Incentive and Loyalty Insights

- Analyzes Six Popular Rewards Offered by Businesses
- Evaluates Motivational Rewards Effect

Overview: This Case Study, although developed in 1993, provides an excellent example of the full range of analysis questions that can be used to evaluate the attractiveness and effectiveness of Incentive Reward Options. The Incentive Research Foundation offers this early study to you, the incentive travel executive, in the hopes that it is helpful to you in the area of program design, as well as in post-program assessments. Sales and marketing management have traditionally utilized travel incentives as a means of motivating their sales forces to achieve and sustain exceptional levels of performance. Many previous anecdotal reports of travel incentive programs have portrayed them to be a panacea in the work place. However, there is a lack of comprehensive, empirically based research which adequately examines the impact and attractiveness of travel rewards. Furthermore, in order to evaluate incentive travel programs, it is necessary to examine the entire incentive program system. To this end, a study was conducted at a life insurance company that currently offers a variety of incentive rewards to its employees.
Read the complete report> (PDF)

Four Psychological Processes Tip The Scales In Favor of Tangible, Non-Cash Incentives ...

Overview: There is perhaps no subject debated more frequently (or as vehemently) by incentive program practitioners and their clients than the value of tangible, non-monetary (also referred to as non-cash) incentives versus cash.
Read the complete report> (PDF)

Research & Best Practices

Overview: Each year, U.S. corporations spend nearly twenty-seven billion dollars on non-cash incentives, such as merchandise, meals, travel, and recognition awards. When cash incentives are included, the figure is estimated to be as high as $117 billion annually. In spite of 100 or more years of studies on the impact of incentives, discrepancies about their value remain.

For years, researchers from the fields of accounting, education, economics, communications, human factors, psychology, and sociology, have conducted various organizational and laboratory studies on the subject of incentive systems. Due perhaps to the breadth of such research conducted by so many varying disciplines, conflicting information and controversies have resulted. This report was prepared with the goal of creating clear, comprehensive, and accurate conclusions about incentive systems that are supported by research and practice.
Read the complete report> (PDF)

Overview: This is a much-needed guide for measuring performance in the workplace. If you’re a creative executive or manager, and you’re constantly seeking ways to improve productivity and quality in the workplace, this guide will help you. With today’s emphasis on energizing employees toward greater performance — especially in the service sector — the job of gauging and improving output has become paramount. And while many have deemed “performance” an immeasurable intangible, this guide shows how every job and every task can be measured, improved and rewarded.
Read the complete report>

Overview: Sales incentives such as merchandise, meals, travel (and other forms of rewards and recognition) represent a multi-billion dollar industry in the U.S. Some estimates put the annual amount at well over $100 billion (Stolovitch, Clark and Condly 2002). Despite widespread acceptance of incentives as part of sales compensation, true impact on sales performance is often questioned. Proving that a sales incentive program delivered a return on investment (ROI) is one of the most daunting challenges facing incentive program administrators and incentive firms. To say that a sales incentive program was successful in terms of meeting certain objectives is one thing – but it is in the boardroom that actual financial pay back is most hotly debated. To the rescue is the scientific method to determine “causality” – the main subject of this report. At the boardroom level, providing a true ROI measurement requires “causal proof” that the program had a direct and inarguable impact on the numbers.
Read the complete report> (PDF)

A new study on employee motivation and performance lays the groundwork for creation of the IRF Motivation Index.

Overview: Employee turnover within the U.S. fast-food and hotel industries costs those industries in the neighborhood of $140 billion annually. In more bite-sized terms, it will cost roughly 100% to 200% of an employee’s base salary to recruit and train a replacement. Although the turnover rate for these industries hovers between 78.3 percent and 95.4 percent on a national basis, some fast-food restaurants and hotels experience much lower rates, and have significantly greater success retaining employees. Overall, higher levels of motivation and motivated performance translate into a 53 percent reduction in worker turnover. It is generally understood that employment in these industries is often considered to be temporary, or stop-gap employment, with workers leaving eventually for what they will consider “greener pastures.” And certainly, different economics are at work depending on the region, the type of establishment, etc. However, turnover rates also vary within the same economies, the same chains, the same cities, and the same regions. All things being equal, then, what accounts for the differences in turnover rates? And more importantly, what can managers do to reduce turnover at their properties?

The Site Foundation is seeking to answer those questions by studying employee motivation and performance in the fast- food and hotel industries. The study - Motivation in the Hospitality Industry - measures key indices of motivated behavior using the widely recognized CANE (Commitment And Necessary Effort) Model of Motivation. The following describes key findings from research to date and offers methods managers can use to reduce turnover in their fast-food or hotel operations.
Read the complete report> (PDF)

a Business Process Perspective

Overview: This research represents an extension of a previous study sponsored by the Incentive Research Foundation that described ROI (return on investment) assessment of sales incentive programs. The present study adopts a business process view of sales incentive programs noting that their impact can extend well beyond the sales function to other constituents within the organization.
Read the complete report> (PDF)

Using Readily Available Employee Data to Measure the Long-Term Impact of Incentive Programs

Overview: In the past few years, companies in the United States, Europe, Australia, and parts of Asia have broadened the use of incentive travel to include many different types of employees and have become more sophisticated in the way they measure employee performance. Yet, despite the fact that the world’s businesses spend more than $10 billion on incentive travel, there is no research that gauges the long-term impact of incentive travel on organizations and their people. As a result, The Incentive Research Foundation has undertaken a multi -year effort to track organizations that use incentive travel to see how these programs affect performance and to determine what organizations can do to maximize the effectiveness of incentive travel programs.
Read the complete report> (PDF)