Three Simple Guidelines for Your Bonus Plan Communications

Authored by Laura Morgan – It’s bonus plan documentation time! You made it to this point with an approved plan design – congratulations! I’m sure you did a lot of work. All of the Excel analyses and tests on eligibility and plan effectiveness paid off.

Now, how do you make sure your leaders and HR business partners are equipped to share the details as intended? How do you make sure the participants are clear on the specifics of their plan?

Length Adds Confusion

My compensation friends, let’s be clear. You should not have a highly-sophisticated vocabulary in your plan letters nor presentations. Leave that mumbo jumbo in the plan document to make your lawyers happy. You want your plan participants to fully understand the details and appreciate the value of the plan. Right? The value of your plan is understood much better with simple, easy words.

If your words are lengthy, let’s face it, you will lose some people’s attention. Why risk that? What value does that offer? Shining your vocabulary strength is not the goal. Remember, the goal is to have everyone understand the details and value the plan.

Next, make sure your sentences are crisp and short. Attention is heightened with shorter sentences. Remember Shakespeare? I had to read his work out loud repeatedly to understand the meaning. We are not novelists working to embed symbolism into our craft. I’m sure you’ve heard that compensation is confusing to many people. Let’s just make it as simple as possible.

Helpful Tool

There is a handy-dandy tool that can help you. In Microsoft Word, you may have noticed a box that appears after you run spell check. Note: there are many other readability applications online.

This is a great tool to tell you how hard your document is to understand. Take notice of the Readability section. Flesch Reading Ease score is on a 100-point scale. The higher the score, the easier it is to understand the document. For most items, you want the score to be between 60 and 70. The Flesch-Kincaid Grade Level rates documents on the school grade level. For example, a score of 6.0 means that a sixth grader can understand the document. A good aim for compensation documents is a score of 5.0 to 7.0. Now, I know what you are thinking. Why middle school? Again, the goal is to confidently know that your readers understand the details and value the plan.

As for passive voice, many experts say passive voice makes your sentences less energetic and adds clutter. All I can say is—think twice. There is an active debate about this. Other experts say your active voice may be reducing clarity. Just make sure your participants know what they need to do and by when.

For kicks, check your readability on your participant letter from last year. What do you notice?

This year, take it on as a challenge to use easy words and make shorter sentences. Organize your messages and schedule the dates to communicate the details. Your leadership team and, most importantly, your plan participants will appreciate your hard work.

Plan “3” Events

Your role is with every bonus plan rollout is as a change agent. Your participants’ level of awareness ranges from decision-maker to newcomer. You need to successfully explain what changed, what didn’t change, and why this plan is designed the way it is. Your success is dependent upon the participants understanding and appreciation of the plan. To help you, remember “3” is the magic number. Communication experts share this concept time and time again. You need three consistent touch-points with your participants to move from them awareness to appreciation. To be successful, plan three events and schedule the review, revision, and distribution dates to make sure they happen. An example of a bonus plan communication rollout is shown in the table below.

Solid compensation program designs are often destroyed by bad communications. If a participant doesn’t understand the program, they will have doubt and anxiety. Those emotions create confusion and distrust. Therefore, aim for 100% clarity with simple word choice and sentence structure. Take the time to map your communication strategy. It does not have to be overwhelming; just timed well and implemented thoughtfully. Use these simple ideas to ensure your program design work is understood and appreciated.

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About the Author: Neil Morgan

Neil Morgan is the Managing Director of MorganHR, Inc., a leading Human Resources consulting company and software provider. A technology proponent who is also passionate about process simplification, Neil led the creation of SimplyMerit to help leaders take control of and optimize their annual merit, bonus, and equity processes. SimplyMerit now forms the backbone of MorganHR’s Compensation Management solutions.