Most companies put a great deal of work into finding the best available talent for their open positions. After spending countless hours and dollars recruiting, interviewing, hiring, and training, businesses want to keep that talent around for more than just a season. One of the most obvious answers to employee retention to make sure you’re paying them a competitive wage. The challenge, however, is that your budget may not always allow for increased compensation packages. Without the proper incentives, your employees may start to disengage and, eventually, start looking for other jobs.

Luckily, increased compensation is not the only way to incentivize employees. More importantly, today’s ever-changing workforce wants more than just money. Financial incentives may attract and retain employees, but specific non-monetary programs can be better ways to attract and retain talent. In addition, many companies enjoy higher revenue results from their non-financial incentive programs.

Here are some things to consider when planning your plans to increase employee engagement, attract talent, and keep employees happier for more extended periods.

Why Try Non-Monetary Incentive Plans?

Financial incentive programs have been the go-to for motivating employees for a long time. The thinking is that employees are more invested and will work harder if they are paid more. Bonuses, commissions, and contests do see some success, but non-financial rewards also see results. To better understand why it’s worth considering adding non-financial rewards to your organization, let’s compare the two kinds of programs.

Monetary Rewards

• An incentive that involves direct money given to employees.
• Top-performing and extremely talented employees earn them.
• Often cause employees to focus only on money.
• Are an expense to the company since they involve additional payments.
• They can cause jealousy and unhealthy competition among employees, although they can also foster healthy competition and innovation.

Non-Monetary Rewards

• Incentives that do not involve money being given directly to employees.
• They are often given to entire teams of employees.
• They can also be considered an additional expense to the company.
• Less likely to hurt employee relationships.

One of the most crucial things to consider is what it costs to have unmotivated and disengaged employees. Studies show that lazy workers can cost companies substantial amounts of money each year.

Research also indicates that non-monetary compensation is a better long-term motivator when compared to monetary incentives, which tend to only last for a short time.

Here are some of the top non-monetary incentives that make the most impact.

1. Physical Rewards

Non-Monetary rewards might sound like they’re free, that doesn’t have to be the case.

In the strictest sense, non-monetary simply means that employees do not get money directly. Inexpensive physical rewards can be a huge motivator. Tickets to a concert or play, restaurant gift cards, company swag, or other experiences can go a long way. Companies might also consider rewards that can be used over a long period of time. Bonus checks are deposited and forgotten. Physical rewards can be reminders of an employee’s hard work.

The key to a successful physical reward program is that all employees must be able to earn them.

If rewards are only attainable by individual employees, the positive effect can be lost. The other key is being clear about what kinds of actions earn a reward and maintaining consistency. The employee who works extra hours and receives a coffee mug may grow to resent the other employee who works the same extra hours for a gift certificate. Inconsistent rewards will eventually stop being effective incentivizes.

At the same time, physical rewards can still be based on merit and accomplishments. These rewards can also be an occasional approach, so long as the programs are fair.

The final thing to consider is when rewards should be given. To best reinforce the positive behavior, rewards should be given as close to the reward-earning action as possible. Surprise rewards are still appreciated but are best used for long-term morale.

2. Recognition and Praise

Your employees that they are valued is a relatively easy way to improve engagement. Most surveys show that receiving praise from a supervisor is the best method for motivation. Here’s how you can create an effective employee recognition program:

• Create a recognition team. These individuals want to promote engagement around the office
• Create a list of positive behaviors to reinforce. These behaviors should contribute to the company in some way. They should also be something that can be identified.
• Set realistic goals. Every employee should be able to be recognized and should understand the expectations of the program.
• Recognize employees often. A good program is consistent in how it rewards employees.
• Make the program work for your company. It would be easy to search for and copy an existing program from another company. This plan may not work for your company’s unique culture. It’s fine to seek inspiration from another company’s program, but make sure to tailor it for your needs.

There are a variety of ways to show praise to employees. In some cases, a personal thank-you note from management is a great way to reinforce a particular behavior. In other cases, a public announcement or awards ceremony is the best option. More significant events, like a ceremony, should be reserved for significant milestones and accomplishments.

3. Work-Life Balance and Flexibility

A healthier work-life balance and greater flexibility in the office is another motivating factor for employees. Allowing for greater flexibility in the workplace has a considerable impact on employees’ engagement and overall job satisfaction.

One of the most popular non-financial perks involves allowing employees to telecommute. With the rising cost and time spent commuting to work, employees often find a day working from home to be a significant perk. With the Pegasus One custom software development of newer technologies, working from a remote location has never been easier.

Of course, there are industries and jobs where telecommuting wouldn’t be possible. In these cases, offering flex-time could be a better alternative. Employees who don’t have to take personal days to attend their kids’ soccer games are going to be much more committed to their jobs. Flex-time allows employees great flexibility without having to miss work.

Other rewards, like gym memberships, can also improve work-life-balance.

Having a consistent program is critical. If nothing else, taking an interest in what employees do outside of work can make an impact. A new mother, after returning from maternity leave, for example, might appreciate a more flexible schedule. Adjusting to life after introducing a baby to the house can be challenging. A little bit of understanding can make a huge difference during this time.

Read more: Modern Learning and Development

Conclusion

There seems to be no end in how companies can reward and motivate employee engagement. These efforts are well worth it as engaged employees outperform those who have lost interest. Financial incentives are undoubtedly lovely and can go a long way, but not every company can afford additional bonuses. Many companies benefit from implementing non-monetary incentive programs with great success. In many cases, the effects of these non-financial programs have even more significant long-term rewards.

What non-financial incentive programs has your company used? Share your experience in the comments below. 

© New To HR