Keep it simple seems like good advice when it comes to employee incentive programs. It’s the first of a few rules of thumb offered by a compensation expert in our cover story this month. It seems like a no-brainer to me, as someone who can barely keep up with her school-age daughters’ sticker charts.
Landscape company owners and managers have enough on their plates. Why would you want to create a complicated program that someone has to track and employees may not even understand? But upon further investigation, I can see why some incentive programs get complicated.
On the surface, setting goals—and rewarding people for meeting them—seems like a reasonable thing to do for a company that’s looking to grow. Unfortunately, it’s not that simple.
Consider the Wells Fargo scandal that broke last year. Under pressure to meet quotas for selling multiple financial products to individual customers, the bank’s employees created millions of fraudulent accounts for clients—unbeknownst to them.
The resulting firestorm led to a $185 million fine, a Congressional investigation, the resignation of CEO John Stumpf and an untold amount of bad press.
You get what you pay for is an often-cited phrase in employee incentive circles. If you’re not careful, you may be rewarding things you don’t mean to.
The Wells Fargo example may be an extreme one, but there are many other instances of unintended consequences across multiple professions. When money is on the line, people find ways to game the system.
That’s why setting up a basic rewards program isn’t so simple. The landscape industry isn’t immune to this phenomenon. You end up with multiple caveats, and before long a simple program is a few pages long and may be more trouble than it’s worth.
The truth is, incentive programs alone don’t create lasting behavioral changes. They only ensure short-term compliance. But that doesn’t mean they’re unfeasible.
Experts say the companies that find success with incentive programs tie their rewards to the firm’s overall profitability and combine their incentive programs with educational efforts that emphasize the company’s culture and values.
Above all, the goal should be to recruit and develop employees who think and behave like owners and are rewarded for doing so.
Editor’s note: This month we say farewell to Associate Editor Dillon Stewart. Thanks, Dillon, for all your hard work over the past two years, and good luck at Cleveland Magazine!
