Create a Bonus Programme

Create a Bonus Programme

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With ongoing, rampant unemployment, owners and managers of companies might be thinking they don’t need to do much to keep employees happy. With so few options out there, employees should be happy to have any job, right? Wrong! Experts say that unless companies do what they can now to keep employees content, there will be a huge exodus of talent once the economy turns. One strategy to keep employees satisfied and motivated is to create a bonus programme targeted at generating new business.

By motivating professional staff and managers to modify their behaviour companies can actually increase revenues and profits. Here’s a look at some strategies for bonus programmes:

  1. Profitability-based. The most sensible programme for any business is a plan that ties into the increased profitability of the company. This rewards the employee for helping to improve the bottom line. In many cases, companies can specifically state that if the company is not profitable, bonuses will not be paid out.
  2. Offer a share of increased sales. In this case, your company awards a percent or rand amount when sales figures exceed those of previous years. Bonuses should provide a bit of reach for employees but not be impossible to achieve.
  3. New ideas. A company can offer a fixed percentage or rand amount for developing a process or strategic improvement that is expected to improve profits in the future. In this case, the company assumes the risk, but it also limits its potential developmental cost. Once you decide on what type of programme to implement, there are a couple of ‘musts’ to keep in mind:

Outline plan characteristics.

Be clear about who’s eligible – just managers, or will support staff and subcontractors be included? Think about the reward amount for each category, when it should be paid and how it will be paid.

Clearly communicate programme guidelines.

It’s essential that there be a written, clearly documented programme that addresses the structure of the plan, fairness, measurability and attainable targets. In sum, for a plan to be successful it should be transparent and describe what you’re doing and why.

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