Expensive Trips for High Performers in a Recession - Ditch Them Even if Someone Else Is Paying?

Most folks agree that in the middle of a recession and with the stinky reputation investment banks have garnered for all-expense junkets lately, incentive trips costing a company hundreds of thousand of dollars are a bad idea.  After all, how could you spend all that money while so many people are hurting in today's economy?

Of course, it's never that simple.  If it were simple, everyone could agree.

For example, here's the toughest question regarding travel rewards from my perspective as a VP of HR.  What do you do with "somewhat extravagant" reward trips for high performers when someone else is paying? (a company whose products you sell and needs access to your sales force, etc.)

Paul Hebert weighs in with his view, and remember, he's a rewards and incentive expert:

"The biggest misconception that is being propagated in the news is that these "junkets" are only for the top executives within a company.  I'm guessing the public has visions of fat, half-naked old men, sitting on pillows with young ladies dropping grapes in their mouths.  Nothing could be further from the truth. 

Most incentive participants are:

• The rank and file sales person whose job depends on ever-increasing levels of performance and contains risk most of us desk-jockeys couldn't imagine.  (Do you want your continued employment predicated on your prospect being in a bad mood after spilling hot coffee on his/her lap in the Starbucks drive-thru?)
• Employees who have exceeded, by a wide margin, the constraints of their job description and have increased the competitiveness of their company
• Members of a company's distribution channel who have stuck with the company to become top producers and advocates for the product, service, brand or company - people the company needs to remain competitive and innovative.
• The spouses, children, significant others, who attend with the person who earned the trip - providing much needed reward for the sacrifices they have made to allow the earner the time and attention being one of the best requires.

Incentive and meeting travel is a critical element in building relationships - especially in this predominately electronically connected world.  These relationships will help companies weather this economic storm, create new business ideas from collaborative conversations, foster innovations that will drive business, and reduce the costs of turnover within organizations.

Do not perpetuate the false information that is filling the airwaves, newsprint and electrons." 

Paul raises some good points related to travel rewards.  Travel rewards most commonly go to PRODUCERS - the sales pros who bring home the bacon, so the company can fry it up in the pan.  And if there's a group out there you want to keep motivated, it's the sales force.

So, why not continue rewards travel for that group, especially if someone else is buying, or the funding comes from the difference in revenue once a sales rep goes over 100% quota against an already aggressive plan?  The counter to this view is the employee relations cost.  After all, the regular folks don't get access to the quota spreadsheet, and they don't know if an affiliate/channel partner is paying for the outing.

They just see the trip, the cost and the brand of the hotel, which decidedly did not find your top sales performers staying at a Holiday Inn Express during the last junket.  With that in mind, my call would be to shelf the extravagant trips for 2009 company-wide, regardless of who pays or how critical the trip is said to be to sales force morale. 

After all, like the saying goes - salespeople can give themselves a raise by selling more.  Most of our employees who see the extravagant trip can't perform their way into being included on the junket, and it stings to see the trip going off as planned when they lost 2 people from their 8 person department last Friday.

Lose the junket for 2009.  I'm betting you won't lose your top sales performers. 

Comments

[Kim Bailey]

I completely understand the reasons for your conclusion, but I would offer a different option. Rather than cutting trips to those your business absolutely depends on, why not simply be more transparent in ensuring other employees understand why those things are important.

The economy won't stay bad forever. And when it comes back around, you want to be able to keep the best and compete with the best. If you lose good sales people at that time because they are getting offers left and right for companies desperate to steal the best, then you have hurt those other employees who will suffer the loses to your company in the long run.

Thinking of the long run for employees is upper management's job. Sometimes we all get bogged down in the "day to day", but we expect them to be watching out for the long term.