I frequently have to fight hard to have an incentive based plan implemented in a business, however recently I succeeded. How do I know it worked well? Because we eliminated overtime, and the men were wanting to do another job at 10:00 in the evening, They are wanting to work Saturdays even Sundays…inspired by a huge incentive check.
As always designed, achieving the incentive bonus not only required extra work, but also required the men following the rules and doing what other duties were expected of them, such as reporting accurately, filing in the appropriate paperwork and handing it in on time.
In this particular situation and common, after a while the owners look at the incentive checks and have a heart attack, as they are frequently larger then the normal pay check, and they wonder why am I giving this to them, I should be getting it, forgetting its extra work accomplished and remembering they built in the expenses as well as whatever % of the “extra revenue” they decided to keep for themselves…(at least 50%) thus the program and incentive checks are extremely fair, a terrific deal for everyone, until management stopped paying it.
Why? Because the men were not doing their paper work and rather then correct the situation taking a leadership position and training the men effectively, the owners figured hey what the heck, I now have a reason not to pay them the incentive…The incentive plan just became the self destruction plan.
Now its open warfare, the men are angry planing their exit strategy for certain, believing the owners are ripping them off not paying the incentives they were promised and worked hard to achieve, they are not working harder or faster any more, the owners are not getting the paperwork and are letting this happen destroying any respect for any of the rules as they figure they would rather not pay the incentive anyways, and the whole program is going to drive the employees out rather then keeping them forever.
What went wrong? Loss of the vision, lack of belief in the incentive program and greed. I also bet they are not tracking the incentive payable so it has become the 800 pound gorilla in the room that no one is talking about. There but invisible.
What to do? Admit the error to the men, train them, help them produce the paper flow as required, pay them current on the incentive and pray the damage is not irreversible.
This does not happen all the time but it happens enough to bear watching, owners tend to forget the value of the incentive system and workers have to be constantly trained, reminded and resold, the cash helps allot but will not do it by itself without supporting service and input from management.
Solve the real problem, the owners neglect in properly administering the program and taking responsibility for its success and not using the men’s failure, in this case the paper flow, and remain committed to your plan, or be prepared to take real losses.
Candid discussion, employee reviews, career path training are all initiatives which would pre-empt this problem and afford ample opportunity to cure the issue effectively and immediately.
We all err from time to time, what we do about it, how we handle it remains the true mark of a good manager or owner. Call if you need help 413-549-2966.
