An incentive that relies on non-redemption is a risky strategy.

The Guardian’s Capital Letters is a great place to discover tales of investment scams, corporate greed, shameful customer service, and unsustainable business practices.

From a recent edition comes another tale of woe:

“I am struggling to get my cash back from a contract with The Mobile Outlet. I signed up last September for a £35-a-month deal which will provide my money back if I claim cashbacks according to their rules. I sent off bills in January by recorded delivery, and a second lot in April. But despite phone calls and letters, I have got nowhere. Can you help?”

As Tony Levene replies:

“As with many of the other companies operating “free calls by voucher redemption” promotions, The Mobile Outlet is bust. The cashback model failed to work – it needed more than 70% of customers to forget to redeem (these would be thrown off the scheme) to be successful, but most set their phones to send reminders to themselves so it slipped few minds.”

Trying to operate a business on the basis of non-redemption is a risky strategy, and one that puts your objectives at odds with that of your customers.

We have seen that non-redemption is the dark secret of the voucher industry, with non-redemption rates as high as 30% putting money straight into the pockets of retailers and voucher companies. For many voucher companies much of their profits stems from non-redemption. However, requiring 70% is an insane business model that proved unsustainable, especially if the process of redemption is straightforward.

At IncentiveDirect, using our SweepBack technology, any unspent points are recirculated back to the clients, who can then redistribute them to others, or use it to fund other incentive activity such as surveys or product knowledge tests.

Transport for London have announced this week, that London Underground are ready to launch a system to enable passengers to pay for their train journeys with a mobile phone. The system would initially be launched with handset manufacturer Nokia and phone network O2, but would almost certainly extend to other mobile makes and networks.

This inevitable step follows the launch of the Oyster contact card payment system, and last month’s launch of a combined credit card and Oyster card from Barclaycard.

Over 50% of all phones sold in Japan have the embedded RFID chips that enable this technology. Contactless payment by mobile phones is set to become part of everyday life.

At IncentiveDirect, we believe that the future of incentives are mobile and connected, combining the freedom of choice of vouchers, with the communication and reporting features that a mobile, online solution can offer. We continue to monitor developments in this sector, and evaluate tools and technologies.

How much would you value not having to do a 2-hour round-trip commute to work?

Flexible working practices are gaining ground as the means of improving employees work-life balance and improving staff retention. Mobile telecommunications and cheaper laptop computers mean that knowledge workers no longer need to be chained to a desk.

But a study by the UK’s City & Guilds and Institute of Leadership & Management has concluded that many managers are suspicious of employees working from home.

As reported in Management Issues, managers may outwardly support more flexible working patterns:

“but scratch the surface and managers remain deeply unhappy about letting employees out of their sight, much preferring to manage a team that is physically sat there in front of them.

The research has found that, while nine out of 10 managers said they trusted remote workers and three quarters recognised they were more productive, a significant minority admitted they were still unable to break their old-fashioned “presenteeism” management style.

This was despite the fact that new technology was making remote working a much more viable option.”

As we have previously asserted, work is not somewhere you go, it’s something you do. Attempting to enforce mid-20th Century working practices based on Taylorist time-management principles is doomed to fail.

The old image of the ‘helicopter’ boss, hovering demoniacally over his staff, will give way to a more enlightened, assertive boss, using communication technologies positively to monitor performance and productivity, and engage with staff.

Incentives are an essential part of the new work economy, rewarding productivity, encouraging proactive behaviours, and helping staff set their own goals. Online systems such as iD-points can operate seamlessly across a distributed organisation, wherever it’s staff may be.

But these systems can also to build an element of community amongst users. Using the news feature to announce winners of monthly performance awards, for instance, is a good way to highlight the success stories of the company, and to emphasise a shared endeavour.

In 50 years time, the idea of a corporate office building may be as alien as a Victorian workhouse is to us today. The rules of engagement between staff and employers are changing. Heads-up companies will plan to promote self-sufficiency, look to hire self-motivated staff, and inspire them further with well structured, tactical incentive campaigns.

Remember, iD-points can be spent on IT equipment for that tricked out home office!