Incentive Plan - Developing Effect Incentive Plans

Access Incentive Plan

When it comes to the topic of employees performance and motivation most individuals readily agree that financial incentives create highly productive employees. Where this agreement usually ends, however, is on the question of is the organization financially able to give incentives to employees. Although some are convinced that incentives motivate employee's performance, others maintain that incentives can create a negative effect on the bottom-line. In this paper one will evaluate how the incentives plans do, or do not, help Access achieve its goals and objectives.

Developing Effect Incentive Plans

Incentive pay as stated in the business dictionary (2012), a monetary gift provided to an employee based on performance, which is thought of as one way to entice the employee to continue delivering positive results. Incentive pay may come in the form of a bonus, profit-sharing, or commission. One thing that organizations must take in consideration is to develop a plan that will motivate employees, which will link employees to the organization goals. Employees want to feel that they are rewarded fairly, employees should value rewards, the organization should give employees the tools needed to reach their goals, and employees should believe they can meet performance standards (Noe, Hollenbeck, Gerhart, & Wright, 2007).

Merit Pay

Access merit increase is intended to reward an employee for a continued high-level of performance. The guidelines for merit increase are determined each fiscal year as part of the annual budget process. All employees are given a performance review once a year. Performance and individual position within the salary range are considered in determing the amount of salary increases and whether a salary increase should be given (Access Handbook, 2008). One advantage of merit pay is that it provides a method for rewarding performance in all of the dimensions measured in the organizations performance management system (Noe, Hollenbeck, Gerhart, & Wright, 2007).

Qualification for Access Productivity Bonus

At Access all full-time employees are given the opportunity to qualify for a quarterly bonus. Access has more than 600 employees working in 50 sites throughout the Chicago land community, and more than 200 administrative employees in the downtown loop. Access clinic bonus is driven on productivity. As stated in the business dictionary 2012, productivity is a measure of the efficiency of a person, machine, factory, system, etc., in converting inputs into useful outputs. Productivity is computed by dividing average output per period by the total costs incurred or resources (capital, energy, material, personnel) consumed in that period. Productivity is a critical determinant of cost efficiency. Every clinic productivity is calculated