We were curious to see if there is any way you can build a Salesperson Recognition Program that produces measurable and better results. It’s easy to find lots of statistics and information that employee recognition — sometimes called social recognition — is responsible for driving “workplace engagement, productivity, and employee retention.”
All incredibly important benefits. But what really turns someone’s crank in a recognition program?
Traditionally, recognition programs used physical gifts to reward and recognize their employees. Gift cards, watches, pins, trophies, and other paraphernalia were given as a token of appreciation and to indicate that the staff was doing a good job.
Apart from a cash gift, which everyone can use but can feel impersonal, there’s a limit to how much value staff place on a physical gift they haven’t expressed an interest in and desire for.
Research done by Gallup and Workhuman reports that companies that want to “cut their turnover in half, increase employee engagement by 4x and save up to $16.1 M annually” reimagine the workplace and place employee recognition at its heart.
Recognition and Incentive Programs
There’s a lot of information online about recognition programs as well as incentive programs. What’s the difference? Where are they the same?
Forbes looked into these two ways of rewarding and incentivizing employees to distinguish their difference. They found that incentive programs are usually used as a competitive tool for specific groups within a company, like a sales force. A competition with clear goals is announced, and the winner gets some type of prize.
On the other hand, recognition programs are set up to “acknowledge and reinforce the accomplishments” of the entire workforce. These programs are more about the long-term goals and values of the company rather than a reward for a specific goal.
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While it seems that an incentive program would be particularly effective with salespeople, it might be a mistake to assume that “cash is king” when it comes to rewarding your employees.
Eric Mosley, CEO at Workhuman, says that although money is the currency of compensation, motivation and recognition are far more effective when it comes to motivating your employees.
He explains that while money is psychologically linked to expectation and entitlement, it doesn’t appreciate and acknowledge a job that’s been well done. It has also been shown as not fueling long-term motivation.
The same article goes on to suggest that the commonly held 80/20 Pareto principle doesn’t apply to getting your employees engaged and working hard. Watson Wyatt’s WorkUSA Report reinforced this challenge to the 80/20 rule:
“Highly engaged employees are already working at or near their peak but are often limited by their less engaged co-workers.”
How Top Performing Companies Do Things Differently
Incentive Research Foundation (IRF) released a fascinating report called The Top 2020 Top Performer Study. This study showed that companies that increased their incentive programs were listed among the most successful.
While the report dealt specifically with incentive programs, there’s a lot that managers setting up recognition programs can glean from. Top Performers design programs that acknowledge all staff and recognize “truly exceptional achievers.” Fifty-four percent also have broad-ranging recognition programs.
Here’s a synopsis of what behaviors they found top-performing companies engage in:
- They use award points and offer group incentive trips.
- They focused on the importance of flexibility and relevance when it came to rewards and recognition.
- They gave more automatic awards based on predefined goals.
- They thoughtfully determined what criteria to apply to rewards.
- They increased the number of non-cash rewards.
The study concluded, among other takeaways, that top performers understood that when it comes to recognizing their employees’ achievements, one size definitely does not fit all. They focused on flexibility and personalization.
Effective recognition programs for salespeople aren’t just about the cost or perceived cost of a reward but more about the personal significance the winner attaches to whatever type of reward is given.
If creating a personalized recognition program for the sales staff is key, understanding the basics of behavioral science can be a great way to figure out what that means.
What is behavioral science? According to this blog post by IRF:
“Behavioral science is less a discrete arena of study, and more an interdisciplinary approach to gaining a better understanding of why people do what they do – and, by extension, how to influence their thoughts, actions, and choices.”
The entire post is well worth reading, and especially if you’re one of those people for whom no amount of information is too much, you’ll find a lot to learn from the article.
In order to find what motivates the behavior you want to recognize and reward in your company, they classify four well-known behavioral science motivators into the following:
- Gift Exchange is the idea that the harder we work, the more we’ll be rewarded.
- Loss Aversion suggests that, for individuals, the pain of losing is psychologically twice as painful as the pleasure of gaining.
- Reciprocity is the concept that we’re rewarded unconditionally.
One way to determine what motivates your particular sales force is to learn what each of these motivators means and consider how to apply them to your staff. Another way is to design a recognition program willing to tweak it to see what works best.
An Indian company with one of the largest sales forces in the country decided to test which motivator — loss aversion, reciprocity, or gift exchange — would drive better sales performances.
They divided their 80 salespeople into three groups and, over the course of six months, used a different motivator for each group to see which would be most effective in driving sales.
The Gift Exchange group was rewarded with a cash bonus at the end of each week on the condition they met or exceeded their targets which were set at 20% higher than normal. If they didn’t meet that number, they didn’t get a reward.
The Loss Aversion group got a cash bonus upfront but had to return it if they didn’t reach their quota.
The Reciprocity Condition group was rewarded unconditionally, whether or not they met the quota.
In the end, the experiment determined that a specific bonus-based reward program was most effective for this particular company. The point of the experiment and why experimenting may be a worthwhile effort is that “every workplace differs, as do the employees within.”
Questions to Ask As You Design A Recognition Program for Sales Staff
If we’ve learned anything, we’ve learned that an effective recognition program takes more thought than simply Googling different types of programs and implementing the one that appeals to you most.
Beyond understanding the basics of what motivates people, we found some helpful questions you can ask in order to craft and shape a tailor-made program that brings out the best in your staff. We tweaked some of the ideas a bit to specifically focus on recognition programs, but the concepts are the same.
