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Productivity Incentives That Work

One way to start developing a continuous improvement culture is to offer productivity incentives. When people are just getting used to Lean, or any other improvement method, they probably won’t be regularly offering up ideas. They just aren’t used to that being an expectation of their job.

So provide your team with incentives for improving productivity.

Key Points for Productivity Incentives

  1. Make sure you don’t reward ideas. The goal is to actually get the idea implemented. Only give credit for things that are put in place.
  2. Develop judging criteria. Be open-minded about what an improvement is, but don’t reward artificial gains. And make sure the gains stick.
  3. Make rewards real. They can be physical products like a TV, or intangibles like days off, extra time for lunch, and premium parking spaces. If teams don’t see value in the productivity incentives, there will be no change in behavior.
  4. Make standards clear. Don’t leave things open for debate. The productivity incentives you decide on should not surprise people when it comes time to dole out the good stuff. Make sure nobody walks away bitter that they think they got a raw deal.
  5. Consider a lottery. Stay away from the ‘most ideas wins’ format for productivity incentives. They tend to be a competition between just a few star performers. Instead, use a lottery. Each improvement becomes a ticket. The more improvements a team member makes, the better the chance to win. This keeps people who get behind from checking out and keeps the leaders from hoarding ideas.
  6. Consider an annual mega prize if a pre-determined threshold is reached. Set a goal for a really big prize if there is really big improvement. For example, if the company reaches an average of 50 improvements per person for a year, raffle off a car. If the improvements were real, you should have no trouble finding the money for this from the savings your company realized. But if that is too ‘outside the box’ for your HR department, give a person an extra week of vacation. (Don’t forget to pay the taxes for the winning employee!)
  7. But don’t hold all your productivity incentives until the end of the year. If you do offer a big prize, don’t let it eat into the recurring ones. Regular incentives motivate people more than end of the year rewards. The repetition keeps people interested in the program.
  8. Consider when to end your productivity incentives. Be careful about how you implement any productivity incentives program. You want it to help build a culture, not replace it. The goal is to get teams making improvements because it is a part of their job. You don’t want to foster an environment where the extra mile is only travelled to get something extra.

But, since changing values and attitudes starts with shifting behaviors, productivity incentives are good ways to alter what people do. Just remember: they won’t change how people think without a well-rounded effort to build up a continuous improvement culture.

Why not try it out, and see if you can get your team inspired to make more frequent changes? And please, let me know in the comments section below if you have done anything similar that has worked for you.


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