Incentivization and its Impact in the Workplace

As individuals, we are motivated to do what we do by either internal or external factors. Internally, our actions are driven by our personal goals and dreams in life.  Externally, our actions are influenced by incentives and rewards that interest us.

Most of our choices are influenced by incentives unless you are an ascetic who is living in the Himalayas😉. For example, if you see a 20% cashback offer on a phone you were thinking on buying, that cashback offer acts as an incentive to buy it while the offer is still on.

Similarly, in your workplace, you are offered incentives as motivation to perform better and increase the quality (and quantity) of the work you do. It could be a big fat promotion, a trip to Hawaii for achieving your sales targets — you get the drift.

There are primarily two forms of incentives offered by organizations.

Non-monetary Incentive

Any reward which has nothing to do with money is non-monetary. Gratitude, appreciation, a pat on the back, thank you cards, and any other incentives along those lines, are non-monetary.

For example, a customer support manager setting up a “Champion of the Quarter” award for agents who have received a certain decided number of positive CSAT score is a non-monetary incentive.

Monetary Incentive

When actions are rewarded with money, they are monetary incentives. For instance, a customer support manager rewarding the  “Champion of the Quarter” with prize money makes it a monetary incentive. Most companies make it a practice to reward their most valuable employees with stock grants and commissions during their yearly salary review and have other monetary incentives as well. This also doubles as a way to retain these employees in the company and motivates them to continue their good work.

Notes of Caution — Where Incentives can Fail

One important mistake businesses should avoid is turning incentives into an unhealthy cut-throat competition amongst employees. There should not be only one prize where only the top performing individual is rewarded. When everyone’s eyes are set on that single reward, the work environment could turn hostile and over-competitive.

The right approach is to set a benchmark performance based on certain defining traits/factors. Whoever exceeds the set benchmark can be rewarded. It is also permissible to have more than one benchmark, which will encourage people to constantly work towards improving their performance.

Another mistake to avoid is setting the same benchmark for all departments of your company.  For example, customer support and customer success teams have the same purpose — to provide great customer experience. But the way these two teams function is completely different. The customer support team receives queries from customers, on the other hand, the customer success team reaches out to customers asking if they are facing any problems.

Now if you set the foundation for receiving the incentive as whoever solved ‘n’ number of queries in a year, it holds good only for the customer support team. But a lot of customer success players might not reach the set target despite having possibly put in an equal amount of effort to keep customers happy. So assessing how each department contributes to the success of the company is paramount.

Setting up an Incentive Program for Customer Support

So far I’ve talked about what incentives are and how they can help motivate your team. Now how do you set up this process for your support team? You can pick any of the following approaches to set the right benchmark.

Based on Behavioral Traits 

The ideal agent should exude positivity when they are working with the rest of the team. Are they enjoying their work on a day-to-day basis? For instance, here at Freshworks, during the yearly career review, how our employees champion the company’s culture is a key evaluation factor.

Based on Business Impact 

Observe how your team’s work is impacting the business, either directly or indirectly. For instance, a customer support agent may not bring you new clients, but empathy and good customer service from them will definitely help in reducing customer churn rate – in turn saving your time and money.

Based on Metrics 

Measure the amount of work they are getting done. Apps can be of massive assistance here. If your support team is using email as the primary support tool, we have a simple solution for measuring your metrics – Inbox Grader, which is a free-to-use reporting tool.

As an alternative to email-based support, you can try Freshdesk, our customer support software, which has an even better reporting and analytics feature. With this, you can measure important agent metrics like customer satisfaction, first response time, resolution SLA, and much more.

What next?

So far I spoke in detail about incentives – what they are, how they influence people and on what basis incentives should be offered.  In my next blog post, I will explore the aspect of gamification mechanics, and how it can turn your agents’ day-to-day work into a thoroughly enjoyable experience. This will be closely related to incentivization. So watch out for the post!