Motivating Employees in Tough Times

Posted by: Aili McConnon on April 13, 2009

As salaries and bonuses are getting slashed, not to mention widespread lay-offs, I am fascinated by creative ways managers are motivating their remaining troops without breaking the bank.

One strategy that caught my attention is a workplace video game offered by Wyoming-based Snowfly. If a manager wants to reward an employee for an accomplishment such as delivering a project early or landing a new client, the manager gives them Snowfly tokens than can be used to play various online games like roulette or a scratch-and-win game. Employees accumulate points by playing these games that can be exchanged for rewards ranging from a $100 pre-paid Visa card to a week working from home to use of the boss’s parking spot when he or she is on vacation.

Founder Brooks Mitchell says the downturn has brought him more clients, approximately one a month in the past year because his Capstone software costs less than traditional rewards like a company clock or a trip to Las Vegas. Snowfly now has 50 clients including Hyatt, Avis, Time Warner and Blue Cross Blue Shield. Mitchell, who worked as a behavioral psychologist before founding Snowfly, says the company has found that if an employer spends 1.5% to 3% of an employee’s base salary on a reward program of some sort, that translates into a 20-25% improvement in productivity.

What other creative ways are managers motivating employees in difficult times? Any interesting strategies being used where you work?

Reader Comments

sam

April 15, 2009 1:49 AM

It's pretty stupid to think that people will still love you after you cut their paycheck. And if the people on top continue to collect their perks and bonuses you will send morale into the sewer until the end of time.

Squeezebox

April 15, 2009 12:33 PM

Let me get this straight: you have to get projects in early AND play video games too? And that's after you just cut bodies? How about eliminating the video games and just reward your people for getting things done?

Derek Irvine, Globoforce

April 15, 2009 3:57 PM

Please. You want people to play games at work? I see a world of problem with this, not least of which is how do you know all your employees even like to play video games?

If the idea is to reward desired behavior, why would you want to do that with an activity that, by definition, reduces employee productivity.

A far better solution is to immediately reward desired behaviors through a strategic program that tells employees precisely why that behavior or action was demonstrative of a company value or strategic goal achieved and then to let the employee choose from millions of rewards that will serve as a lasting reminder of the company’s appreciation for and investment in the employee.

Now is not the time or the economy to be playing games. Employee recognition can deliver significant bottom-line returns, but only if deployed strategically.

More on unwanted recognition here: http://globoforce.blogspot.com/search?q=game

pogi

April 16, 2009 12:29 AM

Culture plays a major role in any organization, particularly in perilous times such as now. What Snowfly did is something that worked to their advantage. Bottom line is, business must be sustained. People within any organization can choose to either adapt or go elsewhere... keep on finding the best applicable motivational gear! Remember things will turn around when times get better.

Realist

April 16, 2009 11:21 AM

Aili McConnen obviously doesn't work for Delphi Automotive (Saginaw Site). The Management at that facility haven't taken any salary cuts yet. The salary cuts they claim they have taken are sitting at home getting full pay and benefits! Their Management ability thus far as the economy worsens has led many to believe they are trying to make the business fail. Management is too busy claiming that the Employees are the reason that the business is failing. Not so, everyone would know the truth if they came through the front doors of any plant. If this business is to survive, Management needs to cut their numbers (sever those Management personnel off site & those soon to leave)drastically. Add Production Personnel to make products (which creates money for the company). Add Skilled Tradesmen who repair/install equipment which make it possible for the Production Personnel to make the product.

VP

April 17, 2009 9:02 AM

It's definitely an interesting strategy, but as most of the other commenters have noted, it seems like the company may be focusing their innovation in the wrong direction.

Still, if it works for them, that's great. Each business has to discover its own morale-boosting and productivity-enhancing techniques.

VP
www.verifyprotect.com

Barbara D Holtzman

April 17, 2009 11:12 AM

The only reason stuff like this catches on is becasue it's invisible to the public - unlike trips to Vegas. I like the response that says this is going to cut down on productivity, because it has to. I also wonder about Hyatt, Avis, Time Warner and Blue Cross Blue Shield - this is why my clients won't let me reveal who they are. These companies look stupid to me, and I'm going to think about it when I need to make a purchase. Make people play video games to get rewarded for productivity? What if you're like me and don't liek video games? Hey, what about playing beer pong at lunch for rewards? Makes almost as much sense.

