Businesses that capitalise on employee engagement through employee rewards and recognition programs can reap the financial reward.
There comes a point in time during every company's maturation process that the product being sold begins to take a back seat to those who are selling it. Effective salespeople are critical to an organisation's success in saturated markets, and businesses that recognise and capitalise on this through employee rewards and recognition programs, benefit financially.
This isn't a revolutionary insight. In fact, the Deloitte University Press estimated that 90 per cent of corporate executives recognise the importance of employee engagement. Unfortunately, less than 50 per cent have a clue as to how to improve it.
"Executives understand employee engagement is important, but don't know how to improve it."
Motivating employees doesn't always start with a modest pay raise. More often than not, facilitating a connected and committed workforce simply requires a repositioning of organisational values, and the benefits can be found far and wide across the company.
Improve revenue growth
Every salesperson wants to be recognised for meeting his or her goals. Achieving or exceeding key performance indicators certainly provides a sense of worth, but without acknowledgement from management or co-workers, the motivation to do so can be virtually non-existent.
By implementing a system that provides performance-based employee rewards, companies encourage their staff to explore every cross-sell or lead-referral opportunity. When salespeople understand their extra effort will be recognised and compensated for, a newfound commitment to organisational excellence begins to take shape.
The financial impact of employee rewards and recognition is clear: Companies with these programs in place experienced 26 per cent better year-over-year revenue growth than businesses that don't have something similar in place, according to Glassdoor.
Win the turnover battle
People stay with companies long-term for a number of reasons. Whether it be career opportunities, recognition or culture, the crux of the theory is simple: Engaged employees create lower turnover rates.
A workplace with a steady line of workers walking out the door suffers two-fold. First, those still in the organisation see their peers leaving and begin to wonder why, which damages morale. Second, the cost of finding replacements almost always outstrips the expense of what it would have been to keep the original employee.
"Poor employee engagement creates a high turnover rate."
ERE Media, a talent management and human resources news source, estimated it costs, on average, 40 per cent of an entry-level worker's salary to replace him or her. That figure spikes to 150 per cent for mid-level talent and 400 per cent for senior executives. Suffice it to say, losing employees is financially akin to client's cancelling contracts, as they both negatively impact the bottom-line.
Unfortunately, many organisations tend to prioritise the latter over the former, perhaps not realising the financial implications of high turnover rates. By providing performance-based employee rewards and recognition to all members of the company, as well as health care and other benefits that supplement salary, businesses not only cut down the amount of workers leaving each year, but also shed the costs associated with them.
As previously mentioned, most executives understand the benefits of improved employee engagement throughout a company but just don't know where to begin. There's no right or wrong way to mend workforce morale, but identifying known faults within your organisation is an excellent starting point.
An Aberdeen Group study found that just roughly 15 per cent of managers are provided the tools to facilitate effective employee engagement strategies. Work with a third-party provider that can provide a scalable, cloud-based platform that not only allows supervisors to maintain control over KPIs and reward distribution, but also gives workers a chance to praise one another for accomplishments.
Interested in learning how employee engagement can financially benefit your company? Contact a Power2Motivate representative today.