...Companies use incentive plans as a way to motivate and compensate employees’ remarkable levels of professional accomplishment. It can also be a used to boost production levels and reward employees for a job well done. The objective of incentives awards is to motivate employee goal-setting, cooperation, and group interaction. For the most employees will perform according to how they are measured and compensated. When employees work as a team, they should be paid as a team. And if the employees don’t get compensated as a team they probably won’t performed as a team. Business has different incentives awards, these incentives can begin at the beginning of a pay period, quarter or the start of the year. Employees could receive a lump-sum payment ranging from $100.00 to $10,000 or Time-Off Award. According to online source “Compensation alone won’t guarantee high levels of performance; however, reward programs can produce the behaviors most likely to lead to success. Employees living more balanced lives tend to be more productive.” (Caruth & Caruth, 2013) The Academic Journal, Team Performance Management was written by Jody R. Hoffman and Steven G. Rogelberg. In this Journal the authors wrote the article “A Guide to Team Incentive Systems” the article was about the seven major categories of a team incentive plan. The seven categories are: 1) team gainsharing profit-sharing, 2) team goal-based incentive systems. 3) Team discretionary bonus systems, 4) team skill incentive systems. 5)...
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...CheckPoint: Incentive Plans Peggy Harrington HRM/240 J. Scott Lodge March 8, 2012 Axia College CheckPoint: Incentive Plans Companies utilize various incentive plans to acquire the best and most skilled employees. The incentive plans can be broken down into individual incentive plans and group incentive plans. Below are a few of the pros and cons for each type. Individual Incentive(s) Piecework Pros - Individuals receive a certain rate for each unit produced Computing rate of pay is simple Labor costs are more accurately predicted Cons - Not an effective motivator Quality may be lacking Standard Hour Plan Pros - Based on “standard time” for job completion, even if completed in less time Best for non-repetitive tasks and requiring varied skills Cons - Quality can suffer due to employees not taking enough time to do the job properly High equipment maintenance due to employees not exercising proper care of the equipment Bonuses/Spot Bonuses Pros - Not part of base pay Typically given at end of year Useful as a retention and motivational tool Cons - Hard to predict labor costs Employees may come to expect the bonus Merit Pay Pros - Based on performance Can be a motivator if increase is large enough Cons - May be perpetuated even if performance declines Employees see it as an entitlement ...
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...Incentive Plans Travis Green MGT 431 Human Resources Management May 26, 2012 Incentive Plans Providing job satisfaction and incentives for employees should be a priority for employers because incentive pay is often related to job satisfaction. Job satisfaction helps retain valuable employees and contributes to a companies continued success. According to Noe, et al, 2007, “An effective performance plan should be linked to an organizations goal and employees should believe they can meet performance standards.” (Noe, Hollenbeck, Gerhart, & Wright, 2007). This paper will examine incentive plans at EMCOR Mechanical Services and how these plans do or do not help the organization achieve its goals and objectives. At EMCOR Mechanical Services, the organizational objectives are to “go above and beyond promoting a profitable and sustainable business that meets the customers’ expectations, while maximizing opportunities.” The organization also places focus on career satisfaction, integrating employee’s values, integrity, teamwork, effective communication, and empowerment to make the job fun. As a nationwide organization, that continues to grow in a down economy, many employees are committed to the organization. These employees care about the quality of work they produce and are more productive because the company seems to care about them. Salary, flexibility, growth, interpersonal relationships, and a since of value should be taken into consideration when planning...
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...Employee Relations: Incentive Plans Paper Katrina J. King MGT/431 - Human Resources Management University of Phoenix July 19, 2011 Dr. Cassandra Molavrh Employee Relations: Incentive Plans Paper Money motivates employees. Cold hard cash. Cash money will always and forever be the most important factor in motivating employees. However, money is not the only solution. Developing solid incentive techniques for Texas Sports Beat require the organization to take a deeper look within the organizational culture to find ways to offer and introduce the ‘Incentives Plan Program.’ “How can the organization attract and keep quality staff ensuring everyone is involved and interested?” As mentioned in the above paragraph, cash is not always the answer and in countless cases not even the best response. According to the Law of Individual Differences; People differ in abilities, needs, personality, and values. Thus people react to different incentives in different ways. Because TSB Sports, is a small organization, it cannot afford to pay salary wages to employees. The organization employs contract workers to perform specific tasks. For an example: A staff photographer would be paid hourly wages per game worked.. Usually, three to 12 games per week (home games only). Photographers are paid by the hour, no matter staff, or freelance. Photographer’s incentives are opportunities to take images of players and coaches...
