Impact of Incentive Plans

Impact of Incentive Plans

Incentive Plans are all conventional approaches that offer and identify as well as give rewards to deserving employees in case they achieve the planned goals and set objectives of the institution. Most of these plans are established to motivate people or groups in order to perform well in their place of work. Good examples of the incentives shared or given to employees and employers include but not limited to the following; money .that is given to employees annually as bonuses, profits shared by employers and employees in institutions, gifts in the form of cards or shopping vouchers or even paid field and vacation trips by the institution to its employees or the management among other enchanting services. To perform well or to serve their purposes, incentives should have clear rules and clear boundaries drawn to benefit the intended or target groups.

Benefits of incentives plan to employees.

They are a source of motivation for Employees.

Being created to serve the purpose of encouraging employees to motivate and push themselves in a flexible manner to increase their productivity, incentives serve as a significant portion in creating high morale in the working spirits of employees. By giving rewards to the destined employees, mostly for achieving the set targets and objectives, provides an area that encourages and pushes the employees to aim for the achievement.

They are a form of financial backing to employees.

In most cases, the incentive comes as a form of financial reward or a boost to the usual monthly or annual earnings of employees. Sometimes, the higher the revenue the employee will create for business, the higher the reward that will come in return as a result of their hard work.

With the joy of having an extra income, employees usually work to their best to achieve that extra income that will boost their investment or support their daily expenditure. Generally, this is the best of the best reward that employees enjoy from their employers.

Creates a mindset of loyalty in employees

In most cases, employees will have the capability to earn more or win better rewards form their employers over time, creating a positive bond between the employee and the employer. This bond comes with another to the employers, which is referred to as loyalty. This loyalty comes as a result of residual value where the employees work the best to increase their bonus or turnover rates through better services to their clients. You will always remain loyal to the hand which looks after you in the best way i.e., provides that quality service or product that you can never get anywhere else. Loyalty rewards the employees and employers with long terms of services.

Leads to a reduction in the turnover of staff

For most employees, they will always go and look for greener pastures to the employers where they feel they are appreciated and paid well for their service provision. Through offering incentives to employees, it shows that the management is recognizing their efforts and that they are being considered for their hard work. With this, the employees of that particular institution will always show for work, and very few will have the thoughts of going to look for jobs in other lesser paying companies.

Tightens the right relationships between employees and employers

After getting incentives, the relationship between employers and employees will always improve. The excellent relation is best through creating a flexible workforce between the two involved parties.it also gives a good flow of work and good productivity realized at all seasons.

Other benefits include:

1. The attraction of staff who are excellent and qualified from other competing businesses.
2. Promotes the spirit of teamwork
3. Increased services from an institution etc.

Among the incentives that are done is most institutions are the commission incentives that are done or given to the sales agents in different companies. This occurs where the employee is given a specified target to sell the products of the company. Upon reaching the goal, the employee can seize marketing the other products, but in case they prefer to trade them, a certain amount will be added to their wages or salaries for each item sold.it comes as a commission but differently to improve the morale of employees in making extra incomes while the company increases their productivity.

On the employee side, the coin is two-headed. Sometimes the market may be kind enough to make the usual sales and start the extra sales and still make huge sales. This will reciprocate in their accounts with vast deposits of extra income deposited and boosting their financial income and status. On the other hand, the day might kick off on the wrong side with the employee’s failure to sell the target products. Sometimes, failing to reach the target products of the sale in a day may come with its consequences and specific fees deducted from their salary or wage accounts. It is the bitter/ sweet deal of the work, and the employee will gamble to realize what the cards hold for them.

For the employers, all is fine in both coins. Whether the employee makes good extra sales, the company will also earn the extra money that will come with the additional sales, on top of the regular daily deals. In case the employee fails to purchase the extra sales, the company will get the average sales, and the rest pushed forward to the next day, week, or month. If any deductions are needed from the employee’s accounts for failing to reach targets, then the company will do so as agreed in the consignment forms. The plans have been fruitful for both the employees and employers for most organizations and have been able to make some employees productive day by day as long as the sales are good and made right to the target markets.

Among the recommendations that I can give to the Human resource, officers include The introduction of group incentives. Sometimes, individual employees may have difficulties in spotting the markets for some products. It makes it difficult to make good sales for the company. To increase sales, the employees should be grouped and targets established for the groups. The ones who know which plans are better for sales will show the rest and the resultant will be good sales for the company. Another recommendation is the provision of incentives for the casual workers who work under the lowest professional e.g., cleaners and security workers. This will give them a sense of belonging and perform to their best.