People & Leadership

How incentives could improve staff efficiency

Use People Science to understand your employees

As a small business owner you are typically close enough to the operation to see where efficiencies can be made, but too busy to micro manage others to make the improvements needed.

How then do you stop inefficiencies taking place, in order to maximize performance and profits? There’s nothing worse than being a small business owner who feels that inefficiencies are taking place and watching your profits go down the drain.

Well, an option is to incentivise your staff. You may be thinking that your staff are already being paid handsomely or at least fairly to do their job. Luckily incentives don’t have to be monetary, although they can be. Alternatives to monetary incentives are:

If you do, here some tips on how you could create an incentive scheme to tackle them.

  1. Reward the right thing
    This first is to ensure that you reward the right behaviours. e.g you may want to save money on paper, that doesn’t mean that you want your customer correspondence now going out on paper that is of sub standard quality. The efficiency might be an improved contract with your paper supplier; in this instance you want to reward quality not just quantity.
  2. Group rather than individual incentive
    Be careful not to set up unhelpful competition by providing individual incentives, group incentives can enhance the sharing of information and best practice, creating better ways of working, as well as collaboration, and the breaking down of silos if they exist.Group incentives can also help to correct individual under-performance. e.g. If the inefficiency you want to correct is time consuming and poorly run meetings, the person who always arrives unprepared and late will now be corrected by the other members of the team who see him/her as standing in the way of achievement.
  3. Fairness and promotion
    Any incentive that you create must of course be fair and be promoted well so that everyone understands the process and it disadvantages no one. e.g. If a new database is implemented all must understand why and be given a timeline for inputting their data on to it that is reasonable within the context of their current role.

A couple of final thoughts, do make your incentive long term, the new behaviour is more likely to become a habit and stick even when the incentive is gone as a result. Be creative and have fun with incentives and your staff will too.