Employee Incentive Programs Go Global

January 19, 2010 (PLANSPONSOR.com) - With more employees than ever working in other countries, more multinational corporations are contemplating a global incentive strategy rather than piecemeal, country-by-country efforts, according to a new white paper. 

The report from Accor Services contends the programs keep employees, external sales reps, and other channel partners engaged – especially during challenging economic times – and produce substantial payoffs for companies looking to hone their competitive edges.

The report says incentive use has been growing steadily since 1996, according to surveys for the Incentive Federation. Half of large companies used merchandise incentives in 2006, and six out of 10 predicted their incentive budgets would increase over the next two years.

The Incentive Federation’s most recent study, released in 2007, found that U.S. companies spent $32.7 billion on merchandise. Of the companies that launched incentive programs in 2006, more than half used gift cards or certificates for merchandise, while 45% used cash awards.

According to the report, although the domestic incentive industry is healthy and growing, globalizing these programs is becoming a top priority for North American companies as overseas expansion has evolved into a key growth driver. The report pointed out that the largest U.S. companies rang up 48% of their 2008 sales through international channels, up from 32% in 2001, and two-thirds of employees at the largest U.S. multinational companies work abroad, according to a study by Standard and Poor’s.

“Top executives know they need to develop programs that encourage widely dispersed employees to support one mission and reaffirm corporate values. Smart recognition programs stretch across corporate supply chains. They include far-flung global partners such as offshore software development and business process outsourcing facilities,” Accor suggests.

The white paper can be downloaded from here.