Every business requires a good rewards program. The chief goal of these programs is to nurture goodwill between a company and its stakeholders. Most rewards programs target the customer, who is considered as the main stakeholder in any business. Other business owners introduce such programs to nurture good relationships with the employees, suppliers, distributors and all other stakeholders. Goodwill is an important aspect in the growth, profitability and sustainability of any business. These programs therefore benefit both the business as well as the stakeholder involved. The following are some of the benefits accrued from these programs.
It enhances employee productivity. Employees are determined to achieve all the targets set by their departments and meet the expectations of their job role in order to obtain the reward. It boosts employee motivation. Employees are usually motivated to work since they are assured of recognition and appreciation at the end of the day.
It facilitates loyalty from all stakeholders. Your stakeholders will stay loyal to your brand if you give them rewards for their efforts. Suppliers will start seeing you as a credible partner and thus trust you with products even on credit terms. Customers will be determined to make all purchases from your stores in order to earn points or obtain the benefits of the reward system. Employees will be motivated to work for you for a longer time in order to continue receiving the rewards associated with duration of service such as promotions and trophies.
It leads to the achievement of company goals. Employer sets target and rewards those employees who meet the targets. Therefore, more employees will be working towards achievement of those goals in order to obtain the promised rewards.
It reduces operation costs. Employees become more devoted to their work by reporting without fail, sticking to one employer and thus reducing the costs involved in recruitment and absenteeism.
It leads to reduced absenteeism. Most workers abandon duties due to low motivation. They always find an excuse to absent themselves especially if they feel unappreciated. Rewards programs seek to recognize outstanding employees, and appreciate the efforts of the most hard working and dedicated employee. At the end of the day, all employees have something to keep them working. They have all reasons to work tirelessly and report to work without failure since they are assured of a reward for their hard work and input.
It enhances teamwork. Employees work together as a unit in order to achieve the set targets and achieve the promised reward.
Features of a successful rewards program
• It involves all stakeholders. The person being targeted by the rewards program should be involved in the implementation of the program. The managers should take their time to educate both parties on how the program works in order to achieve success from it.
• It is based on clear guidelines. The person giving rewards and the person being rewarded should have a blueprint of the criteria used to give and receive the reward.
• Its results are measurable. Both parties should be able to know the results of the rewards system.
• It is based on mutual benefits. Both parties should benefit from the system.
• It is consistent. Once it is implemented, it should continue throughout the life of the business. The timing for giving the rewards should also be clear from the beginning.
In order to succeed, you need to:
• Set realistic and achievable goals
• Come up with a list of expectations prior to implementation of the program.
• Create a system of measuring the success of the program.
• Educate the employees on how the reward system works.
• Ensure that the results are clearly visible and affect the overall company goals.
• Implement meaningful rewards.
• Give out the rewards immediately.
• It should be sustainable.
• It should impact productivity positively.
• If it targets customers, it should impact the overall productivity of the company positively.
• All programs targeting customers should have a validity time. Do not allow customers to accumulate points and leave them unused for years. Let them use the points as soon as possible so as to stay loyal to your brand.
• Give your customers freedom to choose their favourite provider.
• A good customer loyalty program has multiple tiers of membership. All members are ranked according to specified criteria.
• Create a strict rewards budget so as to avoid loses.
Therefore, before you create a rewards system, it is important to consult with the parties involved, come up with a budget and write down a blueprint of how the system will work. Click here to find out how you can start your own rewards program.