A New York-based start-up is turning the traditional appraisal system on it's head by allowing peers to dole out bonuses to each other finds Yolande D'Mello.
How do you motivate your team at work?” That was a question that John Quinn, who works at a software firm, mulled over while sharing a drink with a friend Raphael Crawford-Marks in New York one day about a year ago.
Three whiskeys later, the concept of Bonus.ly was born. Crawford-Marks has since quit his job to work on the start-up full time.
Bonus.ly is a web-based collaborative system that uses peer feedback to ensure productive employees are recognised and rewarded. Though it is still in the alpha phase of testing, it promises to change the largely opaque way most employee bonuses are given.
How does it work? Employers set a bonus budget that is distributed to each team in the company. The currency of this budget can be in the form of cash or even points, miles and credits that can be redeemed for prizes later.
Each team member can reward his or her peer with a bonus during the course of the month. When employees award bonuses to deserving team members, they must state the reason that goes up online in a twitter-like feed. Besides working as a motivating factor, such transparency also prevents bogus awards and 'fixing' (in case two team members are good friends who want to reward each other.)
The manager retains a certain amount of control over the final assessment.
But what's wrong with the old system?
“Annual bonuses aren't timely enough and employee-of-the-month initiatives become a redundant political exercise. Companies end up awarding the oldest member of the team a plaque without any monetary hike,” he says. “This way, you hand over the power to the employees.”
But not everyone is convinced. Kartik Chaturvedi, associate at Pune-based healthcare consultancy firm, says it's an idealistic idea. “Giving employees the task of judging the output of peers and associating it with money is ambitious, but I doubt it will be fair to those who work hard but don't market themselves enough,” he says. His company currently follows a three-tier system of evaluation with inputs from laterally placed colleagues too.
Chennai-based Rajendran Dandapani, director of engineering at Zoho Corporation, a software company that's trying out the Bonus.ly system says, “In this system, the players realise the verdict is not all tied up with the company's 'official' appraisal system connected with the salary structure. Peer-to-peer is the best way to provide micro-inspiration on a frequent basis.” His company has even developed an iPhone application for the system.
Ruth Sequeira, manager at a retail brand is sceptical about biases. “Only if the final decision is being made by the boss, this rating will be helpful for large teams where peers are better informed of each other's performance.” BPO manager Ralph D'Souza prefers that his bonus be based on hard numbers, thank you very much.
“The concept of performance is subjective; my priorities may not be that of my colleagues.” His bonus is currently based on target figures for each month, and an average calculated for the year. “I'd prefer to let my numbers speak for me rather than my colleagues.”
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