Why Do Bonus Systems Often Fail?


You, the practice owner, feeling quite generous one day, decide to put in a bonus system of some type for your staff. This seemed like a really good idea at the time and when you presented the idea to the staff, they too thought that it would be wonderful.

This doesn’t mean that you are obliged to give away your profit. That is your pay for owning a business and all the headaches and problems and financial outlay that is involved in that. Here’s the problem: If you work harder and smarter, you can make more income, but if your staff work harder and smarter and think outside the box and help grow the practice some more, they still make the same as always.

A bonus system is supposed to reward staff for production above and beyond the norm that creates more income for the practice. This is as opposed to doing raises every year, even when the practice billings are down. The team produced less and yet expects their pay to go up. This just doesn’t make sense business-wise.

Bonus systems are a good answer if implemented correctly. Truly productive team members who are working in the direction of growing the practice should be rewarded for it. After all, the whole point of a practice is to give quality service to the patients, and anyone in your practice who is working hard to give more and BETTER service to the patients and is causing the practice to grow should be acknowledged for their efforts. Hence, a bonus system.

How can a bonus system fail?

1. The staff didn’t agree with the bonus system idea in the first place. They like things just the way they are. Maybe there is too much “status quo” and not enough inspiration and leadership as to how to improve things and make them go better.

2. The way the bonus system is set up is not to their liking – it’s only a once a year bonus – which is far too infrequent. Bonuses should be as immediate as the growth of the practice. Weekly might be best, but certainly no longer than once a month. Get the staffs thoughts on bonuses so they are included in the creation of the system.

3. Some staff worry that other staff are going to suddenly get super competitive and walk all over others in order to get a bigger bonus. This, by the way, will only happen if you have bad staff that are not true team players. True team members help each other to do better, not squash each other.

4. If a bonus system is set up and the staff achieved the target but do not receive the bonus, the team can be demoralized and lose interest. If promised, it must be paid.

5. If there is no way of determining what is causing the stats to go up and down on a weekly or monthly basis, and no one knows what to do to fix them, an apathy will set in and the bonus system will collapse. There needs to be a system of managing by statistics that will determine the causes of the ups and downs so that there is control and the practice grows.

One of our clients said she didn’t need to give her staff a bonus as they already give her 110%. However, when she finally did implement bonuses, they then gave her 150%. The true winners? … the patients who got the care and service above and beyond their expectations!

To learn how to manage by statistics and how to create a bonus system,
please call: 416-466-6286 or click here.

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