FEATURESTORY

SalesForceXP September/October 2007 CoverWho Loves Ya, Baby?

The importance of making employee rewards memorable

By Scott Jeffrey and Lisa Silbert

Sales managers constantly ponder what they can get employees do in pursuit of rewards, but an equally important question - and one that is not asked as often - is what will employees do after receiving a reward, specifically a non-cash reward?

Our research shows that the more often an employee recalls receiving an incentive, the stronger that employee perceives he or she is supported by the employer.

Employee-Employer Relationships

Early work on the psychological relationship between an employee and employer studied the difference between two types of relationships: exchange relationships and communal relationships. An exchange relationship occurs when one party gives something of value to another party with the expectation that a benefit will be returned. A communal relationship is more of a social exchange, where each party is concerned with the welfare of the other, and therefore benefits given are not strictly as part of an economic exchange.

The Study:  A group of 133 sales professionals were recruited from an international organization specializing in incentive programs used in a variety of industries and job functions. In a pre-survey, they were asked to provide up to three incentive rewards they had previously received from their firm. They also were asked 55 questions designed to capture their view of their relationship with the firm, their supervisor(s), and their opinion of the fairness of the firm.

At a second point in time, we asked them questions about how much they liked their reward and how frequently they thought about or were reminded of their rewards.

Results:  We received completed surveys from 59 employees so the sample size is somewhat small. However, our results were highly significant statistically, which to a large extent contributes to the credibility of the results.

As has been found by other research, fairness perceptions had a positive impact on perceived support, as did the quality of supervisory relationships. Beyond those previously studied effects, we found a large and significant effect for the frequency of reward recall. For each one unit change in frequency, perceived organizational support rose by approximately one-half. For example, if the number of times an employee thinks about their reward changes from "weekly" to "daily" (a two-point shift), the response to questions that address perceived support go from agree to strongly agree.

This study shows another way in which tangible incentives can work to motivate your work force. Beyond exerting effort in pursuit of a tangible incentive, once employees possess the award and use it, they will be reminded of how the firm values them. This leads to positive long-term behaviors that benefit the organization.

The relationship between an employee and an organization cannot be strictly classified as either exchange or communal. In some cases, employees feel that the extent of their relationship with their firm is explained by the fact that the company provides them a paycheck in exchange for service. In other cases, employees have more of a personal relationship with their company. They believe that they are not "just another employee," but that they uniquely contribute to the survival and growth of the organization.

Building perceived organizational support

There are four main ways to create a positive perception in employees: good supervisor relationships, favorable job conditions, fair policies and practices, and rewards and recognition. Consequently, supportive actions taken by a supervisor will not only be seen by the employee as direct support from that supervisor, but also as support from the organization.

When an employee initially receives a reward from the organization, the employee will realize that he or she is valued by the organization. The more frequently the employee sees, thinks about or uses the reward, the more that worker will realize that he or she is valued by the organization, thereby increasing the employee's perceived organizational support.

Lisa Silbert, received her master's degree in applied science in 2005 from the University of Waterloo, where she was under the supervision of Scott Jeffrey. She currently does process improvement for the government of Ontario.

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See also in the article: Reflections on Rewards

Study Shows Increased Use of Non-Cash Incentives

You Were Always On My Mind

Who Loves Ya, Baby?

 

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