Stan's got a problem

The example of an incentive program on The Incentive Markeing Association website, is a dog.

"Stan supervised a group of 50 people. He did a little research and came to the conclusion that each employee used an average of 10 sick days per year. He felt this seriously cut into productivity on the assembly line and he figured that cutting this figure in half, or 5 days per year, would greatly improve production figures for his department."

The aims of the incentive might be laudable - to improve productivity - but the solution chosen - to improve attendence and reduce sick days - tackles only the symptoms, not the cause. Note that Stan spends no time trying to find out or understand why employees are taking so many sick days.

So Stan kicks off his little incentive "with a small party of donuts and coffee" - the best aspect of the incentive, incidentally - and, lo, in this fictitious scenario, gets the results he is after. But of course his incentive also punishes those who are genuinely sick, and may also encourage people to come to work who should really be at home, thus possibly spreading more illness. No mention is made of staff in other departments who are not part of the incentive - a divisive strategy that may affect the overall attendence levels and productivity of the business.

The biggest trap Stan's incentive falls into is to award attendence, not performance. Those that turn up to work have no additional incentive to work harder or smarter, or otherwise perform better. Stan has replaced absenteeism with presenteeism.

The incentive also offers nothing beyond the reward, except the impromptu recognition ceremony. There is no attempt to engage the staff in a dialogue about performance, teamwork, and attendence.

Stan has also given himself a nasty admin overhead. Not only does he have to calculate which employees to reward, from the attendence records, which is not too much of an issue, but he has had to "put together a catalogue of gifts" in an appropriate price range. Not only that, he'll have to deal with collecting the orders, arranging delivery, and dealing with any issues regarding faulty items, returns, stock availability, plus irate employees who will complain that there's nothing they like.

Plus he probably has to put together a report, and maybe try and calculate the ROI from his incentive. Stan has got some long evenings with Excel ahead of him.

The article concludes that "Stan decided to run a similar incentive program the following year", but here's a crazy idea Stan. Why not try offering free coffee and donuts first thing every morning, and ditch the rest of the incentive?

If Stan's company is serious about improving productivity, it needs to come up with a company-wide incentive solution that does more than just reward. It should find some one to run it for them, and free Stan's time up to focus on what they are trying to achieve, and how to use rewards to drive staff engagement.