{"id":131014,"date":"2016-02-29T00:00:00","date_gmt":"2016-02-28T22:00:00","guid":{"rendered":"http:\/\/qmarkets.net\/carrot-vs-cash-how-to-make-your-innovation-incentive-program-addictive\/"},"modified":"2016-02-29T00:00:00","modified_gmt":"2016-02-28T22:00:00","slug":"carrot-vs-cash-how-to-make-your-innovation-incentive-program-addictive","status":"publish","type":"post","link":"https:\/\/qmarkets.net\/he\/resources\/article\/carrot-vs-cash-how-to-make-your-innovation-incentive-program-addictive\/","title":{"rendered":"Carrot vs Cash – How to Make Your Innovation Incentive Program Addictive"},"content":{"rendered":"

Let's face it, taking a large group of somber and sensible employees and transforming them into a highly imaginative group of visionaries is challenging. There's no magic bullet when it comes to ensuring all your employees super creative and innovative. However, having a well-run innovation incentive program in place can help make the task of engaging employees much easier \u2013 read on to find out how.<\/span><\/strong><\/p>\n

In today's hyper-competitive and increasingly-disurptive corporate landscape, where the phrase 'innovate or die' is truer than ever<\/a>, it's little wonder more and more companies are investing in generating new ideas. However, many companies often come up short when facing the major initial challenge\u2013 how do you get employees to participate?<\/p>\n

Sharing is Caring<\/strong><\/span><\/h2>\n

The solution to increasing participation sounds simple, but it\u2019s actually very complicated –\u00a0you have to make participants care. This can be achieved in a few ways, but the two approaches which are most successful here are rewards and recognition. When these are established in a well-structured innovation incentive program, participation levels are far more likely to rise.<\/p>\n

Incentives have long been used to encourage innovation, and for a good reason –\u00a0they work. A Harvard Business School study<\/a> concluded that "prizes can be an important inducement for innovation". World leading companies such as Amazon, BASF, Citibank, Coca-Cola, Toyota, Citi, Cisco, AT&T, Netflix and American Express know this, and all employ extensive reward programs.<\/p>\n

All of us have fundamental desires for acknowledgment, status, achievement, and reward. Your company's innovation incentive program can therefore play a key role in driving innovative behavior. The proverbial carrot on a string can be a very effective motivator, but would it become even more effective if the carrot is replaced with cash?<\/p>\n

\"Innovation
Figure 1: Innovation engagement – the numbers<\/span><\/em><\/figcaption><\/figure>\n

Extrinsic or Intrinsic Rewards?<\/strong><\/span><\/h2>\n

There are many ways to reward workers and get them excited and involved in innovation. In the innovation field, rewards are generally broken down into two categories: Tangibles and Intangibles (or Extrinsic and Intrinsic). Tangibles are usually monetary rewards, a product, or service. Intangibles can be appreciation, recognition, or promotion. Each type has its advantages and disadvantages, however the most effective reward programs are the ones which find a perfect balance between compensation and recognition.<\/p>\n

Money Talks \u2013 Tangibles<\/strong><\/span><\/h2>\n

In my experience as an innovation specialist at Qmarkets, many businesses\u00a0typically prioritize compensation as the primary incentive reward. A tangible bonus can be ideal for not only re-enforcing exemplary behaviors in the short-term but also fostering long-term loyalty.<\/p>\n

Some monetary rewards for innovation are huge. Most notably, several leading brands who use the Qmarkets platform<\/a> offer users a share in the success of their idea. So if an idea saves the company $500K \u2013 then the submitter could earn between $5K and $50K depending on how generous the company is!<\/p>\n

However the reward amount doesn\u2019t have to be astronomical to deliver astounding results. One company found that rewarding the best ideas cost them only $14,250 over the course of a year. Meanwhile, it stands to earn an estimated $1.5 \u2013 $8 million in annual net profits from the innovations generated.<\/p>\n

As the saying goes \u2013 \u201cit\u2019s the thought that counts\u201d and often employees appreciate meaningful and thoughtful gifts much more than a cash bonus. For example, one company wanted their employees to spend more time at home with their families on the weekends, rather than doing chores. They believe this helps them come back on Mondays ready to do better work. So they provide gift cards for babysitters, home repair services, and days out to help employees appreciate their time off.<\/p>\n

Baby I Need Your Love \u2013 Intangibles<\/strong><\/span><\/h2>\n

Public recognition enables you to showcase employees who demonstrate the behavior and performance that you want to cultivate.<\/p>\n

Some companies make a point of recognizing innovation efforts in a very public way. For example, one of Qmarkets global Fortune 50 clients<\/a> creates a \u201cDragon\u2019s Den\u201d style gameshow for internal use, which has been incredibly successful at engaging employees across all seniority levels. \u00a0Other companies hold galas where awards are given out on a local, national, and global level. Public recognition enables you to showcase employees who demonstrate the behavior and performance that you want to cultivate.<\/span><\/p>\n

Recognition is defined as \u201can acknowledgment before peers of the value of one's contributions\u201d. Surprisingly, this can often be a powerful motivator, with one recent study finding that 69% of employees would work harder if they were better recognized (see Figure 1). Recognition can be as simple as awarding plaques and certificates. While these may seem "cheap", their value comes from being displayed in the workplace. It could also be a mention in the company newsletter or a picture in the company magazine. Others offer meetings with company leaders, whether at work or over dinner.<\/p>\n

