What is an Incentive Program?

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  • Last Modified Date: 08 October 2019
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An incentive program is any type of program that motivates participants in some particular way by offering them some form of reward. Incentives can be used in a variety of ways and in many different places. They could help encourage members of a company to achieve certain goals or they might jumpstart extra learning in a classroom. In business incentive programs are often used in the sales industry, but this is clearly not the only way that people can be inspired to achieve more.

When people contemplate adding an incentive program to a workforce or learning environment, they should determine several things. First, people should have a clear goal of the behavior they want to encourage. They need to also have a sense of what type of incentives they’ll offer when employees achieve set goals.


For instance, a sales manager wants to see each sales representative increase their sales by 20%. The manager has to decide how to offer an incentive that might work. This could be money, a trip for two someplace special, tickets to a fabulous concert, or many other things. A smart manager might introduce this incentive with a company lunch or with training aimed at getting salespeople to increase their sales. Since 20% is a large goal, the manager could also set lower goals with smaller prizes so that he encourages each employee to do his/her best in improving performance, and makes more employees happy because more of them would “win” an incentive prize.

There are plenty of incentive program types in schools too. Teachers can give small rewards for increased reading, strong grades, and citizenship or for many other things. As with the managing sales director, the teacher has to sell an incentive program as something special that makes students desire earning it. Since the rewards are usually smaller, the teacher may actually have the larger job selling such a program. He or she must also be more sensitive to the issue that lower performing students in the class may not be able to bring performance up to a level that would earn any incentives offered.

In the classroom or the office, an incentive program will not work well in most cases if there is not routine respect for students or employees. People tend to be more productive if they’re happier, and that means that an incentive program can never take the place of skillful managing or teaching that is respectful. Rather, any such program should be viewed as an outgrowth of an already refined and skilled managerial or teaching approach. If it is not, it runs the risk of being mocked rather than creating excitement.


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Post 1

Both intrinsic and extrinsic factors play into motivation. Incentive programs provide obvious extrinsic (external) factors in the form of rewards, but to be truly effective over time, programs need to include intrinsic (internal) elements like the social satisfaction of recognition or the competitive satisfaction of winning a contest.

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