Question from Employer: Our company has achieved a remarkable third quarter and would like to give away incentives to the team. But, instead of cash bonuses we would like to give non-cash inducements that are both innovative and motivating.
Can you please give us some examples of creative bonus payouts that won't drain our earnings? Thanks! – Sunita M. N. Answer from Bayt HR Guru: Thank you, Sunita. This is a very interesting question. Human resource experts believe that non-cash rewards can have a greater impact on the performance of employees. This is due to the fact that most employees yearn for recognition for a job well done.
So instead of simply giving employees financial bonuses, employers could recognize efforts by giving away other types of non-cash incentives. Using non-financial incentives implies that employees are better off than the 62.9% professionals across the MENA region who said their company does not offer any kind of incentive. Also, if you are a cash-strapped start-up, chances are that you would be re-investing the hard earned profits back into your business. Below are some alternatives to cash bonuses worth considering:
1. Training: By providing adequate training to employees, not only will you fulfill their need for continual self-development, but also reap the benefits of enhanced skills and competencies. According to Bayt.com’s Reward Programs and Employee Engagement in the Middle East survey, 44.7% of professionals in the Middle East say that more opportunities to learn and grow within the company is what they need to feel more engaged at work, beating the option of ‘a better salary and benefits package’.
2. Team building activities: Over the past decades, management theory has evolved from the promotion of competitive work environments to the development of cooperative ones. As a part of this evolution, companies have put an increasing emphasis on team building. Team building activities, whether they are five-minute games or week-long retreats, teach essential collaborative skills while helping employees develop trust in each other and each other's abilities.
3. Off-time: As Bayt.com’s poll on Wok-Life Balance in the MENA region shows, professionals today give more importance to work-life balance than ever before. In fact, 88.3% of professionals who participated in this poll go as far as stating that they wouldn’t mind changing their job for better work-life balance. In the same poll, 36.2% of professionals also said that they would spend their free time with family members and loved ones. In light of the above, employers should know that their employees need a break once in a while. That’s why companies should offer paid off-time in the form of vacation days, holidays, personal leaves, and sick leaves, so as to give employees down time and a chance to deal with non-work related issues. Despite the high costs of paid off-time, companies who offer it are also the same companies that are good at attracting and retaining talented employees.
4. Memberships: There is no doubt that free gym memberships keep employees healthy and happy. But, what’s more into it, and what many companies don’t know, is the fact that 1 dollar invested in year-round health-promotion programs can ultimately save you more than 3 dollars in the form of increased productivity, reduced absenteeism, and less healthcare related costs[1]. People who are more active may not need to go to the doctor as much. But what it really comes down to is that better health means more productivity. So what can you do? As an employer, you can provide staff with access to on-site gym facilities at no cost, or can negotiate a deal or discounts with local gyms and fitness centers. Another healthy incentive could be by offering your team a nutritious canteen service at the office. 45% of professionals in the MENA region say that they don’t have an office canteen/cafeteria, and would appreciate one. (For more information, please read: MENA Professionals Health & Eating Habits, April 2012).
5. Free parking: No statistics to prove this, but based on common sense, employees consider ‘parking woes’ as one of their top daily peeves. An incentive practice (which we follow at Bayt.com) is granting top achievers access to free office parking.
6. Gift cards: With many financial compensation and bonus programs cancelled or suspended because of the slowing economy, employers are turning to gift cards to express their appreciation. Most employers give gift cards to acknowledge outstanding performance, boost morale, increase sales, or reward loyalty. Gift cards are non-cash incentives that are often referred to as “sticky” rewards, because of their tendency to remain in the minds of employees long after cash is spent. Non-cash rewards can be much more effective than cash rewards. It’s just the way our brains work.
People are able to visualize and remember tangible items better than cash, and therefore stay more actively engaged with program goals and objectives. They’re also more emotionally involved and willing to work harder for something perceived as an emotional item, rather than cash or a more practical reward. So, when thinking about alternatives to cash bonuses you can let your creativity run as wild as it can! [1] Baicker, K., Cutler, D., and Song, Z. 2010. Workplace Wellness Programs Can Generate Savings. Harvard University. Health Affairs 29 (2), 304-311.
