Every once in a while, I like to take my employees out for a company-sponsored dinner. It works wonders - it's much appreciated by my staff and really boosts morale.

If a few burgers can do this, think of how effective a formal incentives program can be at your workplace. Even the smallest businesses can customize a program that suits all of your employees, as well as your budget.

When setting up an incentives program, start small. An easy way is to offer an incentive around a key goal or the completion of a project. Employees can work toward the targets, like hitting certain sales figures or meeting certain deadlines.

Be creative with rewards. You don't have to offer the traditional trophy or plaque. Great monthly or quarterly rewards can be had for less than a few hundred dollars, like online gift certificates or a PDA, a.k.a. personal digital assistant.

And don't assume rewards have to be individual. Promote teamwork by taking everyone out to dinner or buying something fun for the office, like a pingpong table.

Managing an incentive program that gauges ongoing performance requires more effort. To do that well, you will need to track your employees' performance, keep them updated on their status, all while trying to figure out a desirable reward.

Incentive services can help take care of the drudge work around communicating status and choosing rewards. And good news - some online incentive services will manage your program for free, which can be the right price tag for any small business.

Services will differ, but most offer a simple game plan that involves a point system, where one point typically equals $1. You award points to your employees based on their performance. These points can then be redeemed for rewards offered through the service's online catalog or gift list.

If you choose to outsource, take a look at the service's catalog first to check that there a large enough range of rewards to please all of your employees. And check to see if their prices are competitive.

An incentive program does need to be well thought through, otherwise your grand plans can backfire. Make the goals a stretch, but achievable. Also stress to your employees that you want them to have fun, but that earning the incentive should not be the focus of their business goals. And if a goal is reached, that's no reason to start slacking off. Also, with individual incentives, employees who are left out can feel discouraged.

It may seem like a lot of work, but incentives programs are worth it. It will not only boost the mood in your small office, but with the range of options you have to consider, it can be just as fun to plan it as it is to work for the reward.

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