Should You Offer Holiday Bonuses?

It is that time of year again; the Holidays are in full swing, and organizational leaders are debating whether or not to hand out annual bonuses. Leaders ask themselves, Can we afford to hand out gifts? What budget line item will it fall under, or should I give out of my pocket? Will it set up a precedent I can’t continue? Do bonuses motivate employees?

The answer, as always, is to act with intentionality. If you notice office chatter or Facebook Memes at this time of year about bonuses and suddenly feel the need to give your employees extra money in their next paychecks, that may lead to unintended negative consequences. Reactive organizational behavior rarely leads to the best outcomes.

The Holiday Season happens every year. Instead of reacting this year by offering bonuses and forgetting next year (which may cause your employees to feel slighted) It may be wiser to take a step back and use the reminder as an opportunity to plan well for next year. Think of what you can do that is nice for your employees in the short-term but make time in your schedule to think strategically about how your organization motivates employees.

The Harvard Business Review published an article about employee motivations entitled Employee Motivation: A Powerful New Model. In the piece, Nitin Nohria, Boris Groysberg, and Linda-Eling Lee discuss four types of employee motivation drivers; Acquire, Bond, Comprehend, and Defend. They also mention how to provide systems to address those innate motivation drivers. Some examples they offer are reward systems, positive work culture, job design, and performance management process.

Offering end-of-the-year bonuses sporadically while at the same time neglecting culture, clear job descriptions, and evaluation processes will likely have little effect on organizational health and employee satisfaction. Instead, a holistic approach to motivation is necessary and doable with some planning and preparation.

So, should you hand out bonuses? That is up to you. What is more important is a desire to think critically about employee motivation techniques if you are interested in designing organizational motivators to improve employee satisfaction and reduce costly turnover set up a free consultation with Spark Group today!

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