Employee Motivation Rewards
All effective employee motivation programs depend on including an employee motivation reward system. People like to be rewarded for a job well done, or for effort put in above and beyond the call of duty. To effectively motivate employees they must be rewarded. However, these rewards must be based solely on job performance if they are to successfully motivate.
One of the best models of an employee motivation reward program based on employee performance is an employee stock program. Many companies have adopted this business model and turned over the company stock (or a large portion of it) to the employees. When the employees own a piece of the company, they have a vested interest in seeing it perform well. Nothing is more directly tied to proper planning and management of a company than the price of the stock. Good business decisions, good marketing and sales, and good customer service should see a rise in the price of the company's stock. This in turn gives an automatic bonus to the employees as their net worth has just increased. They do not have to wait for management approval, the price of the stock reflects how well the company is doing in its market.
Why is an employee stock program such a good employee motivation reward? It goes back to motivating employees. They need to feel that are part of the company's mission and vision in order to want to perform well. The best way to make them part of the big picture is to give them a piece of the company. Now they own a part of the mission and vision. Now it matters to them that the company does well because they have a tangible piece of it. Employees of companies that offer this type of program have a lower turnover rate than those who do not. Therefore, it makes sense to implement this type of program when possible.
How do you set up a stock program as an employee motivation reward? You need to check with your legal advisors and tax advisors. This may change the legal structure of your company so it is very important to get really good advice before you make any radical decisions.
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