Incentive Plan

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Category: Business and Industry

Date Submitted: 08/29/2011 05:47 PM

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An Incentive plan is a compensation strategy that can encourage employees to upsurge the efficiency to perform better than the usual standards that were established prior in the company. There are several different kinds of incentive strategies through the specialists in the study Human Resource industry. Compensation of merit is one of the enticement strategies most corporations use which is created for employee success and success of performance, which is established by the corporations’ policy and procedures. Merit promotions can be motivating towards employees if they distinguish the increase to be associated to performances required to receive the merit increase.

The disadvantage of employees receiving a raises merit is when their performance deteriorations over a period of time they may feel that they are still entitled to a merit increase if they deserved it or not. They feel beside their performance their seniority and loyalty should entitle them to a merit increase. In addition to another problem with merit raises is that is maybe insufficient funds obtainable for all employees, supervisors or managers. Without guidelines in placed for the merit increase to describe or amount performance, workers might perceive merits increases has nothing to do with their performance. Evaluation of performances objectives of employees and managers are at odds often, the deficiency of trustworthiness on both parts of the employee and management and merit pay does not appear motivating often to high level employees. A group incentive plans however differs from an individual plan. Groups do offer several benefits for employees. It can decreases jealousy and gives everybody the opportunity to work as a team setting so everyone in the team can gain from the rewards. The disadvantage is the kind of reassurance could cause employees to react in in disorderly way, offer would be one employee not willing to work with the team, but willing to except the bonus...