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...Incentive Plans MGT/431 February 21, 2012 Incentive Plans Organizations provide incentive plans to employees as motivation to reach the objectives and goals of the company. Incentives are given to personnel to encourage them to do his or her best. Incentive plans in any business might include bonuses or raises, stock option plans, or other forms of incentives. This is in exchange for the employees who work harder, better, or faster in accordance with the organizations goals and objectives (Businesstown.com, 2001). The majority of incentives are performance-based policies in which workers receive additional cash or benefits centered on a worker’s performance. Raises and Bonuses Most companies will award a base salary increase that is dependent on several factors, including job classification, your individual performance, your company's overall financial performance, and your company's salary structure (Salary.com, 2012). Bonuses and annual incentive payouts depend primarily on two variables: your job performance and your company's overall financial performance. Depending on your job, these programs can vary in complexity and payout (Salary.com, 2012). Each year employee’s at Aetna are given bonuses and raises based on how well the company does. If an employee receives a three or higher on his or her year-end scorecard they are eligible for the bonus and raise. During the month of February employees are contacted by their manager who advises them what his or her bonus...
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...Incentive plans paper Marques King MGT/431 October 18, 2011 University Of Phoenix Tracy Garmer Incentive plans paper In this essay I will discuss how organization’s incentive plans relate to organizational objectives. Second, I will evaluate how the incentive plans do, or do not help the organization to achieve its goals and objectives. Along with wages and salary, many organizations offer incentive pay which is designed to energize, direct, or control employee’s behavior. Incentive pay is effective, because the amount paid is linked to certain behaviors or outcomes (Noe, R. A. Hollenbeck, J. R., Gerhart, B. & Wright, P. M. 2007). The way to integrate employee incentive plans with organizational objectives is to focus on incentives the activities that are relevant to achieve the desired objectives, rather than basing it things such as seniority or organizational politics (Ingram, D. ehow contributor 2011). There are many reasons why an employee incentive plan was created such as, employee recognition, cash or non-cash incentives, eligibility, and performance measures. Some incentive plans only offer positive recognition for employees who can reach their goals under the plan. This type of incentive plan will not motivate most people to want to reach their goals. A study from People Performance Management and Measurement found that most managers use employee recognition as their incentive plan. Managers can also design a special program to achieve...
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...Head: Incentive Plans Paper * * * * * * * * Incentive Plans Paper Myra Callahan University of Phoenix MGT/431 Human Resources Management Brad Bridges March 6th, 2011 The organization’s incentive plans relate to organizational objective because of the involvement of the financial goals for the company. Objectives define strategies or implementation steps to attain the identified goals. Unlike goals, objectives are specific, measurable, and have a defined completion date. They are more specific and outline the “who, what, when, where, and how” of reaching the goals. The development of the objectives will be to help achieve goals by dividing them into manageable components (Workforce Development, 2009). Therefore, the objectives and incentive plans go hand in hand. Incentive Plans Incentive plans are not successful when it is extremely broad and is not created for the employees or staff members. There is a saying, “all for one and one for all,” that is no longer effectively accepted into the business world. It definitely discourages those trying their best in their job performances. This certain style of increase sharing is like an entitlement. Being that some employees slack in their performances, the productive employees will reject that style of incentives. Everyone must have a clear understanding of the incentive compensation and how it connects to his or her effort. A well thought out compensation plan will push...
