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Employee Recognition
Sales Incentives
Employee Motivation


THE POWER OF TANGIBLE MERCHANDISE AWARDS

A Vice President relates a simple example of the power of tangible merchandise awards in his company-sponsored incentive program:

A teller at a local bank told me that a woman came in and proudly modeled for both customers and employees a jacket she had won.

She said, My employer gave me this for doing a good job. Its the first time in the 18 years Ive worked there that theyve recognized the things I do every day

During those years she had earned $230,000 in wages, which had paid for cars, a home mortgage, food, vacations, college education and other essentials.

The money was not recognition of her work, but the jacket was.

-Daniel C. Boyle, Vice President
Diamond Fiber Products, Inc
Harvard Business Review


Recognition

WHAT A WELL-DESIGNED EMPLOYEE RECOGNITION PROGRAM CAN DO FOR YOU!

Its a fact: Keeping your employees motivated and happy can produce measurable bottom-line benefits. Research shows that an employee recognition program can help a business prosper in three distinct ways:

  1. By helping companies make more money
  2. By keeping employees engaged in their work
  3. By improving employee performance.

FINANCIAL PAYBACK

Its clear from studies such as those cited below that an employee recognition program can have a direct effect on the financial performance of a company.

In Study #1, employee-focused organizations increased their revenue 483% over competitors that were strictly bottom-line focused.

Study 1

In Study #2, companies that rewarded their employees made more money over a five-year time period than companies that did not.

KEEPS EMPLOYEES ENGAGED

Want your employees to feel more ownership in your organization? Then make sure they know theyre valued! Recognizing an employee for a job well done reinforces what is important to your company, and provides feedback that helps employees know what behavior(s) to repeat in the future.

Workplaces that practice employee recognition are characterized by:

IMPROVES EMPLOYEE PERFORMANCE

Recognition also increases employee performance. When employees feel appreciated for their contributions, they are more likely to repeat positive behaviors, leading to higher productivity and results. According to Jeffrey Pfeffer, Stanford School of Business, studies show that thirty percent of employees improve performance after being criticized; 90% of employees improve performance after being praised.

WHAT IS RECOGNITION?

Recognition is an after-the-fact display of appreciation or acknowledgement of an individual or teams desired behavior, effort, or business result that supports the organizations goals and values.
[Source: National Association for Employee Recognition]

STRUCTURE IS CRITICAL!

Recognition is more than simply throwing a party, giving an employee a gift, or saying thank you. It is an acknowledgement that intentionally links employee behavior to corporate goals!

A good recognition program includes rewards, awards, incentives, and celebrations.

BOTTOM-LINE BENEFITS OF EMPLOYEE RECOGNITION

A recent study concludes, Satisfied employees create satisfied customers, which improves the financial performance of the entire organization.
[Source: Forum for People Performance Management, Northwestern University]

THE VALUE OF POSITIVE FEEDBACK

30% of employees improve performance after being criticized; 90% of employees improve performance after being praised.
[Source: Jeffrey Pfeffer, Stanford School of Business]

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Sales Incentives

WANT TO INCREASE SALES PERFORMANCE?
A well-designed incentive program will produce measurable results!

Incentives, also known as performance improvement programs, can be an effective tactic for increasing sales and/or profits by influencing participant behavior. When structured properly, an incentive program can help you

In effect, an incentive program tells your participants, You give me extra effort; Ill give you extra reward. And it worksdriving behavior change through positive reinforcement and enabling quick shifts in performance to improve your bottom line. In most cases, the target audience for incentives should be your mid-range performers. Typically, this group makes up the biggest segment of your sales force and can have the most impact on your overall objectives. Usually, a company has:

WHY INCENTIVES?

INCENTIVE FACT:
If the activity can be measuredthe activity can be improved!

CHOOSING INCENTIVE AWARDS

When asked, most people say they prefer cash over non-cash awards (merchandise and travel). Yet, there is hard evidence that non-cash awards are a better motivator (see case studies below).

And dont assume that what motivates you will motivate others. The best programs offer a wide range of award choices, so participants can work toward items that excite them individually. An online or printed awards catalog or brochure works well for this purpose:

CASH AWARDS COST MORE

The American Compensation Association surveyed 1,600 companies for a White House conference on productivity. Findings included:

ADVANTAGES OF MERCHANDISE/TRAVEL AWARDS VS. CASH

CASE STUDYGULF OIL

Program performance, based on varying levels of cash and non-cash payouts:

INSERT GRAPHIC HERE from Slide 43(?)

