From the course: Human Resources: Compensation and Benefits
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Incentive plans
From the course: Human Resources: Compensation and Benefits
Incentive plans
- Lincoln Electric, a manufacturer of arc welding equipment, pays more than half of its workers according to what they produce rather than an hourly or weekly wage. And Ford Motor Company recently paid each of its 56,000 hourly employees an average of $9,000 in profit sharing. What do these two situations have in common? Both are incentives, extra pay in return for outstanding performance. Workers at Lincoln Electric get paid on the basis of their individual performance. At Ford, hourly employees are rewarded based on the performance of the company as a whole. In fact, many different incentive plans exist and people can earn rewards for excellent performance as individuals, teams, or as whole organizations. In this video, we're going to learn about alternative approaches to incentive plans at all three levels including both short-term and long-term incentives. Let's begin by looking at incentives from the employee's point of view. They should be simple, specific, measurable, and…
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