The Bill Sims Company, Inc.<%=company%>.
The development of an effective safety incentive program is essential in creating a strong safety culture in your company. Whether your goal is to improve a poor safety record or to maintain an already stellar record, incentive programs are an excellent vehicle to meet both goals. And yet the debate rages on as some claim that Safety incentive programs do nothing more than cause hiding of injury, failing to create any real safety behavior improvements.
A Minnesota firm that processes turkeys, Heartland Foods, needed big improvements. "We had a large number of people who were on Workers' Compensationemployees out on a long-term basis," says Marie Huber, safety health and training director. "We were very careful to avoid any 'injury hiding,' and worked to develop a set of rules that would achieve this. Now our numbers are way down." Heartland went from 285 lost-time injuries to 14 in only 18 months, using an incentive program developed by The Bill Sims Company, Inc. The program has more than paid for itself. The rules structure helped Heartland to create positive peer pressure, without injury hiding as a negative result.
W.R. Grace, a specialty chemical manufacturer in Atlanta, was trying to sustain a record that was already impressive, says Vic Anapolle, plant manager. "We went eleven years without a lost-time accidenta million-and-a-quarter employee hours. Our recordables are typically one or two a year for a population of about 70 people."
Though successful programs differ widely, their underlying processes are the same. A successful safety incentive program will raise awareness of safety issues, reduce injuries without causing workers to hide injuries and instill proactive behaviors that create a safe working culture.
It should be pointed out that, in recent years, incentive programs have unfairly been characterized as the "bad boys" of safety, due to a longstanding debate of "attitude versus behavior." Many critics contend that incentive programs cause workers to hide injuries.
And in certain isolated cases, they are correct. Incentives can be used properly or misused with disastrous results. Just as a scalpel can be used to save a patient's life by removing a cancerous tumor, it can also be used improperly and cause harm. Incentive programs can be wielded the same way.
Unfortunately, many safety incentive programs are ill-conceived as they are thrown together at the last minute with little thought given to rule making. This is particularly true of programs that are developed in-house. It is not the incentive tool that is at fault, but rather poor rule design which creates excessive peer pressure and results in hidden injuries and lawsuits. Working with an experienced incentive and motivation company helps avoid these pitfalls.
What are the most common root causes of injury hiding in an incentive program? Our 25 years of careful observation reveal these as a few (but not all) of the underlying causes:
- Use of Big Ticket Prizes (new pickup trucks, $1000 cash per person,etc.)
- Relying totally on group performance as the sole method of awarding a gift (while
ignoring proactive individual achievements)
Successful companies using these programs must ask questions that lead to clear goals, long-term follow through, and meaningful incentives. These factors are even more crucial than the type of incentives used to meet safety goals.
Managers new to incentive programs often get sidetracked by the content of the program, or what types of incentives to offer; one company may offer a steak dinner to employees who pass one quarter without lost time due to injuries, another offers cash and still another offers gift certificates to Wal-Mart. What will work best for your company?
While this is a compelling question, it is not the first question that should be asked. The most important question is "What behaviors will be rewarded?" While prizes and awards can be tinkered with, the processes that ultimately drive successful incentive programs must be considered first and foremost.
Though these programs differ widely in particulars, their underlying dynamics are surprisingly consistent. The first question should be:
"How do we set goals for our incentive program?"
To say that safety incentives should relate directly to safety goals is a truism. Yet goals can be conceived in a variety of ways. Companies that are successful with incentive programs have learned to set goals carefully, knowing that how you word a goal may lead to different results.
Raising safety performance is an obvious purpose of incentive programs. Given that overall goal, employees can receive incentives based on many different criteria: days without recordable accidents, months without lost-time injuries, decreases in Workers' Compensation claims and more. Any of these results can be achieved with a successful program, each having a different impact on a company's bottom line, but care must be taken to insure rules design that won't produce injury hiding.
Alternately, many firms now choose to reward safe behaviors, as part of a growing trend toward behavioral safety techniques. In a program focused on proactive behavior, companies reward a number of 'upstream behaviors' that ultimately produce a good safety record. Some of these behaviors are making safety suggestions, spotting close calls, achieving behavioral safety goals, attending safety meetings, assisting inspections, etc. These programs produce solid results in long-term safety improvement. Olin Chemical reported they had only 60 percent attendance at safety meetings. In the first month they used our proactive-behavior based incentive program, the figure jumped to 100 percent. Another one of our clients developed an innovative way of just saying "Thanks" to employees nominated by their peers as having a "safety first" mentality…and achieved a 46% reduction in injuries.
Promoting safety awareness, generating safety suggestions and recognizing employees for safe behavior are a top priority in incentive programs. Emphasis should be placed on the rules of the program and how that motivates people rather than on the gift awards. The gift award is certainly the catalyst, but most of the emphasis is on how the program works to build teamwork and motivation.
One goal that fits in almost any case is that of raising safety awareness. An incentive program can work simply by forcing people to pay attention. For example, Bar-S Foods Company in Arizona cut its Workers' Compensation costs in half between 1988 and 1993. The company's main objective was to carefully record lost-time accidents and watch the numbers closely during that time.
