Incentive Plans Paper Essay Example | Topics and Well Written Essays - 750 words

Incentive Plans Paper - Essay Example However, all incentive plans are not equally effective. The effectiveness and efficiency of a particular plan is dependent on two major aspects – 1) organizational metrics which influence the performances of the employees and 2) the degree of customizability of the incentive plan (Bohlander & Snell, 2009). The incentive plans should be developed considering the actual needs of the employees of the organization. An effective incentive plan is likely to be transparent, objective oriented and measurable (Durai, 2010). In simple words it can be said that good incentive plan motivate the employees to achieve their individual goals in the organization and the collective achievement of the individual objectives enable the organization to achieve its overall objectives. The aspect of the relationship between the incentive plan and organizational goal is explained below in the context of a real organization. India based Adamas Consulting Pvt Ltd is a medium sized company that works in the content writing industry. It has clients that are based in US, UK, Australia and India. There are almost 50 qualified writers in the company. Performance of each and every of them is evaluated on the basis of quantity as well as quality of their writing. Projects that are accepted can be of different sizes. They are distributed on the basis of the domain of the subject and the qualification of the writers. Each and every project come with a certain point and this is determined on the basis of the number of pages that are to be written and time period within which it needs to be completed. Writers who work as permanent employees in the company have a target of 1200 points in month. On the other side, writers who are in the probationary period have to make at least 900 points per month. The incentive plan of the company says that in case of a permanent employee every point beyond 1200 points gives additional INR 10. However, in case of an employee who is in the probationary period every additional point gives only INR 5. The person who will make maximum points in a year will receive a special bonus which is equals to 25% of his/her monthly salary. The company is planning to add few more features in the incentive plans in near future. The main objective of Adamas is to make as much revenue as possible, because it has plans to expand within the current fiscal into other sectors. The company likes to get into the industry of web designing and internet marketing. As a result, the company wants to earn a significant volume of revenue from its existing business. The incentive plan is in alignment with this objective of the company. Adamas believes that the plan is motivating enough to make the employees work to the best of their potential. If the entire situation is analyzed keeping the present organizational objectives and goals in mind it seems that the incentive program supports the overall objective of the company. However, if the situation is analyzed from th e long term perspective it will be found that the present incentive plan may have a negative impact on the quality of services and this can hurt the relationship with the existing clients of the company. Writing is such job that requires enough thinking to make the best one. If the writers write for making more and more money only then the quality is likely to fall. This in turn will increase the number of revision request from the customers and hence time required to complete