Incentives for Life: Impact and Rewards
May 09, 2008
From customer loyalty to employee performance, the New York Incentive, Rewards and Recognition Show & Brand Engagement Conference present inisightful panels and discussions, as well as offer eye-opening research to the industry.
By Alex Palmer and Leo Jakobson
This year's New York Incentive, Rewards and Recognition Show & Brand Engagement Conference offered attendees in depth tips and broad perspectives on employee rewards and the best practices in running incentive programs. According to a number of exhibitors, the show was a substantial improvement over the initial NYIRR show last year (which was considered successful in its own right) in terms of the number of corporate end users and their interest in the incentive market.
Taking place at the Hilton New York, the show included a keynote address by Don Peppers of the consulting firm the Peppers & Rogers Group, a division of Carlson Marketing. In his address, simply titled "Brands and People," Peppers made the case that an organization looking for long-term loyalty must focus on creating the most value from each customer, rather than relying on creating value primarily from the products themselves.
He cited the example of a neighborhood florist whose service and quality could be so trusted by her customers that "even if flowers suddenly went extinct and she could no longer sell flowers, the florist would still have loyal customers if she decided to sell gift baskets or candy." Extending this "other-orientation" to engaging employees, Peppers stressed the importance of a strong corporate culture that offers a clear sense of purpose and opportunity to workers.
Moving into a much more detail-oriented direction was Rodger Stotz, research committee chair of the Forum for People Performance Management and Measurement and the Incentive Research Foundation, who took the stage following Peppers to discuss "The Science of Performance Measurement." Stotz's presentation touched on several key ways organizations can quantify employee or customer changes in performance, from the basic look at boosts in sales numbers, to the "business perspective" of viewing changes throughout the entire organization; an approach he says has become more popular in recent years.
This look at the bigger picture in assessing the impact of rewards and incentives also came up as Stotz distinguished between the "program period" of when an incentive program actually runs as opposed to the "incentive impact period," which includes a subsequent boost in performance even after the program has officially ended.
One current study Stotz discussed later in the show was the Employee Lifetime Value (ELV) Study, recently completed by the Forum for People Performance Management & Measurement and the Incentive Marketing Association's (IMA) Performance Improvement Council. Stotz described the study's purpose as looking at the internal side of Customer Lifetime Value (CLV), a metric currently gaining respect and attention in corporate America.
"Most marketing people say customers have a lifetime value," Stotz says, explaining that if a customer spends $100 a week at a grocery store, that customer provides $5,200 worth of revenue over the course of a year; if that store retains that customer for 20 years, that customer's lifetime value to the company is more than $100,000. "Employee lifetime value is the internal side of customer lifetime value," Stotz adds. "View [it] through that lens." As for the study itself, Stotz says it was substantial enough that five white papers will be created from it.
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