Heartland Foods employees use "close call" forms to report situations on the plant floor that could lead to recordable accidents and injuries. With an incentive program in place, says Huber, "all of a sudden there is a reason to pay attention, because you're going to get something back for noticing."
IncentivesFrom Bananas to Boats
Once the "how" questions have been answeredthe rules of the game, so to speakthe incentives can then be addressed. Consider for a moment what the term "incentive" entails. It can mean any item that people deem valuable.
Michael LeBoeuf, a management consultant, lists ten basic categories of employee incentives. Besides money, these include:
- Time off
- Stock ownership
- Special assignments
- Increased autonomy
- Training and education
- Parties and other fun activities
Before you agonize over the value of the awards offered, consider the advice of Bob Nelson, author of1001 Ways to Reward Employees. Nelson relates the story of an incident that occurred at the Hewlett-Packard Company. A team of workers had been plagued with a problem for weeks. An engineer finally solved the problem and, overcome with enthusiasm, he burst into his manager's office and blurted out the solution. Thrilled by this idea, the manager offered the only reward he could find at the momenta banana left over from his lunch. The incident started a trend, and the Golden Banana Award is now a coveted employee prize.
The prize took on a personal meaning to the workers because it implied recognitiona job well done. Nelson found that incentive programs work when they tap into the reward that employees favor the mostan immediate on-the-spot recognition of a job well done by their manager. In other words, a pat on the back. He quotes Mary Kay Ash, founder of Mary Kay Cosmetics, on this point: "There are two things people want more than sex and money ... recognition and praise."
Remember, a pat on the back costs you nothing.
Incentives today can include anything from a five-figure gift, to fishing boats, CD players, electronics equipment and pens. The following considerations should be taken into account when creating your incentive:
How can we get the most "bang" for our incentives buck?
Managers commonly assumed that an extra $25, $50 or $100 added to an employee check or a Walmart gift certificate is the strongest incentive for employees. Yet, that bonus added to an employee's check can quickly vanish, eaten up by taxes or mundane expenses. Moreover, employees may become dependent on the extra revenue and come to view it as part of their salary, thereby nullifying the reward's purposesafety awareness. Structuring your program properly with an experienced incentive house can minimize or eliminate the bite that taxes take.
Customize incentives to your company
For the reasons mentioned above, many successful programs rely on low-cost gifts with a high perceived value. Gifts that reinforce corporate identity can spark high interest. One of our clients, a trucking firm that transports new cars, centered its program on a one-of-a-kind jacket imprinted with a special crest. To win the jacket, employees had to drive for three months without an accident. On the last day of the contest, one driver backed his truck into a light pole and damaged the back window of a new car. He asked if he could buy that car. He didn't want to lose out and be the only person at his terminal without a jacket.
Beware of a "canned" incentive program, because what works for one company might not work for yours-each culture requires special changes to adapt a program to fit it. Company cultures differ greatly and that means successful incentives will also differ. Consider the following demographics before choosing incentives: age, rate of turnover, geographic location, racial and ethnic diversity. Nelson suggests distributing a "reinforcer survey: to find out the type of rewards that your employees actually want. Incentive programs thrive on employee input."
The exact kind of incentive program will depend on the culture of your workforce. High turnover and non-English speaking employees all require careful adaptations of incentive programs to ensure success. Your incentive provider must be comfortable with bilingual programs.
Remember the advice of Anapolle, of W.R. Grace, who noted that no employee is going to get rich through the company's incentive program. Instead, the program's goals are to promote safety awareness, generate safety suggestions and recognize employees for safe behavior on a regular basis.
For an incentive program to work well, incentives must be distributed fairly. Contests that reward only a few people or those that reinforce the view that safety is a matter of chance or luck should be avoided. Heartland Foods and W.R. Grace instituted lottery-style programs that could make everyone a winner. For example, employees who meet safety goals can receive scratch-off tickets called "safety bucks." Employees can redeem the buck immediately if it contains matching symbols. If not, employees may still accumulate bucks and redeem them later for gifts or other awards.
Meaningful incentives in a timely manner
Incentives are made meaningful when they are well proportioned to specific behaviors or results. "An employee who completes a two-year project should be rewarded in a more substantial way than the one who simply does a favor for you," writes Nelson in 1001 Ways to Reward Employees.
Also, it is important that rewards, whether material or verbal acknowledgment, be given in a timely manner, soon after the goal has been met. This boosts the impact of the incentive.
Joan Klubnick, author of Rewarding and Recognizing Employees, notes that managers and supervisors often fail to give recognition for a simple reason: they don't know what to say. Klubnick offers a "recipe" for recognition, or basic guidelines to use on a daily basis:
- Thank the employee by name.
- State specifically what the employee did to earn your recognition.
- Explain how you felt about this behavior.
- State how the behavior added value to the company.
- Thank the person again by name.
