Dear Sirs
I wish to introduce Performance Bonus to my top management ( Plant heads ) to improve upon their belongingness as well as responsibility towards their work.
How can I do it? Ours is a secondary Steel manufacturing large set up.
Kindly suggest
Regards
From India, Nagpur
I wish to introduce Performance Bonus to my top management ( Plant heads ) to improve upon their belongingness as well as responsibility towards their work.
How can I do it? Ours is a secondary Steel manufacturing large set up.
Kindly suggest
Regards
From India, Nagpur
Dear Suresh Jakhotiya,
Yes, a performance bonus is one of the means of motivating employees. But one cannot introduce the performance bonus to improve upon their belongingness as well as responsibility towards their work.
If pecuniary gains were to improve upon the responsibility and responsibility, then why depend on a performance bonus? Straightway by increasing the salary, the matter could have been solved.
A sense of belongingness and responsibility towards work arise from the organisation's culture. Culture is too complex and various sub-cultures coexist.
Mere paying a performance bonus to a plant head does not suffice the purpose. He/she has to get work done by his/her subordinates. What if his/her subordinates are not worthy to render a desired level of performance?
Yes, introduce the performance bonus, but before that conduct a survey of the organisation's culture. You need to know which factor holds back the culture of the organisation.
Coming to your query again. The performance bonus will depend on the measures of performance. Do you measure the performance scientifically? If yes, then which costs and ratios are measured scientifically? Do you have the technical infrastructure to measure the costs and ratios associated with your business accurately? I ask these questions because, in your city of Nagpur, I have provided consulting services to one of the prominent pharmaceutical companies. Additionally, I have provided PMS consulting services at other places too.
If you are from manufacturing, then do you measure the "Cost of Quality" (COQ) and the "Cost of Poor Quality" (COPQ) scientifically? Along with these two costs, do you measure Inventory Turnover Ratio (ITR) scientifically? Measuring these two costs and a ratio will be the beginning. For other things, feel free to contact me.
Thanks,
Dinesh Divekar
From India, Bangalore
7884Yes, a performance bonus is one of the means of motivating employees. But one cannot introduce the performance bonus to improve upon their belongingness as well as responsibility towards their work.
If pecuniary gains were to improve upon the responsibility and responsibility, then why depend on a performance bonus? Straightway by increasing the salary, the matter could have been solved.
A sense of belongingness and responsibility towards work arise from the organisation's culture. Culture is too complex and various sub-cultures coexist.
Mere paying a performance bonus to a plant head does not suffice the purpose. He/she has to get work done by his/her subordinates. What if his/her subordinates are not worthy to render a desired level of performance?
Yes, introduce the performance bonus, but before that conduct a survey of the organisation's culture. You need to know which factor holds back the culture of the organisation.
Coming to your query again. The performance bonus will depend on the measures of performance. Do you measure the performance scientifically? If yes, then which costs and ratios are measured scientifically? Do you have the technical infrastructure to measure the costs and ratios associated with your business accurately? I ask these questions because, in your city of Nagpur, I have provided consulting services to one of the prominent pharmaceutical companies. Additionally, I have provided PMS consulting services at other places too.
If you are from manufacturing, then do you measure the "Cost of Quality" (COQ) and the "Cost of Poor Quality" (COPQ) scientifically? Along with these two costs, do you measure Inventory Turnover Ratio (ITR) scientifically? Measuring these two costs and a ratio will be the beginning. For other things, feel free to contact me.
Thanks,
Dinesh Divekar
From India, Bangalore
Dear Suresh,
Performance Bonus can be conferred on following attributes of Leaders.
1. Leaving by Organization's Vision, Mission & Values
2. Business Accumen
3. Creating future Leaders
4. Leading by Examples
5. Retention rate in the Dept.
6. Time bound & Quality Results by Team / Dept.
7. Individual Upskilling Efforts
8. Acting as Change Agent
From India, Karjat
Performance Bonus can be conferred on following attributes of Leaders.
1. Leaving by Organization's Vision, Mission & Values
2. Business Accumen
3. Creating future Leaders
4. Leading by Examples
5. Retention rate in the Dept.
6. Time bound & Quality Results by Team / Dept.
7. Individual Upskilling Efforts
8. Acting as Change Agent
From India, Karjat
Dear Mr Ajay Sawant,
The performance bonus is paid when the performance exceeds the target given. However, it requires measurement. In your post, you have given eight attributes on which the performance bonus can be paid. The performance of the following attributes is measurable but as written in my previous post, "scientific measurement" is no easy task. It requires a proper mechanism in place:
5. Retention rate in the Dept.
6. Time bound & Quality Results by Team / Dept.
7. Individual Upskilling Efforts
However, would you mind explaining how to measure the performance on the following attributes:
1. Living by Organization's Vision, Mission & Values
2. Business Acumen
3. Creating Future Leaders
4. Leading by Examples
and
8. Acting as Change Agent
In case you have a case study on the measurement of the attributes, please share it.
Thanks,
Dinesh Divekar
From India, Bangalore
The performance bonus is paid when the performance exceeds the target given. However, it requires measurement. In your post, you have given eight attributes on which the performance bonus can be paid. The performance of the following attributes is measurable but as written in my previous post, "scientific measurement" is no easy task. It requires a proper mechanism in place:
5. Retention rate in the Dept.
6. Time bound & Quality Results by Team / Dept.
7. Individual Upskilling Efforts
However, would you mind explaining how to measure the performance on the following attributes:
1. Living by Organization's Vision, Mission & Values
2. Business Acumen
3. Creating Future Leaders
4. Leading by Examples
and
8. Acting as Change Agent
In case you have a case study on the measurement of the attributes, please share it.
