Optimize Costs with Pay Review and Boost Productivity with Bonuses

In today's uncertain economic climate, companies face the dual challenges of optimizing costs and enhancing productivity. Many focus solely on pay cuts and layoffs, neglecting productivity improvements, which can harm employee morale.

It is crucial to utilize limited compensation budgets effectively to motivate employees and drive performance. 

​Key Strategies
  • Align Total Compensation with Profit Rather Than Revenue: Link total staff costs to profit, focusing on KPI achievement and the disparity in per capita profit compared to market benchmarks to enhance both performance and profitability.
 
  • Rebalance Pay Mix and Deferral: Increase bonus ratio within the total compensation package; review bonus deferral for high-risk departments and positions.
 
  • Profit-Driven Collaboration: Accrue bonuses based on profit, breaking down silos between business units to foster shared interests through a common bonus pool.
 
  • Performance Oriented Pay Adjustments: Utilize multi-year performance reviews and talent audits to categorize employees. Increase pay only for top performers whose salaries are below market rates; and align inflated salaries with market data.
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  • Differentiate and Address Performance: Reduce salaries for sub-standard performers to highlight the need to improve. Identify and sever surplus under-performers, and reallocate resources to high achievers.
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