Where next for the bonus culture?

PMI’s Jan Gillett comments on the issue of bonuses and performance related pay in the July issue of Management Today.

Responding to the question of whether bonuses should be phased out altogether Jan comments that “There has never been an independent, peer-reviewed report demonstrating the long-term positive correlation between performance-related pay and organisational achievement.  We shouldn’t forget the emotional and psychological side of these kinds of pay structures, which benefit a small minority of workers at the top of an organisation, and this represents a tiny proportion of the intellectual capital of the organisation as a whole. Those who don’t get a bonus, or who get a relatively small one, and who know how arbitrary the bonus awards process is, can become profoundly de-motivated.”

The full article, which explores all the arguments surrounding bonus cultures, can be viewed here.