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...The Best Laid Incentive Plans Requirements • To analyse the case on the basis of conceptual frameworks discussed in the class. • Identify main problem, key issues, alternatives and solution/s for the problem identified. • The related concepts/frameworks should be explained in detail. Case Analysis Executive Summary The case presents an interesting concept of Organizational Behavior and Performance Measurement Systems. Hiram Phillips CFO and CAO of Rainbarrel Products introduced some changes and the company posted good results due to the same. Hiram felt that he had single-handedly turned the company's performance around. Some of the changes included cost cutting in budget, staff reductions by 10 %, introducing policies for customer care representatives, on time shipment policy etc. At the corporate executive council meeting, where the cost reductions and operating efficiencies were to be discussed and everything looked positive / rosy, until some questions were raised. Although Hiram’s numbers looked remarkable on paper, there were lots of things that Hiram was unaware of that were detrimental to the company as a whole. The main problem identified in the case is the shortcomings in the Performance Measurement Systems and the necessity to develop a PMS that meets both organizational and individual needs. Background facts In the case, “The Best Laid Incentive Plans”, the Chief Financial Officer of Rainbarrel Products, Hiram...
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...Incentive Plans Paper LaKesha Lightfoot MGT/431 [ May 22, 2011 ] David Van Gorder Incentive Plans Paper Incentive plans are developed to encouraged motivation. Motivation comes in various forms, but most commonly in the form of money. Individuals find motivation by both recognition and money, which is the reason employers develop incentive plans that will appeal to both groups. Within this paper, incentive plans and how they relate to organizational objectives are reviewed. Whether those plans do or do not help the organization achieve its goals and objectives is also reviewed. Incentive plans Fittings Unlimited, Incorporated (FUI) has not considered the benefits of incentive plans. Therefore, employees have become inactive and lackadaisical. As individuals work and perform their job, it becomes second nature causing excitement and interest to fade. In an industry such as hydraulics, business functions at high speed and everyday needs are three days too late, employees need encouragement to keep going. Overworked employees who are under compensated make the need for motivational strategies more prevalent. Customer service, the essential element of an organizations growth process depends heavily on the employees administering excellent customer service. Motivating those employees with commission earnings from each sale would help ensure employees are performing at optimal levels. Commission earnings would show employees the value their employer put on good...
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...Incentive Plans Most companies use incentive plans in order to retain their current employees and also help recruit new employees. By offering yearly raises, a bonus structure, and performance reviews, employees can be more motivated to perform better and be a valued asset within the company. RealManage does offer incentive plans for each employee however, they are inconsistent to everyone. Most property management companies offer a 3%-5% annual raise each year to help compensate with inflation. RealManage promotes this plan when recruiting new employees. They promote highly competitive pay and place employees on a career path. The president of the branch informs each employee what the career path might be and a timeline is provided. tresero ( 2009), “No one size fits all incentive plan exists”. There are different plans for each employee when it comes to compensation. All hourly employees are presented with unlimited over-time and the ability to charge back all the mileage that you have while commuting back and forth to anything business related. Salary employees are presented with flex time and have the ability to not only charge back mileage but anything that is out of the scope of the contract between the homeowner’s association and the management company. The only difference is when an employee is hired on with RealManage, the compensation incentive suddenly changes. The hourly employees are not allowed to accrue over time hours once the meeting is over. So if an employee...
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...Incentive Plan 1 SAMPLE 1 Pratt Nursing Home’s Incentive Plan Introduction Human resource represents the most valuable asset to an organization and it is for this reason that an organization will go to great lengths in keeping its employees satisfied. Employee satisfaction is known to be a factor that can have a significant on the performance of employees and by extension the overall achievement of organizational goals. There are several techniques currently applicable in the field of human resource management that can be put into use to achieve this goal of maintaining a content staff. An incentive plan is one such technique mainly aimed at providing drive to achieve targets (Schoeffler, 2005). Business in the world today has seen the evolution of several plans available for application with widely varied results. An organization may choose to implement one plan or several incentive plans operating at once leaving employee’s to choose plans to pursue based on their individual goals. Despite the fact that all organizations would like to keep a staff that is highly motivated and productive it is not always possible to implement some of the plans based on factors that may be out of the organization’s control. For example, a non profit organization would find it impossible to implement a profit sharing plan. The selection of the incentive plan to use is dependent on the type of business among other factors and if properly implemented can provide a major boost to the organization...
