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Thread: Bonuses boost performance more than raises

  1. #1
    just me duncan drennan's Avatar
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    Bonuses boost performance more than raises

    Giving a 1 percent raise boosts employee job performance by roughly 2 percent, but offering that same money in the form of a bonus that is strongly linked to a job well done can improve job performance by almost 20 percent, finds a new Cornell study on the relationship between pay and performance.
    That's pretty interesting! I'm trying to download the full report, but a summary can be found here.

    Anyone have some anecdotal experience of the differences between bonuses and merit raises?
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    Site Caretaker Dave A's Avatar
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    Purely anecdotal, but all too often the bigger the pay increase, the more hassle factor you get back.

    A note here: I changed the "hassle factor" description at least three times in typing that simple sentence. Other options were sh*t, attitude, drop in productivity. Just about anything the opposite of grateful appreciation.

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    just me duncan drennan's Avatar
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    Anyone else have experience of this? I was particularly wondering whether anyone has noticed a difference between bonuses and pay raises
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    bonuses work. Pay raises are good also.


    bonus will show your appriciation to the employee on a level of that of his work... what i find that works better is when the employee knows what to do to get a better bonus. the likes of a checklist (Extra effort towards making the client happy. Making sure work is done tidely etc.)

    when they konw what they have to do to get a better bonus it tends to make life easier then for them to have the ability to check and know w hat they will get at the end of the day.

    Raises are based on production of the persons performance... even though they may work badly or whatever the cause.... if their influence or productivity is higher then their pay and generally by a factor of 3 then increase thier money but drop their bonus and explain why.

    If my staff bring in 100000 profit a month i wouldnt have a problem paying them 30000.

    It just makes sense to me.
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    No reply

    and here i was looking forward to a good discussion! :P
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    I was employed at a printing company, where I did not receive an increase at the expected time, which led to a decrease in performance from my side, not that I did not want to work anymore, it just made me feel unappreciated, especially after I was told that I was the best person that filled that position in the all the years it has existed.

    Bonuses were great, but in the end they did not help me in times when the house, food, and petrol went up.

    I needed to stop eating, because I did not receive a raise. Food is the first place to cut, if you look at it logically, it is cheaper to by carbohydrates than proteins, potatoes are much cheaper than meat. You can't give up on petrol, because then you can't get to work. You can't pay less on your house, because then you won't have a place to sleep. There are probably other places where you can cut, but in my opinion, food is always the first to go cheaper, more fattening foods.

    Needles to say, I did not get that raise, and started to look elsewhere for a job.

    Well, that is my rant, bonuses are good, but raises remain essential to an employee.

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