1. What are your goals and objectives?
In the immortal words of Stephen Covey, “Begin with the end in mind.” Grab a notebook, pen, and a cup of coffee to brainstorm what you are trying to achieve with your recognition program. What goals, solutions to problems, or opportunities do you want to reward with this program? Create specific and measurable goals that are in line with your organization’s values and priorities.
2. Is a salesperson recognition program going to get you there?
Now is the time to have a good grasp of how your salesforce is currently doing. If they are killing it on all fronts, all you need to do is creatively strategize the most meaningful ways to recognize their efforts. If you want to increase sales, you might want to consider whether a recognition program is best or if your efforts are better placed to double down on an incentive or rewards program.
3. Goal and performance or behavior-based recognition?
It’s easy to recognize higher sales numbers and reward those who hit those targets, but consider also recognizing and rewarding behavior that leads to these sales:
- Study and learn new sales techniques
- Demonstrate an understanding of their prospects’ needs, wants, and pain points
- Come up with creative, out-of-the-box ways to make a sale
- Develop relationships with long-term clients
4. Individual or team recognition?
Rather than always focusing on an individual salesperson, consider designing a recognition program that also acknowledges a team effort. There’s good reason to extend recognition beyond salespeople and include the “middle 80%,” who set up salespeople for success.
The more your entire workforce feels recognized and valued, the more incentivized they’ll be to work together and support each other.
5. Tangible or intangible rewards?
Recognition programs often offer (or only offer) intangible rewards, but a mix of tangible and intangible might create the best culture of trust and loyalty. Consider when private and/or public recognition is appropriate and how your employee would feel most comfortable receiving it.
However you decide to recognize and reward your sales staff, there’s good logic in underpromising and over-delivering. Sincerity and appreciation always make people feel good about themselves, and if it’s wrapped in a creative way, all the better!
6. Custom or generic rewards?
If we’ve learned anything researching this topic, we’ve learned that each person is an individual and should be treated as such. In an ideal world, a recognition program would laser in on and be customized to each individual’s personality and taste.
In the real world, the most practical rule of thumb when it comes to customized versus generic rewards and recognition is a mix of both.
“Make an effort to know your employees well and appeal to them as individuals, then consider the degree to which you can offer a wide range of choice in rewards while keeping the [recognition] program meaningful and targeted.”
7. Cash or non-cash rewards?
It may seem obvious that most people would prefer cold hard cash as a reward. Research doesn’t support this. Believe it or not, people would rather have a “well-selected, non-cash reward.” Apparently, evidence shows that “on average, non-cash rewards drive higher effort and performance than cash rewards and lead to better business outcomes.”
Creative Ways to Reward Your Salesforce
For a list of ways to recognize your salespeople’s efforts and victories, we found a number of sites filled with creative ideas. Some of them are simple and easily implemented in even a small organization, while others are more appropriate for big companies with big budgets.
Whatever type of recognition program suits your size, it seems clear that the amount of thought and effort you place into recognizing and rewarding your staff is the best way to create a meaningful expression of gratitude.
Praise your successful sellers to the whole company.
Public recognition in front of their peers may make some people blush, but bragging about an individual’s (or team’s) accomplishments always feels good. Whether you announce it at a staff meeting or in a company-wide email, sincerely admiring their efforts doesn’t have a downside.
Reward sales efforts with paid time off.
A formalized way to do this is to set a target goal that recognizes the top salesperson with x amount of paid personal days. You can stagger the rewards by offering the top three salespeople time off in decreasing number of days.
Plan a party to recognize the entire sales team.
Most salespeople are outgoing and extroverts. Not everyone is, but for those who conform to the stereotype, a private party is a great way to recognize their efforts. If you have a good program budget, you could reserve a private room at a great restaurant and pick up the tab. If your budget is smaller, have a company potluck on site and give the sales team a break from bringing anything to contribute.
Buy a personalized trophy.
The idea of trophies might trigger memories of the box of ugly ones you have hiding in the attic, but this type of recognition gift has come a long way. Gone are the days when you come home with one and hide it in a bedroom drawer.
You can easily find beautiful crystal sculptures, hand-carved exotic wood plaques, glass liquor bottles, or silver cups that can be engraved with your recipient’s name and a personal message.
Pay for an out-of-town trip.
Top salespeople work hard and deserve a little pampering. If your budget can afford it, send them on an all-expenses-paid trip. Whether it’s a weekend away with their partner to a charming local destination or a week at a destination resort, know your employee’s likes and tailor the trip to what would fill their bucket.
Check out these ideas for even more ways to recognize your salespeople’s successes.
One of the very best ways to affirm people is when you genuinely praise them to someone else, and they overhear you. If you’ve ever been a kid and heard your dad or mom enthuse about something you did or some character trait you have, you’ll be able to relate to this idea. It’s not part of a formal recognition program, but it’s a great idea.
Claudine is the Chief Relationship Officer at Level 6. She holds a master’s degree in industrial/organizational psychology. Her experience includes working as a certified conflict mediator for the United States Postal Service, a human performance analyst for Accenture, an Academic Dean, and a College Director. She is currently an adjunct Professor of Psychology at Southern New Hampshire University. With over 20 years of experience, she joined Level 6 to guide clients seeking effective ways to change behavior and, ultimately, their bottom line.