Thanks,
Dinesh Divekar
From India, Bangalore
Dear Mr Ajay Sawant,
Attributes 1 to 4 and 8 are not at all measurable. It would be a great risk on the part of the MD to consider them as performance attributes and start disbursing bonuses. What is not measurable is perception driven. Bonuses are for achieving tangible results and not satisfying one's perception.
Attributes 1 to 4 and 8 are the qualities or the traits of leadership. Each leader must possess them. However, merely possessing the qualities or traits is not sufficient but what output is delivered because of them is important.
The stakeholders or the investors who invest in the business are hard-nosed businesspeople. They expect tangible results. To give them higher returns the first requirement is to embrace realism or come out of the world of fantasy. It is a penchant of people in certain disciplines of management to take the fancy of the terms which are characteristic to them. But then business expansion or growth does not happen because of the fanciness!
Thanks,
Dinesh Divekar
From India, Bangalore
Attributes 1 to 4 and 8 are not at all measurable. It would be a great risk on the part of the MD to consider them as performance attributes and start disbursing bonuses. What is not measurable is perception driven. Bonuses are for achieving tangible results and not satisfying one's perception.
Attributes 1 to 4 and 8 are the qualities or the traits of leadership. Each leader must possess them. However, merely possessing the qualities or traits is not sufficient but what output is delivered because of them is important.
The stakeholders or the investors who invest in the business are hard-nosed businesspeople. They expect tangible results. To give them higher returns the first requirement is to embrace realism or come out of the world of fantasy. It is a penchant of people in certain disciplines of management to take the fancy of the terms which are characteristic to them. But then business expansion or growth does not happen because of the fanciness!
Thanks,
Dinesh Divekar
From India, Bangalore
1. Create a clear and measurable performance bonus structure. This should include specific criteria and metrics that you expect your plant heads to achieve in order to earn a bonus. Make sure that the criteria and metrics are achievable and relevant to the roles and responsibilities of your plant heads.
2. Establish a timeline for the performance bonus. This should be based on the desired performance improvement and the length of time it will take to achieve it.
3. Set a monetary value for the bonus. Determine the amount of money or percentage of salary that the bonus will be worth and make sure it is a fair and motivating reward.
4. Communicate the bonus structure to your plant heads. Make sure they understand the criteria and timeline for earning the bonus, and how their performance will be measured.
5. Monitor progress and reward accordingly. Track progress to ensure that your plant heads are meeting the criteria and timeline for earning the bonus. Provide positive feedback and recognition when they do so.
From India, Mumbai
2. Establish a timeline for the performance bonus. This should be based on the desired performance improvement and the length of time it will take to achieve it.
3. Set a monetary value for the bonus. Determine the amount of money or percentage of salary that the bonus will be worth and make sure it is a fair and motivating reward.
4. Communicate the bonus structure to your plant heads. Make sure they understand the criteria and timeline for earning the bonus, and how their performance will be measured.
5. Monitor progress and reward accordingly. Track progress to ensure that your plant heads are meeting the criteria and timeline for earning the bonus. Provide positive feedback and recognition when they do so.
From India, Mumbai
1. Set clear goals and objectives:
Define the desired outcomes of your performance bonus program, such as productivity improvement, quality enhancement, or customer satisfaction.
Develop specific and measurable goals aligned with your objectives.
2. Choose the right metrics:
Select metrics that are specific, measurable, achievable, relevant, and time-bound (SMART).
For productivity improvement, consider metrics like units produced per hour or defects per unit.
3. Communicate the program to your employees:
Ensure your managers understand the program's goals, objectives, and metrics.
Clearly explain how bonuses will be calculated and awarded.
4. Set a budget:
Determine a budget that considers the size of your company, program goals, and chosen metrics.
Allocate resources effectively to sustain the program.
5. Track your results:
Collect and analyze data based on the chosen metrics to evaluate program effectiveness.
Assess if the program is meeting goals and producing desired outcomes.
6. Make adjustments as needed:
Be flexible and willing to make changes based on results and feedback.
Modify goals, refine metrics, or revisit the budget to improve the program's effectiveness.
By following these suggestions, you can introduce a performance bonus program to your top management that aligns with your objectives, motivates your managers, and drives desired outcomes. Clear communication, effective tracking of results, and adaptability are key elements for long-term success.
From India, Dombivali
Define the desired outcomes of your performance bonus program, such as productivity improvement, quality enhancement, or customer satisfaction.
Develop specific and measurable goals aligned with your objectives.
2. Choose the right metrics:
Select metrics that are specific, measurable, achievable, relevant, and time-bound (SMART).
For productivity improvement, consider metrics like units produced per hour or defects per unit.
3. Communicate the program to your employees:
Ensure your managers understand the program's goals, objectives, and metrics.
Clearly explain how bonuses will be calculated and awarded.
4. Set a budget:
Determine a budget that considers the size of your company, program goals, and chosen metrics.
Allocate resources effectively to sustain the program.
5. Track your results:
Collect and analyze data based on the chosen metrics to evaluate program effectiveness.
Assess if the program is meeting goals and producing desired outcomes.
6. Make adjustments as needed:
Be flexible and willing to make changes based on results and feedback.
Modify goals, refine metrics, or revisit the budget to improve the program's effectiveness.
By following these suggestions, you can introduce a performance bonus program to your top management that aligns with your objectives, motivates your managers, and drives desired outcomes. Clear communication, effective tracking of results, and adaptability are key elements for long-term success.
From India, Dombivali
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