Is your annual bonus scheme killing motivation?

Do you ever look at your team and wonder why they don't seem to care about the sales figures as much as you do? 

It is a common frustration for business owners. You are obsessing over the monthly target, checking the bank balance, and losing sleep over the pipeline. Meanwhile, your team seems to clock in, do the work, and clock out.

You might believe the issue is their work ethic. You might suspect they simply aren't motivated enough to chase that extra order.

But often, the problem isn't their attitude. It is your incentives. If you are relying on a vague year-end bonus to motivate your staff, you are probably wasting your money.

Here's what doesn't work. A promise of a bonus in twelve months' time if the company hits a big, intimidating number. To your team, that doesn't seem like an incentive. It looks like a lottery ticket. It's too distant. It feels beyond their control. And honestly, most of them don't believe they will ever see it.

If the reward seems impossible or far away, it ceases to motivate and begins to breed cynicism.

So, how do you fix it? You need to turn the lights on.

If you want your team to care about sales as much as you do, you need to show them the scoreboard.

I recently worked with a client who made a brave decision. He abolished the traditional annual bonus structure altogether. He realised it wasn't encouraging the daily activities he required.

Instead, he started sharing weekly sales performance with the whole team. He put a screen up in the office. Everyone could see exactly where they were against the target for that week. 

The change was incredible.

Suddenly, the team began pursuing quotes without being instructed. They started seeking upsell opportunities on existing jobs. Why? Because they recognised the gap.

They knew that if they secured that one extra order by Friday, the bar on the screen would turn green. They weren't flying blind anymore. They understood how their specific actions that day moved the needle.

Clarity creates ownership.

If you want to replicate this in your business, you need to ensure the game is winnable and worth playing.

It begins with establishing real-time visibility. You can't expect people to give their best if they don't know the score, so stop hiding the numbers in a spreadsheet that only you see. Use a whiteboard or a TV screen and place it where everyone can see it. Updates need to be frequent because a monthly update is too slow. Weekly or daily updates keep motivation high and the focus sharp.

Once you have the visibility, you should set smaller, achievable targets. Temporarily disregard the annual target and break it down. Provide your team with a target for the month or even the week. When the goal is near, effort tends to increase. It is human nature. We work faster when we can see the finish line.

Finally, you should reward the behaviours, not just the result. Don't just reward the final sale. Reward the activities that lead to the sale. Set incentives for the most follow-up calls made or the most quotes sent out. If you incentivise the activity, the results will naturally follow.

When your team understands their objectives and can see their progress in real-time, the dynamic shifts. They cease being passengers and begin to be players.

So, stop concealing the figures. Display the scoreboard and observe what happens to the motivation in the room.

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