Bogus Bonus Plans

Here is what the reader had to say:

“I was in a meeting today, to discuss how our new quarterly bonus plans will be administered. According to our company, only a small percentage of employees will “exceed expectations” and a slightly larger percentage will be “above expectations” The rest will meet or be below expectations.”

THANK YOU Uinseann!

You can thank Jack Welch, former CEO of G.E. and demigod to corporate America for what you just experienced, Uinseann.

Let me start off by saying that Jack’s advice in this area is not bad and not great; however, it has been greatly bastardized by corporate leaders.

Hang with me on this. Most of you are a victim of what I call the “Welch Factor.” Especially if you work for a larger company. (1 billion in revenue or more)

Here is the secret (if you do not snooze through one of his books).

The top 10 % of employees get the most, the bottom 10% get fired. All other employees are lumped into 3 categories of mediocrity.

I worked for a 30 billion dollar company who embraced the self-made, highly esteemed Jack Welch. I sat in a meeting as a manger and was told we would be paying the top 10% well and that we MUST get rid of the bottom 10%. Next down from the top was 20% of my emplyees. They got a little bit of the spoils. 40% were just coporate drones who were told they met expectation. Some would not be eligble for “cost of living” increases. They were just fortunate to work for the company.

Then you have the 20% who were going to be kept as employees, yet not eligible for collecting a dime more than last year, even when factoring in inflation. They lost money if they kept working for this stupid company.

The last 10% were sent to “The Tower.” If you do not know British history, “The Tower” was death row. 10% were to be fired within the next 90 days. I was told to find 10% and get their 90 day paperwork going so that I could fire them.

So, Uinseann, your company has bastardized this stupid, stupid formula even more. Out of 50 employees, 5 should be in the top level. 10, should be “above average?ɬØ?Ǭø?Ǭ?”, 20 should be satisfactory, 10 should have no raise and enjoy their demoralization, and 5 should have their heads hacked off.

You said “I believe that most associates will decide that the deck is stacked against them and will not try as hard as they had in the past.”

YES, YES, YES and YES. Why? Because managers have no idea how to mentor the unlucky 70%.

I love this:

“It was like a bomb went off when we were told, basically, that some of us were not going to get rewarded or rewarded as well as we should since the bean counters did their spreadsheet and stated only a few employees could really do a good job.”

Thank you Jack Welch for your success in infiltrating the mostly blind and stupid corporate American leadership with absolutely the most idiotic plan. This may sound harsh; however, this man has done more damage than good.

Here is how he is described:

“Jack Welch may be the most talked about and widely emulated manager in business history. He’s used his own uncanny instincts and unique leadership strategies to run GE, the most complex organization in the world, increasing its market value by more than $400 billion over two decades.”

Well, that is a great bottom-line figure, but the carnage left behind is irresponsible.

Uinseann says “The defections are starting, we lost two key people in the last week and we are going to lose two more soon.”

Yes, and you Uinseann, your offer will come. Hang on and get ready.

When you get your new job, be sure and drop Jack a Christmas card and let us know. We are cheering for you!