I was reminded the other day just how stupid most service anniversary awards programs are becoming. Here's the story.
A friend of mine just completed 10 years with a company. He received a small box from the CEO. No note, no certificate, just the box. Inside the box was a very nice, two diamond (small diamonds) lapel pin.
The punch line...
The company has a very liberal dress code - jeans and t-shirts allowed on many days. The ONLY person who wears a coat (but no tie most of the time) is the CEO. The person getting the lapel pin has worn a coat and tie maybe 5 times during his tenure - for client presentations. So... where do you think the lapel pin will be 60 days from now? Same place high school yearbooks and notes from your first love go to rest - some box, somewhere in the attic or basement - only to be seen when the big neighborhood garage sale comes around.
I know that the service anniversary program is a tradition, but so was running after DDT fogger trucks and playing in the pestiside laden smoke during the 60's (I know some readers remember that, c'mon.) It's time to retire this tradition.
Back in September of 2008 I wrote a column on Incentive Magazine about this (link here) - I stand by the column. The gist of it was that awarding employees for time is wrong - we need to reward them for growth. Anniversary of time should be replaced with the recognition of their (and your) investment OF time.
Some food for thought.
- The median tenure for employees age 20-24 as of January 2008 is... drum roll... 1.3 years (those are the new hires my fellow readers)
- For those 25-34 years old the median tenure is 2.7 years (these are your future executives)
- For employees age 25+ the median tenure is 5.1 years (this is the total employee base)
Source: US Dept. of Labor September 2008
For those of us that are math challenged - median is not average. Median means 1/2 the people are above that number and 1/2 the people are below that number. So to state it more emphatically, half your employees in each of those categories will leave before the years shown. Half your new hires will leave in just over a year. Half your future managers will leave in less than three years and half your total employee base won't be around in just over 5 years. (special bonus hint - those that leave typically aren't your worst - they are your best.)
This means your "service anniversary" program immediately is worthless to most if not all your employees. In fact, most Service Anniversary programs are designed around the IRS tax ruling on these programs. The award is non-taxable to the employee and the company if they are given after 5 years. So... most programs start the awards at 5-years in order to take advantage of an IRS ruling. That's a good program design criteria. But the numbers don't lie - most of your employees will never see the beautiful lapel pin or crystal vase you've chosen for their special day.
Read the article I wrote and think to yourself - am I just being stupid thinking our service anniversary program actually does anything? You might not be stupid - but your progam probably is.
In honor of service anniversary programs I leave you with this Bill Engval video - "Here's Your Sign"... you'll see the connection after watching...
(readers receiving RSS feed may need to click through to see video)
A
Marketing and Incentive Design Consultancy