A Financial Incentive System for Personnel (FISP) IS NOT the most important thing for a successful business.
It is Strategic Marketing that ranks first, by far and beyond any doubts.
However, none of the second-order factors of success takes so little money, effort and time to implement, on the one hand, but yields such a large-scale effect, both monetary and in terms of duration, on the other.
Detailed rules of building a good FISP are a broad topic that must be enlarged upon in a separate book.
Here, being naturally limited by the size of an online publication, we shall adopt the ‘harmful advice’ strategy and first write how we should approach FISP design to make it as Gothically as possible – i.e. ass-backwards.
That is, as usual.
Again, due to volume restrictions, the narrative below is a summary one, without too much detail or reasoning.
So here is a FISP ‘as usual’:
- in your motivation formula, use fewer indicators that characterize a person’s individual efficiency and more ‘general’ KPIs – the performance of one’s ‘business unit’ or even the company as a whole.
To create a team spirit and all sorts of collective farm stuff, so to say.
For if a scrubwoman receives a percentage of the company’s profit twice a year, that will be an awesome motivation for her to wash the floors more often!
- An even better idea is to tie the bulk of one’s income to indicators that have nothing to do with anybody’s actual performance.
For example, an employee’s main income will depend on monthly appraisal by his boss.
And only a fool can suppose that this approach motivates you to lick your boss’ ass rather than work for the company’s business result. The fool knows nothing about business.
- A very good idea is a subspecies of the previous one, but here the employees appraise one another.
Blindly. This certainly motivates your Comrades not to intrigue or flock together but to work even more ardently for your shareholders’ and customers’ benefit.
- if you still fail to overcome yourself and keep the main component of an employee’s motivation tied to his personal results, there is a magic remedy for this – called ‘planning’.
Set them monthly or quarterly targets picked out of nose, alter the target already approved for the second
quarter because the first quarter’s target has been exceeded and you are reluctant to overpay them.
Your employees will be drowned in target red tape instead of doing their work, you’d say? Or keep their Sales within 95–100% of the target to prevent it from rising next quarter? Bullshit! Your target will be 100% hit. Who cares that your gross profit might be 30 to 70% higher than what you actually get, and your net profit (if any) will be a mere fraction of that.
- a fancy thermonuclear tool based on the previous one: individual plans.
In addition to the glories of the previous paragraph, you get the bonuses of dog-eat-dog ways and passions more acute than in The Game of Thrones. Your corporate life will be spicy and unconventional.
For your customers as well.
- an additional spice is a colossal multi-component calculation formula with a heap of factors to multiply.
More square roots and logarithms, Carl!
Let no employee figure out what he must do to increase his income! For it is the ‘fog of war’ © Clausewitz that can best motivate an employee to work towards his company’s goals.
- change your motivation formulas as often as possible
Do your best to surprise your employees with a new salary scheme at least bi-annually, preferably every
quarter. For the more often you change their motivation, the securer is their life and the more they trust their management! These are the perfect conditions for their labour enthusiasm to reach the heights of self-sacrifice typical of early Christian martyrs.
- and introduce your new salary formulas retroactively.
Towards the end of a month tell them that their salary will be calculated differently starting from the first day next month. How exactly? God knows… we’ll have statistics at the end of the month and then decide!
- Keep it all secure: an employee must have NO access to online calculation of the indicators that make up his income.
Ideally, access to those indicators should be banned altogether. The employee must receive the product of that very mega formula, with factorials and cotangents, as a single ‘TOTAL’ figure once a month. Everything has been calculated for him already, let the wanker see the number and be happy!
For the general public’s favourite topic for gossip, ‘They’re screwing us’, is the best soil for cultivating filial trust in the management.
- introduce the new motivation schemes quickly and decisively!
No preliminary discussions! No introductory meetings / information letters explaining what will be calculated
and how! Storm and stress! Blood, Sweat and Tears is your creed! Well, retroactive enactment is something we’ve already recommended.
- And when the faults of your ill-conceived, poorly calculated and retroactively imposed motivation system become utterly unbearable for your staff and meet with organized discontent and a spontaneous strike prospect,— scrap it immediately, publicly and unconditionally.
Shift the blame, pathetically but unconvincingly, onto scapegoats (for the technique of blaming all on Jews, Freemasons or cyclists see extracts from the speeches of 20th century dictators, from Hitler to Mugabe and from Castro to Putin). Show everybody that you’ve got neither guts nor leadership skills. To mollify your enraged employees, give them some extra money in addition to rolling back to your previous salary scheme.
- push in things that don’t fit in – actively and consistently.
It doesn’t matter that no exhaustive and countable KPIs can exist for some individual positions (fortunately, such positions are not numerous – all jokes aside). Pay your artists for longitudinal metres; cops, for solved crimes; and poets, for the word count.
“In this sign thou shalt conquer.”