Question

3. Which of the individual incentive plans is best? Why?

Answer 1

The bonus pay structure is perhaps the best individual incentive plan because individual efforts can be easily tracked and subsequently rewarded. It is common in professions such as sales, marketing and production. Here, employees are offered a fixed wage but when they achieve fixed goals, they receive bonuses for it which keep increasing with attaining higher targets. This plan also motivates employees to compete with their peers for recognition in the team.