Selling senior execs on the benefits of online incentives: show senior managers how a Web-based, noncash incentive program triggers elevated profits and productivity in their area of responsibility

HR Magazine, Sept, 2004 by Dave Dermer

The Starting Lineup

The senior managers you'll need to communicate with include, but is not limited to, a chief executive officer (CEO), president, chief operating officer (COO), chief information officer (CIO), chief financial officer (CFO), vice president of human resources, vice president of sales and vice president of marketing. Although the size of senior management teams varies, almost all include at least one individual responsible for the following four management positions: vice presidents of sales and marketing, COO and/or CIO and the CEO.

Vice president of sales and marketing. Individuals in these positions are usually very familiar with incentive programs, however, some of their experiences may have been with poorly designed and/or executed programs. Therefore, it is critical that their frame of reference be expanded to understand the benefits when incentive programs are done right.

Most online programs today include communication tools such as e-mail, messaging, quizzes and surveys. When a reward is attached to the communication, it significantly increases the likelihood the information will be absorbed. This is very valuable to your head of marketing.

Choosing rewards such as a well-organized group trip--for example, a weeklong cruise in the Caribbean--can help the company create a bond with your best customers, which makes it extremely difficult for your competitors to steal them away. This is most attractive to the head of sales.

Other points of interest to the vice president of sales and marketing are:

* Sales programs, consumer/user programs and dealer programs reported an 80 percent success rate in achieving their established goals using an incentive program, according to a recent Incentive Federation Study.

* Eighty-five percent of employees surveyed in a 2002 SITE Foundation study said that a certain level of motivation affects the quality and quantity of their work, and 78 percent cite specific instances when motivation has had a significant impact.

Chief operating officer/chief information officer. The COO/CIO is always looking for tools that will motivate the employees to make the best use of the process improvements he or she has implemented. A motivated workforce significantly increases the likelihood of a positive return on investments for any process improvements. The COO/CIO should be very much involved in the program design and implementation process of an online, noncash incentive program. The person holding this position knows how things get accomplished in the organization.

Here are few facts that support your case when speaking with the COO or CIO:

* In his research on motivation, William James of Harvard University found that hourly employees could maintain their jobs (that is, not be fired) by working at approximately 20 to 30 percent of their ability. His study also showed that highly motivated employees work at 80 to 90 percent of their ability. What this means is many companies spend 100 percent of their compensation dollars for 20 to 30 percent of their employees' ability. They leave little or no room for incentives that can help extract an additional 60 percent of what employees have to offer.