Incentive Program for Your ShopMotivating employees is an ongoing process that often seems daunting. An employee’s objectives are not always the same as the company’s. Managers do everything to keep the costs down, and a big part of the cost is labor. However, as far as the employees are concerned, it sometimes seems they only want more compensation for what is asked of them. What would motivate them to produce more and drive down costs? One way to motivate them is an effective incentive program. In this article, I will explain what I mean by this.An effective incentive program requires a buy-in from the employees. Without their total acceptance, an incentive program is a total waste of time and money. It is the employee’s perception, not the manager’s, that must be the focus of this program. An effective incentive program is based on three primary elements. 1) Whether
it is worthwhile
2) Whether it is achievable 3) Whether the individual employee’s effort is being rewarded The first element is whether the program is “Worthwhile.” Why would anybody strive for something that is not worth his time and effort? If you were to throw a quarter on the shop floor, would you expect everybody to pounce on it? What if they were able to shave the labor cost by a few percentage points? The company would then be able to split the savings with its employees. In most shops, a single percentage point is quite a chunk of change. An incentive program should be effective for keeping a lid on excessive labor cost. The company rewards the employees for holding down the time required to complete the projects. Just remember, you are not going to see any savings if the employees do not feel it is worthwhile. The second element is whether the program is “Achievable.” More than one incentive program goes awry when the employees know that the bar is set too high. This achievable aspect should be based on the amount of effort they put into it and not on a fixed level of production. A good incentive program takes into consideration the changing total man-hours from the shop. Individual employees have no control of other employees not showing up for work. The third element is whether the “individual employee’s effort is being rewarded.” If you are one of a hundred people, you have very little impact on a group compared to if you are one of ten people. The goal is to foster team effort and reward the individual for his contribution. Todd Drummond’s Incentive Program for Shop Employees (Part of Consulting Services)
When all is said and done, if the overall incentive package is thought out and implemented well, it will give you the results that you are striving for. If you try to cut corners on any of the elements for an effective incentive program, you are wasting your time and money. Remember that it is not your perspective as a manager that motivates your employees, but their perspective that needs to be the focus. Life is a lot easier when the people you are dealing with have the same goals as you do. They just may look at it a little differently, and it is your job to understand this and use it properly. Testimonial - BMC West, Idaho Falls ID I appreciated Todd's ideas and suggestions as well as his effort to improve our bottom line. Bringing Todd in gave us the chance to take a fresh look at our options. He brought a new perspective and gave us some good suggestions. If you are ready to step out of the box and want to take a fresh look at your operation, I recommend you go forward and request Mr. Drummond's services. Dan West, GM, BMC West Corporation, Idaho Falls, ID See reference page for statements by general managers and owners about services.
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