How to Design an Effective Personal Performance Bonus Plan
In a work environment where employees often juggle multiple responsibilities, use different tools, and enjoy more flexible work schedules, performance plans and bonuses have become more difficult to design. But, for many organizations, they are necessary — in a survey conducted by PayScale, 65% of employees would like a bonus based on personal performance. The trick is to establish what types of effort and contributions warrant a reward and find ways to incentivize people accordingly.
Decide what Employees are Rewarded For
This can be tricky for some roles, as only certain tasks can be directly tied to revenue. For example, a marketing professional may be responsible for paid digital marketing and campaign deliverables such as social media posts, thought leadership articles, and graphics. The paid digital marketing component will have a clear ROI, and while the other items may contribute to that ROI, their impact is much harder to determine.
While building out your bonus structure, keep in mind that employees will often focus more effort on the projects that directly impact their incentives. It’s important that “bonused” tasks relate to the things that will truly impact business success. If employees are overburdened with unrewarded projects or incentivized on tasks that don’t directly impact results, they may struggle to reach their goals and achieve that monetary reward.
For roles that are more directly tied to revenue, such as sales, the process is more straightforward. But even then, it’s crucial to gauge employee workloads to ensure they have enough time to spend on key sales work over administrative duties so they can focus the majority of their time on the right type of work.
In all cases, streamlining your department’s workflow will help to free up time for priority tasks, and we have some tips for doing that here.
Establish a Baseline For Performance
To reward employees for a job well done, you have to know what a job well done looks like. To do this, data is a great place to start. Productivity data can provide insight into employee effort, for instance. Obviously, metrics focused on ROI, such as sales and performance marketing, should figure into the equation, but productivity data can help to account for those “unbonused” tasks discussed earlier.
Bonuses and performance management based on how people show up to work will encourage workers to put in the effort every day, and feel confident that their contributions are not going unnoticed. With Prodoscore, that’s easy to do. Plus, the solution provides tools for self-coaching, identifying training gaps, and visualizing good performance.
Reshape Performance Reviews With a Bonus Tracker
Designing a bonus structure tied to both productivity and ROI not only allows you to offer an incentive package that takes all tasks into account, but it also encourages a proactive approach. You can help this process along by implementing an employee “bonus tracker” that shows employees how close they are to reaching their goals, one that they can preferably access at any time. This way, if they find that they aren’t on track, they can reach out for help and guidance to get back on track.
This bonus tracker can also be used as a management tool that you can take a look at once a month to see where an employee may not be meeting their goals, just in case they are too busy to reach out.
Performance-based Incentives For Other Staff
In the past, performance-based bonuses may not have worked for everyone. People in accounting or customer service may not have been enthusiastic about it as their tasks were not easily tied to company revenue. Now that we can actually measure employee productivity, it makes more sense for professionals in any department. For these types of workers, the ROI component can be tied to overall company performance rather than the ROI performance of their own department.
Prodoscore is designed to help you reward the good, and its own ROI can be realized in helping to design an incentive program that works for everyone. As a non-invasive employee productivity monitoring solution, it gives management transparency into what people are doing without the “surveillance” feeling of other tools. Contact us today for a demonstration to see how we can help you reward your top contributors and improve productivity for the rest of your team.
