We are all working harder these days, both on and off the clock. Not only has company downsizing resulted in office-workload supersizing, but trends toward automation have us pumping our own gas, processing our own banking transactions, checking ourselves in at the airport and checking our groceries out at the market. Unlike pumps, ATMs, kiosks and scanners, people occasionally need a little motivation and inspiration to keep running at optimum level. Sometimes, a simple pat on the back is all that’s needed to encourage someone to go the extra mile or two. A big, fat bonus check also does wonders for sagging spirits. But, is a monetary reward the best way to satisfy and motivate the individuals contributing to a company’s success?
In addressing the American Psychological Association, Dr. Charles Garfield—who has conducted extensive research in the field of human potential from the standpoint of professional and personal productivity—pointed out that money has not been in the top three rewards for working Americans for many years now. He went on to say, “Most of us hate not getting one of the most essential rewards of all; to be recognized, to be unique, to have made a contribution—and have it known.”
Research from the Incentive Marketing Association showed approximately 30 percent of U.S. companies use non-cash incentive rewards to improve performance, with more than 80 percent of incentives being tied to sales objectives. Wirthlin Worldwide—a consulting firm specializing in polls and their interpretation—discovered that although cash rewards still have wide appeal, sponsors of non-cash incentives exploit the important psychological distinction between compensation and “motivation” by playing to those highly personal aspects of incentive recognition. Furthermore, Wirthlin Worldwide’s survey of 1,000 employees in a cash-based incentive program found that 18 percent didn’t remember receiving the cash, while 15 percent couldn’t remember how they used the money.
Actually, the impact of cash rewards is felt more by the companies handing it out. The American Productivity & Quality Center reported sponsors of cash programs actually require three to five times the amount of cash value to achieve the same results as with non-cash incentives. This isn’t news to Greg Muzzillo, founder and co-CEO of Cleveland-based Proforma. He is quite cognizant of the fact that it takes more to dispel discouragement and keep top earners pumped up and productive. Say, like an all expense-paid trip to St. Thomas or induction into the Million Dollar Club and receipt of the distinctive blazer worn by members of the illustrious group.
“The biggest incentive Proforma offers to our top-sellers is our Million Dollar Club,” he stated. “[It is] an internal organization that honors members who sell more than $1 million in the course of an annual billing cycle. Members [who] qualify are awarded an all-expenses paid vacation to one exciting location each year. The vacation is a time to relax, celebrate and network.”
Previous Million Dollar Club trips include Atlantis, Palm Springs, Punta Cana, Riviera Maya and Las Vegas. And, while soaking up the sun, members have an opportunity to network with a large group of other top performers, as well as with Proforma’s top preferred supplier group.
“The key to motivating with incentive programs is giving top producers something with a high perceived value,” shared Muzzillo. “Recent trends in sales incentives that we’ve noticed attempt to raise the level of perceived value for the sales achievers. Travel incentives ... are becoming more and more popular around the industry. Travel has a high perceived value because it incorporates luxury, relaxation and family time.”
Cash, he observed, may seem to have a high perceived value, but typically, when people are given cash incentives, instead of using the money for any kind of enjoyment, they’ll often use it to pay bills and for other expenses. “The perceived value of a vacation or an electronic gadget that they wouldn’t purchase for themselves is often higher than a cash incentive, and more cost-effective for the company,” added Muzzillo.
Peer recognition is also a powerful motivator. “For the highest producers in the industry, no amount of cash or gifts is going to motivate them the way ... industry and peer recognition will,” he continued. “[Besides the Million Dollar Club] members may receive various awards at our Annual Convention and Family Reunion. Recognition has proven to be a particularly excellent motivator among our members, and is the most cost-effective form of incentives that can be utilized.”
Print Professional wanted to hear from members of the Million Dollar Club to find out just how effective non-cash incentives are for keeping them at the top of their game. Here is what some highly-successful Proforma franchise owners had to say:
Steve and Lori Garst
Stephen C. Garst, owner of Proforma—Promotion Consultants, Stamford, Conn., recently closed a multimillion dollar deal with a client in the beverage industry. He has been working with the parent company and other divisions for approximately six years, providing a turnkey solution for the client. His office handles print, promotions, e-commerce, warehousing and distribution for the brand marketing team and field sales.
Said Garst, “[For the past] four years, I’ve gone on the trips; three of the four years have been [as part of the] Multimillion Dollar Club, and I have [already] qualified for the ‘09 trip at the multimillion dollar level.
