How to calculate the bonus: precise methods and instructions
The Award is an important tool for motivating staff that can increase their productivity and performance. The determination of the award is not a simple task that needs to be addressed in a sound and equitable manner. A number of factors need to be taken into account, such as performance, complexity, contribution to company development and others.
There are different methods for determining bonus interest, which can be applied according to the conditions and circumstances of the organization. One of the most common methods is setting a fixed percentage of the total sales or profits of the company. In this case, the sales plan or financial indicators can provide a basis for the award.
Another way of determining the bonus is to use the scale of graduation, where each level of achievement meets a certain amount. For example, a staff member may receive a bonus of 10 per cent of salary and a higher than 20 per cent, etc. This method takes into account not only the financial dynamics of the company, but also the individual performance of the staff.
Regardless of the chosen method of calculating the bonus, transparency and fairness are important. Staff should be aware of the factors that influence the award and how they can influence their performance. This will help to support collective motivation and achieve better results.
What's a bonus interest and why you need it.
A bonus is a percentage that is applied to the staff member ' s core salary in connection with certain conditions or results. It is used to stimulate and motivate staff to work more efficiently, achieve their goals and increase productivity.
A bonus can be assessed on the individual accomplishments of the individual staff member and on the overall performance of the entire team or enterprise as a whole. Thus, it can be both individual and collective.
The value of the bonus may vary depending on the level of achievement of the objectives, the complexity of the task, the outcome and other factors. It can be expressed both as a percentage of wages and as a fixed amount.
Often, the bonus is discussed and agreed in advance between management and staff in order to establish clear and understandable rules for awards, avoid grievances and misunderstandings.
A bonus could be a powerful tool for motivating and rewarding staff for their work. It creates a system of incentives where staff can receive additional remuneration for their work, and management can encourage and encourage better staff for good results and achievements.
What are the main methods of computing the bonus percentage?
A bonus is the percentage of wages that the company pays to staff members over their base salaries as additional motivation or remuneration. The award may vary according to company specificity and policy.
These are some of the main methods of awarding:
- Measurement of individual productivity employees are assessed on their performance, achievements and contributions to the company. The company ' s management then sets a premium on the basis of these data.
- Basis for quarterly or annual indicators A premium may depend on the company ' s overall financial position, its profitability and/or increased sales. The better the company figures, the higher the premium.
- Annual award Some companies may determine a premium on the basis of a specific monetary value to be paid as a bonus for the entire year. For example, 10 per cent of the staff member ' s annual salary.
- Labour-intensive A bonus could be used to compensate staff who performed additional work or showed outstanding results. For example, when a successful project is completed or an important objective is achieved.
It is important to understand that each award method is individual and can be adapted to the company ' s specific needs. It should be equitable and motivational for staff to encourage their efforts, but also to match the company ' s financial capacity.
Method 1: Total profit margin
One method of calculating the premium is based on the total profits of the company. The calculation requires the following:
- Determine the company's total profit. Total profits are the sum of the company ' s total income over a period, less all costs and taxes.
- Count the basic award. The basic award is a percentage of the total profit that will be used to calculate the bonus.
- Determine the target profit. The profit target is a certain amount that the company seeks to achieve. It may be claimed as an absolute value of profit or as a percentage of total profit.
- Count the bonus. A bonus is defined as the ratio of the target value of profits to the base rate of the award.
Example of calculation:
| Parameter | Importance |
|---|---|
| Total income | 100,000 roubles |
| Basic award | 10% |
| Target profit | 20,000 roubles |
Estimated premium:
- Award interest = Target value of profits / Base Award
- Premises = 20,000 roubles / 10% = 200,000 roubles
Thus, the premium is 200,000 roubles. This means that a total profit of 200,000 roubles is required to obtain the 20,000 roubles bonus.
Method 2: Calculation of premiums based on personal performance
This method suggests that the staff member ' s personal performance be taken into account when calculating the bonus interest. It is based on an assessment of its productivity, achievements and contributions.
The following steps may be taken to determine the premium on the basis of personal success:
- Define the evaluation criteria. Establish an evaluation system that will take into account the different aspects of the staff member ' s work, such as the quality of the tasks performed, performance, initiative etc. Set a scale of assessments, for example, between 1 and 10.
- Appraise the staff member. Appraise it for each of the criteria using a given scale of assessments. Take into account all the positive and negative aspects of his work.
- Count the average score. Put all the staff member ' s evaluations down and divide them into the number of criteria to obtain an average score.
- Determine the bonus interest. Set up a table where each average score corresponds to a certain premium. For example:
| Average score | Percentage |
|---|---|
| 10 | 20% |
| 9 | 18% |
| 8 | 16% |
| 7 | 14% |
| 6 | 12% |
| 5 | 10% |
| 4 | 8 per cent |
| 3 | 6 per cent |
| 2 | 4 per cent |
| 1 | 2 per cent |
Find an appropriate premium in the table based on the average staff member ' s score.
On the basis of the evaluation, this method allows staff to be equitably discouraged by encouraging their work and increasing the level of motivation on the team.
Method 3: Target-based bonus calculation
Another method of computing the bonus is to ensure that the staff member ' s objectives are met. This method involves the determination of the objectives to be achieved by a staff member over a certain period of time and the awarding of a bonus depending on the extent to which it is implemented.
