Does Incentive Compensation Really Motivate Employees?

HRsoft

Incentive compensation continues to work for many organizations, but does it truly motivate employees to contribute their best efforts? To understand whether incentives can truly drive performance, it’s important to understand the difference between extrinsic versus intrinsic motivation.

Promotions, Bonuses, Raises, Recognition - When They Work (and When They Don't)

Compensation Cafe

You can’t give all employees promotions, bonuses, or raises. The driving force behind this is often budgetary: “I can’t give Susie a raise, and there’s no career development path in the department right now. Bonuses. Compensation Philosophy Incentives/Bonuses Recognition

Plan Design Laid Bare!

Compensation Cafe

Whether you are redesigning your base pay program or creating an incentive plan, it pays to learn from experienced colleagues, so I've included links to Compensation Cafe articles about each of these three best practices. Best practices for plan design?

Don't Do That! Bad Habits and Compensation

Compensation Cafe

New incentive coming up next year? Whether you're developing an implementation plan or a communication plan, it's crucial to start by defining the habits, understanding and attitudes that exist now and will just be plain wrong when you move into your new plan or new compensation year.

When Size Matters -- Basics for Early Stage and Small Companies

Compensation Cafe

Get credit for your incentives. Many CEOs of small companies don't like to talk about incentives since they can't guarantee a yearly payout. Base Salaries Benefits & Perquisites Incentives/Bonuses Small Company Compensation Total Rewards

Spring Cleaning Checklist!

Compensation Cafe

Bonuses are paid, last year's results are old news and grand plans for this year have been signed, sealed and delivered. Run your bonus plan(s)through the washer periodically. Looking at clear skies these days?

Solid Reasons to Start Communication Planning in August

Compensation Cafe

If you are going to make sure your compensation and performance management programs are procedurally fair , you've got research, analysis and strategy development to complete. Base Salaries Compensation Communication Incentives/Bonuses Pay for Performance Performance Management

Mid-Career Hires Are Tricky

Compensation Cafe

At the same time, mid-career hires are tricky. Let's face it, the job switch is a life event for most of your candidates, involving substantial change and readjustment as well as career promise. Development. Incentives. Mid-career hires take this to the next level.

Cafe Classic: Chaos Theory

Compensation Cafe

Margaret O'Hanlon, CCP brings deep expertise to discussions on employee pay, performance management, career development and communications at the Café. Base Salaries Compensation Philosophy Incentives/Bonuses Nonprofit Compensation Small Company Compensation

How Are Salaries Affecting Millenial Engagement?

Compensation Cafe

At some point, wouldn't it be wiser to invest (in salaries, let alone other loyalty and trust issues like career development) rather than spend (on lower productivity, recruiting, orientations and so on)? Base Salaries Compensation Philosophy Incentives/Bonuses Total Rewards

5 Ways to Fight the "Peanut Butter" Syndrome

Compensation Cafe

Remember, some companies have begun to put their differentiation efforts into incentive payments rather than salary increases. Incentive decisions can also be peanut buttered, as I'm sure you've noticed.

Cafe Classic: Can You Spell D E B U N K?

Compensation Cafe

There is an extreme mismatch between what our employees really want and our efforts at motivating them (through feedback, merit increases and incentives). . Base Salaries Compensation Philosophy Incentives/Bonuses Pay for Performance

You've Got to Start Somewhere!

Compensation Cafe

Market tested your incentive rates? Margaret O'Hanlon, CCP brings deep expertise to discussions on employee pay, performance management, career development and communications at the Café. Base Salaries Compensation Communication Compensation Philosophy Incentives/Bonuses

Ready for Cutting Edge Communications?

Compensation Cafe

Or how about building an online resource that helped them understand the pros and cons of giving everyone the same bonus, and showed them simulations for different payout scenarios? Margaret O'Hanlon, CCP brings deep expertise to discussions on employee pay, performance management, career development and communications at the Café. Base Salaries Compensation Communication Incentives/Bonuses Pay for Performance Performance Management

When Virtual Reality Meets Plan Design

Compensation Cafe

This enables you to see things you need to see, and do things you might not have tried on your own yet, so you're better able to develop a plan. Base Salaries Compensation Communication Incentives/Bonuses

Looking for a Compensation Communications Template Anyone?

Compensation Cafe

Margaret O'Hanlon, CCP brings deep expertise to discussions on employee pay, performance management, career development and communications at the Café. It's that time of year again. Any day now you're going to need to get serious about planning compensation communications.

Cafe Classic: Time for Spring Cleaning?

Compensation Cafe

Margaret O'Hanlon, CCP brings deep expertise to discussions on employee pay, performance management, career development and communications at the Café. Base Salaries Incentives/Bonuses Pay for Performance Performance ManagementEditor's Note: Yes, it's that time of year.

