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100 WAYS: #10 Link Bonus to Performance
– December 20, 2010
Make sure your bonus system provides real value. The fundamental basis for any incentive compensation program is simple: it should equitably and consistently recognize and compensate employees for superior performance.
There should always be two winners in a bonus structure: the employer and the employee. Giving ample reward and recognition to the star performers in an organization has the benefit of providing a role model for other employees. As a result, standards of performance are elevated and morale is strengthened.
In order to implement this, the company must be able to set clear measurable goals and make everyone’s bonus tied to the achievement of those goals. Each group of employees (secretaries, accounting, purchasing, sales) can be measured by different matrixes.
This is Profit Enhancement Idea #10 in Heard, McElroy & Vestal's 100 Ways: The Profit Enhancement Process series. The purpose of the series is to assist business owners and managers in cutting costs and increasing revenues by working smarter, not harder.
Walker Coburn
318.429.2109
wcoburn@hmvcpa.com
Walker is an Audit Manager in our Shreveport office. He received his Bachelor of Administration in Accounting and a Masters of Accountancy from Millsaps College in Jackson, MS. Prior to returning to his hometown of Shreveport and joining Heard, McElroy & Vestal, Walker worked for KPMG in Jackson and Memphis, and more recently as a financial reporting advisor for FedEx Corporate.
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