It is therefore important to speak with employees so that they understand how their salary will be calculated, as well as with those responsible for controlling it, so that they can use this tool to motivate staff and align individual objectives with business objectives.
Study phase
Before introducing a variable remuneration system, it is important to contact key workers , as well as potential area managers, in order to identify how performance is defined in each position.
Bottlenecks will be sought and the necessary measures to facilitate the flow of work will be studied . All this will help us to define what an "extraordinary worker" is in each position, which will become a rewarding objective depending on how close we get to this ideal.
We can make the mistake of thinking that the only positions where a variable system can be introduced are those that are directly productive, such as salespeople, technicians, factory employees, etc. The truth is that all workers influence their results to a greater or lesser extent and help make the organization efficient and profitable.
Any job that involves quantifiable tasks can be subject to control and rewards when they are performed beyond the minimum requirements of the position. However, the important thing is to find out which tasks are the most important , so as not to reward irrelevant functions.
Our first task is to find the critical processes , improve them and empower workers to go beyond minimum performance. Communication will be an essential weapon.
Design phase
A variable compensation system must be fair, objective, realistic, reliable, transportation email list achievable, adjustable and controllable. With these things in mind, as well as the variables we are going to monitor, we need to create not just an incentive system but a control system .
On the one hand, we can try to find out how/how much an employee must work to “pay” his base salary and from what point it is possible to offer a bonus. We must also establish the optimal profitability levels of the main tasks. These equilibrium points will allow us to create a reasonable scale.
A modern variable remuneration system should be supported by technological tools that allow the study of recorded data, but also allow workers themselves to observe their progress and their individual and group objectives.
Monitoring should be complemented by progress meetings in which employees will learn about their monthly results and what the company thinks about them based on the objectives set, but in which the problems encountered in achieving them can also be highlighted, in order to solve them on the fly.
