Achievement-Based Bonus Programs That Don’t Stink – Part 2

Achievement-based bonus programs that work.

Achievement-based bonus programs that work.

Win, win, win

Once you’ve decided that embarking on an achievement-based bonus program will be beneficial for your team members as well as your construction business your next move will be determining which bonus initiatives will be most advantageous.

Typically, the considerations fall into two major categories – efficiency and profits. Or, reduced to its base level, time and money. Yet, there are a couple more categories which may help bring this matter into better focus. Retention and satisfaction. Retention of your best employees and the satisfaction level of your clients.

A well-executed achievement-based bonus program will be a win for your clients, a win for your team, and a win for your construction business. Yep, win, win, win.

Set the bar high for employee achievement

You’ve been told in the past to look for your clients’ pain points and determine a way to meet their needs. Good advice. Yet, have you considered your employees may also have pain points which need to be addressed? There will always be the WIIFM (What’s In It For Me) issue to consider. When devising your plan, be sure your employees will be rewarded well for their achievements. The goals you set for them should be easy to understand. They should know both what they’re expected to do and what they stand to gain if they do it.

And, while you’re setting the bar high, don’t set it so high no one could ever hope to jump “clear up there.” Plus (and this is the part that will ease your team’s minds) whenever possible, have graded levels of achievement. “If you reach this milestone, the reward you’ll receive is this.” And, “If you meet this even harder milestone, this reward will be on the table.” Plus, “This really tough to reach target will net you this reward.”

By the way, the rewards don’t necessarily have to be higher and higher amounts of money. But, more on that later.

Give the client more than they asked for

“I would like for this project to last longer than we agreed on and cost significantly more than expected”, said no client ever. Which translates into being done on time and not exceeding the budget is the bare minimum for meeting client expectations. But, what more could they ask?

Listening to your clients translates into detail or specialty applications and may mean improved functionality. Having a pulse on your clients, means you will likely learn of ways your team can perform better to improve the clients’ delight levels. Incorporate what you learn into your achievement-based bonus program.

Bottom line, communication with your clients can, and should be, what pushes your achievement-based bonus process.

How to implement a bonus program

At the highest level of implementation are two considerations:

  1. Motivating your employees to excel beyond their base job descriptions and regular duties.
  2. Exceeding your client’s expectations in both small and big ways.

Thinking of the above two considerations, use the 6 Ds to design your program.

  • Determine the objectives


  • Decide who will be eligible to participate (consider team or individual based)


  • Develop the achievement criteria


  • Devise the reward levels


  • Derive the funding formula (Where’s the money coming from to pay for this?)


  • Decree the method of payment

*There will be an example of using this method in part 3 of this 3-part series.

You’re not made of cash

You’re a nice person. You’re also a good business owner. You would like to give lots of great stuff to your well-performing employees. There is only so much money in your coffers. You have a dilemma. Or do you?

You may think the only thing your employees want or will respond to is cold hard cash. Yet studies show that isn’t always the case.  The author of an article found at Incentive Concepts states, “The best rewards experience, then, isn’t a matter of presenting the best rewards, but the best mix of reward, recognition, and experience.” It is an enlightening article based on studies conducted by the Incentive Research Foundation (IRF) and the Incentive Marketing Association (IMA).

Which incentives to give

Following is a brief list of possible reward options you can consider.

  • gym membership
  • golf trip
  • training or educational opportunities
  • company-paid family activity events
  • tickets for sporting events
  • additional vacation days
  • paid group meals
  • company branded mugs, hats, shirts, or jackets
  • chair massages
  • job site lunch delivery
  • tools
  • a magazine or audio subscription
  • car wash and detail coupon
  • ice cream socials
  • theater gift cards
  • concert tickets
  • entrance fees for industry related conferences
  • house-cleaning or maid service at their home
  • museum, zoo, or botanical garden memberships
  • gift cards

You’re likely to think of many other options, especially when you pay attention to what your team members are into. What are they talking about before and after meetings, while on the job site, or during lunch. What are they interested in? Where do they spend their time when not working? What are the ages of their children?

Bargains, discounts, and low-cost gifts

Be on the lookout for bargains and discounts on the items you’ll be presenting to your employees. The obvious option is buying while items are on sale. You can also ask for a discount when purchasing in bulk – even if the “bulk” is only a few dozen on some items. Discounted gift cards are a good option.  Another source for bargain priced gift cards is found here.

You can also consider gift cards in small denominations. Five or ten-dollar cards to local fast-food restaurants and coffee houses, plus slightly higher denominations for familiar department stores.

