Experiences are the best way to reward employees for their hard work and dedication today, with 84% of millennials sharing that they prefer experiences over rewards with cash value. They differentiate your company from competition, giving employees an alternative that supports their personal development. In turn, this leads to a highly engaged, productive and happy team.
But what exactly is the psychology behind this? Here are the reasons why experiences are the future of rewarding employees, and why you should employ this in your rewards programme.
Experiences bring the team closer
Instead of limiting interaction to the office, experiences take employees out on a fun adventure and encourages bonding on a personal level.
Whether it is an outstation trip, an outdoor activity, or hands-on workshop, it’s a good thing to hear your team members laugh about “that day we hiked through the jungle”, “that weekend we spent at the beach in Port Dickson” or “that time we scared ourselves in that haunted house”.
Meaningful interaction creates team members who are highly engaged, which in turn leads to higher productivity and staff retention. Of course, let’s not forget that the great work culture that comes with it – an important deciding factor for choosing a workplace these days.
Experiences are a luxury as living costs rise
Let’s get real: the rising cost of living means more people are holding back on their spending to pay the bills and save up. But surely, monetary rewards are better then? Well, research by CEB/Gartner reveals that bonus pay-outs for high performers need to be at least 50% greater than pay-outs for the average employee for it to have meaningful impact on their behaviour. When it comes to motivation, cash rewards can be short-lived; meaningful rewards go a long way.
Meanwhile, experience rewards give employees a chance to enjoy something without worrying about the price tag. Some examples include art classes, dining experiences, extreme sports, or family day outs they normally won’t splurge on.
Experiences give teams a new perspective
Beyond the typical resort day outs, Starbucks gift cards and cash vouchers, these days there are many options for unique, out-of-the-box activities. Experience rewards that are different set yourself apart from other companies.
For instance, what if they could join a wau bulan (traditional kite) making workshop with a Kelantanese kite master, or a wayang kulit (shadow puppet) making workshop with a tok dalang? Not only would they get to understand the culture first hand, they can interact with someone whose life is vastly unlike theirs, as well as learn about their perseverance and passion.
Experiences open your employee’s eyes to a fresh new perspective and broaden their knowledge. This enhances their problem-solving skills, encouraging them to come up with innovative solutions both in work and in life.
Experiences are personal
Companies should recognise that every employee has different personalities and are motivated by different things. Family-oriented employees are more likely to enjoy activities where they can spend time with their family. People who love to cook may prefer cooking classes, while musically-inclined individuals may go for dance classes or music lessons.
In cases like these, gift vouchers are a good idea for rewarding top employees or as an annual dinner gift, especially if you can find a supplier offering experiences. That way, employees can choose whatever they want, and join the activity whenever they want.
Experiences can do good, and feel good
Experiences which benefit both the individual and the community really makes a difference. The largest generation in the workforce are Millennials, majority of which are socially conscious and looking for companies that have meaningful CSR engagement:
- 64% consider a company’s social and environmental commitments when deciding where to work
- 83% be more loyal to a company that helps them contribute to social and environmental issues.
- 88% say their job is more fulfilling when provided with opportunities to make positive impact on social and environmental issue
- 84% want their company to help them identify ways to get more involved in their communities
- 83% wish their employer would provide volunteer opportunities they could do with friends or family
Modern employees want their work to be an extension of what they stand for, and are looking for ways to make an impact within and outside the company. From team building programmes that empower local artists, to workshops that seek to preserve culture, or even having a meal that can change lives, there are many activities in Malaysia that cater to that.
When people feel inspired, they will be more invested.
Experiences are fun and memorable
At the end of the day, choosing experiences over monetary rewards comes down to two things: they are fun, and they make beautiful memories. They create stronger and longer-lasting emotions. You would want your employees to remember that they had an amazing experience, and talk about how your company made it happen, for years to come.
Experience rewards come in two forms:
- Experience-based team buildings – Group activities that the whole team can participate in
- Gift vouchers – Suitable for annual dinners or reward incentives, and can be redeemed anytime