Incentive programs, union culture, and injury hiding…
Some unions have stepped up their efforts against incentive programs in recent years, using the familar objection of injury-hiding. On the other hand, many unions are supportive of incentive programs. One union president told Dorsey Trailers during contract negotiations, "We may pay for a part of health insurance, but if you take away Safety Bucks, we're gonna put on the boxing gloves."
A survey showed that unionized firms were even more likely to utilize incentives than non-union operations. One key to success in implementing programs in a union culture is to make the union a partner in the design of the program. Part of the problem unions have with incentives stem from their not being included in the design phase. Early union buy-in is key to selling the program, as are proper rules designed to eliminate injury hiding. Following these steps will help make unions a supporter of the recognition program rather than an opponent.
At the urging of the UAW and other labor groups, OSHA has examined incentive programs from four decades, concerned with the issue of injury hiding. After pouring over hundreds of programs, Marthe Kent, director of the OSHA office of Regulatory Analysis, submitted an interim status report. In the report, quoted in the September '98 issue of ISHN Magazine she said, "I see no dominant trend…the information is overwhelmingly anecdotal. Companies that have good safety incentive programs already have a strong safety and health program in place. A good safety and health program has employee involvement, hazard analysis, and injury reporting."
Echoing matters already discussed, OSHA VPP guidelines emphasize the value of psychological "warm and fuzzy" type rewards rather than large cash rewards.
Moreover, the claims of injury hiding by critics of incentive programs are vastly overblown. Incentive programs have become easy scapegoats to blame lots of problems on, with little or no research to back up the claims of their opponents. They have been charged "guilty until proven innocent." Our research has shown that injury hiding never occurs in a well-designed safety incentive program. Injury hiding is more often caused by sloppy record keeping, than by an incentive program. OSHA has conducted an exhaustive review of incentive programs on this matter and their findings so far are "inconclusive". This shows that all incentive programs DO NOT cause injury hiding; only those that are poorly designed. A company using a poorly designed safety incentive program is also likely to have poor reporting techniques, sub-standard accident investigation and preventive measures, and a lack of management commitment to the safety process---all factors that are far more likely to produce injury hiding than the incentive program itself.
Evidently, some poorly designed incentive programs in marginal safety programs have produced instances of injury hiding---and incentive opponents have latched onto these as proof that all incentives and employee recognition are inherently evil, without taking the time to thoroughly prove and document their conclusions using a wide range study. If OSHA, after its detailed analysis, has been unable to prove conclusively that incentives always cause injury hiding, then it is evident that they do not, when properly designed.
How do you sustain an incentive program?
Willingness to experiment and learn by trial and error are indispensable in creating a successful incentive program. One way to reduce the learning curve is find out what other companies are doing and consult recent literature on incentives.
Anapolle sees advantages in designing a cohesive program and then giving it time. "We took a lot of separate programs that were giving out premiums and various small cash awards. Then we added up what we were doing and said, let's roll these all into one program and see how that works for the next three or four years."
Consistency and follow through are key according to Huber. "You can't start an incentive program and then walk away and expect that it's going to run itself. You have to have safety meetings and give away incentives every month. Programs work when you implement employee suggestions and correct safety problems as they happen."
Both Huber and Anapolle agree that the incentive program should be changed periodically so that it stays fresh. Even a minor change such as a new gift item may be enough to sustain your employee's interest.
Huber and Anapolle, along with others who've succeeded with incentives, also report that these programs are simply the "icing on the cake"one part of an overall program that emphasizes safety at every point from hiring to training and daily supervision. By asking "how questions" a safety manager can restore the needed perspective and lift his eyes to this larger horizon.
Vic Anapolle, plant manager, W.R. Grace;
Marie Huber, safety health and training director, Heartland Foods;
Michael LeBoeuf, professor of management, University of New Orleans;
Bob Nelson, management consultant and author.
Incentive programs have become easy scapegoats to blame lots of problems on, with little or no research to back up the claims of their opponents.
Some incentives, such as a pat on the back and a compliment, cost nothing.
An incentive program can work simply by forcing people to pay attention.
Incentive programs are simply the "icing on the cake"one part of an overall program that emphasizes safety at every point from hiring to training and daily supervision.
- Vic Anapolle, plant manager, W.R. Grace, 5225 Phillip Lee Drive, Atlanta, GA 30336; 800-509-9816.
- Marie Huber, safety health and training director, Heartland Foods, PO Box 263, Marshall, MN, 56258; 507-247-4105.
- <%=company%>., president, The Bill Sims Company, 102 Lake Vista Drive, Chapin, SC, 29036; 800-690-1860.
About the author
<%=company%>., president of The Bill Sims Co., Inc., began work with Norfolk Southern Railway, Walt Disney World and Coca-Cola in the early '80s, helping them with employee motivation and recognition programs in safety and quality improvement. He has spent his career helping employers increase workplace employee performance. In business since 1945, The Bill Sims Co., Inc., includes among its clients Walt Disney World, Chrysler, General Motors and Coca-Cola. The company's website is at www.billsims.com and offers further articles on this subject.