Bonus For Your Staff, How To Implement?
Bonus is given to our Staff to reward performance and to encourage staff loyalty.
Having said that, how to quantify performance is very important to reward fairly so that good staff would feel good and bad staff would feel bad.
So, it is good practice to let all your staff know the KPIs of their expected performance even before first day of the year. Market practices the use of Balanced Score Card. Try it.
To encourage Loyalty, you can reward your good staff real well, and bad performing staff with Zero bonus.
For bonus to your good staff, you can even reward him with a 10 months bonus, but split into 3 tranches, say, with 1/3 to be paid out immediately after year end accounts is finalized, balance 1/3 6 months later after AGM, and balance 1/3 after Form C-S filed in Nov.
Staff who resigns later before bonus payout will not receive cash payout of balance bonuses, i.e. their balance tranches of bonus will be forfeited.
In this way, your good staff will never leave, and bad ones will be motivated to improve or exit the company.
Three things you must do :
1. Balanced Score Card and KPIs must be communicated to Wah staff at beginning of the year, and get their sign-off
2. You must have impartial ways of recording actual scores in their Balanced Score Cards monthly, and share the actual scores with the staff monthly. Ask them why are there gaps, and what they are going to close them
3. you must do your Cash Flow Forecasting ahead to cater enough cash to meet bonus tranches payout when fall due, for not meeting your side of the commitment would hurt you negatively in this whole program.
Good Luck!
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