Core Values

Engaging a recognition and incentive program for employees is a step in the right direction, but it does not guarantee success. What is sometimes overlooked is the importance of organisational goals, if an organisation’s goals are not aligned with those of its employees, programs can fail, for example:

  • “Bankers maximise their bonuses while forgetting about the health and integrity of the financial system.
  • Call centre staff hurry customers off the line or transfer them so the employees can meet their quota of calls per hour.
  • Salespeople maximise their commissions and forget about what best meets the client’s needs or what is best aligned with the firm’s capabilities. When top sales executives are incentivised to maximise their bonuses and options, the result is “channel stuffing” – overloading retailers with goods just before the end of reporting periods.
  • Whenever production is incentivised in terms of the number of units produced or the cost per unit, the result is simply more inventory, more cash tied up in inventory and less flexibility in coping with changing demand.”

Today, Leading Company published an article titled “When your Incentive System Backfires”, written by Vijay Govindarajan, a Professor of International Business at Dartmouth College. Govindarajan succinctly highlights how some organisations are getting it wrong with their programs and how we can learn from them and get it right.

Read the full article here.

Mark is the General Manager of Power2Motivate APAC, delivering world class employee recognition and B2B loyalty programs to a wide range of clients.

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