HR Corner Reward schemes help build team spirit by Charles Mak In the world of retail, commission payments can be used to motivate all staff and define the corporate culture When people assess what a potential employer has to offer, they will generally focus on the details of the remuneration package and any financial incentives. In the retail sector, they can usually expect to see some kind of commission scheme, which is likely to be closely tied to performance and to have a significant effect on the prevailing corporate culture. "For anyone who joins us, basic salary, commission and other financial incentives are certainly factors," says Linda Lau, human resources manager for The Sincere Company Limited. "But after working here for a few months, they will find that any commission schemes are simply tools for staff motivation and that our culture is what they enjoy the most." Sincere's comprehensive system of incentives includes quarterly, monthly and weekly commissions. There are others linked to special promotional events, along with bonuses for best performing team in terms of sales as well as service. Further reward schemes at different levels are in place to boost morale and strengthen team spirit. "We've spent a lot of time to set up all these schemes," says Ms Lau, "and the aim of all our efforts is to increase staff motivation." In November 2002, Sincere launched its first weekly commission scheme, which soon became an acknowledged success. "A monthly commission payment can seem too far ahead and staff might feel frustrated and lose motivation if they felt business wasn't picking up," Ms Lau explains. "However, if there is a weekly sales target, they know it is possible to assert a direct influence and they are happier to go for it." New accountability The weekly commission is a team-based scheme. One result of this approach is that accountability shifts from shop managers to department supervisors who have a team to oversee and a goal to achieve. Therefore, they learn to lead and motivate, developing basic management skills at the same time, Ms Lau stresses. However, a weekly commission scheme is not without pitfalls. "Different teams may see different business situations," she says. "For example, in the weeks following Chinese New Year, people don't usually buy shoes. It's just a tradition in Chinese culture, but can lead to discontent among salespeople in a shoe department." To maintain team spirit within the whole store, there is also a shop-based monthly commission. For every promotional event, such as clearance sales, all full-time staff are eligible for special cash bonuses. "There were six of these events last year and everyone from the sales director to our tea-lady had a share of the bonus, so it generates excitement for all of us," Ms Lau says. Fair share Part-time salespeople and staff responsible for concessions are similarly entitled to commission, with cashiers and security guards also getting a fair share. The basic concept has been to get everybody involved and to emphasise accountability, a sense of belonging, job satisfaction, good staff morale, and excitement through achieving business targets. "Cashiers, as a part of the sales team, have a shop commission, while security guards can enjoy 50 per cent of weekly commissions and a fixed monthly payment," explains Ms Lau. "Since introducing this, we have noticed that all staff have had a more proactive attitude towards customer care." For support staff in HR, accounts, logistics, delivery, visual merchandising and marketing, a quarterly bonus is granted when business targets have been achieved, as a way of recognising their efforts. "Some of these commissions are not pegged to the salary scale. What we try to do is to keep things simple and effective and everything works like a dream," says Ms Lau. Since being established in 1900, Sincere has offered a comprehensive range of quality merchandise and provided numerous career opportunities. As a business which has been through many ups and downs, it realises the importance of a motivated workforce for long-term success. Incentives and commission are now a key element in this and have been refined in the last two years to cover each level of staff. In 2004 alone, over 30 per cent growth in gross profit was recorded, thanks in no small part to what the scheme has helped to achieve. Besides that, all staff can choose between a non-contributory ORSO or an MPF fund and receive medical coverage amounting to HK$5,000 annually for an unlimited number claims, including for traditional Chinese medicine. Retirees can enjoy a payment of half of their basic salary times the number of years service with Sincere. "Our current record is a payment to one retiree for 38 years with the company," says Ms Lau. "With all our current schemes and incentives, we hope many staff will be motivated and proud to be part of Sincere for as long as that!" Salient points Commission schemes and incentives are important tools for staff motivation By leading small teams with clear goals, supervisors learn essential management skills The key to successful staff motivation is getting everybody involved Special campaigns in which everyone receives a share of the bonus create a sense of fairness and excitement Accountability and better staff morale result from a comprehensive commission scheme Taken from Career Times 8 April 2005, p. 16 Your comments are welcome at [email protected]