Cash vs. Non-Cash
Companies must first decide whether their objective and desire is to compensate (pay out cash), or to reward and recognize (incent through merchandise and/or travel) their participants.
  • Cash is considered the least effective performance motivator
  • Cash is a satisfier, not a motivator
  • Cash has Trophy Value - Isn't discussed with others
  • Cash is viewed in time as regular compensation
  • Cash quickly disappears into the family budget:
    • Cash is spent on bills or everyday expenses
    • The reward aspect is quickly forgotten
    • Once spent, cash leaves nothing tangible
  • It becomes extremely hard to eliminate a cash based promotion once it is already in place
  • Once participants have adjusted to their new income, cash will no longer be the motivating catalyst it originally was
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