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That BU president demonstrates the underlying problem: Companies see bonuses as a tool to further the goals of the business, managers see them as a tool to further their own goals, such as rewarding or inspiring loyalty, returning a favor, sending a signal or avoiding an unpleasant situation. Sometimes to two agendas dovetail nicely but rarely by design.

My conversation with that BU president came after the company had spent over 6 months redesigning the performance appraisal process. Within five minutes he relegated that effort to the trash heap. Wouldn't use it - and therefore neither did his management team, and through trickle down thinking so went the rest of the BU.

One of the key takeaways from this experience was to avoid designing employee-oriented plans in a bubble. You have to bring in the users to help design / test something that will actually be used. Duh!

Hey Chuck,

Good post. It never ceases to amaze me that companies spend millions on incentives without applying the same diligence that they would to any other expenditure of that magnitude. Involvement of the key stakeholders in program design, ongoing communication with participants, and a solid "wrap up" report can help improve the ROI.

It is a process, not an event!

Too often the defensive reaction of poor managers is that "we have the money," or "it's been budgeted", as if somehow having the money is a justification as to how it should be spent.

Hmmm, I wonder if they follow that same practice with their own money .

It makes you want to rap your head against the wall.

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