Examples of Successful Incentive Programs

Here are a few examples of highly successful Incentive programs our clients have conducted.

1, Company Wide Performance Improvement Program

A large specialty products company that was facing intense competition within its industry and an industry-wide slump of approximately 20% decided to challenge all employees to turn the situation around in the next fiscal year. They designed a program that identified what each division and work unit would need to accomplish to produce the desired result. They then placed a value on the relative importance of the performance in relationship to their unit and company goals. A multi-tiered incentive program was put in place that included benchmarks from inside and outside the organization to measure the success and effectiveness of the program. With over 600 employees in 7 work sites, it was critical to have buy-in from the entire company. The company identified 35 of the key players that would most influence the ultimate outcome of this effort. The incentive for these 35 would be an all expense paid trip for the employee and companion on a 7 day western Mediterranean cruise in private veranda staterooms. Incentive awards of varying value were assigned to everyone underneath so that employees could see appreciation for their work. At the end of the fiscal year, not only did they meet their goals but exceeded them beating the industry average by a +30% gain and one of the most profitable years in their companies history. The cost of the incentive awards in relationship to the profits accumulated were a little over 25%. A handsome reward for everyone concerned, particularly shareholders of the company.

 

2. Company Annual Managers Meeting and Awards Program

Individual stores of national fast food franchise chain are owned and operated by holding companies that may own multiple stores. Because the fast food industry is so highly competitive and profit margins razor thin, operational efficiency is key to profitable operations. Store managers play a critical role in achieving this and can literally make or break a store. One of the holding companies that owns and operates 37 of the franchise stores developed a very innovative point based incentive program for store managers as a means of achieving this efficiency. Point values are assigned for items like reducing costly employee turnover (the industry average is nearly 300% in a fast food restaurants), reducing down time on equipment by regular and thorough preventative maintenance, high mystery shopper scores, innovative local marketing to move featured products, reduction of customer complaints and a wide variety of other tasks that reduce real dollar expenditures and improve store profitability. Each year the holding company conducts its annual meeting either on a cruise ship or a nice land resort and those store managers who have achieved a certain level are allowed to bring their families on the trip with expenses for the employee and spouse fully paid by the company. In addition to business meetings, the company does a very special awards ceremony on the last night that highlights the best performers that have helped company increase profitability for the year. The camaraderie of the store managers and healthy competition between them is refreshing to see and a testament to skilled owners who know how to get the best from their employees.