Brooks Mitchell

April 17, 2009 11:27 AM

This story obviously hit a nerve with Mr. Irvine and Globoforce. I am reminded of the wisdom of the German philosopher, Arthur Schopenhauer:
“All truth passes through three stages. First, it is ridiculed. Second, it is violently opposed. Third, it is accepted as being self-evident.”

And, of course, the enduring words of Shakespeare,
"The lady doth protest too much, methinks."
Hamlet Act 3, scene 2
Brooks Mitchell, Snowfly CEO and Evangelist

Dan McCarthy

April 19, 2009 9:04 AM

Aili -
Here’s my 2 cents on the topic: How to Create a Motivating Work Environment.
No silly award programs and the first nine ideas don’t cost anything.

rajiv

April 19, 2009 5:15 PM

Guilt, fear, and paranoia, as well as a few other destructive emotions, can freeze people's performance during tough times. The natural response is for a leader to click his or her heels with the hopes of ending up in Kansas. Denial is the natural response when things get tough, but many leaders never move beyond that. The thought of talking about feelings openly sends shivers down the spines of most managers, and ignoring those emotions only causes greater challenges.

To increase motivation and performance, create a forum for people to share their feelings so that they can release them and move on. Put on your tomato suit and listen to the whining in a structured forum. If you don't, your employees are sure to keep whining for months and months past the time people would normally let it go.

The funny thing about emotions is that if we don't sense that the other person truly understands our emotions, we tend to stay charged. If you don't want to be listening to the same complaints over and over, then listen with emotion. If someone's voice is loud and angry, say back in a loud voice, "I feel terrible because I see you're so upset." Then continue the conversation by dropping your voice slowly to a normal range. Watch the magic as they defuse by simply knowing you "really got it."


============================
raj
============================

foreclosed homes:

Bill Goodlatte

April 20, 2009 2:28 PM

The LDF Companies have been extremely satisfied Snowfly customers for nearly ten years. We have experienced behavioral changes resulting in significant increases in sales, productivity,cost savings,customer service,safety,attendance,employee referrals,training,efficiency,and profits. Our employees really enjoy the fun atmosphere of Snowfly incentives and the reloadable Visa debit cards. We also utilize Snowfly's computerized interviewing programs, scoring models and attitude surveys, all of which have dramatically reduced our employee turnover.

Patrick Ahern

April 24, 2009 12:21 PM

Motivating employees through perks such as games and pre-paid Visa cards certainly can improve motivation and the "fun factor" of work, but what about the “how factors” that should be recognized and reinforced?

In my opinion, companies should be focused on engaging and recognizing employees for behavior to achieve an outcome/result not just for the outcome/result. In other words, powerful and strategic recognition is focused on behavior, not outcomes. This approach is what truly sustains employee engagement and motivates employees to focus on the strategies and actions that are most important to the company's desired results and bottom line.

Peer based employee engagement systems that offer rewards for great work that are tied to a company's strategies enable leadership to not only extend appreciation for employee contributions, but to actually educate and measure awareness, buy-in and performance on strategy execution. In a day when ROI is critical for every expenditure, these technology-based systems allow leaders to go beyond measuring productivity to assess accountability and performance across all key strategic areas to uncover valuable data, including:
• Which employees are going the extra mile repeatedly to drive loyalty, sales and profits, and which employees are not participating at desired levels
• Best practices that can become more common within the organization to improve results
• What areas of the company strategy require more focus to achieve success
• Employee insight that can improve innovation, cost savings, operational efficiency, and customer satisfaction and sales
• Visibility into performance across different departments and geographic locations to analyze consistency

-Patrick Ahern, Partner & Brand Strategist with Brand Integrity

Aubrey Daniels

April 25, 2009 8:54 PM

Patrick is correct in that rewarding results without knowing the behavior that created them can create serious problems. I think this is at the heart of the Wall Street problems. However when results are highly correlated with the desired behavior it is effective and efficient to reward results. The opportunity to play games as a result of some business accomplishment is a positive reinforcer to many people at work. The Snowfly technology incorporates variable ratio schedules of reinforcement that creates excitement and enthusiasm for the work. While it is no substitute for good pay and benefits, it is certainly an affordable initiative in tough economic times.

