Usually bonuses are treated as a reward for exemplary performance. Although in some cases companies have a policy of handing out year-end bonuses to everyone. This beloved corporate tradition has been around for quite some time, giving employees something to look forward to come year-end. But is this long-time tradition still relevant in today’s workplace? Employees may come to accept this as a norm and expect holiday bonuses every year, rather than strive to earn one. There is a rather significant difference between gifting employees with a bonus and rewarding employees with a bonus. There are plenty of other ways to incentive and reward employee loyalty and performance.
If the intent is to ensure higher employee engagement in the long term, simply giving bonus is not sufficient. The euphoric feeling of having received this bonus is not expected to last for a long time. Typically 1 month and later on employees need to look at the next major milestone of achievement. Employers need to come up with other innovative ways to incentive’s their employees to keep them engaged in their work.
Another case to consider is that only the upper echelons of the organisation receives the lion’s share of the bonus. You may have come across news or press releases where C-Level designations have been awarded millions for their visionary guidance, along with their already sky-high salaries. What happens to the next levels in the organisation. As we go further down the hierarchy, this amount is reduced to a great extent. At the lowest level, this reward is appreciated more for the recognition rather than the amount received.
The problem here is not the bonus. The problem is that some companies are still using traditional annual performance reviews, a methodology that has been around for decades. Today once-a-year review and feedback is not sufficient. The need of the hour is to have continuous exchange of feedback as well as replacing annual reviews throughout the organisation.
Thus instead of handing out that annual bonus, that not everyone may deserve, employees can be rewarded every time they reach a personal milestone that also contributes to the overall team and subsequently the organisation.
For example, if you see some salespersons employing a better way to convert their prospects into full fledged leads, acknowledge their innovation as fast as possible. Then to measure these employees’ performance versus their effort, tie their behavior to the incentive plan. Tying consistent behavior with incentives will encourage your team to complete these very necessary responsibilities.
Other alternatives for bonus
Recognition of efforts:
Every employee, no matter what job position he or she has, is always hungry for recognition. So, by recognizing their efficiency, you will motivate them and bring out their hidden talents. Co-workers that are rewarded for trying hard and go that extra mile are fulfilled and more productive, more loyal and eager to contribute in a meaningful way. Recognition enables you to publicly showcase employees who demonstrate the behavior and performance that you want to cultivate.
Gifts and freebies:
Recognize and reward a well-done job by offering a day or two of discretionary time off. Coordinate with HR to add the bonus as no-strings-attached vacation time. Gifting doesn’t necessarily have to be expensive, but creative gifts must carry enough perceived value to incentive employees Once it’s on the books, let your employees know how they earned it.
Creative time off:
Your employees have worked hard for a long time. Encourage them to take a break and rejuvenate. Let them replace their creative juices that have been depleted due to extensive and hectic deadlines. Company can offer unlimited paid time off and make it entirely performance-driven. Those who worked hard will be able to maintain a good track record making it easy for their managers to identify the winners from the rest. This way there are no biases when it comes to choosing the winners.
Perks and Benefits:
No matter what these are, there can be made as an addition into the overall work environment in order to attract and retain top talent, as well as increase long-term employee performance. Now a day many companies offer attractive salaries. So it these other innovative perks and benefits that are the differentiating factor for potential candidates. Be it Facebook’s liberal paternity leave policy or Apple’s Friday beer bash, there needs to be something unique that can make stand out from the crowd.