Check out a recent article by Mila D’Antonio, editor at 1to1 Magazine, 3 Steps to a Supercharged Incentive Program That Pays. Good overview of key considerations when designing an incentive program.
Two key points that I brought into the discussion. First, you’ve got to accurately measure performance for employees to trust the results. Second, few managers factor in the power of peer pressure and performance transparency. Providing visibility into how employees are performing against peers and within teams is a powerful incentive to compete and excel.