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From Management point of view, how to choose between offering employees annual bonus or profit sharing arrangement?

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تم إضافة السؤال من قبل Ibrahim Hussein Mayaleh , Sales & Business Consultant and Trainer , Self-employed
تاريخ النشر: 2015/01/01
Mohamed Hamdy Kamal Riad
من قبل Mohamed Hamdy Kamal Riad , Senior Solution Architect , IBM

I think that annual bonus is most liked by employees .

As it is stable .

Ibrahim Hussein Mayaleh
من قبل Ibrahim Hussein Mayaleh , Sales & Business Consultant and Trainer , Self-employed

Management look from business point of view in which they see the performance of all employees as on entity.

I believe profit sharing is one of (if not most) important way to develop employees' loyalty. When employees feel that they are part of the company's success (not only in the efforts but also in the profits) they will be more involved and will care.

Annual bonus is usually based on individual performance, but profit sharing is based on team's/ whole company's  performance. Therefore every employee will not only be watching his own but also other's performance.

VENKITARAMAN KRISHNA MOORTHY VRINDAVAN
من قبل VENKITARAMAN KRISHNA MOORTHY VRINDAVAN , Project Execution Manager & Accounts Manager , ALI INTERNATIONAL TRADING EST.

Bonus is an additional payment purely at the discretion of the management unless and otherwise a statutory stipulation in this regard by the Government. But  in many companies this is incentive package linked to sales and profit.  It is generally expressed in terms of number of days in a year calculated on the basis of Basic salary/Gross salary as the case may be. Usually on incremental basis year over year. I believe this is a good practice better than sharing arrangement, as the employees cannot digest a discounted return by way of bonus, even though it is not a right for them.  Because the expectations should not diminish for small earners as it will upset their morale boost. Opinions may differ, but I believe this is good for them.

مستخدم محذوف‎
من قبل مستخدم محذوف‎

There is no special law with the enoughs annual fixed but is due to several reasons, including the size and value of the annual profits are distributed in proportions varying staff as administrative center according to the specialization of each employee and is not imposed on companies is encouraging and an incentive to exert maximum effort and provide the highest bid

LABIB KOOLI
من قبل LABIB KOOLI , Director of the Sectoral Center for Training in Hotel Technologies at Southern Hammamet , Tunisian Vocational Training Agency (ATFP)

In my point of view , profit sharing is rarely practised and in many cases that is a try  

management for salvaging a company with financial difficulties. 

Annual bonus is safe an fair, it's up to you as a Manager how to fix it to be fair, logical and guarantee the self and the hole group motivations.

Alex Al Yazouri
من قبل Alex Al Yazouri , General Manager , Al Mushref Cooperative Society

Management point of view always focus on which one motivates employees to work harder?

Profit sharing arrangement

PRADEEP MEHRA
من قبل PRADEEP MEHRA , CEO , Angel international Inc.

Thank you for addressing your question to me. As per my experience, for the role where contribution is directly measurable Profit Sharing model may be chosen. Roles on projects annual bonus may be offered.

Muhammad Saey
من قبل Muhammad Saey , Senior Veterinary Doctor , PAFN Public Autority for Food and Nutrition

I prefer the profit sharing for two reasons:

  1. Encourage the employees for team work achievements
  2. Increase the loyalty to work and improving work environment.

Moreover, I prefer to do it quarterly, not annually.

Mohammed Thiab
من قبل Mohammed Thiab , Founder / Chief Consultant , MV Consulting

From management viewpoint, this decision will be based on the preference of the employee and what makes him/her really tick and deliver their best, noting that such choice is given to key employees only with which the whole business will tick and deliver its best

مستخدم محذوف‎
من قبل مستخدم محذوف‎

agree with the answer

Waqayan Al Waqayan
من قبل Waqayan Al Waqayan , Secretary of Sharia Supervisory Board (SSB) , Ahli United Bank (AUB)

I don't know.

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