In a study by workforce solutions firm, Kelly Services, found that 40% of employees feel they would be more productive if they had their earnings linked to certain performance or productivity goals. When coming up with bonus and incentive ideas for your practice, think of what will inspire morale and productivity in your employees. There are many strategies out there that you can use. Tailoring it to you and your practice will guarantee you more results and will help grow your dental practice by empowering your team.
What's the difference between a bonus, incentive, and appreciation?
Bonus Definition: an amount of money added to wages on a seasonal basis, especially as a reward for good performance.
Incentive Definition: A thing that motivates or encourages one to do something.
Appreciation Definition: Recognition and enjoyment of the good qualities of someone or something.
A bonus, incentive, and appreciation, in their respective definitions, are very different BUT can have similar ways of being shown within a professional setting. When coming up with bonus or incentive ideas, simply ask yourself: Is this a bonus or incentive gift?
Today, we are going to be focusing on bonuses and incentive ideas. For more on employee appreciation, see our blog entitled Dental Team Building: Easy Tips for a Happy Staff.
Every bonus strategy needs these 3 things
The goal needs to be measurable.
In order to receive a bonus, employees must do something that you can measure. Decide what category your bonus strategy is in and what the goal is. Make sure this is clearly communicated.
The goal must be achievable.
When setting the goal for a bonus, evaluate how achievable it is. If the goals you set are consistently out of reach, your employees will be discouraged. The sweet spot is something that can be reached but will require some work and team effort.
The bonus needs to be desirable.
Whether you are choosing a cash bonus or an alternative it must be substantial enough to be desired. Think about who your employees are and what they may want. Consider asking them what they would be interested in. Movie tickets, a show, or a check? Keep the bonus in line with the work done, aka smaller bonuses for smaller goals, and bigger bonuses for bigger and more long term goals.
Why have an incentive program?
Incentive programs have been found to be an effective way to boost productivity among employees and improve overall performance as a business. Reducing turnover of staff is another big benefit. Making the investment instead of incurring the loss of hiring new employees regularly.
Alison Frey, a travel specialist, wrote, "Every year, according to the most recent figures, roughly $11 billion is lost due to employee turnover. Incentives are a great means of curbing this loss."
Ideas for Alternatives to Cash Incentives
What could the manager or business owner do differently to retain employees AND boost productivity and morale? If your employees don't respond to cash what could you do differently? Including something as simple as a handwritten note with a cash bonus could be enough. Encouraging or publicly recognizing someone's hard work during your morning huddle. (link morning routine blog) Having tickets to an event, gift-card to a dinner, or a weekend getaway, are all appropriate alternatives. Note: the examples above could also be used for employee appreciation but that doesn't mean they can't be used for bonuses as well.
The Incentive Marketing Association did a study which found 65% of employees preferred non-cash incentives.
There are 3 main bonus types:
A performance bonus is exactly as it sounds. It is performance-based. This bonus is given to those who have achieved or surpassed a set goal. It's based on personal performance instead of group performance. This bonus is given regularly...either annually or more often. It's designed to keep top-performing employees happy and in your practice.
A milestone bonus is a project-based bonus. For a practice this could look like wanting to cut your clients leaving an appointed list in half. Anyone involved in reaching this milestone or project goal would receive a bonus.
Ad Hoc Bonus
This bonus is the least common of the three. An Ad Hoc bonus is considered to be more spontaneous and is up to the discretion of the giver of the bonuses. This one is commonly a smaller bonus and is a reward for a good idea, a one-off improvement, or high-level performance in a specific situation. This is not for a long term goal. This bonus isn't too big but should be one that everyone receives, it's specific to one-off performance moments but can be incredibly impactful due to its element of surprise.
Base Your Bonuses on Hitting Targeted KPI Goals
Use the tool you have to create and measure goals. Your KPI's should be a part of your goal setting process. See where you've been, where you are, and track the progress of where you're going. Below are 3 examples of KPI's to monitor, what team could bring improvement, and what their goal could be:
KPI: Reactivation/Re-care KPI
Team: Front desk/Hygiene
Goal: Your team could work towards reducing how many people leave your practice un-appointed. They can do this by: 1) offering to pre-appoint them before they walk out the door, 2) educating them on the importance of oral hygiene, and 3) understanding their insurance.
KPI: New Patient
Team: Marketing/Front Desk
Goal: Your marketing team could have a goal of bringing in more new clients. Tracking the ROI in marketing can be difficult so be careful and ask your marketing team what an achievable goal might be for them. They should be trying new tactics if their current strategy isn't working.
Team: Front Office/Manager
Goal: Managing your schedule falls to your front office and office manager. A goal for your team is scheduling patients out in advance, and keeping openings for emergencies. Having a prioritized list of patients that your team calls when there are openings means they're using the KPI's in an effective way to keep the practice on track and create more revenue.
Adding bonuses to your budget can feel like a cost you can't in-cure. Knowing all the benefits isn't enough, you need to know it's financially possible. If you don't have a Dental CPA, hiring one should be the first thing you do. Next, you'll need to review your numbers with them. You'll want to determine your break even point, and utilizing a KPI monitoring system is a great tool to help with this. To read more on this, see this blog by Dentistry Business.
When it comes time to reward your team, you should be beyond excited. Your dental team has gone above and beyond to exceed your expectations. As an employee, receiving a gift is a welcomed thank you, but, at times, to hear "job well done" goes even farther. Invest in keeping employees instead of replacing them!