Examination rates based on objectives:
- Determine the specific objectives to be achieved by the staff member. This can be sales targets, at a certain level of productivity, to increase the client base, etc.
- Assess the extent to which each target is met. For example, if the purpose of sales is to achieve a certain amount of sales, it can be determined how many per cent of this was achieved.
- Set a bonus based on objectives. To this end, a scale in which each level of achievement meets a certain premium can be used.
- Take into account other factors that may affect the award. For example, if the staff member has made a significant contribution to the overall objectives of the company or has a high level of productivity throughout the period, this may also affect the award.
The advantage of this awarding method is that it takes into account the individual ' s specific achievements and motivates it to achieve its objectives. However, for its successful implementation, clear and measurable goals must be established to assess their implementation.
| Level of achievement | Percentage |
|---|---|
| 100 per cent or more | 10% |
| 90% to 99% | 7% |
| 80% to 89% | 5% |
| Less than 80% | 0 per cent |
For example, if the staff member reaches 95 per cent of his or her objectives, his or her bonus will be 7 per cent.
It is important to remember that this method of calculating the bonus could be adapted to the specific conditions and needs of the organization. It should be consistent with its objectives and staff motivation strategies.
Example of awards
The awarding of a bonus requires several steps. The following is a detailed instruction with all necessary steps and an example of calculation.
- Determine the basic wage. This is an amount that is paid to a staff member without a bonus. For example, we suggest that the basic wage is 50,000 roubles.
- Determine the amount of the award. That's the amount you want to give the staff member as a bonus. For example, let's assume that you're willing to award 10,000 roubles.
- Separate the desired amount of the basic wage award. This will allow a 10-point bonus. For example, 10,000 roubles / 50,000 roubles = 0.2
- Transfer the bonus percentage to percentage. Renumber the value of the previous step by 100. For example, 0.2 * 100 = 20 per cent
The premium is thus 20 per cent. This means that the staff member will receive a bonus of 20 per cent of his or her base salary.
It is important to understand that this instruction is general and can be adapted according to specific requirements and rules in your organization.
Important aspects of the calculation and application of the bonus
In modern business, the application of the bonus plays an important role in motivating staff, encouraging them to work effectively and achieving their goals. The premium is an additional payment to the staff member above his or her base salary and depends on his/her productivity, the quality of the work performed and the achievement of the set.
The computation of the bonus requires several important aspects:
- Target setting} In order to determine the award, it is necessary to clearly define the expected performance of the staff member and set the targets to be achieved.
- Individual productivity assessment} The performance evaluation of each staff member should be objective and based on specific criteria, appropriate to his or her post and duties.
- Premier determination} The interest rate of the award is determined on the basis of the objectives, productivity evaluation and the staff member ' s rating. This ratio should be equitable and motivated by the staff member.
- Companies ' capacity} In determining the premium, account must be taken of the budgetary constraints and financial capacity of the company. Interest should be cost-effective.
The application of premiums in the company achieves several objectives:
- Staff modifications} The award encourages staff to achieve high results and promotes their effectiveness. This helps to strengthen motivation and attract and retain talented staff.
- Improving the quality of work} The application of the bonus makes it possible to improve the quality of the work of the staff, as the beneficiaries tend to work more responsibly and carefully.
- Achievement of objectives} The application of the bonus relates the award to the company ' s objectives. This helps staff to better focus on and achieve successful objectives.
- Improvement of company performance} In parallel with the improvement of staff performance, the application of the bonus percentage increases the company ' s overall performance, such as profitability, client satisfaction and reputation.
| Staff | Base pay, rub. | Productivity assessment | Premium factor | Percentage | A bonus, a shirt. |
|---|---|---|---|---|---|
| Ivanov Ivan Ivanović | 50 000 | 9 of 10 | 0.2 | 20 | 10 000 |
| Petrov Petrovic | 60 000 | 7 of 10 | 0.1 | 10 | 6 000 |
| Sidorov Anna Ivanovna | 45 000 | 8 of 10 | 0.15 | 15 | 6 750 |
As a means of motivating and encouraging staff, the bonus percentage is an effective tool for achieving good results, improving the quality of work and improving the company ' s overall performance.
Question-record
What is the method for calculating the bonus interest?
The precise method of calculating the bonus is based on an analysis of the financial reporting and performance of the staff member, such as KPI, the volume of work performed and the achievement of the objectives set.
What factors should be taken into account when computing the bonus interest?
The following factors should be taken into account when computing the bonus: achieving objectives, workload, quality of work, KPI performance, out-of-work, staff capacity and skills, its contribution to company success and other relevant factors.
How does the bonus affect the motivation of staff?
A bonus has a significant impact on staff motivation. When a staff member sees that his or her efforts and achievements are assessed by a financial bonus, it encourages him to do his or her work better and more effectively. The award may also create healthy competition among staff and increase overall productivity in the company.
How is it right to allocate bonus budgets to staff?
The allocation of premarital budgets to staff should be based on objective criteria, such as the achievement of objectives, KPI performance, workload and quality of work. The individual skills and skills of staff should also be taken into account and their contribution to the success of the company. The budget allocation should be equitable in order to encourage all staff to work best.