Advice on implementing bonus plans

There are several strategies and tactics for improving implementation, concludes Towers Perrin's Beth Burkholder in this six-page Workspan article:

1. Leadership

• Provide vision of a successful implementation.
• Act as project and implementation champions.

"By showing strong leadership throughout the design and roll-out, employees will understand this plan is not optional," says Burkholder.

2. Involvement

• Foster buy-in and commitment through employee involvement in the process.

Your design team needs broad-based representation including line management, HR, finance, IT, payroll and representatives from specific functions that may be affected, says Burkholder. "Allowing involvement will let people feel that their voices are heard."

3. Technology

• Develop supporting structures for accurate goal setting.
• Ensure the ability to generate accurate reports and pay-outs.

"Solid technology will support the plan, including accessing baseline data for goal setting and generating regular performance reports throughout the plan year - not to mention calculating pay-outs accurately and on time," says Burkholder.

4. Communication

• Give clear and consistent messages throughout the process.
• Roll-out clear and comprehensive plan documentation.

Communication is vital. "Participants need to hear what the new plans will involve, what the changes are and why this will benefit them. Next, they need time to absorb and ask questions. Then the plan should be explained again - this time in more detail."

5. Measurement

• Provide feedback to participants on their performance.
• Ensure plans are meeting stated objectives, and course-correct as necessary.

As Burkholder concludes: "Monitoring the plan ensure it functions as intended, lets participants know how they are doing, and gauges the impact plans have had against stated objectives."