Three principal findings: (1) Any incentives are likely to produce some results; (2) Doubling the value of merchandise awards does not automatically double incremental performance; (3) Cash does workbut it can take up to six times as much to do the job of non-cash incentives.

CASE STUDYMAZDA

Three-month test on truck sales (two test groups, each made up of 32 districts; one group offered cash, the other offered non-cash incentive).

INSERT GRAPHIC HERE from Slide 47(?)

Three principal findings: (1) Any incentives are likely to produce some results; (2) Doubling the value of merchandise awards does not automatically double incremental performance; (3) Cash does workbut it can take up to six times as much to do the job of non-cash incentives.

Key results: (1) Non-cash districts @ 115.7% of goal (cash districts @102.1%); (2) 21 of 32 non-cash districts exceeded goal (cash districts 15 of 32); (3) All sizes of dealerships in non-cash groups out-performed cash group.

ACHIEVE SIMILAR RESULTS

Let us help YOU achieve similar results, with an incentive program aimed at your specific objectives. Our services include program development, awards, communications, administration, and ROI analysisfor total turn-key support!

Employee Motivation


Caculator

WHY INCENTIVE-BASED EMPLOYEE PROGRAMS WORK

Returns Far Exceed Costs!

Employee turnoverlost time due to accidentsunscheduled absenteeism. Personnel issues like these can be costly to your business. How do you protect your bottom line?

The answer is: MOTIVATION.

A well-designed incentive program can change employee attitudes and behavior, and pay off measurably. Safety incentive programs are a good example. With workers comp costs ranging from 5%-35% of an employees wages in some industries, many companies are investing in programs that address accident prevention. By motivating employees to think and perform proactively, identifying and correcting unsafe actions or conditions, such programs often pay for themselves in a very short period. The most effective programs are strong on communication (making employees understand how even the smallest infraction can have enormous repercussions) as well as rewards (giving everyone a stake in the process).

Its a fact that safety incentives pay off. Some employees10 to 20%will always have the work ethic to perform beyond expectations. But many others are satisfied with average output, and for those 80 to 90%, incentives work to spur safety efforts that can significantly decrease lost time due to accidents and increase your profitability.

Find out why more and more companies view incentive-based safety programs as an investment rather than an expense. We can help design a program thats right for you!

JUSTIFYING COSTS

A large self-insured company reports savings of several million dollars annually while utilizing a safety incentive programsimilarly, a company with less than 200 employees saves $83,000 on their annual workers' comp premium. Youll find that a strong, well-run safety incentive program is one of the best investments you can make in your businessespecially if youre in an industry at high risk for accidents!

WHAT WORKS BETTER, CASH OR NON-CASH INCENTIVES?

COST EFFECTIVE? A recent study by GULF OIL concluded that it takes up to six times as much cash to do the same job as non-cash awards in a safety incentive program.

SUSTAINABLE? In a separate study, GE concluded that the trophy value for cash lasted less than three weeks. Ultimately, cash becomes another entitlement with little, if any, connection to safe behavior.

BEST PRACTICES

THE HIGH COST OF EMPLOYEE TURNOVER

Incentive-based programs aimed at reducing employee turnover also offer big payback. Current estimates put the cost of replacing a well-trained employee at 150% of annual compensation. That means to replace a $30,000/year employee, your cost is $45,000 per turnover!

Using that average figure, see how the annual costs add up:

Company Size Rate of Turnover Annual Cost of Turnover
40 employees 10% $180,000
100 employees 10% $450,000
1,000 employees 10% $4,500,000

Who wouldnt want to add tremendous numbers like these to their profit line? *Source: Cost of Employee Turnover (www.isquare.com)

Caculator




CAN YOU AFFORD TO IGNORE NUMBERS LIKE THESE?

The cost of unscheduled employee absenteeism can have a huge impact on a companys bottom line. Yet, because its seldom tracked, its a cost that often goes unnoticed. Consider:

Variable Ratio Reward Cards

A new and very exciting non-cash incentive tool that you can use to motivate your employees & sales channel to increased performance.

We have both printed cards and electronic cards available. Please go to the website below to play a card (it takes about a minute and its fun!)

Some of your benefits in using VR Cards as the awards media in your incentive programs are:

http://demo.vrwebcard.com
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