The sentiment for more reward and recognition through incentive programs has increased dramatically, according to the latest findings by Incentive Research Foundation. Its “2020 Top Performer Study” found that a whopping 94 percent of executives surveyed were strong supporters of reward as a competitive advantage, up from 86 percent last year.
This study, which included 153 participants, focused on the technology sector of a total top performer sample of 400 companies—those that experienced more than five percent revenue growth within the past year, among other requirements.
The study’s purpose was to find how incentives and rewards from top-performing companies differentiate from others. While the study does not make the claim that strong incentive programs lead to better business performance, it does suggest there is a correlation between strong business performance and a company’s commitment to incentive programs.
Top Performers Offer More Flexibility
A key difference found between top performers and their competitor companies is the priority given to the flexibility of tangible rewards. Top performers were more than twice as likely (35 percent) to list this as their most important consideration when giving merchandise or gift cards, as compared to competitors (14 percent); they also prioritized “ease of administration” (17 percent).
In creating incentive travel programs, top performers placed a greater emphasis on participant flexibility (30 percent), versus 7 percent of competitors. The competitors tied “appealing across large audiences” and “building emotional connections” (21 percent) as their priorities. Top performers place a greater emphasis on personalization of incentive trips and noncash incentives, rather than appealing to the greatest number of people.
Top Performers Focus on Incentive Trips
Although top performers and their competitors were similar in their offering of award points, gift cards and individual incentive travel, with only slight differences in percentages, top performers had an evident advantage in their offering of group incentive trips–42 percent versus competitors’ 32 percent. Nonetheless, the competitors who offer these trips more than doubled (from 15 percent in 2019).
Program Reach is Expanding
The percentage of technology companies that design incentive programs with the goal of reaching all participants, while also recognizing exceptional achievers, more than doubled from last year, from 10 percent in 2019 to 22 percent in 2020. Competitors with this goal also increased, from 15 percent to 24 percent in 2020.
The study found that top performers were almost twice as likely to structure programs with the aim of giving each participant recognition or a reward during the program: 58 percent versus 31 percent of competitors. They were also more likely to structure programs to reward top achievers: 43 percent versus 17 percent.
While the data shows top-performing technology companies have higher levels of engagement and give more attention to noncash incentives, the study indicated that both top performers and their competitors are increasing their investment in incentive programs.