One thing that every entrepreneur should remember is that, in most companies, it is staff on the ground that make the company’s money … the same ones that get just a measly portion of the business’s profits. This may be a living wage or maybe higher than what the average employee earns, but our workers deserve more than infrequent and, often, long overdue increases in their pay grade. And, they deserve a bonus if they do well enough or exceed expectations.
Why is a bonus so important?
1. Bonuses make your employees feel valued
A bonus helps your staff feel that the company appreciates their hard work. This is a great way to encourage motivation while further increasing your employees’ loyalty. Workers who believe that they are well-appreciated by their bosses are more willing to stay for longer and are more than eager to give their best at work.
2. A bonus motivates your employees
Pay raises may be great motivators, but they may not be enough. In particular, it may not meet the rate of inflation and often ends up trivial or overdue upon arrival. Bonuses, on the other hand, can give immediate financial gratification and can be used to motivate good performance. For example, you can reward employees with bonuses if they get to reach certain goals.
3. Incentive programmes attract talent
Giving bonuses to employees doesn’t have to be arbitrary. You can organise bonuses into a comprehensive incentive programme that rewards employees for achieving targets. You don’t have to keep it within the office walls either; you can publicise your incentive scheme as a selling point for your company. If done well, it will help you attract talent to your company and keep them in the long run. This will cut down recruitment costs.
4. They encourages friendly competition
When you incentivise work and offer great bonuses to employees who have achieved the goals that you’ve set, you set the stage for healthy workplace competition. Your staff will end up vying to see who reaches their goals first or who’s going to get the most rewards. Essentially, your bonuses gamify the workplace. The prospect of a bonus and the fact that others are also gunning for the reward should keep your workers from slacking off and taking their minds off various workplace distractions, allowing them to focus on whatever goals you’ve set for them.