In any workplace, employees want to understand their impact. Feedback and recognition of their contributions keep workers engaged and are critical to retention. 63% of employees believe they can easily find another job as good as they have now, according to Gallup. Therefore, you need a rewards program to let employees know they matter to your organization.
While a rewards program can be easy to implement, you also need a way to measure its success. It’s imperative to establish essential key performance indicators (KPIs). Otherwise, unimportant data can creep into your reporting. Rewards program KPI monitoring is vital with abstract concepts like employees’ emotional connections to goals and commitment to company values. Let’s go over what KPIs can give you a clear look at your program’s outcomes.
Calculate your retention rate by dividing the number of employees who quit during a set period (like three months, six months, or a year) by the total number of remaining employees. This is a critical metric because consistently losing employees outside of the norm negatively impacts your bottom line.
Replacing employees who leave unexpectedly is expensive, time consuming, and can result in unintended wage increases. If your employees feel appreciated by a clear and consistent rewards program, this number should reflect a low willingness to leave for perceived better opportunities.
With this metric, you can pinpoint where management needs strengthening and identify any weak areas in your rewards program. You’ll also better understand your costs associated with turnover.
You can also note how long employees stay with your company and at what point they tend to quit. Knowing these indicators allows you to evaluate the effectiveness and competitiveness of your rewards program and how you could use it to increase retention. In addition, depending on the position, department, and location, these metrics could help create a career track, allowing employees to see a clear path to growth opportunities.
In addition to the overall retention rate, you’ll also want to consider key staff retention as a KPI. Divide staffers in crucial decision making and supervisory roles who have quit during a set period by the total number of remaining staffers at the same levels.
Though these staffers have higher salaries, management perks, and other privileges, they’re still affected by employee morale and turnover. If your rewards program isn’t performing as intended, you’ll see it in the number of managers who voluntarily leave the company. When managers leave, employees across all levels begin to question their place and security within the organization. Incentives can be vital to preventing disarray.
Another rewards program KPI is the percentage of unfilled positions at your company. Know which jobs are vacant and why they’re open. If the rate is high, talk with your leadership team to see if the vacancies are fundamental gaps or if the positions are no longer needed.
If low staffing is a significant problem because your business depends heavily on personnel, you should check your rewards program to see if it’s attractive enough to draw the talent you need.
Send an employee survey to help gauge satisfaction and note how your employees feel about their environment, rewards, perks, and bonuses. You’ll gain helpful information to adjust your rewards program as needed.
Without a formal survey, you may never hear negative feedback. It would be best if you also didn’t rely on your personal observations of the workplace or ask employees about their feelings in a face-to-face format. You’re unlikely to get honest answers.
You can easily calculate increases in productivity and sales by dividing employee output by the number of your employees. Increasing productivity is what led you to implement a rewards program. If your program is doing its job, you’ll see it in better productivity. If not, request more feedback from management and workers. Your employees must value the rewards you give. Find out what real value looks like to them.
Find out how your products or services meet customers’ expectations through surveys. Employees perform best when they feel valued, and that will come through in high customer satisfaction levels.
By reviewing reward program usage, you’ll get hard numbers on who is using the program and what incentives truly make an impact via the times it has been redeemed. Additionally, you can determine which incentives are not effective and clear that space for those that are.
These aren’t the only rewards program KPI numbers worth measuring. Talk to your leadership about their thoughts on the industry, job responsibilities, region, existing tech frameworks, and other metrics. Understanding what’s essential for you and the rest of your company leadership regarding your incentives is the heart of crafting meaningful programs that work over the long term.
Data-driven decisions are important when you want to make predictions and optimize your rewards program. But, to get these insights quickly and accurately, you need digital tools. Here’s how our Rewards Genius solution can help. Our reporting feature lets you see history at the organizational, group, and individual levels for any date range you specify. This way, you can track the success of your rewards and make informed decisions about your incentive strategy to help your program grow.
Email firstname.lastname@example.org if you’d like to see how Rewards Genius can help you administer and monitor the success of a fully customizable rewards program based on historical data.
Want more thought leadership from Tango Card? Sign up here to be alerted when we post new content, host webinars, and speak at events.