When it comes to motivating employees, everyone prefers cash, right? In fact, the opposite is true. The use of non-cash rewards by U.S. companies has recently exploded. A recent Incentive Research Foundation study estimates that the number of firms using non-cash rewards has risen sharply from approximately 25% in the 1990s to more than 80% in 2018. Consider rewards and recognition programs that motivate your employees with non-cash rewards.
Administrators like you are finding that focusing on recognition is key to building high-performing teams. This is especially true in today’s competitive job market, which emphasizes employee engagement. So, if non-cash incentives have the advantage, why are they more effective? Let’s consider what end-users had to say about their experience with non-cash awards.
The merits of non-cash rewards.
IRF’s research team interviewed 50 end-users about a range of non-cash rewards programs in order to understand what they considered relevant and compelling. Results from this 10-month 2018 study revealed that cash is not widely preferred, and that it is firmly viewed as compensation (i.e., another business transaction). On the other hand, the merits of non-cash rewards were extolled as complementary to compensation, and tied to an entirely different sentiment. Whether a program was small and new or had run for years on a million-dollar budget, non-cash recognition was viewed by survey participants as celebratory. Celebratory!
From a social aspect, the impact on corporate culture is that non-cash rewards are more fun and memorable than cash. Non-cash rewards are more likely to be discussed with pride and a friendly sense of competition. A teammate earns a weekend trip and tells her coworkers. They join the excitement and applaud her. By contrast, a cash bonus creates envy or even a sense of entitlement. One reward ignites imagination and inspires a chain reaction, while the other is kept hush to avoid invoking jealousy.
More bang for your buck.
Research shows that merchandise and travel rewards provide lasting reminders of success. They also lengthen the boost in a participant’s performance. A survey of corporations by the American Productivity & Quality Center found that “sales incentive programs offering non-cash awards generated more tangible results than those offering cash.”
Participants report feeling more satisfaction from non-cash awards because they don’t have to feel guilty spending them. Whether points, merchandise, or trips, the reward is thought of as “extra.” Compared with a cash reward of $1,500, which might be applied to a loan or bill, you can guess which will be most memorable. In our experience, we have seen countless surveys in which the participant had fun and felt valued—the makings of memories.
Promoting your non-cash rewards.
Non-cash programs are easy to promote, too. It’s uplifting to work on giveaway marketing, and your employees will engage in water cooler talk about which prizes they’re striving to earn. Even outside the office, participants are likely to create a buzz about the wonderful “perks” their company provides. While they’re considering how to improve their performance, outsiders are drawn into the story of your company.
Engaging your team.
Recognition is fundamental to achieving a cohesive, high-performing organizational culture. At VIKTOR, we are known for our performance-related incentive travel trips and rewards programs. We also have an engagement team who decides how to reward our own staff’s hard work. We may hold an outing, order in Chinese food, bring out the snack trolley, or recognize wellness activities with points redeemable at our online store. Ideas you can implement in any office setting. Your staff probably has a few suggestions of their own.
You’re already committed to employee recognition. As you plan your next motivational reward, we hope you’ll take a closer look at non-cash rewards to see what’s most meaningful to your participants.