Small Medium Business Talking Points: Profit Sharing, the New Muse for Employees
Let’s face it; people get employed primarily to earn money. The vision of stepping up in the corporate ladder is not just about professional growth; it is also because of higher salaries.
As a small to medium business owner, you are well aware that you cannot promise immediate promotions and high compensation packages to your employees. You are just starting a business and you need to manage your cash flow very well.
So how do you motivate your existing staff and how do you attract quality employees into your business? The answer is simple; give them something to look forward to.
Pay for performance compensation plan is a “win-win” situation for you and your employees. Your small to medium business will thrive because of the better performance from your employees while your employees are inspired by the promise of higher pays as the business keeps on flourishing.
Under this compensation package, employees typically receive a base salary which is slightly lower than others working in the same industry. However, they stand to make more if the company does well - through bonuses and profit sharing.
For the small to medium business owner, this package bodes well since it promotes higher efficiency in his employees. There is less mediocre performance as the spirit of positive competition takes over the workplace. Everyone seems to gain more energy as the company becomes more and more successful.
However, even with its enticing outlook, this merit system does have its drawbacks. One is you, the small to medium business owner; need to be aware that some of your employees might not do well in this kind of atmosphere. You or your manager should be ready to face your under performing crew and explain to them why they’re not getting any piece of the pie.
Another setback is that the competitive mood in the workplace may cause your team not to work toward the same goal anymore. They might just be heading toward achieving self fulfillment and this may lead to complications and breaks in employee relationships. You certainly do not want a workplace full of irate people who do not care about each other.
How do you earn the perks of this reward system without having to sacrifice the spirit of camaraderie in your office? Be the peacekeeper.
Your small to medium business is in the position to benefit greatly in this type of program so you need to utilize this wisely. One way of policing the competition in your workplace is to actually have your staff work in groups, or maybe even just pairs. This encourages them to think of other people instead of only taking care of their own interests. Shuffle members of the group constantly to promote healthier and a more positive competition. Being with other members of the company ensures you that everyone is still working toward the same goal as your small to medium business. Regularly have team building activities like simple lunch outs or even just coffee breaks that encourage all the members of your staff to talk. Then lean back and watch your business grow!
Tags: Profit Sharing, Small Medium Business Talking Points, the New Muse for Employees