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STEP 1: IDENTIFY OBJECTIVES
- Sales?
- Service?
- Safety?
- Customer loyalty?
- Quality?
While objectives should support overall company goals, they should be tailored to reflect the realities of your markets, your customers and your target audience. Increasing sales is the most commonly cited incentive objective; however, there are countless types of program goals:
- Introduce new products and services
- Invigorate slow seasons
- Increase product knowledge or selling skills
- Establish new procedures or processes
- Bring in new leads or referrals
- Retain and service existing customers
- Improve customer satisfaction scores
- Reduce turnover and/or improve attendance
- Improve driving records or warehouse safety efforts
- Solicit employee revenue-generating and cost-saving ideas
Performance measures are based on common sense. Keep the "three M's" in mind when setting objectives:
1. Meaningful. Company goals need to be translated into meaningful performance objectives for each participant. Make them simple and specific so participants have a clear understanding of what you want them to do.
2. Measurable. You should be able to measure both quantitative and qualitative results. Confirm the source and reliability of the information used to track performance. (If data is only available quarterly, do not measure performance monthly. Or, for instance, if you don't have a customer feedback system, then don't establish an objective to increase customer satisfaction.)
3. Moveable. Set goals that are challenging, but attainable. Make sure participants believe they can move past the mark. Your program is destined for failure before it begins if objectives are perceived as too ambitious or unreachable.
Properly Defined Objectives:
- Reduce average order turnaround from 48 to 24 hours in the next quarter
- Increase sales of product X by 15% during the next 60 days
- Achieve 95% attendance during the next three months
- Identify $100,000 of cost-saving ideas over the next six months
- RESIST trying to accomplish all of your goals in one program. Focus on the objectives you believe to be the most important now and save the rest for future efforts.
- LOOK BEYOND the performance you want. Ask yourself, "Why are desired performance levels not being achieved?" If, for example, sales of a certain product are not as high as you would like, perhaps it is because Sales Reps or Distributors don't know enough about the product and are not comfortable selling it. In this case, increased product knowledge might be one of your objectives.
- EXAMINE company and participant historical performance data first. Look at trends for seasonal cycles in your business; length of service compared to sales volume; geographic considerations; etc. Use the data to ensure sound business goals and attainable objectives for participants.
- CONSIDER timing and length of your promotion. How long will it take to accomplish objectives? How will you hold participant interest? Does your competitor run a program? Should yours run at the same time?
- REMEMBER, incentive programs are just one element of your entire marketing strategy. As part of the mix, incentive programs can pinpoint specific objectives and achieve incredible results. If your product has a flaw, however, or you don't have enough sales or service support to address customer needs, an incentive program alone won't solve your problems.
WHEN ALL IS SAID AND DONE, the two most important perspectives to keep in mind as you develop and evaluate any program are:
1. Your Participants: If you were a participant in the program, would you put forth the extra effort required to take advantage of the earning opportunity?
2. The Sponsors: As the sponsor of the program, will you feel the program's investment generated a satisfactory return?
Next step - STEP 2: Define Target Audience
Back to 10-Step Incentive Process
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