Tag Archives: career

Bonuses – why they should be banned


Awarding bonuses is something I have read much about, taught and experienced firsthand in my career.

They are almost always misused. Instead of encouraging better performance from employees the only thing it encourages it greed, lies and discontent.

Bonuses are usually paid from middle management on up, and therefore breed discontent and envy from everyone below middle management.

Why?

Because the success of a business rests upon every employee performing at their best, not just a select few.

There is now a whole industry that has been built around team building, team bonding and trust, fuelled by bonuses. This is because bonuses are 95% of the time given to individuals, not teams.

This conflict, and disconnect between performance and reward breeds nothing but bitter rivalry.

It also encourages illegal activity, such as we in Australia have seen recently with the Royal Commission into banks. The corruption that bonuses perpetuate has also been evident for a long time and played a significant role in the Global Financial Crisis.

Bonuses are mostly put in place by people who want to motivate their employees, and so they can argue for a bonus system for themselves.

If middle management are given the opportunity to earn a bonus, then surely those above them should be offered one as well! And so it goes, to the very top.

This is where the rot really sets in.

For example; there is a team of five salespeople and it is coming to the end of their reporting year. Three of the salespeople have passed their performance benchmarks but two have not, but they are not far behind.

As the salespeople get a bonus only if their overall targets are met the three salespeople who have already qualified will start to allow the credit for their sales to go to the other two. This way they have a chance of meeting their bonus targets.

It is now just two weeks from the cutoff date to achieve bonuses and one salesperson is still behind. If this remains the case no-one will get a bonus for the past twelve months work.

The senior salesperson has been keeping the Sales Manager aprised of what is going on, because of course the Sales Manager wants his/her bonus as well. They have also been getting more and more phone calls from their Regional Manager who also has a bonus, but theirs relies on the Sales Manager hitting their target.

And so it goes up to the CEO.

So in order to achieve their target, and therefore achieve a bonus for everyone, the leading salesperson goes to the Sales Manager with a proposition. What if they create a fake sale that will meet their target, and everyone elses?

The Sales Manager goes to their Regional Manager and over a coffee proposes the sales person’s idea. Because the bonuses get larger as you go higher up the corporate ladder the Regional Manager will lose far more than the Sales Manager if they just fall short.

So the Regional Manager agrees to let it slip through.

Their Manager might realise it is a fake order when it comes across their deak, but they of course approve it because they want their bonus. After all it is the salesperson and Sales Manager who will take the fall if anything happens.

And so it goes, all the way to the top where the CEO’s bonus could be worth up to a million dollars or more (disgusting but true, just read the financials of the big banks, or any of the top ten companies in Australia).

So everyone gets a bonus that year, everyone is happy…until next year.

This year has been particularly difficult, and it looks like only one salesperson will meet their target. But now they have a ready made solution, and because all levels of management let it go last year, surely they will let it go this year?

So a much larger fraud is committed, but again who is going to complain? If anyone did they would all lose their bonuses.

Although a somewhat simplistic example, this is exactly the way bonuses work. If you set a team bonus the above scenario will occur, and if you set team bonuses (sales team, regional management team, product management team) internal resentment occurs because the top salesperson earns just as much as the salesperson who is lazy and doesn’t care.

You also alienate the people in customer support, who are talking to customers all day, trying to make them happy. Surely the salespeople wouldn’t get their results without the help of customer support? And what about the staff that key in the orders, shouldn’t they receive a bonus for accuracy, because it costs the business a lot of money if they slip up?

Now you have discontent between departments.

Bonuses should be banned altogether. I believe they do nothing but create friction in the workplace and sanction greed.

In my own experience with bonuses I was awarded a trip overseas. I didn’t deserve it on my own because I had a great salesperson and also because one customer placed a huge order that year, the only year they did. What eased my conscience was that my salesperson went as well.

I also was a Regional Manager when our region won a table tennis table. I was told by my immediate boss to take it home and enjoy it. I would have loved to, but I knew it was because of the sales in our Western Australian branch that got us over the line. So I told my boss to send it to the WA office. On my next visit there they were still struck dumb as to why I would do such a thing, and sadly my response of “because it was fair” was considered unsatisfactory.

As I have said, bonuses are like a cancer to a business as they only encourage greed and false reporting. Everyone knows it, which is why my WA team couldn’t believe I had behaved fairly.

If no-one believes bonuses are fair, even if they are rewarded by one, then surely it is game over?

One final thought. If you have to offer someone a bonus to motivate them, are they worth employing?

A certain percentage of young people will always leave South Australia


It stinks, but it’s true.

Steven Marshall campaigned hard on this issue in the recent SA State election (which he won) and I for one am glad that fresh eyes are looking at this problem. However he will never be completely successful.

It remains a fact that 90+ percent of head offices are in either Sydney or Melbourne, and unless we want to double our size (in people, infrastructure etc) we will never attract more than one or two big businesses here, compared to the dozens interstate.

Of course it is worth trying but ANZ, Telstra, Panasonic and the very large organisations will never move here.

