Total employee compensation paid out is equal in all three cases.pic.twitter.com/H7BPGiHrcs
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1. Motivation from bonus fades with time, much quicker then a year, and it doesn't scale with amount 2. w/o randomness people will expect the bonus and when they don't get it it's extremely demotivating
1. Agreed, but this must be balanced with the fact that giving out fair bonuses is extremely time consuming 2. People will also expect bonuses if it is random though.
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1. Yes. The system must be kept super simple. 2. Maybe but they dont know the amount. I once had a bonus system as an employee where i optionally got 25% every quarter based on the subjective judgement of my boss. It worked quite well. You learn quickly whats expected of you.
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What metrics or qualitative considerations were used by your boss?
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