Company bonus schemes and commission strategies incentivise employees to push the boundaries within their role and excel. When designed to improve engagement with the company mission, employee incentive schemes can drive business growth, and boost sales, profit and employee loyalty, aligning values throughout an organisation.
Paydata’s approach to employee bonus scheme design
At Paydata, we offer a service that acts as an extension of your own HR department. We understand that every business has different requirements and the pressures facing each sector vary. With this in mind, we use a results-driven approach to design staff incentive schemes, creating systems that are built around your organisation’s goals and vision.
Our service incorporates a systematic methodology, looking holistically at the review and design process from the outset. Combining this with over 20 years of expertise and knowledge, the team at Paydata are perfectly positioned to help shape your bonus scheme for optimal growth and business success.
Generally, we propose a two-staged approach:
1. 'Discovery' phase - where we review your current approach:
Reviewing your existing plan documentation and employee survey feedback.
Collecting views from key stakeholders.
Documenting what we have found.
2. 'Proposal' phase - outlining 2-3 options for each scheme:
Generating options, referencing market practice and our own consulting experience.
Reviewing these options for viability with key stakeholders.
Preparation of a formal and bespoke management report, detailing our findings, options and recommendations.
When to implement a bonus scheme
Employee incentives of all specifications should be incorporated into the wider business strategy to effectively promote overarching success and productivity. Ultimately, bonus schemes are key to attracting high-quality prospects as well as keeping the talent that you already have, especially if competitors within the same sector are offering enhanced benefits.Incentive schemes are best used to address changes in employee behaviour that may be having an adverse effect on business growth or success. You should consider implementing or amending a bonus scheme if you are facing:
A drop in employee morale or engagement
Difficulty in acquiring new talent
Employee retention issues
Changes in industry remuneration trends
How can a bonus scheme help your business?
Employees define organisations, which is why strong business growth is often dependent on a combination of effective processes, great products and happy staff. Company bonus schemes are employee engagement tools that can guide and influence staff behaviours. Salary and bonuses all play an important role in contributing to employee satisfaction, productivity and performance, which are fundamental in helping businesses achieve their objectives.
Bonus schemes can tackle:
A lack of alignment between employee values and the company mission can be the result of countless issues. Addressing this concern requires a multi-faceted strategy that starts with learning why employees are disengaged in the first place; however, incentives and bonuses can make a big difference to the overall value employees receive from their reward package and help reinvigorate a passion for your organisation.
Employees feel that their hard work is acknowledged, creating a newfound zeal for what they are doing and improving trust levels between the staff and employer. Aligning your workforce with company goals is fundamental to get the most out of team members and enhance staff performance.
Staff bonuses can also impact your ability to acquire the best talent available. Many organisations, both large and small, emphasise the importance of cost-saving efficiencies in every area – goods, salaries or bonuses. This can save money in the short-term but can also stunt organisational growth by reducing the appeal of your employer brand to candidates. This is especially true if competitors offer better remuneration or bonus packages, therefore attracting all of the best staff themselves.
If you are struggling to build your team or applicants for roles are proving unqualified, consider implementing a bonus scheme to increase the incentives on offer for prospective applicants.
In a similar manner to talent acquisition concerns, staff retention can be improved with the addition of a company bonus scheme to your reward structure. Whilst a combination of issues may be responsible for high staff turnover, reward levels often play a key role.
Staff members will usually tolerate a working environment they do not enjoy for longer if they are rewarded fairly for what they do. This window of time provides you with the opportunity to address other more intrinsic problems that may be causing loyal staff to leave, such as company culture or managerial concerns. Consider bonus schemes as a method to improve your reward offering if staff departures are putting pressure on business operations.
Shifting industry trends
Finally, staff bonuses also need to address changing industry practices and trends. Keeping up to date with the remuneration and benefits being offered in your industry is key to maintaining a happy and engaged workforce who will be aware of competitive pay levels they can access in the market.
If you are noticing your competitors include bonuses in their reward strategies, consider incorporating your own scheme to keep up with them, attract new talent and retain what you already have.
Commission and incentive schemes are a managerial decision, but we recommend taking into account external factors when deciding whether one is suitable for your organisation or what changes should be made to existing programmes. Similarly, the size of bonuses varies greatly from organisation to organisation and at Paydata, we can leverage our experience across a variety of industries to assist in this decision-making.
Get in touch today to find out more about our Bonus and Commission Scheme Design service.
Tim is a passionate HR specialist with over 20 years’ experience in pay and reward. As a director of Paydata, Tim has worked with thousands of satis...