Bob Cowen, Snowfly

April 30, 2009 11:41 AM

Derek Irvine of Globoforce wrote “You want people to play games at work? I see a world of problem with this, not least of which is how do you know all your employees even like to play video games? If the idea is to reward desired behavior, why would you want to do that with an activity that, by definition, reduces employee productivity.”

I have yet to see an incentive program that did not have some type of game or theme: March Madness, Kentucky Derby, Indy Race Car, Jeopardy, spin the wheel, etc. Organizations use games because they keep the “buzz” going and they are cost-effective.

Derek Irvine of Globoforce wrote "…and then to let the employee choose from millions of rewards that will serve as a lasting reminder of the company’s appreciation for and investment in the employee."

What do the following have in common: Who Wants to be a Millionaire, Deal-or-No-Deal, Wheel of Fortune, Jeopardy, Las Vegas and Atlantic City? Do the program sponsors & advertisers know something that Mr. Irvine does not? If the winners “could choose from millions of rewards that will serve as a lasting reminder” what do you think they do with the merchandise? If you check eBay, you will see lots of beautiful Cross pen/pencil sets with various company logos. How much value did the employer get for their money? The wonderful feature of money (besides providing infinite choice) is that it can be given frequently and in small increments thus continuously rewarding and reinforcing the activity rather than waiting months, quarters or longer periods of time to redeem points for larger awards. Perhaps Mr. Irvine and his company make money from selling merchandise or highly marked up gift cards?

Paul Herr

May 1, 2009 11:56 AM

I just wrote a book dealing with the intrinsic rewards in the workplace called "Primal Management." It turns out that all forms of reward, monetary or otherwise, are encoded as positive feelings by a brain structure called the basal striatum. The ultimate paycheck is therefore the emotional one. Money, for example, is only motivating because of the feelings it engenders: 1) if I have money in the bank I don't need to worry as much, which equates to a reduction in pain; 2) if I make a good salary it means I am competent at what I do which boosts self esteem, an ongoing good feeling about myself; 3) money can be converted into a myriad of emotionally-rewarding goods and services like a hot new car or an exotic vacation. It all boils down to feelings. Feelings are the raw forces that move us, so any strategy that enhances these motive forces is going to improve productivity.

For you nay sayers out there, lets tally up the rewarding feelings from the Snowfly system: 1) my boss thinks I did a good job = euphoria of a win (dopamine-based reward), 2) I must be a competent and skilled employee to rate such a reward = improved self esteem (serotonin based reward); 3) this is a fun group activity that improves interpersonal bonds (oxytocin-based reward); 4) I enjoy the game itself (dopamine again).

I think everybody should lighten up. The important thing is for managers to pay attention to their employees and dispense badly-needed kudos. Human beings need strokes almost as much as they need oxygen, but most managers are very stingy with praise according to Gallup. A software system that improves the praise-rate is, in my opinion, a very smart idea! For more info about intrinsic rewards that drive high performance, check out primalmanagement.com.

Best,

Paul Herr
Author of Primal Management

Richard Clark

June 14, 2009 7:47 PM

It is easy to understand why anyone would be cautious about the use of incentives for increased performance in work settings. I was suspicious when I undertook a review of all published research in English on the result of incentive programs at work a few years back. We found that when well planned incentive programs were fairly implemented, the average increase in performance for individuals was over 20 percent and for teams up to 45 percent (the larger increase for teams we suspected was because incentives require that performance be measured a bit more rigorously and so a reduction in social loafing on teams may lead to the larger gain). What was also important was the evidence that commitment to work and an employer also increased - AND we found that incentive programs actually build over time so that the longer they are in place, the more performance gains are achieved. If you want to read the "meta analysis" we published, go to http://www.cogtech.usc.edu/recent_publications.php
and look for the study by Condly, Clark and Stolovitch. .

Zormit

July 13, 2009 9:52 PM

Businessweek is crap!

Jill Bradlie

February 17, 2010 2:33 PM

some pretty good ideas here. You need to think outside the box when it comes to stuff like this.

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Jill Bradlie

February 17, 2010 2:34 PM

some pretty good ideas here. You need to think outside the box when it comes to stuff like this.

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