At the Incentive Marketing Association’s Executive Summit in Denver on Tuesday, a panel of incentive company leaders addressed some of the changes in the incentive and recognition landscape.
The Social Workplace
One of the most important and growing trends is the importance of social aspects of the workplace. Writing in Strategy + Business in 2009 , the scientist David Rock noted that the brain experiences the workplace first and foremost as a social system. This is not to be taken lightly. We understand that human interactions are just as important as the mechanistic work processes that underlie “what we do”. And as “what we do” becomes superseded by “what we create,” the power of human moments and human interactions becomes even more important.
The most successful companies have understood the importance of the social dimensions of work, both in how they connect to their customers and in how they engage their people. Customers are now a community to be engaged not just for their wallets, but also for their insights that can inform the next generation of products, and for their membership in a network that can enhance the company’s marketing efforts with live testimonials. Think of the Apple experience as the impact that a powerful brand can create with a devoted user base.
Likewise, employees are not just mere units of output or costs. People create the experiences that keep customers engaged. The positive effects of employee engagement on a companies’ financial performance have been documented in multiple studies. Yet, the most recent Gallup Study on the State of the American Workplace indicates that only 30% of workers are engaged and inspired at work. How can an external brand rally and inspire customers if 70% of the people who live that brand internally are not inspired? One of the key reasons that employee engagement is important is that a strong internal brand is a pre-requisite for inspired and devoted customers.
Social networks in themselves have value; they give people new connections, a new thing to belong to, new brands and products to believe in. A powerful brand becomes not just a marketing lever, but it’s something people rally around and identify themselves with. Brands become a source of meaning.
Extrinsic Rewards
Another conversation or trend in the incentive and recognition landscape that relates to the role of incentives, or “extrinsic” rewards in creating value and meaning. If brands themselves create passionate advocates and higher meaning, then why do companies need extrinsic rewards when intrinsic motivation is already high?
The key point in this conversation is the type of extrinsic rewards. Many companies and even some writers in this space have equated extrinsic rewards with cash and bonuses. Cash and bonuses have been shown to actually undermine intrinsic motivation. However, used appropriately to reward desired behaviors and performance, non-cash rewards actually reinforce and enhance intrinsic motivation.
If we accept that the workplace is innately social, we also accept that human beings are not mechanistic actors on the stage of the workplace. Without applause, without positive reinforcement, and without rewards for specific performances, what is “intrinsic” suddenly becomes what is taken for granted. The beauty of non-cash rewards is that they can engage very powerful emotions. If I am motivated by a special gift for a spouse or loved one, a family vacation or a kayak for my weekend warrior self, the opportunity for earning a reward like this for hitting it out of the park will cement my identification with the internal brand in a way that cash, or a gift card with someone else’s brand name on it, can never accomplish.
Extrinsic, non-cash rewards help reinforce the intrinsic. It’s a way of saying “I care” that goes beyond just words. Extrinsic rewards build powerful internal brand experiences that complement and reinforce intrinsic motivation to be part of a desired workplace environment.
Do you agree with these trends we’ve identified in the incentive and recognition landscape? If so, what will you do to enhance the social aspects of your workplace, and to reward someone who has done something special?
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