Giving your staff incentives

Having spent most of my career in so-called glamorous but low-paying jobs, I can appreciate the value of staff incentives. Whenever I felt that it was time to move on to a more lucrative field, little things like discount movie tickets and $5 CDs conspired to keep me where I was.

It also helped immeasurably that I have had fair and compassionate bosses. "There are some things money can't buy," I often told myself when I was short on cash. "At least my boss is great."

Was I naive? Not at all. In fact, in this shrinking labor market, staff incentives designed to lure and keep good employees are vital. And since the health club industry is not known for its high-rolling salaries (indeed it has a large part-time work force), incentives are doubly valuable.

"One of our company's core beliefs is that if we want to get extraordinary customer service, our employees have to be treated in an extraordinary fashion," says Herb Lipsman, general manager of The Houstonian Club, in Texas. That attitude has paid off for The Houstonian: Employee turnover has dropped from close to 100 percent annually in the early '90s to under 19 percent for 1999.

What exactly is extraordinary treatment? It can cover a wide gamut, as you'll see.

* Respect your employees. "Every employee needs to be treated with dignity at all times," says Lipsman. "We have to make sure we treat our employees in a manner that enables them to feel good about their job, their opportunities and themselves when they come to work."

To accomplish that, The Houstonian puts all employees through a three-day course: "The Seven Habits of Highly Effective People." "We feel we are investing in our employees so they have a better life," says Lipsman. "That course would cost them $2,000 to $3,000. We give it to them for free and pay them while they're taking it."

* Institute a bonus program. At WellBridge (formerly Club Sports International), monthly bonuses are awarded to staffers who exceed their goals. "Thirty-five hours a week is full-time for our industry, so incentives become key because you've got to be able to offer people something beyond an hourly wage," notes Lynne Short, WellBridge's vice president for human resources. For example, at WellBridge, a full-time massage therapist receives a bonus if she exceeds 25 hours per week; a part-timer, if she exceeds 10 hours.

"We bonus employees to deliver more than what we plan for from a budgetary standpoint," says Short. "It increases revenue for us, and it's an incentive for them to build business."

The Houstonian's bonus program is measured by specific criteria and is organizational rather than individual-focused. Previously the program was based on performance, customer surveys and employee turnover, and checks were distributed quarterly. Now the criteria will be profitability and employee turnover, and bonuses will be distributed twice a year. "When the checks are smaller, the bonus becomes almost an entitlement. Employees don't think about the impact of those numbers," says Lipsman. "But the twice-a-year bonus will have more of an impact. The potential gross amount per check will be $600 per person, which is a pretty good chunk of money for someone earning $5 to $7 per hour." Managers, who are measured by the same criteria, receive a percentage of their salary.

* Emphasize career development. "It's the biggest long-term retention factor," notes Short. To that end, WellBridge has created three levels of training programs for employees. Also the organization has established three areas - athletics, operations and sales - from which promising employees can be groomed for a general manager job. "We let people know: If you become more skilled, we'll move you up in the organization and we'll pay you more money," says Short.

Give performance feedback, preferably monthly, says Short: "Informal performance feedback, at the minimum, is necessary on a quarterly basis."

* Make the process of promotion a democratic one. WellBridge has de-scriptions for each and every job that state "very fully the necessary qualifications," says Short. When an opening occurs, the job is posted throughout the company, as are the details: the salary range, whom the person would report to and so on. "We interview anyone who meets the qualifications," says Short, "and fill most of our jobs internally, which is a key retention factor." But, and here's the important part, all those who don't get the job have a performance discussion. "We give them very specific reasons why they didn't get the job and map out a development plan for them," says Short.

* Give employees free membership. Employees of The Houstonian receive complimentary individual memberships. Usage is limited to certain periods, but many employees take advantage of the membership. "Almost none would be able to afford this club," says Lipsman.

* Offer a discount in your sport or pro shop. "We try to keep benefits equal across the board as much as possible," says Lipsman. "The [25 percent shop] discount is not just for managers; it's for everybody. It's another way of telling employees that they're important and we want to show them some special consideration."

* Try short-term team incentives. For example, reward everyone in a department two free movie tickets for accomplishing something like perfect attendance.

* Commemorate the important events. A yearly holiday party for employees' children is one of the traditions at The Houstonian. This past year, 400 kids attended the carnival-themed party and every one of them received a gift. On another night, employees attended a dressy holiday party complete with DJ and buffet. Events like these "build the culture, making employees feel more connected," says Lipsman. "People feel good about the club after they attend these events."

WellBridge has a monthly birthday cake to celebrate staff birthdays en masse. On the first, third, fifth, 10th, 15th and 20th service anniversaries, staffers receive a gift, ranging from a T-shirt and pin (for the first) to a leather jacket bearing the club's insignia (for the 20th). Also Well-Bridge designates an "Employee of the Month" and features the individual in the newsletter. "People love to be recognized," says Short. "That's one way for people to feel like they're part of a family."

* Look out for your employees. Each December The Houstonian encloses a card with its monthly bill telling members that in recognition of the services staff provide, $35 per member will go into a fund and be distributed to full- and part-time employees. If a member chooses to pay the amount, he simply checks a box. "This year, each full-time employee received $605; part-time staff received half of that," says Lipsman. "Most members gladly pay the amount and many add to it."

* Recognize good work performance. The Houstonian's program "The Extra Mile" is based on member feedback. Any time the club receives a note or call from a member or guest praising a staff person, he receives an "Extra Mile" pin. The award is presented with a lot of hoopla, and a proclamation acknowledging the extraordinary service is read. "It's funny that something that simple really has an effect," says Lipsman.

* Be committed to your incentive programs. "They won't work if you go in and try to have a program of the week," warns Lipsman. Part of what makes a program work is the thought that goes into it. Lipsman suggests three to five years of planning "as opposed to saying, 'We're going to go in and make nice and give a bonus.' "