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Q&A about Base Pay Rewarding


Six Reward Principles

Four Total Reward Components

Improving Variable Pay or Incentives


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Improving Variable Pay or Incentives

Most organizations have variable pay or incentives. The major pay change during the 1990s was providing variable pay or incentives to most or all levels of the workforce—not just executives and salespeople. Incentive plan design has continued to evolve since then, including improvements in measurement and goal setting, increased incentive participation, increased incentive opportunity, and refinements in other design features to optimize performance results. Take this quiz to determine if variable pay is doing all it can do for your company:

  1. Does variable pay support business directions and performance initiatives? 

  2. Are communications sustained to ensure understanding, acceptance, and commitment to accomplishing the goals and objectives of the variable pay plan? 

  3. Does variable pay have champions? 

  4. Does variable pay involve measures and goals that people can impact? 

  5. Does variable pay provide a win-win for all parties? 

  6. Does variable pay provide upside award opportunity to reward outstanding results? 

  7. Does variable pay stay agile and flexible? 

  8. Does variable pay engage and involve people in achieving goals? 

  9. Does variable pay celebrate success? 

  10. Do measures, goals, and variable pay design evolve with business need? 

The more "yes" answers you have, the better. If you have several "no" answers, now is the time to review and evolve your variable pay plan—making it subject to continuous improvement like any other process or system in the organization.


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