Although many people within UK remain on furlough, it is no surprise that Covid-19, has forced companies to re-address employee engagement, reward & recognition, especially during these difficult times. If you are planning on launching a new reward scheme here are 5 simple steps to consider:
Step 1 – Define your objectives
There are many reasons for running a rewards scheme: reducing turnover, driving sales, changing the company culture etc. Whatever you want to do, make sure you dedicate time to think about why you need a rewards scheme and have your goals well defined. This will help you to look back at each stage and ensure your activity is aligned.
Let’s say you wish to drive sales, in that instance, choosing to give each employee a gift on their birthday will not line up. If you want to drive loyalty, do not make your rewards sales driven. It sounds simple enough, but a lot of companies give rewards without an overlying strategy or purpose, therefore you must start with a clear purpose.
Step 2 – Identify your budget
Your budget will decide what you can deliver and will determine the options you have available to you. There are various ways of reviewing how much budget you wish to allocate for your reward scheme. One of the simplest methods is to multiply the number of employees you have by the amount you’re willing to give back to your employee base. Or, you could take the budget you have been assigned and divide this by the number of employees you have – this will give you an indication of ‘cost per head’ Your budget range will also determine the types of reward partners you could work with
Step 3 – Choose your reward
Once you have identified your budget, you want to know how most effectively to use it. The two main areas to look at here is whether to use cash rewards or non-cash rewards. Building a rewards scheme with cash only rewards may seem simple enough, however it can become very expensive quite quickly. As an example, if you were to award £100 one year, your employees are likely to expect the same (if not more) the next year in line with inflation. Award a percentage of salary as a bonus, and that gets progressively more expensive the longer your employee stays with your company. On the other hand, non-cash rewards are easier to manage and are becoming more popular by nature. Vouchers and Gift Cards are a good option as lots of restaurants and retail outlets offer own-brand gift cards and vouchers. Some of which will offer discounts when bought in bulk – so your budget can stretch 5-10% further if you shop around and negotiate final price.
You will want to ensure you choose national retail chains or vouchers that are valid nationwide, this will help guarantee your teams using the reward and they hopefully will not let it expire. It is in your best interest that your teams use their vouchers, otherwise they’re unlikely to look at the reward in a positive light!
Step 4 – Deliver Your Reward Scheme
The fun part! Delivering your reward scheme is incredibly satisfying. Firstly, you want to ensure you internally communicate about the rewards. Plan how you’re going to inform your teams about their new rewards and ensure you try and spread the word via all key internal communication channels. This goes without saying, however, do consult close colleagues about the reward scheme as they can start to create a buzzy word of mouth campaign for you amongst the wider employees. In terms of the actual delivery of the reward itself, you can leave it on people’s desks, add it to the payroll (if it is a cash reward you’ve chosen), send it via an email or post it to people’s homes (an added delivery cost to consider in the budget)
Don’t forget to inform your employees that’s what you have done, this will help cover those out of the office.
Step 5 – Review the Scheme
It’s always best practice to review the results of all reward efforts and this helps with forward planning for the year ahead. The first year of implementing a new reward scheme is always going to be something of a trial, but by the time the second year comes you will be well informed if the scheme was worth it, or not.
Were your colleagues happy with what they received? How did the reward make them feel? Did the reward influence people to work harder? Are your employees likely to stay at the company longer? How many of your colleagues redeemed what you gave them? If it was a non-cash reward you picked. Could you have spent less (or more) and got better results? There’s lots to consider when reviewing your scheme.
According to your decisions in step 1, you will know what questions you need to ask of the scheme and what data you need to review, to calculate the benefits. If you have a BI (business intelligence) team, they could be your best source of internal data and data-gathering techniques. However, one of the simple ways to assess results is to send out an internal survey asking all recipients for individual feedback. Internal surveys have an average response rate of 30-40% so you should receive a good response.
Good luck with implementing your reward scheme!