by Susan Adams | September 24, 2018
The incentive and recognition marketplace touches every industry from manufacturing to tech. Program audiences are made up of top performers in financial services and retail workers in big box stores. Rewards range from a sincere "thank you" with a handshake to group incentive travel programs valued at tens of thousands of dollars per winner. As performance improvement and engagement specialists, we have worked with every conceivable reward and our communications go out across every possible media. Even with this complexity, all programs have two things in common: the participant and the client.

I am fortunate to contribute to the work of the Incentive Research Foundation and over the last couple of years, we have put extra focus on the business environment of clients and corporate end users. The IRF recently released The Voice of the Market, Parts 1 and 2, a qualitative study that explores the challenges, industry awareness, and solutions employed across 50 organizations. Here's what IRF researchers found out about the clients and what it means for us as an industry:

Recession Is in the Rearview Mirror

Everyone in our industry remembers 2008 with a shudder. AIG's travel program made the nightly news and incentive travel -- the most powerful motivator -- went from being a strategic reward to a vilified "junket" overnight. As incentive, recognition, and engagement providers weathered the storm of reduced budgets, they also faced questions about the legitimacy of non-cash rewards and recognition as solutions for business challenges.  

Those days are over. Across the board, the data proves the value of these programs and now over 80 percent of businesses use non-cash rewards as part of a suite of solutions to keep their employees and channel partners engaged with the company mission and goals. Measurement and centralized program accounting are important validating steps, but as Part 1 of the study states, "End-users interviewed for this research are strong believers in the merits of non-cash rewards and report that this sentiment is broadly shared among their executive teams." 

In fact, "strong belief in recognition and rewards" and "strong executive buy-in" are hallmarks of best-in-class companies, as identified by IRF in the paper, Ten Things Top Performing Companies Do Differently. There is clear confidence that incentive, recognition, and rewards programs represent sound business strategy and in 2018 there is a healthy appetite -- and budget -- for effective solutions to increase performance.

Solutions Remain Disorganized

The problem, however, is that programs remain scattered across organizations. This decentralization represents risk to companies in a number of ways:

Too Many Cooks: Diffuse or conflicting messaging, even with channel partners
Reinventing the Wheel: Duplication of effort and resources
Gift Cards in the Desk Drawer: Lost control of centralized purchasing, accounting, and taxation

Third party organizations, such as incentive houses and engagement providers, have seen some large corporations with literally hundreds of distinct programs, many operating without the benefit or oversight of cohesive communications, regulatory guidance, or accounting and procurement support. Bringing those programs together allows for consistent branding, clear goals aligned with corporate intent, and economies and efficiencies of scale.

A Need for Knowledge

Additionally, Part 2 of the study found that "incentives and recognition management is not a career path typically sought deliberately by program owners."

In fact, in an informal chat with incentive and recognition industry colleagues, we discovered that none of us signed up for this. Each of us came to motivation and inspiration down a different path, learning as we went. As an example, I started planning French incentive travel programs because I had a wonderful experience as an exchange student in France. I didn't really know what the programs were all about strategically. My understanding of the whole industry exploded when I came to Next Level Performance (then Dittman Incentive Marketing) and had the opportunity to get involved with the Incentive Marketing Association, Recognition Professionals International, and the IRF. Good connections, good conversations, and a lot of reading later, I see the industry for what it is.

It is no different for corporate end users. Most of corporate end users are learning on the job, seeking out connections through industry associations, and searching the web. And while many end-users really enjoy the ownership of this role -- after all what's not to love helping people make a positive emotional connection to their work -- it is important for us as an industry to acknowledge that corporate end users often have no idea of the resources that are available to them, even as programs grow and stretch capabilities beyond capacity. 

Further, when this lack of exposure is also true for senior leadership, there may be little reason to pull programs together under one umbrella of communications, technology, and strategic goals. 

What Can Incentive Providers Do?

We must ensure that the corporate end user has a seat at the table. End users make up part of the IRF board, contribute to research efforts, and are an important consideration when planning communications and education. By bringing together end-users, third party providers, and vendors, we advance the end goals: participant experience and organizational success.

The IRF is also working with the academic community, contributing to curriculum planning and funding grants so that students of business and hospitality have some exposure to the latest thinking on incentives, recognition, and engagement as a business strategy. 

Third-party providers and vendors must work towards educating clients on the benefits our industry and resources they can bring. We can begin by supporting efforts of industry organizations and media, sharing content socially, including clients in our plans for education, or sponsoring meaningful research.

It's our job to take the client's vision, apply our extensive partnerships and resources, and amplify their message and intended experience. 

Susan Adams is Vice President of Engagement at Next Level Performance and a member of the Board of Trustees of the Incentive Research Foundation.