Dave Baiocchi

Incentives – Engendering Engagement

Posted on Mar 20, 2019 in Featured, Features

As a dealer principle, I liked to think that the wages we paid our people provided enough motivation for them to be personally invested in delivering a quality experience to our customers.  Over time I found that while wages are necessary, the best and most productive employees are hard-wired to innovate.  For that additional innovation they want a chance to get a little extra.   My goal in designing incentive programs was always to try and foster a team environment and an atmosphere that called people up to the next level, both in our dealership, and in their personal lives.

Employee engagement is a funny thing.  Over the years I have learned a thing or two about what motivates people to find that inner magic.  The big surprise was that many times it was not really connected to wages, or even bonuses and over-rides.  Instead there were a myriad of other motivating factors that are seldom considered in even the most robust incentive programs.

We have all talked ad-nauseam about the generational differences that exist in our workforce, but despite all the talk, I am not sure that we have made the organizational shifts to keep our millennial’s and Gen-X’rs engaged.  We still hang money in front of them and expect them to jump for it.  When they don’t, we still seemed surprised.

By 2025, the millennial generation will represent over 50% of our workforce.  The more we do the same old things, the harder it will be to get them excited about our business.  We have to address what compels them to engage.

Studies have shown that overall, our newer employees value many things as much as OR MORE than adequate compensation:

• Time and work/life balance

Baby boomers always saw their working life as a CALLING.  Much of their identity was tied up in their occupation, and they validated themselves through achievement in the working world.  Employees currently in the workforce however may not see work as a calling. Instead they view their employment as a CONTRACT.  Their validation and identity are many times completely separated from how they earn their money.  It’s not that they are not serious about what they do, but they truly VALUE their time as much (if not more) than their money.

• Meaningful Contribution

Connected to this obsession with time, is the burning desire they have to be a part of something important, and worthwhile.  They want their work to be meaningful.  They want to solve problems and overcome challenge in new and different ways.  They value efficiency, and find it exciting and motivating to find new answers to old problems.  This is why they constantly ask WHY.   Management wrongly sees this question as an affront to their authority, but most of the time the WHY is simply an attempt at finding an alternative (and perhaps a better, and more profitable) process.  We think we know what works.  But maybe….we are missing an opportunity.

• Recognition

Yes, everyone still likes to be recognized publicly.  What we recognize employees for however has changed little over the years.  We made our numbers!!!   We had no accidents!!!  We met our sales goals!!!   All of this is great, but it does nothing to really motivate the crew.  Younger employees like being recognized for achievement, but even more than that they value being appreciated for their IDEAS.  Things like reducing the current administrative paper trail, writing better and more customer focused SOP’s, and making computer enhancements for the benefit of all departments should be celebrated as much if not more, than selling some tires, and signing up PM’s.

If we find a way to weave rewards into our programs that address these areas, it is likely that you will find that elusive magic formula that draws employees to be personally involved and engaged.  All that said, what should an incentive plan look like?   How do we meet the motivational needs of a diverse intergenerational workforce?  Not everyone is a millennial, and we want a broad enough program to engender participation from everyone.

I don’t know if there is an easy answer, but I do think that whatever incentive format or system you put in place there are some compulsory components that need to be included.

• Incentive program products need to be customized, focused, and planned.

Don’t broad brush the program.  Customize both the products and the rewards based on the department you are trying to motivate.  As an example, road techs should be rewarded for tire sales, but tires are not necessarily a hot item for parts countermen.  Scale the products in the program toward items that fit naturally within the department’s capabilities and customer opportunities.

• Rewards should include CHOICES

Yes, it’s easier to just throw money at them, but in light of what we discussed earlier, perhaps we could add some PTO hours, sporting event tickets, Snap on tool credits, or even dining or travel awards.  The wider the range of choices, the more participation you will get, regardless of the generational proclivities.

• Programs should include EDUCATION

If you give someone a story to tell, they may just tell it!  If your dealership is highlighting a product, and hanging a reward on it, you will have much more success if you educate the people selling it on the compelling reasons why a customer may want to buy it.  This addresses the “WHY” we discussed earlier.  It they want to know WHY, let’s tell them!

• Programs must have adequate INVENTORY

Nothing kills an incentive program like NOT HAVING THE ITEM.  Your employees will actually ridicule the management for their lack of planning and any traction you established early on will disappear.

• Programs must be internally advertised

If you don’t talk about it, why should you expect them to?   Banners, leader boards, paycheck stuffers, blast emails….just keep the communication going.  Your employees are watching you….they will only be as excited as YOU are about the program.

• Rewards must be distributed no less than monthly, and only during staff meetings.

Nothing says “we’re really serious about this” more than actually paying the rewards.  Doing so publicly even heightens the effect.  Once again on the subject of choices….you may allow your employees to accumulate points toward upper level rewards, or cash them out as you go.  Flexibility is the key to making the program popular.  Just as an aside….I know that employees always prefer CASH.  Their preference notwithstanding, if the program is successful, this may complicate tax consequences for both the employee and the dealership.  We did not pay cash, but instead created and presented our own internal payroll voucher.  The employee got a copy of the voucher knowing what they earned, and were able to anticipate getting their reward on their next paycheck.

There are dozens of ways you can engender participation.  The key is to be creative.  Perhaps you can reward the world of “ideas and improvements” (discussed earlier) by having managers submit candidates that made contributions every quarter.   Reserve some rewards just for the idea generators among you.  We even offered shop techs rewards based on completing jobs under the quoted hour allowance.   Whatever you do….make it fun, talk it up, and pay it often.

About the Columnist:

Dave Baiocchi is the president of Resonant Dealer Services LLC.  He has spent 37 years in the equipment business as a sales manager, aftermarket director and dealer principal.  Dave now consults with dealerships nationwide to establish and enhance best practices, especially in the area of aftermarket development and performance.  E-mail [email protected] to contact Dave.