Reward Cards Motivate

Value, ease of use, and the widest possible choice of rewards make them an obvious incentive for safety programs.

THE decision facing most corporate managers is not whether to offer incentives to assist in the attainment of important business and safety objectives. For most of these folks, that's a given--incentives work, and they know it. Thus, the real decision comes down to picking the type of incentive that can produce the biggest bang for the buck.

In the early days of incentive planning, that choice was easy--cash was king, and everybody knew it. Today, however, few companies attempt to motivate actions or shape behaviors such as safe work habits with greenbacks. Why? Because most have discovered that a reward that can be folded into disposable income doesn't motivate.

So along came a new incentive industry gold standard: full-color award catalogs crammed with everything from pots and pans to puppies. No doubt these glitzy coffee-table-sized books motivated far better than cash, but it wasn't long before they, too, had their detractors. Among them were participants, some of whom asked, "Doesn't the company realize how grossly overvalued the award choices are?" Others readily admitted they weren't motivated by the selection of rewards available to them or by lengthy delays between the time rewards were ordered and the time they were received.

What's A Decision-Maker to Do?
I suggest the answer may be as simple as this: Ask your employees what they want from the safety incentive program you're considering. We think their responses may be strikingly similar to these . . . .

  • "Give us the broadest possible selection of awards." A total of 2,000 or so awards featured in many catalogs may sound like a lot, but it pales when one considers the millions of possibilities available in shopping centers, discount stores, and the like. And another alternative--single-store gift certificates--are, by design, even more limiting in choice.
  • "Give us true value for our hard-earned award points." Said another way, give us the opportunity to take advantage of discounts or, at the minimum, to shop competitively. Certainly, nobody has ever celebrated because they paid too much, either in dollars or award points.
  • "Allow us to shop where and when we want to shop, maybe even impulse shop if that's our thing." After all, who doesn't want to touch, feel, and try things on before making a "purchasing" decision?
  • "Permit us to take immediate delivery of our reward." Didn't we all learn in Psych 101 that rewards--if they're to be identified with a specific effort--ought to be immediate?

It seems that employees around the country are sending decision makers a message: "If you expect us to work harder or want us to change our behaviors, expand the universe of available rewards (the more, the better); allow us to shop where we want, when we want; allow us to feel that what we've selected represents good value; and, finally, let us take our rewards home immediately so we can begin enjoying the fruits of our reward-earning performances."

Reward Cards . . . Are They the Incentive Answer for You?
If you decide they are, you'll be among an increasing number of decision-makers who have concluded that reward cards give them the biggest bang for the buck.

Reward cards work like this: As points are earned in return for accomplishment of objectives, they're loaded onto a card (similar to a debit card). Once earned, points can be spent by the recipient at any participating retail or travel establishment. (In many cases, there are thousands.)

To form a stronger identity with the sponsoring company, cards can be branded with the company name and logo, a connection that's reinforced and recalled every time cardholders pull their cards out of their wallets.

IRS Excludes Some Safety Awards From Taxation

The important thing to remember is most reward cards work like debit cards, with one very important distinction: Because reward earners successfully delivered the performance or demonstrated specified behaviors, they never get a bill. The cards have been pre-funded with their reward points and are ready to spend.

Reward Cards at Work . . . A Case History
A few years ago, Producers Assistance Corporation (PAC), a provider of contract personnel to the oil and gas industry, implemented a safety, health, and environmental plan. Company employees were rewarded for behaviors the company knew would avoid injuries. Unfortunately, the combination of cash and merchandise initially offered as incentives didn't get the job done.

According to Executive Vice President John Knapp, "PAC looked at other incentive solutions (cash and merchandise), but they didn't have the depth and quality needed to satisfy the range of our employees' reward preferences." The solution for PAC was a reward card. When PAC's employees demonstrated desired and specified behaviors such as attending or presenting at safety meetings, points were automatically loaded onto a personalized PAC Reward Card at the end of the pay period.

Results were even better than expected. According to Gary Dean, vice president of operations, the company saw a significant increase in participation; in fact, when reward cards were offered as the incentive, participation more than doubled. "The best result has been a significant decline in the incident rate," Dean added.

Following a six-month trial with the reward card, the company conducted an audit of its safety, health, and environmental program. Not only did participants give it the highest possible satisfaction rating, but, according to Knapp, "Our employees' minds are now refocused on the safety."

Reward Cards . . . The Freedom to Choose
Why did reward cards work so well for Producers Assistance Corporation? I'd wager that the company's employees liked the fact they were offered the broadest possible selection of reward possibilities.

A February 2003 survey by American Express Incentive Services (the research was conducted by Synovate) supports the contention that freedom to choose rewards motivates performance. When a random group of employees were asked which attributes of a reward program would most motivate them, respondents clearly wanted freedom of choice:

  • 80 percent want variety in their purchase options.
  • 82 percent want the flexibility to choose when and where to shop.
  • 77 percent want to inspect items before buying.
  • 72 percent want to take advantage of sales.
  • 68 percent want to take immediate delivery of their reward.

Unlike award catalogs, reward cards offer an unlimited selection of award options, the things people want and are willing to work harder to earn.

A Turnkey Solution to Safety Incentive Management
There's a lot to like about reward card programs, including the fact they are a snap to administer. Merchants handle fulfillment, and the company providing the card manages customer service. Clients can be given the opportunity to manage multiple reward programs, from participant eligibility and reward issuance to program communications and reporting, right from their PC with the click of a mouse.

The Bottom Line? Give 'Em Choice and They'll Give You Results
Want the biggest bang for your incentive dollar? Then I suggest you ask prospective participants what they expect from your next safety incentive program. If they tell you choice (the broadest possible selection of awards), value (the opportunity to shop for the best price) and immediacy of reward (receipt of the reward when they want it), you know the answer . . . . Reward cards!


IRS Excludes Some Safety Awards From Taxation
Do you need another reason to consider reward cards for your next safety incentive program? Employees who earn achievement awards for length of service or safety achievement generally can exclude the value of the rewards from their income, with these stipulations:

Exclusion from taxation does not apply to managers, administrators, clerical employees, or other professional employees or if more than 10 percent of eligible employees previously received safety achievement awards during the year.

This article originally appeared in the June 2003 issue of Occupational Health & Safety.

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