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...infrastructure development. 2010. Nr. 5 (24). Research papers. CRITICAL ISSUES FOR COMPENSATION AND INCENTIVES MANAGEMENT: THEORETICAL APPROACH Ramunė Čiarnienė, Milita Vienažindienė Kaunas University of Technology, Vilnius Co-operative College For most people, pay is a primary reason for working. Indeed, compensation is at the core of any employment exchange, and it serves as a defining characteristic of any employment relationship. The study focuses on critical points of compensation and incentives management. The fundamentals of a good incentive program include the elements of vision, potential, communication and motivation and can be realized if incentive promises are fulfilled – by both employer and employee. The aim of the paper is to identify the most important attributes of compensation and incentives management. Research method is the analysis and synthesis of scientific literature, logical, comparative and graphic representation. On the base of analysis, authors of this paper present the model of incentive system for positive employee attitudes and behaviors. Keywords: compensation, employees, incentives, management. Introduction Compensation refers to all forms of financial returns and tangible services and benefits employees receive as part of an employment relationship. Pay may be received directly in the form of cash (e.g., wages, merit increases, incentives, cost of living adjustments) or indirectly through benefits and services (e. g., pensions, health insurance...
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...Case of the Unpopular Pay Plan” “The Case of the Unpopular Pay Plan” discusses how the company Top Chemical decides that they need to change their current pay plan to more closely resemble their quality control program. Currently their pay plan is set up where employees receive raises based on seniority. The senior management would like to change the pay plan to complement the quality program. In the quality program employees are on teams. The proposed pay plan would reward employees whose teams were making beneficial contributions towards quality, profitability, and new ideas to increase speed, unit cost, and improvements. Some of the top management disagrees with the new pay plan claiming that having to rely on other groups within the company to get a pay raise is unfair and beyond their control. While others agree that each employee’s pay should be a reflection of how well the company is doing as a whole. Some commentators had the following perspectives about this pay plan: Maggie Coil, vice president of compensation of Motorola, thinks that the employees of Top Chemical should have some input on if and how to change the pay plan since they are the majority that will be affected and by allowing them to be part of the process of designing and implementing the pay plan, it will make it more accepted. Donald Berwick, associate professor at the Harvard Medical School and Harvard School of Public Health in Boston, thought the new pay plan is moving in the right direction...
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...Incentive plans are plentiful and are used by companies to help promote a more productive environment. Incentive plans are offered to encourage employees to do the best they can as well as exceed the goals set for them. Most employees are eager to reach and exceed their goals to reach the incentive set for them. However, the company does need to be mindful that some incentive plans can give the reverse effect they are going for and bring the moral down and the employee productivity too. Some examples of incentive plans are profit sharing, casual rewards, and stock options. Incentive plans can be created based on the creativity of the creator. These few exampled are the more common incentive plans offered to employees. Profit sharing is extended to employees when the company profits increase, and the money is available for bonuses. The larger the profits for the company the larger the bonuses are for the employees. One of the drawbacks to profit sharing is when the company is not doing well then the company is not able to offer profit sharing ("What Are The Different Types Of Incentive Plans?", 2011). Casual rewards incentive plans are the rewards or acknowledgement for a job well done. These rewards could be something simple as a pat on the back, a sincere thank-you, or a gift card to dinner and a movie (“Incentive Pay (pay for performance),” 2006). This type of incentive is a way of letting an employee know that the company notice their efforts and appreciate...
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...6, 2012 Incentive Pay This topic was picked as a local health organization is going to be implementing this for their employees in the 2014 fiscal year. They have decided after many years of debate to finally make the decision to include this when they do annual reviews to determine if the employee will receive an additional pay raise over the normal market percentage that they receive on a yearly basis. This is a new device that employers are beginning to use to coax employees to do more in their everyday functions than just what is required of them by their employer. There are several steps to implementing a successful incentive compensation program. The six steps mentioned here that are worth exploring further to make sure the process goes accordingly to help the organization to reach their goal of more revenue, increased patient satisfaction and increased motivation from employees. The process was written by D. Kevin Berchelmann of Triangle Performance LLC. 1. Determine what the plan intends to accomplish-Identify in detail what the desired conditions should be and the reasonable behaviors necessary to achieve them. It’s important to make sure that the organization analyzes the appropriateness for the environment for which the plan will be implemented and to make sure that the plan clearly states what it is that the organization wants, be specific as possible. 2. Determine Participants- Every employee is key component to making the plan a success...
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