In the post-recession business world, employee incentives are often the first programs that companies put on the chopping block. Extravagant corporate trips and employee gifts risk giving bad publicity in an age of austerity, and they’re also not seen as a necessity for running a business.
Rewards, after all, don’t seem to have a direct link with producing goods, making sales calls or covering operation costs.
Still, employees will remember how they were treated during the hard times. Overworked and unrewarded staff are likely to seek out greener pastures as the economy improves and companies begin hiring again.
Costly incentive programs need not be the only answer to increasing productivity and employee retention. At the heart of staff reward programs is engagement, and the simple feeling of recognition that people yearn for.
This stays true for all companies: Incentive travel and other rewards programs work just as effectively among Chinese employees as in other parts of the world. At the same time, multinational corporations (MNCs) based in the country can still think creatively and tailor incentive programs to the local environment.
While cash bonuses are often tied to employees’ productivity or sales performances, they are not as effective in fostering a sense of loyalty or pride in the company they work for. For example, receiving US$1,000 to deposit into a bank account or to help purchase a car, does not establish the same kind of emotional connection with a company as an actual gift.
Giving a watch, or organizing a company retreat that incorporates team-building activities, creates an experience – a memory in which an employee feels he belongs to a team that recognizes and appreciates hard work.
“Employee of the month” programs have a similar effect, and work well with China’s emphasis on face, or mianzi. With this in mind, some companies opt for a visible appraisal method, posting staff members’ photos on a wall and placing gold stars against those who have performed well. This easily translates into a points system, where people are given a gift for accumulating the most stars.
While the initiative is simplistic, its merits lie in its transparency. Recognition is not hidden under the table, but provided a spotlight where all employees can compete for a moment to shine. As such, even small firms with limited budgets can find ways to increase productivity.
Furthermore, MNCs can also learn from their Chinese counterparts. The country’s largest dairy producer Bright Dairy & Food (600597.SH), for instance, has taken note of how much parents and family can sway an individual’s job decision in China. The company responded by not only showing appreciation for its factory employees, but also for their families: It mailed letters to all parents, thanking them for allowing their children to contribute to Bright Dairy’s success.
Lavish resorts and huge cash bonuses may be sought after by many, but the simplest reward – getting a pat on the back and feeling empowered – is equally important. Companies that make an effort to do so will reap rewards too.