Are Non-Cash Rewards Effective?

Economists say the economy is recovering, but employers are still having a hard time finding money to hand out cash incentives. If your company is a little short on cash, you don't have to give up on employee incentives completely. It's possible to use non-cash rewards to motivate employees and make your company a more attractive place to work. Here is what you need to know about developing and implementing such a plan.

There are dozens of non-cash rewards you can use to increase employee engagement and retain your best employees. There isn't one incentive that is right for every company, so you need to know what motivates your workers and pushes them to do their best. If some of your employees want additional learning opportunities, starting a mentoring program is a great way to motivate people without spending a lot of money. For those who thrive on recognition, giving out certificates of achievement is a low-cost way to keep people engaged.

Once you choose the right employee incentives, you need to develop a formal incentive plan. The Society for Human Resource Management says non-cash rewards are most useful when they are tied to organizational values. The employee incentives you choose should also be meaningful to your employees.

If you decide to create an incentive program, it's important to customize the program based on your organization's needs. The best way to customize such a program is to set goals before you do anything else. Think about what you want to accomplish by offering non-cash employee incentives. Do you want to reduce turnover, increase employee engagement or motivate your employees to work harder?

Employee incentives need support from managers at every level. Executives can show their support by promoting the program and talking about employee incentives in a positive way. Supervisors and team leads can get involved in the program by reviewing program applications or handing out awards. If you really want your program to succeed, allow employees to nominate their peers for awards. Employee involvement is essential if you want your program to succeed.

Once you implement an incentive program, you need to keep it fresh. Don't give the same awards every quarter, or people are likely to lose interest. Reward employees based on their professional goals and personal interests. If you know one of your employees enjoys yoga, a gift certificate to a local yoga studio is an appropriate reward. Just be careful not to choose rewards that inadvertently cause hurt feelings. It's not a good idea to give away a gym membership unless you are sure the employee has a genuine interest in using the gym.

Cash incentives are great, but not every organization can afford to hand out cash every time an employee deserves some recognition. Non-cash employee incentives have the power to motivate employees and reduce turnover without having as much of an impact on your budget.

Photo courtesy of Stuart Miles at FreeDigitalPhotos.net