Employee bonus system design and compensation strategy

Calculating Evaluation and Reward is one of the most challenging aspects of management and leadership. Most of the contemporary management literature deals excessively (and often quite successfully) with positively reinforced management styles, but few works address compensation.

The most viable method of compensation is through the bonus system. Motivate employees to succeed through a positive and friendly work environment, yes, but help them truly excel by attaching bonus payments to their work product.

Design a system wherein employees are compensated via bonus not only for a successful project or venture (whether it be a sales target, a new contract, etc.) but for volume of work too.

However, be careful that the "success" component of the bonus far outstrip the volume bonus, so employees are not incorrectly motivated to simply get work out the door, however, mediocre.

Featuring a high level of bonus for success and low level of bonus for volume encourages employees to get the highest amount of high quality work out the door, as it is in their best interest not only to work hard, but to work well.

The other challenge, however, is to either maintain an aura of complete openness about bonus structures among employees or an aura of complete secrecy. Anything in the middle is damaging to group productivity.