Getting Started

If you're new to incentives the task of creating a successful can seem scary. It doesn't have to be. Although there are many things to consider, the following four steps will help you get started.

1. Define Target Audience



2. Establish Program Goals



3. Build a Budget



4. Select the Awards

Define Target Audience

Select which employee types in your company you would like to motivate. The majority of incentive programs focus on rewarding sales employees; however, depending on your business, it may also be important to include customer service, marketing, finance, and other non-sales related employee types. Once your target audience is selected, you will need to develop criteria for each participating organization. For a company-wide incentive program to be successful, it is important to announce individual criteria directed at each group of employees you wish to reward.

Establish Program Goals

As you select the behaviors and/or results you would like to affect, try to be specific with your criteria, and keep your objectives simple. Try to limit the number of goals you reward employees for achieving. The more focused your employees, the better your results.

When deciding on performance thresholds, it is important to not only incorporate your company goals, but also your incentive program budget. Look at sales and revenue results from the past quarter, the past year and from the same timeframe the previous year. Make sure to set realistic goals for your program. For example, if your program is targeted to increase sales during a normally slow period, do not expect results comparable to higher periods.

Let Xceleration help structure a program that excites, motivates and drives performance.

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Build a Budget

A well-designed incentive program should pay for itself based on the profits or cost savings it generates. As you design your criteria, an important question to ask is: How much are you willing to reward a sales rep for every dollar of increased revenue they produce? The answer to that question should help you decide what type of program structure to incorporate; thereby helping you meet your program budget.

Open-Ended Program Budget
An Open-Ended Program will reward all employees who achieve a certain goal. For example, if you choose to reward all sales employees who surpass 150% of their sales quota, you could potentially pay out an award to every employee who participates in your program. Obviously, any company executive would be happy with such fantastic results. But if you're managing the program with a fixed budget - you will have some problems.

Closed-Ended Program Budget
A second option is utilizing a Closed-Ended Program. This structure will afford you more flexibility in creating criteria and outlining objectives for your employees - while guaranteeing that you do not exceed your budget. The concept in close-ended programs is simple, but not without faults. Using this system, you could reward "the top 10 performers in each sales region, based on total units sold." As you can see, no matter how great the impact of your incentive program, you will only be rewarding the top 10 performers. The negative side of using this system is that it is only directed at your top performers. When your criteria are announced, you could lose the interest of the majority of your eligible audience who automatically think they don't have a chance to win. There are, of course, many ways to structure your criteria to prevent this from happening. For example, your could reward the top 10 performers based on units sold AND the top 10 performers with the greatest increase in sales from the previous month.

Whatever your company's budget, there is a way to effectively motivate your employees. Let Xceleration build a program that motivates, while staying within your budget.

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Select the Awards

When selecting the awards for your program, there are several things you should consider:

Provide a wide selection of awards for employees to choose from. Your catalog should offer awards that tailor to employees in multiple income brackets, and with various interests.

The shorter the program timeframe, the higher the value of awards you should offer. Utilize your awards to increase excitement and get your employees selling quickly.

The higher the participant's income, the more you will have to include premium items to increase their interest and participation in the program. A $10 water bottle is most likely NOT going to motivate a sales rep making $100,000 each year.

The next section outlines "The Great Incentives Debate…. Merchandise vs. Cash". Which is the better incentive?

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