A successful incentive compensation plan focuses on achieving company goals by driving the right behaviors in employees. One of the biggest failures of incentive compensation programs is they often do not take into account all the key drivers that will make the company successful. How does a company determine if its incentive plan is effective? If the answer is “no” to any of the following questions, chances are the company is not getting the most benefit out of its plan. Continue »
The theory behind incentive compensation is money motivates employees to perform well. Unfortunately, many contractors spend a lot of money on employee incentives and receive little value in return.
Employees may become angry with the company because their own expectations for bonuses are not met. Morale is hurt when employees work hard all year, yet the profits of the company still lag because employees are working inefficiently. Contractors that genuinely try to reward hard-working employees are frustrated when they realize they unintentionally created a negative company atmosphere. Unfortunately, this is what many companies face when they incorrectly design and implement incentive compensation plans. Continue »