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June 2009 | Volume 28 / Number 1
Ask the Experts

Considering Incentives

By Tim Passios,
Director of Product Management, Interactive Intelligence

I have a sure-fire method of guaranteeing high attendance at your next meeting. Send out an e-mail saying “We will be discussing your paycheck at the next meeting.” You’ll have a line at your door in 5 minutes!

Compensation is always a relevant topic in contact centers. Constructing an effective incentive strategy is tricky. How do we compensate? How much should the incentives be? How does the company get the benefits they seek? How quick does the reward need to come after the goal is achieved? I will provide some helpful guidelines for these questions based on proven experiences.

Incentives are powerful motivators for many companies and employees and their potential impact and benefits should not be ignored. They are especially effective for special or critical projects and in sales-oriented or outsourced contact centers.

Additionally, many high-performance employees are strongly motivated when their compensation is directly tied to their sales performance. Contact centers can use such compensation plans to attract these highly motivated employees, increasing sales and market share. In many cases, cultivating a highly stimulating and exciting sales environment with a little healthy competition actually increases sales a bit further.

Before creating an incentive program, consider whether you can report on the criteria you are trying to incentivize. Make sure your systems can report the right metrics and do it in the right time increments. If you can’t, fix that problem first. If calculating your daily incentives consume an hour per day, that should be impractical. Once you’re sure the reporting is working, you’re ready to create your plan.

Here are some guidelines to get you started:
First, don’t think incentives always have to be cold, hard cash. Some people value time off or other types of “compensation.” Don’t get me wrong — financial compensation works well most of the time. Give people choices and let them decide. You can’t know the preferences for every person and you don’t have to if you offer choices.

Second, make the rewards more frequent. Even a small incentive daily can improve attendance and schedule adherence. Make Monday and Friday rewards a bit bigger to help resolve the “weekend effect” many contact centers experience. If you do one monthly or quarterly reward, your employees have fewer chances to win. If they don’t win, they know they have to wait a long time and their chances aren’t good. After all, they worked hard the last time and didn’t win. Why will next time be any different? Subconsciously, the connection between their performance and the reward is not strong and at some point, they may decide that the value of an unlikely reward is not worth the extra daily effort. Work to avoid that feeling by using frequency.

Third, find a balance in the goals. Make each goal challenging but achievable. People give up and performance suffers if they know they don’t have a chance. Conversely, if the goals are too easy to achieve, performance won’t increase and their rewards become entitlements.

Fourth, don’t delay the receipt of the reward. If you can give cash or a gift card immediately, do it. Don’t wait and add it into the next payroll check. There is a subconscious connection between the act of the performance and the timing of the benefit.

Here’s an effective idea I heard. A contact center manager filled a paper grocery bag with a mix of $1, $5, $10, $20, and $50 bills. (Since he filled the bag, he controlled the mix and stayed within budget.) Then when it was time to reward someone, he walked through the office with the bag. Everyone noticed and knew what was going to happen next. They followed him or peeked around the wall to see where he was going. (Great exposure and great participation.) When he finally stopped, he announced who the winner was and why they won the opportunity to draw from the bag. (The employee received recognition from management and the other employees were reminded what goal had been achieved.) When the employee reached in the bag, the amount rewarded was left to chance. If $1 was pulled out, the employee knew it was chance and didn’t blame the manager that it wasn’t a $50. The other employees noticed and knew there were still $50 bills in the bag. If it was anything besides a $1, that led to a mini-celebration right on the spot. Lots of joking occurred too. “Hey, we need more $50 bills in that bag!” “Why? Do you think you’re going to get a $50 when you draw?” “I sure hope so!”

A properly designed incentive program can accomplish many goals at once. Use the guidelines I’ve described as a starting point. Every contact center has slightly different needs and goals. Tailor your plan to help you achieve them.

Tim Passios is Director of Solutions Marketing for Interactive Intelligence, Inc. and has more than 18 years experience in the contact center industry. Interactive Intelligence is a leading provider of IP business communications software and services for the contact center and the enterprise, with more than 3,000 installations in nearly 90 countries. For more information, contact Interactive Intelligence at [email protected] or (317) 872-3000.

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