Assessing Lafarge incentive strategy to trade partners in a competitive market

In this report, Daniel Obi assesses route to effective reward system and its impact in an organisation leveraging recent Lafarge incentive strategy to trade partners.

Motivating employees or trade partners globally must follow certain principle to achieve necessary measurable impact. One of such standards is often-less-considered factor – Timing. In most organizations, emphasis has always been placed on size of gifts and perhaps venue. While these are important to ignite expected behavioural change, experts have linked the dependence of timing and reward as key ingredient to effective reward system.

To achieve effective impact in a reward system, it is also important and expected that the criteria are well spelt out from the beginning. When the process of selecting winners is open to employees and trade partners, it douses suspicion which could be counter-productive and de-motivating.

It is always difficult to successfully combine all the principles for effective reward impact but when an organization consciously attempts it, the result is consequently effectual.

Taking viewpoints from the recent trade partners award organized by Lafarge Africa Plc, the sub-Saharan Africa building materials company which is a subsidiary of LafargeHolcim, there was clarity of balance in the mix of the principles such as timing, size of the gift, and attempt to bring all trade partners who met performance standards for the award instead of selecting single overall winner.

The management admitted that this method has proved effective in the trade partners reward as distributors have shown to be delighted each year with the awards which has translated to their volume sales. For instance,  extracts from the nine-month earnings report of Lafarge Africa for the period ended September 30, 2015 showed that sales rose marginally by five per cent to N168.14 billion in third quarter of 2015 as against N159.4 billion recorded in comparable period of 2014.

  “Each year, we agree priorities with our distributors. We look at their performance versus our expectations and on that basis we reward those who have outstanding or exceptional performance. Our aim is to motivate them to better assist us in meeting what the market expects from us. Our distributors are hence important in making us achieve our corporate objectives and also in making our end users achieve their goals”, says Rilwan Yusuf, head of retail, Lafarge Africa said.

Yusuf further said that it is always very good to compliment the efforts of business partners. “Your distributors are very key when it comes to your ability to effectively cover your target market, they are very key in terms of being able to effectively satisfy the specific needs of each category of customers. In the last 5 years, I think the awards have evolved overtime and every year we try to refine the awards to meet the exigencies of the day because business is not done in a vacuum. Business is also conducted in a way and manner that as the economic conditions changes, we also try to make sure that we reflect that in the awards. And I can tell you that overtime, it has become a concept that the customers look forward to and because they are looking forward to it, they want to be part of it, they want to be celebrated, and because they want to be celebrated, you see them striving to out-do one another with regards to meeting and surpassing expectations. So, to that extent, I think it has been a huge success over the last 5 years. Our distributors now see the benchmark you set for them as actually being the minimum and in order to deliver on this, they strive to do better than what the standards are.  And don’t forget also, part of what we also look at is the fact that we are a safety conscious organization, so we also use the opportunity to emphasize the need for safe practices as we move our products from our distributors to our end users”.

At the award this year in Lagos, about 36 trade partners were rewarded with various prizes including cars, various electronic gadgets such as LED TVs, generators, Tablets and cash awards as well as corporate products.

The Chairman, Board of Directors, Lafarge Africa Plc., Mobolaji Balogun, reiterated that the reason behind the annual Customer Awards was to express the company’s gratitude to the distributors for their support for the growth of Lafarge Africa business in Nigeria.

With strong heritage of over 50 years in Nigeria, Balogun believes that  the company’s distributors’ have consistently contributed to meeting expectations of outstanding quality and safety that generations of Nigerian professionals and end users have of  Lafarge  products and services. “We deem it important to continually recognize and energize the existing partnership between us as an organization and you as our customers by acknowledging and valuing your distinctive impact on the company’s performance. It is imperative to note that your continued dedication and partnership are paramount for the past, present and future successes of our company”, Balogun said.

Similarly, the CEO Cement, Lafarge Africa Plc,  Adepeju Adebajo, stated that the importance of this year’s event is underscored by the fact that although the Customer Awards started in 2005, this is the first pan-Nigeria Customer Awards ceremony, covering Lafarge Africa Plc’s operations in the North (AshakaCem), the South (Unicem) and South West (WAPCO). “This is the first time we are able to bring all our key customers across the country together to celebrate your contribution to the growth and success of your company – Lafarge Africa Plc” she stressed.

At the awards, several dealers went home with numerous prizes including cars, which were given out based on performance. The top performance award of 2016 Kia Sportage was presented to Mabos Ayok Inv. Co. Ltd; Day-Kings Solutions Ent.; Raheed Ishola Ventures ltd; Batoframog E Ent and Kpaksbuddy Nig. Ltd.

While Rosent Invest Ltd and Ubotex Nig. Ltd each received 2016 Honda CRV as Special Recognition Award for WAPCO Operations and UNICEM Operations respectively; Maiyaki General Merchant Ltd was presented with 2016 Kia Sportage as Special Recognition Award for Ashaka Operations.

In the same vein, Temitope Oil Nigeria Ltd, Ebony D Great Ent; Jolly Friends; Ibukun Oluwa Ent., U Meakasons, John-Jeff Nig. Ltd, Rose Sej Business Ent Ltd, and Adamu Mohammed Aba received the Regional Champions Award of an all-expense paid trip to Cape Town, South Africa for their efforts.

Speaking further, Adepoju said “actualizing Lafarge Africa’s vision has led us to an increased focus on customer transformation through value adding experiences and partnership. We are dedicated to being the first choice innovative solutions provider by developing value-added products and solutions to fulfill the growing needs for housing and infrastructure and, building better cities. We are also ensuring a deep understanding of how our products are used and the value they create and engaging with our customers to develop products and solutions tailored to their needs”.

Sam Ndionyenma, Sales Director, Lafarge Africa Plc explained that the Key Distribution Scheme, a strong route to market distribution system which has been vital in expanding the company’s distribution footprint would be rolled out nationwide. He congratulated the distributors for delivering the quality Lafarge Africa demands of its partners.  According to him, “building materials are as good as the quality of their delivery channels, they must arrive at the users’ sites in the quality they left our plants”. 

The yearly impact of such awards underscores the significance of leveraging research and obeying the principles to understand human behavior and factors that could ignite motivation.

Daniel Obi