Examination Of Incentive Plans

Running head: EXAMINATION OF INCENTIVE PLANS
Examination of Incentive Plans
Name of the Student
Name of the University
Author’s Note

1EXAMINATION OF INCENTIVE PLANS
Table of Contents
Answer to Question 1......................................................................................................................2
1.1 Nature of Incentive Plans.......................................................................................................2
1.2 Benefits to Employers and Employees..................................................................................2
Answer to Question 2......................................................................................................................3
2.1 Incentives that are offered in the Organization......................................................................3
2.2 Process to Administer the Incentive Plans.............................................................................3
2.3 Role of Incentive Plans in Motivating Employees................................................................4
Answer to Question 3......................................................................................................................5
3.1 Recommendations..................................................................................................................5
References........................................................................................................................................6

2EXAMINATION OF INCENTIVE PLANS
Answer to Question 1
1.1 Nature of Incentive Plans
Incentive plans are gaining major popularity as a tool to drive employee performance. A
well-crafted incentive plan can assist in accelerating business growth while attracting and
retaining talents. While considering the nature of an incentive plan, it needs to be mentioned that
it needs to be clear and specific so that it is easy to comprehend. This helps the employees in
gaining an unconstructed view of the incentive plan along with its objectives for reinforcing their
behaviors to achieve the desired outcome. In today’s continuously changing and highly
competitive business world, business need to constantly evolve for staying relevant and
innovative. Similarly, agility needs to be there is a good incentive plan for quickly adapting the
changes for remaining as a performance driver. Attractiveness needs to be there in a good
incentive plan for motivating performance and it needs to be attainable for eliminating
discouragement in the employees. The measures of an incentive plan needs to be measurable
with precise indicators. Apart from monetary plans, incentive plans needs to be non-monetary
also in order to be most effective (Durham & Bartol, 2000).
1.2 Benefits to Employers and Employees
For the employers, incentive plans crates substantial impact on the businesses by
increasing productivity while lowering the production costs and increasing earnings of the
employees. These plans require less direct supervision for maintaining practical level of outputs
as compared to underpayment by time. In many cases, in case the payment system is
accompanies by enhanced organizational and work measures, this become possible for the