Get the crew talking – in a good way

Remember, the pleasure your crew derives from receiving achievement bonuses is three pronged. They want reward, recognition, and experience.  Following is a list of fun or different gift items sure to get people talking – adding more to the experience part of receiving the bonus.

Extraordinary shaving items

Gentleman Barbarian T-Shirts

A variety of products found at The Art of Manliness

Give some fun from Etsy

Sleeve notes (you know who needs this)

Key finder (another of those products best suited for certain members of your team who most “deserve” or need them)

Consider the gift of home cooking made easy here, here, or here.

And of course, rubber duckies.   You decide how and when you pass out these little lovelies based on . . . well, who knows what! They’re just for fun.

Perhaps you can start a rubber ducky tradition, similar to the golden banana award tradition. If you don’t already know about the Hewlett Packard Golden Banana Award each of these articles includes the story. New York Times.   Smart Business.   Cindy Ventrice on LinkedIn.

If you missed part 1 you can find it here.

In part 3 expect expanded information concerning how to implement a bonus program based on the 6 Ds mentioned above. Plus, there will be a simple example of the system used in “real life.”

Call today to get in on the Schulte and Schulte accounting advice you need. 866-629-7735

Performance-Based Bonus Programs That Don’t Stink – Part 1

bonus programs and incentives that don't stink

bonus programs and incentives that don't stink

Some bonus programs stink

Bonus programs based on the wrong parameters or instituted poorly can be really yucky for everyone. Your team loses, you lose, and you throw your hands up in despair thinking bonus programs are a waste of time and (more importantly) a waste of money.

Yet, if you get it right, the win-win effect takes place bringing everyone (including your clients) into a much better place. Instituting bonus incentives in your construction contracting or service business is worth the time and effort.

A bad example

One of the best companies I ever worked for made a honking mistake when they first instituted a bonus program which offered a rather stunning reward. I mean, who do you know who wouldn’t want to have an all-expense paid, eight-day vacation with the person of his or her choice in a foreign land while the paycheck continued to roll in?

In case you’re wondering if I’m calling sour grapes simply because I never achieved the bonus, think again. I did achieve the bonus. My hubby and I were delighted to be a part of the group which arrived in Thailand ready for an adventure. Yet, we were only able to go because the company realized after the first disastrous year they had made a parameter mistake when instituting the bonus.

There isn’t reason to go into all the details, but you’ll understand what went wrong when I mention that the goal which was set the first year could only be reached by a limited number of employees. It had to do with location. The folks who could reach the particular goal set for that year all lived in metropolitan areas. Those of us who had no hope for reaching the goal lived in rural areas. And yes, you guessed right. When we first learned what the goals were, we looked at each other, smiled, and mentioned that we weren’t possibly going to reach that goal. So, nothing in our behavior changed.

The point is, when setting goals for your team, be sure they are attainable. That doesn’t mean make it easy, it just means the goal should be one everyone in your employ can see hope of achieving. Which brings me to my next point.

Achievement rather than performance

Ah, words. Words can mess with our minds. This report from the University of Michigan will give you more insight into the validity of choosing words which are more in line with what you want to convey.  So, there is every reason to choose the correct word when determining what it really is that you want to accomplish. The word performance tends to remind us of a stage. When a person is asked to perform there is the concept of getting it right for the sake of the audience (in this case the boss.) But, when a person is asked to achieve the idea inherent in the word is that of making ones-self better. You can see how that simple change in words will set the right tone for introducing bonuses to your team. It will also aid you in determining parameters that are highly advantageous for all involved.

Achievement-based bonus program

Perhaps stating what an achievement-based program is NOT will be helpful. It is not:

  • A freewill gift (for instance a Christmas or Chanukah present)
  • Delivered randomly without a plan
  • A tenure bonus (although this is close)
  • An employee referral program (yet it will add juice to your attempts to gain employable referrals)
  • A signing bonus

Now, let’s talk about what a well-executed achievement-based bonus program IS. While you can make a case for “a job well done is its own reward,” you must admit raising the bar with extra incentives is a useful tool in your management toolbelt. When you reward accomplishment, you help people achieve more (sometimes more than they thought themselves capable) and you:

  • Increase teamwork and camaraderie
  • Decrease unsafe practices
  • Escalate productivity
  • Improve customer service
  • See your business improve

Results are what count

After all, incentives are all about achieving specific results rather than simply doing a good job.

In part two of this 3-part post we’ll talk about how to determine which bonus initiatives will be most advantageous for your construction contracting company. There will be information on how to implement the program. And there’ll be the part about “which incentives to give.”

 Contact us here or call 866-629-7735.