You might be surprised to find out that when it comes to incentives, it's actually non-cash rewards that work best. Read on to find out why!
It's easy to think that money makes the world go round, but when it comes to incentives, it's actually non-cash rewards that work best. So, while you may be tempted to attract talent and increase performance by promising higher salaries or a cash bonuses, you should be considering non-monetary incentives instead. Here's why.
1) Non-cash is more effective at achieving goals
Employee incentives don't exist just to entice new talent. One of their primary functions is to help the company meet specific goals, either by driving more sales, increasing revenue or producing some other return on investment.
Top performing companies had strong incentive schemes in place, predominantly with non-cash rewards.
Non-monetary rewards have been proven to be much more effective than cash at achieving these goals. For example, a study by the Incentive Research Foundation assessed incentives at a wide variety of companies. Those that were deemed top performers (because of their higher revenue, good growth, and excellent customer and employee ratings) were 90 per cent more likely to reward their sales people, employees (88 per cent) and channel partners (81 per cent).
And, of these top performers, the prevalence was for non-cash rather than monetary benefits.
Further, research by Incentive Magazine found companies that had a well-conceived incentive program in place saw average gains in productivity of 44 to 48 per cent within the first six months.
Put simply, if you want your incentives to achieve their aims, non-monetary is best.
2) Non-cash is more memorable
If someone is given a lump sum in cash, they're probably going to do something fairly sensible with it. They might spend it on groceries, or put it straight into a savings account. While this is certainly useful, it's not something that they're going to remember six months down the line if asked what they spent their employee rewards on.
Cash rewards, even when created as a separate bonus scheme, are often seen as part and parcel of an employee's overall salary and compensation, rather than as a reward in and of itself.
However, when incentivised with something tangible, such as event tickets or electronics, they'll think of your company every time they recall the event or use the item. This will mean they'll positively associate that reward with their employer.
3) Non-cash is more personal
A monetary reward doesn't require much thought - you're giving the same thing to everyone. However, a non-cash reward will feel much more personal, especially if your employees are given a say in the incentive they receive.
For example, Power2Motivate's Global Rewards Gallery gives users access to thousands of different rewards. From travel and trips to homeware and electronic appliances, there's a meaningful reward for everyone.
If an employee looks at the rewards gallery at the start of the incentive scheme and sees a prize that they'd like, such as a trip, they will have that reward in mind every time they work. This means they'll end up putting more effort in as they know exactly what the end goal will be. Power 2 Motivate even gamify reward programs, adding a competitive element that will add even more excitement!
Non-cash rewards with Power2Motivate
From employee rewards and recognition to years of service and sales incentive programs, Power2Motivate Australia offers a huge range of rewards and incentive programs to help you provide benefits for all areas of your company.
We provide an easy reporting function to help you keep track of which incentive are most popular, as well as monitor ROI and KPIs.
For more information on any of our rewards programs, contact the Power2Motivate team today.