Empower with policies
A few years ago, IPC employees complained about the increasing complexity of their incentive plan in both surveys and exit interviews. So Singer simplified it in 2006 by aligning incentives with the company’s success. But the catch is that the incentive is tied to each practice group’s performance as a team.
The plan also came with the power for teams to make their own changes in order to earn their incentive. Singer learned that even details like the structure of your incentive plan can foster an environment of empowerment.
“What it does is it forces the high-productivity individuals of the team to work with the lower-producing members of the team to improve their productivity so the overall team does better,” Singer says.
At IPC, 40 percent of each employee’s income is incentivized. But individual incentives ride on the team’s success.
“Either the group hits its target and then they get their bonuses, which are individually based,” Singer says. “Or the group doesn’t hit its target and nobody gets a bonus.”
You make your job easier by giving employees the power to control how they achieve goals. When the plan dictates that each employee’s success depends on their team’s success, everyone is motivated to pull each other up to par so you won’t have to.
“If there is someone in that team that’s not pulling their weight, it comes out of the bonus of the higher producers,” Singer says. “The higher producers get penalized for a lower-producing person on their team. So it has the team working together to get e
ve
rybody profitable, as opposed to the company coming down on an individual.”
The structure of your plan can inherently empower teams to help each other, but you have to give them permission. Singer’s groups — which typically consist of four to six doctors — can divvy up workloads and rearrange work shifts to give lower performers the right amount of work in order to reach their goal. They’ve even asked underperformers to lower their base salaries so they don’t create a loss.
“The beauty is that the compensation plan itself (empowers people),” Singer says. “If I’m losing money because you’re not producing, I’m motivated to make changes to identify what the problem is and fix it.”