointment among employees and can in fact diminish workplace performance, precisely the opposite result to the one incentive programs are set up to achieve. This can lead to unnecessary costs in terms of changing or removing the program, and also the indirect costs attributed to a drop in workplace performance.

In recent years, the positive impact of recognition and incentive programs on workplace performance has been proven time and again, with growing numbers of progressive leaders incorporating these programs as key planks of their people strategies. What remains clear is that for maximum impact, these programs need to be undertaken by HR professionals in partnership with business leaders and be given a high priority. This increases the chances of getting the program design right first time, and minimises the chances of creating disenfranchised and under-performing employees, and incurring unnecessary program costs down the track.

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