Example of an Employee Incentive Program

Incentives motivate employees.

Incentives not only boost a company's employee morale, but also help to generate increases in revenue, according to BusinessKnowledgeSource.com. In addition, incentive programs are also useful when rallying employee support behind new company initiatives. For example, an employee incentive program could include providing additional compensation for exceptional sales of a company's new introductory product.

Purpose

Prior to establishing an employee incentive program, the objectives to be accomplished must be explicit. This ensures that the resulting program is on target to generate the desired results.

Guidelines

When establishing a money-based employee incentive program, it is of the utmost importance that employees understand have a firm understanding of the prerequisites needed to earn extra compensation for their work. A common structure includes a tier-style format.

For example, an additional 2 percent commission is earned for every $1,000 in sales over the expected monthly $10,000 sales quota.

Effectiveness

Having implemented an employee incentive program, it is important to document the results of such. Doing so spotlights areas needing improvement so they can be addressed and corrected.

References

• BusinessKnowledgeSource: Employee Incentive

Resources

• BusinessKnowledgeSource