“Other than a great excuse for getting away to a beautiful destination, one of the best opportunities is to connect with other owners and Proforma executives and employees, hear about their opportunities, [and listen to their] advice. It’s great fun to hang out and kick back. I know it inspires me, as well as many other owners, and it’s great to see others receive their jackets. We all try to support and look out for each other. I think salespeople are competitive and want to achieve the highest award, or number-one status.”
David and Cyndi Kolko
“I have been a member for six years, and been on six vacation trips. There is no way I would miss one,” exclaimed David Kolko, president, Proforma—I.F. Print Services, Rochester, N.Y. “The best part for me—aside from the pure excitement of being on vacation—is getting to see old friends and discuss work-related issues in a casual atmosphere with people in similar positions. Also, getting to know the [preferred suppliers] in the same atmosphere is terrific. Being comfortable with your vendors is an important part of business today.
“It means a lot to me [to be part of the Million Dollar Club] and the people I work with back at my office. To continue to achieve in today’s ever-changing world is not easy, and to be recognized for it is a true compliment. I am the face of our franchise to Proforma, but trust me, there are many people behind the scenes working for this achievement, and without them it would be not only more difficult, but less rewarding. Everyone at the meeting should be inspired by what they see around them—I know I am. If they are not, they might be in the wrong business.”
Patti Spadafora and Glen Rapoport
“We’ve been members [of the Million Dollar Club] since 2001 and [have gone on the] trips every year since joining,” said Patti Spadafora, co-owner, Proforma Instant Promotions, Toronto. “The Million Dollar Club trip is truly a great time to connect with fellow owners and the Proforma executive team and just decompress. We don’t believe a cash reward could provide the same impact as a few days away in a great setting. Additionally, I believe it’s most beneficial for our vendor relationships. It gives our vendors a chance to create a relationship with the larger franchise owners in a very relaxed atmosphere, without the distractions of day-to-day business. Glen and I have forged some key relationships with vendors [during] Million Dollar Club [trips], where we’ve moved significant business their way. Let’s face it, our business is all about relationships, and we feel a great relationship with our vendors is just as important as a great relationship with our clients. And, membership in the Million Dollar Club plays a roll in our client relationships.
“Being part of the ‘top’ producers in any network is an accolade that can serve you well. I think it also represents strong signs of stability, dedication and integrity in our business—not only to our clients, but within our industry. From some owners I’ve spoken to, I think the Million Dollar Club is a benchmark they can measure their own businesses by and set their own goals, which I feel is good for all of us, regardless of what stage we’re at in our businesses.”
Jeff Bowles (pictured on p. 23 with his business partner, Jeff Levy)
“I qualified for the Million Dollar Club in 2006, and our first trip was to Palm Springs,” recalled Jeff Bowles, principal, Proforma Promotionally Yours, Overland Park, Kan. “We had an incredible time—nothing like warm weather in early March when you live in the Midwest. In 2007, we qualified for the Multimillion Dollar Club, but weren’t able to attend the trip to St. Thomas because my wife was nine months pregnant with our second daughter at the time. It killed us not to be there with everyone and we spent the entire pregnancy commiserating over our lousy planning! Proforma still sent us the gift bag that [members] receive[d] on the trip, and when we opened it up to see a beach bag and beach towels—while it was freezing and rainy here—we just about hopped on a plane and decided we’d have to be okay with delivering a baby in the Caribbean!
“Outside of a chance to get away and enjoy a great vacation with family and friends, the Million Dollar Club trips have also proved to be extremely profitable. Networking with other successful owners, as well as top supplier reps, and forming relationships that you carry with you back into the office after the trip, have translated directly into increased sales and higher profit margins. This isn’t a new industry ... and chances are someone has already tried what you’re thinking about and already learned a lot of lessons you can benefit from. Being able to frankly discuss approaches to business growth, employees, account management and vendor selection with people who have already been where you are today is, hands-down, the most valuable benefit of Million Dollar Club status with Proforma.
In this industry, since most distributors are fairly small businesses with only a small number of employees, there aren’t a lot of opportunities to measure your accomplishments against anything other than what you accomplished in years past. Being awarded a Million Dollar Club and Multimillion Dollar Club jacket in front of your peers at our annual convention is very rewarding and highly motivating. While all successful distributors in this industry have to be intrinsically motivated to succeed, this type of recognition really does provide a great outlet for external motivation and recognition that is missing in most small businesses.”
- Companies:
- Proforma