Making incentive compensation work for workers

There are plenty of times where personnel may look at their coworkers and feel they are not earning as much as they think they should be. In some cases, people might also perceive another staff member's efforts as less intense as their own, yet experience lower pay for what they think is greater output. In these cases, it's best to come up with transparent earning schedules and incentive compensation plans so that everyone stays happy and engaged.

Tackling talent problems
As The Guardian stated, some workers see their own output in comparison to what their coworkers are doing, earning and receiving and don't see the equity in these scenarios. If someone has been working for an organization longer yet making less money, it could be that there are disparities in skills or different incentives being handed out to various personnel, but individual employees are not aware of these scenarios. Therefore, a compensation plan that outlines all the various bonuses and benefits could significantly reduce workplace friction, as people would no longer have to wonder why they and their colleagues are earning the specific amounts and awards they are.

Specifically, The Guardian indicated one common sales incentive compensation concern, wherein a top representative with greater tenure was already awarded a work-from-home status. However, a newer associate with less output and revenue generation was awarded a raise and other perks, making the veteran employee feel less appreciated. In such cases, confronting a boss can be difficult for these personnel, but failing to meet employee expectations could cause retention issues for top talent.

Selecting a good plan
Choosing the right kind of compensation plan is as tricky as it is essential to ongoing corporate health. As ABA Banking wrote, there are specific federal guidelines regarding how and when associates can be rewarded, but it's up to each firm to pick a strategy that fits their associates' selling styles. In some cases, giving upper-level management too much control over doling out bonuses can cause congestion in delivery and disconnects within different departments, but businesses may also find that they have less of a grasp on the return on investment for such deployments when they don't have a top-down style.

Fostering a solution that targets positive sales figures and is easy for all employees to access and navigate is a critical aspect of any good compensation plan. Use social tools to ensure that personnel are on track with these options and are receptive to the kinds of rewards being offered.