How to Improve Plan Design

Compensation Cafe

According to behavioral economists, we have a lot to learn about designing cash incentives. It is common with MBOs, sales programs and classic incentive designs. Base Salaries Compensation Communication Incentives/Bonuses Pay for Performance Performance Management

Marketing Compensation to Employees and Managers? You Bet.

Compensation Cafe

Just as increased medical deductibles can simply telegraph higher out-of-pocket costs to employees unless they are addressed from a marketing standpoint, compensation announcements are strengthened by addressing employees' desires for recognition, a career with a successful company and retirement.

Cafe Classic: Get Rich Quick!

Compensation Cafe

Data on these four topics could be immensely valuable in your daily discussions: Distribution of employees by defining variables like age, sex, length of service, employment status, bonus eligibility and so on. Editor's Note: You too could be sitting on a treasure trove!

Thinking about Strategy for the New Year

Compensation Cafe

When it came time to develop a strategy for the function, her first step was to send an Associate level staff member to talk with employees. One of the first steps in strategy development, and perhaps the most demanding, is to identify the business problem you need to solve.

Software Implementation? Skip the Machine Language!

Compensation Cafe

Margaret O'Hanlon, CCP brings deep expertise to discussions on employee pay, performance management, career development and communications at the Café. Base Salaries Compensation Communication Incentives/Bonuses Performance Management

Who Are We Kidding?

Compensation Cafe

I have no doubt that EBITDA is the right target measure for most companies to hang all or part of incentive plan funding on. Will it cause the manager in shipping to make an effort to improve delivery times so this year's incentive plan is funded?

Cafe Classic: Managers Can't Use Salary Surveys Wisely, and Other Urban Myths

Compensation Cafe

Another important detail is that all employees are eligible for incentives. Margaret O'Hanlon, CCP brings deep expertise to discussions on employee pay, performance management, career development and communications at the Café.

Cafe Classic: 3 Ways to Meet – and Exceed – Expectations

Compensation Cafe

Let’s say, a year when there will be layoffs and no bonuses. Margaret O'Hanlon, CCP brings deep expertise to discussions on employee pay, performance management, career development and communications at the Café. Incentives/Bonuses Pay for Performance Performance Management

A Word to the Wise, Once Again!

Compensation Cafe

It May Have Become a Bonus " We all know about this trend, we've helped to create it. Especially informative is the Aon Hewitt visual about the share of companies' payrolls devoted to bonuses vs. the share devoted to salary increases. "If

Growing a Healthy Compensation Program -- The Turning Point

Compensation Cafe

HR operating context: Every department is working on developing reliable SOPs. Bonus: Healthy Gadgets' business model has shifted from "let's get going" to "grow, grow, grow." Base Salaries Executive Compensation Incentives/Bonuses Job Evaluation Pay for Performance

5 Ways to Do Comp Better

Compensation Cafe

Margaret O'Hanlon, CCP brings deep expertise to discussions on employee pay, performance management, career development and communications at the Café. Base Salaries Compensation Philosophy Incentives/Bonuses Recognition

How Well Do Numbers Speak for Themselves?

Compensation Cafe

Base pay $750,000; bonus $100,000; non taxable pay $10,198. Size of endowment and development responsibilities would have also helped -- especially the trends during her tenure. With the very best intentions, we often assume that the size of a merit increase or bonus speaks for itself.

Do You Know How to Attract Star Employees?

Compensation Cafe

Not only is the famous battle for talent waging outside your company's ramparts, but a large chunk of the people you want to recruit think career opportunities and inspiring business goals are higher priorities than compensation when choosing a new employer.

Expect More (From Yourself) This Year

Compensation Cafe

Margaret O'Hanlon, CCP brings deep expertise to discussions on employee pay, performance management, career development and communications at the Café. Base Salaries Compensation Communication Incentives/Bonuses Pay for Performance Performance Management

Acing Your Next Executive Presentation

Compensation Cafe

It's the time of year for executive presentations with topics like handling the increase budget, allocating the bonus pool, budgeting for next year, doing more with less and/or introducing change. Margaret O'Hanlon, CCP brings deep expertise to discussions on employee pay, performance management, career development and communications at the Café.

Job Candidates: How to Win Friends and Influence Their Decisions to Join You

Compensation Cafe

They also want to know your company's plans for the future, which they will use as a road map for their own career potential in your company. Many candidates come from employers who use incentives very differently than your company does.

eBook 60

Clearing Away the Cobwebs

Compensation Cafe

In the wider world think merit pay, incentives, equity awards, sales compensation, wellness, medical cost management, training and you've only touched on the most obvious examples. Somehow it felt like time to hit the reset button, so I went looking for inspiration.

Cafe Classic: Making the CFO Your New BFF

Compensation Cafe

Margaret O'Hanlon, CCP brings deep expertise to discussions on employee pay, performance management, career development and communications at the Café. Executive Compensation Incentives/Bonuses Total RewardsEditor's Note: Friending the CFO: A bridge too far.