Have you started planning your organization’s 2011 service award program? The end of August brings both a relief from high humidity and the time to get started working on a budget and plan for awarding employees who will reach milestone anniversaries next year. In the past, many companies simply awarded cash to recipients who were happy to receive a bonus to commemorate an anniversary. Although younger professionals might accept the cash, most do not consider cash bonuses as a reason to stay loyal to an organization. I have three tips to increase retention of Generation X and Y employees as you plan your 2011 service award program.

Appreciate and Recognize Employees

According to the research WorldAtWork.org references in the article, “Study Finds Money Isn’t Everything to Workers,” the most beneficial impact on employee performance and retention is an increase in overall compensation that shows employee appreciation. As you put together your 2011 service award program, make sure that you consider how recognition will be given to employees and how your organization can show employees they are valued and appreciated.

Award Employees with Lifestyle Merchandise

Ray B. Williams supports this recognition idea in his article, “Money no longer the motivator for Gen X and Gen Y?” Williams explains, “A decade ago, Baby Boomer executives who turned to me for advice about career strategies were usually driven by simple motivator--lucrative financial compensation and getting the corner office and title. Today, Generation X and Generation Y, who aspire to be leaders, are driven by different lifestyle choices.”

Make sure when planning your service award program that you provide employees with a variety of lifestyle merchandise awards that appeal to younger employees. Merchandise based recognition programs conceal the value of the milestone being reached by and employee and help to make a service award more than just financial compensation for employee loyalty. When the value of an employee recognition award is unknown, your employees will tend to assign a higher perceived value to it.

Communicate the Service Program

Generation X and Millennial employees need to be aware of the service award program you have planned. There are several different recognition program supplements that can be used to communicate the recognition program and probably the best media include recognition websites and emails. Utilize your employee recognition website as a bulletin board for information on the goals of the recognition program and highlight positive employee behavior. Recognition emails can be sent to employees on their anniversaries and birthdays or thank employees for their contributions. Many younger employees are familiar with computers and will take advantage of information you post online.

In his article featured in Furniture World Magazine, John Schaefer voices his concern for providing a rewarding experience to Generation X and Y employees in order to increase retention. “The data overwhelmingly supports the fact that well-designed incentives will out-perform cash by more than 2 to 1, as well as carry far lower tax consequences,” states Schaefer. Take time to consider how your 2011 service award program will appeal to younger employees and you will be able to retain them in the long term with recognition, rewards and communication.

“There’s a growing acceptance,” acknowledges Laura Schroeder, contributing author to the Compensation Cafe blog, “that one size no longer fits all when it comes to rewards.” Schroeder cites shrinking budgets to an emerging phenomenon of tailored award programs in which individuals are asked how they prefer to be rewarded and the organization designs an award program accordingly. This of course means that a reward program can end up being different things to different employees, or as Paul Herbert calls it a, “Goldilocks Incentive Program”. Many HR blogs are discussing this topic and from my research I have found four main components of a tailored award program that I would like to share with readers.

Gathering Employee Feedback

If you are regular reader, you have probably picked up on this point in previous blog posts but I really cannot overstate the importance and impact on an incentive program when you take the time to gather employee feedback and expectations prior to launching the reward program. There is really no other way to ensure that the incentive program will be relevant and rewarding to participants unless you keep records of employee preferences. Also note that what employees value and prefer changes over time and often depends on what stage in life a person is in, which is where the next two components come in.

Offering a Wide Variety of Award Merchandise

Incentive programs need to appeal to any demographic of participants you are looking to engage with. One of the best ways to have this appeal is to offer a wide variety of lifestyle rewards. If you have locations outside of the United States, you have the added concern of offering a variety of rewards that will be valued and usable in other countries as well. Partnering with an experienced award program provider will allow you to offer hundreds name brand rewards at a valuable cost. Trust industry experts to put together award collections that contain lots of items and a wide variety of items; all of which are state of the art and modern.

Being Flexible

Recently I have received more emails from participants inquiring if their points can be saved, donated or even turned in for other reasons or opportunities. A couple of months ago, one of my clients with a service award program had a recipient who wanted two gifts instead of one but the cost of the two gifts was equal to the original award. All of these situations can be accommodated but it is really up to the organization to determine if points will expire, if people can donate their points to a co-worker, if rewards can be cashed in for vacation or logo’d merchandise and whether a person should be able to order the gift or gifts that he or she really wants. The bottom line is that what people find rewarding varies on a person to person basis and the more flexible you are, the better the incentive program will be at 1) engaging employees to reach goals and 2) maintaining its relevance to everyone in the company.