I myself spent four years in Sydney because I wanted to see how high I could go, and to enjoy the variety and challenge of working for a major corporation. I ended up as National Product Manager for IT Products for Panasonic Australia, a position I loved and never would have achieved had I remained in SA.

Mind you four years was enough (I spent over three hours a day commuting, thankfully in a company car), and family circumstances necessitated that I return to SA.

I came back to a position as a Corporate Salesperson for Ericsson. This was a big step down from travelling around Australia every few months, demonstrating the latest IT products and teaching distributors and major retail outlets how to sell them. I also gained valuable experience in presenting to the top buyers in Harvey Norman, Myers and so on, negotiating floor space and pricing.

I never would have had that experience here in Adelaide, where the biggest employer is the State Government.

I much prefer working in Adelaide to the traffic, congestion, polluted air and high cost of living in Sydney. However the upsides of working interstate, if you have ambition, far outweigh the negatives.

The attitude interstate is also much closer to the US and Silicon Valley. There, if you have started a business and failed they are actually impressed by your initiative and know that you learned some hard lessons. In Adelaide you are more likely to be shunned.

This attitude within our beautiful State will not change until the current ‘startup generation’ are well into their forties. Unfortunately this is a hard fact that we must face head-on.

So how do we keep young people from leaving SA? By being more forgiving of their mistakes and encouraging them to try again. By recognising that a certain percentage will move interstate no matter what you do, and helping the rest to make the move back ‘home’ an easy one.

You can accomplish this by having a small department that keeps in contact with these talented and adventurous young people, encouraging them to explore outside SA (they will anyway) and yet also ehticing them to return by offering a more welcoming attitude. This same small department could assist them in their transition back to SA, without them having to go backwards in their careers, by facilitating them to find a relevant position here that is of sufficient interest to them.

This small (keep it simple and focused!) government department could help them find interesting roles by assisting local businesses here to create them. This can be achieved by finding the already successful small businesses in SA (of which there are many) and assisting them, without mountains of red tape, to grow.

Up until now most of the emphasis has been on opening startup hubs and announcing unrealistic figures on how many jobs they will create. Yes we need to foster our local startup community but it needs to be coordinated and supported properly. This would involve assisting them by providing long term mentoring, cheap access to accountants, lawyers and investors to steer them in the right direction. Also vital is utilising the founders of already successful startups in SA, by encouraging them to introduce local business people to respected contacts they never would have met otherwise.

All this needs to be done in conjunction with identifying small businesses that could easily become large businesses with the right backing and support.

Such a coordinated effort would make it more attractive for our young people to stay here, and for those that leave it would encourage the talented ones to return. That involves keeping track of them and using a CRM (customer relationship management) system within government, to keep in touch and to entice them back.

This means it would be essential for this arm of government to be run like a business.

I, for one, have hope.

Who needs politicians??


People keep leaving Adelaide for better jobs in other States.

It’s been this way for decades yet no politician has taken it seriously. It’s all up to us to do it ourselves, and to volunteer to help people who need it.

The government does nothing but produce reports and spend our money like they’d won the lottery.

Without the people nothing would get done, and without the politicians MORE would get done!

A benevolent dictatorship looks better every day…

Two Thirds of University Students Fail to Graduate


So two thirds of university students fail to graduate…when will they learn that they need to provide far more than text books and large lecture theatres?

A huge shake-up is needed in this sector for it to still be relevant in the years and decades to come. Teaching techniques have to change drastically – having young post grads being tutors because they are PhD students is rediculous, as is expecting people to sit through lectures over an hour long.

Come on guys, time for some disruption!

Constantly Working Long Hours? Maybe You’re The Problem.


I’ve always thought that if you’re constantly having to work long hours (the exception being if it’s your business, then it’s your choice and sometimes a necessity) then you are not efficient and don’t use your time as productively as possible.

In the past I’ve heard many people spend an hour a day, or more, complaining that they don’t have enough time to do their job!

A person working long hours more often than not demonstrates a lack of ability or of support, both are toxic in any organisation.

Go home, spend time with family or on yourself, because you’ll never be paid for those extra hours and your boss won’t appreciate it, she/he will just get used to it and soon expect it as your normal day.

Do yourself a favour and GO HOME!

Adelaide more expensive to live in than Melbourne!


Adelaide is now more expensive to live in than Melbourne?? Thank you politicians and greedy utility companies, way to go!! We are so over-taxed in SA it’s a disgrace.

Desalination plants that never get turned on, expensive non-functional hospitals, mounds of money spent on reviews that have gone nowhere…thanks Labor!!

Visit the printed story here.

Do it now!!


You never know when your working life will end.

This time last year I was looking forward to the next stage of my career, now I am ill and will never go to work again.

I say this not for sympathy, as those close to me give me more than I deserve already, but to plead with you to act now on what you want to do, start that study, or knock on doors for that start you crave, or change careers NOW.

You have no idea how long you have, and regrets hurt far worse than all the “No’s” you’ll receive before you get your yes!

Go for it, or resign yourself to decades of regret, your choice.