Founded in 1991, our client is a specialist white label engineering provider for telephone services. Following our appointment in 2011, the company explained that they had, for over 6 years, tried to work with our predecessor on implementing a staff incentive scheme.
Decide objectives
The client had a basic bonus scheme in place, but staff consultation revealed that employees rarely achieved the bonuses and had lost faith in the system. Departments were also starting to blame each other for failure to meet performance targets.
Coalesco decided to start again from scratch, taking into account staff feedback and lessons learnt from the old scheme. The management team brainstormed ideas for a new incentive scheme to motivate staff, encourage teamwork and improve overall business performance.
Design a scheme
The key to the new scheme was introducing quarterly, rather than annual, bonuses. This gave the company flexibility to modify goals every three months, to fit the business’ needs.
Coalesco also changed the bonus award criteria. previously, the bonus was based on an annual financial target. The new scheme included a range of goals, including revenue targets, cash collection and profit target.
Coalesco also recommended included a personal target for each employee, based on their job specification. The scheme was designed so that staff could get a percentage of the bonus, even if they didn’t achieve every target in a quarter. Bonus guidelines were issued to all staff and managers talked to them so everyone knew how the scheme worked.
“We regularly review the scheme in consultation with staff and communicate progress. In the current financial year, we’ve exceeded both revenue and profit targets and reduced the number of debtor days”.
“Staff feedback has been great too. We’ve been surprised at how much the scheme has boosted teamwork. Departments are now keen to co-operate and go that extra mile to get a job done, because they have common, achievable goals.
“The flexibility of quarterly target setting has also worked well. For example, we based one quarter’s targets around the launch of a new product. Quarterly goals also help to maintain staff interest and are far more effective than a distant annual target.”