\"Gamification
Figure 2: Gamification badges on Qmarkets' platform<\/span><\/em><\/figcaption><\/figure>\n

Work related rewards are especially appropriate. One of the easiest ways to both recognize innovation and encourage more is to let your most creative employees choose their next projects or assignments. This allows great innovators to work in the most inspiring possible environments. You could also give them more responsibility. If the contribution is significant enough, this could even mean handing out promotions.<\/p>\n

To Each Their Own<\/strong><\/span><\/h2>\n

Rewards should be meaningful, memorable and motivating, but one size doesn\u2019t fit all. No two employees are alike and the same goes for rewards. Some prefer monetary remuneration, others would like some time off, while still others prefer recognition. By offering a choice to your employees, you get much more engagement and can drive the kind of results you want.<\/p>\n

The type of reward may also be a factor of age. Younger employees, just joining the working force, have an intrinsic need to prove themselves and climb the corporate ladder. Older, more established employees, may prefer more tangible rewards. Often the best solution is a mixture, combining tangible rewards with recognition.<\/p>\n

It's All in the Timing<\/strong><\/span><\/h2>\n

When should an innovative idea be rewarded? When it\u2019s first conceived, first applied or when it proves successful?<\/p>\n

For manufacturing ideas, the approach is typically to wait until a year after an innovation was implemented, conservatively calculating the savings and then give the originator a fixed percentage (e.g. 10%). This has led to occasional large payouts when someone spotted a way to significantly cut costs.<\/p>\n

For most process improvements, however, the cost savings are hard to measure and the wait for the reward is so long, people lose interest. In some industries, like pharmaceuticals, it can take decades for a new concept to be applied.<\/p>\n

Companies wanting to spur employees to come up with new ideas should provide incentives even in the early phase of ideation<\/a>. Although this may seem like jumping the gun, organizations serious about creating an innovation culture know it's necessary to start up the process. One solution is to give a small reward as soon as an idea is approved and enters the pipeline. If it reaches fruition, a second larger prize can be given later.<\/p>\n

\"Rewarding
Figure 3: Rewarding contributors on a Q-start system\u00a0<\/span><\/em><\/figcaption><\/figure>\n

Supporting Your Strategy<\/strong><\/span><\/h2>\n

Whichever way you choose to reward your employees, the best way to facilitate this process is by using an innovation management platform which allows you to configure your incentive scheme<\/a> to suit your requirements. \u00a0Qmarkets' software can be fully integrated<\/a> with any innovation strategy or incentives scheme, in order to foster a powerful culture of innovation which generates repeatable business results.<\/p>\n

One of its key benefits is the option to use advanced gamification features These enable users to earn points for submitting ideas and comments to the innovation platform (figure 2). These points can then be exchanged for rewards\/recognition according to predetermined parameters\/guidelines that you choose. Powerful innovation platforms<\/a>, like that of Qmarkets, even allow you to setup a customized e-commerce store where you can "buy" items in exchange for points. This allows the whole process to be automated, thereby maximizing efficiency.<\/p>\n

If you still aren\u2019t sure which approach to take regarding rewards, don\u2019t worry! \u00a0Leading idea management companies, such as Qmarkets, are usually willing to provide their clients with hand-in-hand innovation incentive program guidance based on best practice processes.<\/p>\n

Whether you choose to reward your employees or recognize them \u2014 with the support of experienced innovation professionals and a tailor-made platform for you to build your program upon, you'll have a core foundation on which to achieve success with your innovation project. Good luck!<\/p>\n

Contact Qmarkets<\/a> to consult with our experts\u00a0 to discover\u00a0how your enterprise can innovate and transform your ideas into results!<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Let's face it, taking a large group of somber and sensible employees and transforming them into a highly imaginative group of visionaries is challenging. There's no magic bullet when it comes to ensuring all your employees super creative and innovative. However, having a well-run innovation incentive program in place can help make the task of engaging employees much easier \u2013 read on to find out how. In today's hyper-competitive and increasingly-disurptive corporate landscape, where the phrase 'innovate or die' is truer than ever, it's little wonder more and more companies are investing in generating new ideas. However, many companies often come up short when facing the major initial challenge\u2013 how do you get employees to participate? Sharing is Caring The solution to increasing participation sounds simple, but it\u2019s actually very complicated –\u00a0you have to make participants care. This can be […]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"footnotes":""},"categories":[294],"tags":[205],"class_list":["post-131014","post","type-post","status-publish","format-standard","hentry","category-article","tag-best-practices"],"acf":[],"_links":{"self":[{"href":"https:\/\/qmarkets.net\/he\/wp-json\/wp\/v2\/posts\/131014","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/qmarkets.net\/he\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/qmarkets.net\/he\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/qmarkets.net\/he\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/qmarkets.net\/he\/wp-json\/wp\/v2\/comments?post=131014"}],"version-history":[{"count":0,"href":"https:\/\/qmarkets.net\/he\/wp-json\/wp\/v2\/posts\/131014\/revisions"}],"wp:attachment":[{"href":"https:\/\/qmarkets.net\/he\/wp-json\/wp\/v2\/media?parent=131014"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/qmarkets.net\/he\/wp-json\/wp\/v2\/categories?post=131014"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/qmarkets.net\/he\/wp-json\/wp\/v2\/tags?post=131014"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}