Compensation and Behavior

How compensation incentives apply to positives and negatives in a company.

When it comes to working nobody wants to be doing extra work for the same amount of pay. This is just the human mind’s natural tendency to find efficiencies to accomplish a goal. You wouldn’t want to purposefully take the long way to work if your goal was to save gas similar to how you wouldn’t want to work extra hours at your job just to get paid the exact same if you worked less. Compensation in the workplace is how you keep your employees motivated to get the job done. When it all comes down to it most people work in order to obtain more money, hence the reason why most raises and bonuses come in the form of monetary compensation. Bonuses at the end of the quarter are one of the main things that incentivize quality work for employees. This form of transactional leadership is one of the many ways to motivate employees and increase good work behaviors. Compensation also can be given not in the form of monetary value. Learning what your employees enjoy doing and providing rewards around their interests not only increases work productivity and behavior but it creates a better bond between employee and manager. One of the main places I saw this was at my friend’s dad’s place of work. Tom loves the Boston Bruins and his boss noticed this. He frequently gave Tom company seats to home games which shows that he cared for his employees beyond work alone.

Competition can also lead to negatives if it is not executed properly. If bonuses are directed specifically at a singular target you may have inter-company competition that can have adverse effects on department-level chemistry which in turn can hurt the business long term. It is important to mitigate these issues by recognizing team goals and finding ways to intrinsically motivate groups of employees rather than just one alone.