Symptoms
& Solutions
In our 20 years of experience
in the Incentive industry, we have witnessed
a paradigm shift. Incentive Program budgets
are now scrutinized for the value they add,
and are required to prove their investment
value (as a revenue generator) in measurable
dollars or face elimination.
Here are just a few of the
issues we've addressed and solved for our
customers:
Your incentive program budget has been reduced
When economic climates are poor or stalling,
companies are forced to reconsider all expenditures.
When they look at incentive programs, they
find increased sales but little or no documentation
to verify the profit contribution made by
these programs. Company management is then
faced with the dilemma of looking at invoices,
income statements and expense reports for
the program, with little or no information
regarding the financial and non-financial
value they provided. The end result is often
a reduction in the overall budget for the
incentive program. A reduced budget forces
the incentive planner to implement a program
that is certain to have a lesser perceived
value to the incentive program participants.
The solution to this problem is the development
of an incentive program that is based on
quantifiable Return On Investment results.
The company-wide impact of the program must
be understood, and buy-in from all effected
departments must be obtained in order for
the program to be successful.
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You have reduced your incentive program
awards
When the value of an incentive program
isn't understood by company management,
but there is hesitation to eliminate the
program, the result is often a reduction
in the incentive award itself (i.e., shortened
travel period, lower value merchandise,
etc.) The top performers who have enjoyed
previous years' programs quickly recognize
that they are receiving less award value
for the same or more effort.
The solution to this problem is the selection
of an incentive program award that is suited
to the profile of the program participants,
and is funded based on a quantifiable Return
On Investment.
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You are nervous about meeting with your
management team to obtain your incentive
program budget approval
Historically, incentive program budgets
have often been presented based on emotion
surrounding the award itself. Elaborate
presentations outlining exotic travel destinations,
expensive merchandise, etc. are often used
to elicit support from the budget approval
committee. Companies are now looking beyond
"the fluff," and want to be presented
with the business solution that incentive
programs can provide.
The solution to the problem is a study
of the internal and external company environment,
and the potential effect of the incentive
program. The results of this study can be
presented to the budget approval committee
as a business solution, with a projected
Return On Investment.
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You have a high percentage of repeat award
recipients
When your incentive program includes a
high percentage of repeat award recipients,
indications are that your program is no
longer an Incentive, but rather a part of
overall compensation. Repeat recipients
now expect this as part of their total compensation.
The participants who do not receive the
award view the program as an unobtainable
perk awarded to the same group each time.
The solution to this problem is the development
of a program rules structure that creates
a level playing field for all participants,
while still providing a business solution
with measurable results.
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Other departments within your company do
not support your incentive program
Often times incentive programs are designed
to stimulate front end activity (sales,
production, etc.) that causes a ripple effect
on other company departments. This can create
internal animosity towards the incentive
program and participants themselves as others
perceive this to be a one-sided benefit.
The solution is the development of an incentive
program that includes a cause and effect
analysis for all departments of the company.
The result is an incentive program that
provides (and communicates) a benefit to
all effected departments, and obtains support
from your entire company.
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You are having trouble justifying the incentive
program management fees you are paying
When incentive program budgets are being
scrutinized and cost savings become paramount,
incentive program planners are often forced
to handle program concept design and implementation,
rather than contracting with a professional
Incentive company.
The solution is a contract with an Incentive
company based on a fee schedule that fairly
compensates the Incentive company for delivering
achievement of business solution objectives
with a measurable Return On Investment.
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The quality of your incentive award is based
on how well you negotiate with incentive
Suppliers
Incentive planners often focus their efforts
on negotiating "a good deal" with
the incentive award Suppliers. This often
results in a less than exceptional and inconsistent
award on an ongoing basis.
The solution is to partner with your incentive
Suppliers when developing and operating
your incentive program. This partnership
includes the Suppliers' agreement to performance
based clauses in your contracts, ensuring
an exceptional and equivalent experience
for all recipients. Also part of the partnership
is your agreement to provide regular program
status updates to the Supplier, to avoid
any "surprises" that may negatively
impact the Supplier. The end result is an
incentive program award that rewards the
participant for the extraordinary effort
that she/he has put forth, and a Supplier
that is able to utilize their resources
most effectively to provide that award.
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