Paradigm Shift: Employee Incentives

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“We will receive not what we idly wish for, but what we justly earn. Our rewards will always be in exact proportion to our service.” — Earl Nightingale, self-help speaker and author

Good employees work hard to earn their paychecks. They show up early or on time, are diligent throughout the day, help clean up and even stay late occasionally to finish working on every car that drives into your bays. You want to reward them for being a vital piece in your quick lube business puzzle. Giving out cash bonuses is popular, but money isn’t always the main motivator for hard work.

“I’m always looking for innovative and inspiring ways to motivate my staff,” said Haj Carr, president and CEO of TrueLine Publishing, an international leader in digital trade publications and online business resources, located in Portland, Maine. “I have found that cash bonuses don’t work nearly as well as trips and outings. When I think about an incentive, I think about setting a bar for a realistic yet aggressive goal that allows everyone who works hard to attend. This way, the staff and I both win. Those who work hard earn the prize, and I successfully pay for additional productivity. I have found incentivized outings not only make employees feel like they’re a part of an elite circle of winners, but it also makes them feel more appreciated.”

Of course, employees will gladly accept cash bonuses. But why not make spending that bonus into a fun event for all?

“My company had an event called the Freeport 500,” Carr said. “Freeport is a town in Maine with a bunch of outlet stores, and it’s a ton of fun. I knew I could afford to spend $500 per employee if they hit a particular sales mark. So, as opposed to giving people a $500 bonus for their productivity, I translated it into something much more fun. Whoever hit the designated sales quota becomes a member of the [Freeport 500] team and they get to go to Freeport with a $500 cash shopping spree. Then, we had a contest. The contest was, can you spend all $500 on things for yourself? You could be as frivolous as you wanted, it didn’t matter. Whoever got the closest to one penny got an additional $50. So, the whole month [leading up to the event] we said, ‘Are you going to be a part of the team? Are you going to be at the Freeport 500?’ And the moment they hit their quota, we put a star next to their name.”

The key to offering incentives is to get your employees excited. If you want to go the route of having a designated sales goal for each employee, make the goal attainable. You want the majority to reach it, yet make it challenging enough so they push themselves more than usual.

“I always try to make incentives attainable,” Carr said. “They’re not extremely easy, but something where at least half the people are going to be able to make it. That way, people get fired up and don’t feel like, ‘Oh, here’s another pointless incentive.’”

Have you ever heard your staff mention they’d love to travel to a foreign country but can’t afford it? Wouldn’t it be fantastic to provide your employees the opportunity to take a trip? Well, you can if you make a few smart decisions.

“I recently ran an incentive for the holiday season where I told my staff whoever hit a certain level of sales would be invited to come on an all-expenses paid trip to Jamaica for the weekend,” Carr said. “Since we’re in New England and in the midst of a brutal winter, a trip to the tropics was a perfect motivator. The trip cost me about $1,200 per person, which is $200 more than the bonus I would have given for the same revenue, but the concept of flying to Jamaica was way more exciting. People were talking about it all month, and more than half the staff made [the sales goal].”

A trip to Jamaica — or any other island — may seem impossible, but booking it is as simple as making a phone call.

“We call AAA. They put together an all-inclusive trip for us. It’s really easy,” Carr said. “You just give them the names of the people going on the trip, and they’ll tell you how much it costs for the flight and hotel. The all-inclusive factor is cool because all the drinks and food are included in the trip.”

If you’re worried about a possible lawsuit popping up if there’s an accident during a company outing, have your bases covered and there will be no need to worry.

“I make my employees sign a waiver saying [their participation is totally optional] before going on trips,” Carr said. “If someone comes up to me on the side and asks if they can have the cash equivalent instead of going on the trip, I’ll do that. That also sets the precedent that it’s not mandatory, and then you’re not liable.”

You don’t always have to have an extravagant incentive for your employees. Simply spending time with one another over barbecue and beverages is a good team-building event.

But why even bother coming up with creative events or backyard barbecues? Carr said there are other benefits to rewarding your employees.

“I think people have a sense of pride in where they work. They gain more camaraderie with their peers, which helps with employee retention,” he said. “The more people feel as though their life revolves around their job and they’re happy with their job, then they’re happier with their life. Then I don’t have to worry about recruiting as often, and I have a more skilled employee because if you stay with me longer, you’re going to be better at what you do than a new person. So, there are a lot of residual benefits. Just the overall incentive factor pushes people to do their job and go above and beyond, because they feel like they’re being adequately rewarded for it.”

It may seem like spending extra money on your employees is an added expense you can’t afford, but Carr has a different way of thinking about it.

“When you invest $5,000-$10,000 in your staff, it sounds like you can’t afford it because you’re not used to it,” he said. “But, if your roof collapsed and you had to buy a new one, you might gripe about it but you’d do it. I think investing in your employees is a paradigm shift. It’s a very important expense to invest money in. It feels as if there’s no direct return on your money, but I can tell you, over the years, the results are direct. I know I’m getting a return on my investment by way of all those little intangibles. You’re going to get more out of [your technician] who’s cranking it out because he loves his job because y’all had a company event and he’s feeling good. Maybe he’s doing things 10-percent quicker and you’re going to turn through more customers and you’re going to get the money back. It’s one of the cheapest ways to buy additional productivity, in my opinion.”

Just like Earl Nightingale said, your employees’ rewards should be in exact proportion to their service. Create a monthly, quarterly or yearly company event and make it something more valuable than just cash; make it an experience. In the end, you’re bound to see happier and more productive employees.

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