Need for smart monetary bonuses for employees
According to a PricewaterhouseCoopers (PwC) report, Australian employees are willing to sacrifice up to 10 per cent of their salary for better working conditions, or more flexible working hours.
This comes out of the 'What are You Really Paying For? Improving Return on Reward Investment' survey that polled more than 1,000 workers on how their monetary incentives are structured and how they are related to their individual productivity levels.
The results reveal that bonuses for extra or excellent work is only positive to the employer if it is simply structured, is easy to calculate and is based on individual performance or a small team. More than four in ten (41 per cent) of employees would stop working at or around a bonus cap and workers are not motivated by team bonuses if the team size is more than five, or if they don't know their team members very well.
PwC Partner Emma Grogan explained that financial incentives can, in particular cases, deliver motivation or productivity benefits.
"Simple bonus plans with fewer metrics and limited managerial discretion could see greater employee motivation at lower cost. We felt the need to debunk highly publicised studies that promote the idea that financial incentives don't work," she said.
"We have ended up in a place where businesses have added more complexity to their reward structures in an attempt to meet the needs of employees, employers and shareholders, without the benefit of innovation. Added complexity destroys value in the eyes of the employee."
Ms Grogan concluded by stating that employers can't simply throw money at employees for better productivity; it needs to be designed in particular way.
Businesses could consider implementing productivity software into their company. The software can improve employee work rates by streamlining systems and this will increase the overall efficiency of the organisation.