Employee Incentive Schemes
Recent economic developments have found many organizations tied up in a battle attempting to reconcile employee entitlement mind-set with economic reality, and sometimes with major unwanted consequences. That is why many organizations have started rethinking their pay structures and are now shifting to employee incentive pay models.
Employee incentives aim to motivate employees to achieve high performance results and, where necessary, to change behaviours. They are considered powerful tools for enhancing individual and organisational performance thus it is not an area to be taken lightly by the management.
At Human Asset we understand that challenging existing mind-sets about compensation structures is not an easy task. It requires a systematic approach and careful integration with a firm’s culture, strategy as well as with HRM objectives and systems.
Utilizing our extensive experience in the field we can help organizations to develop and implement a suitable incentive blend to meet their individual needs and circumstances. Some of the incentive plans we can develop for our clients include:
- Performance related pay: Performance related pay when carefully integrated with current organizational mechanisms can be a powerful tool in boosting individual and group performance. It can also help organizations differentiate and retain their high performers and attract new talents.
- Promotions: Similarly to performance related pay, promotions can be an equally powerful incentive tool. Providing employees opportunities for growth raises engagement and commitment to the organization.
- Bonus Schemes: Whether targeted towards all employees, specific departments, levels or functions, bonus schemes have proven their worth in helping organizations raising employee satisfaction, performance and commitment. Conversely to performance related pay and promotions that are usually linked to year end results, bonus payments can be distributed in more frequent intervals depending on the issue(s) each organization wants to tackle.
- Commission Schemes: Whether forming the full or part of the package, commission pay is most commonly used to reward sales targets. Even though is perceived by many as a simple percentage multiplied by the value of a good or service the process of developing and adopting such a scheme is more complex than this. One needs to consider factors such as competition, market conditions, sales price, the complexity of the good or service and sales effort required. Of equal importance is the “when” factor i.e. when do you pay the commission; upon issuing of invoice upon full settlement of invoice etc.
Working site by site with our clients we help them deciding on issues like:
- What type of incentive plans or how many incentive plans
- Performance measurements
- How much
- When to be paid
Our approach is always designed to meet our client requirements and help establish a well- blended incentive scheme mix aligned to their needs.