Changing Goals and Introducing Goals on the fly

Paul Hebert in his recent article on The Goldilocks Incentive Program, describes a sales situation in which product “A” has sold out and is now on back order. As a result, competition is offering a substitute to product “A” and so incentives are offered to sales people to connect with customers and make sure customers understand the differences in the two products and why it is worth the wait product “A”.

With an online incentive program, you have the ability to add, change or remove goals as needed. When incentive program goals have changed, email or other communications can be sent out immediately to notify participants. So in the case presented by Hebert, you could easily add the goal of keeping product “A” on order and communicate this with sales people right away.

In short, tailored reward programs are the exact opposite of a one size fits all reward. When you take the time to find out what employees want, offer a good variety of rewards, try to stay flexible and change goals on the fly, you will have a tailored incentive program that is sure to produce bottom line results.

As I am sure many regular visitors have noticed, the Awards Network website was recently updated. In addition to the fresh look, new resources have been added to the website including a downloadable samples library. These samples are all resources that I have provided clients in the past and I am really pleased to have these resources available online not only for Awards Network Account Managers and clients to use but also for anyone planning a recognition or incentive program. This week I would like to discuss the details of each of the complimentary resources in the downloadable library.

Recognition Letters and Certificates of Appreciation

There are three sets of recognition letters and certificates of appreciation available to download at no charge. The first letter and certificate have simple language and can be used for any type of recognition award. The second letter and certificate were created for service award programs. These are the most common types of recognition programs and often my clients request sample years of service letters and certificates of appreciation to get them started on their own recognition materials. The third letter and certificate is designed for an outstanding performance, above and beyond, caught in the act or teamwork award.

The recognition letters and certificates were created in Microsoft Word which makes it easy for anyone to add in a company logo or signature, alter the text and even change the border colors and styles. These three sets of letters and certificates of appreciation can be used just the way they are or easily customized and even personalized for your company and its recognition award recipients.

Budget Worksheet

If you have one group or you are targeting incentives towards numerous groups of people, this worksheet will assist you in developing an incentive program budget. Formulas have been entered so that you can change the frequency of a goal or number of points for each goal and see its impact on your annual budget. There are two tabs that contain goals for individual locations and one tab containing an incentive program budget summary and discretionary points.

More and more of my clients are including points in their incentive programs that can be given out as needed. Discretionary points are generally distributed to supervisors or managers who can decide how and when to use his or her discretionary points and the team members to give the points to.

Presentation Tips

The presentation tips pdf is another resource for planning a recognition award program. Depending on the goals of your recognition program and employee preferences, there are four ways (formal, informal, random and planned) to present employee awards. Each type of recognition event is described along with what the event achieves, what is being recognized and how to plan it.

Incentive Program Goals

So many clients who are putting together an umbrella incentive program or a total rewards program want to ensure they are not leaving out any goals that could benefit their organization. The incentive program goals sheet has a tab for four different groups of incentive goals: wellness, call center, sales and safety. If you are planning an incentive programs that is targeting different groups of employees, these lists help to give you an idea of what other clients have included in their goals and can get you thinking about goals you would like to include in your reward program.

Setting up a Program Checklists

If you would like to know how to set up a specific type of award program or what you should have ready prior to becoming a client of Awards Network, these checklists include all of the steps needed to get a reward program started. Employee engagement programs, incentive programs, recognition programs, safety programs and a general program set up checklists are all included as references in the downloadable resource library.

Case Studies

There are many case studies and client successes sprinkled throughout the Awards Network website and blog but if you are looking for even more statistics and information on specific types of recognition and incentive programs, the complimentary downloadable case studies are an excellent resource. Call center, employee engagement, online incentives, printed safety, safety recognition, sales incentive, total rewards and wellness programs are all case studies available to download in the resource center. There is even a link at the end of the list of case studies to download all 8 case studies in one document.

If you are interested in finding out more information about these resources and would like to discuss a reward program you are planning with one of our recognition or incentive experts, please contact us by phone or email for assistance.