What is the importance of motivation and incentive programs?
This is yet another aspect that many business owners fail to share with their employees. Here are some key points to consider. • Without an incentive program, employers risk internal fraud. • Keep it simple. Employees must understand how the program works to be motivated by it. • Incentives must be tied to specific cost areas where the employee has control. Example: A worker or crew of workers is given an estimate of 500 hours to complete a job. If the job is done in fewer hours, they are rewarded with a percentage of the overage. • The incentive plan must reward a group as a whole. A good solution is a bonus pool that covers the incentives for all jobs in a certain time period. As employees function more efficiently, the bonus pool grows. • Two sides: The incentive plan must consider all outcomes, helping employees focus on costs. In the 500-hours example, if the job is done in less time, it adds to the bonus pool. However, if costs exceed that figure, a percentage is subtracted from
