The way to develop the best that is in a person is by appreciation and encouragement
– Charles Schwab
Bonus season has arrived—a chance to show extra appreciation for a PT practice team that’s gone above and beyond. (Remember: appreciation shouldn’t be a special event. It’s most powerful when it’s part of your everyday practice culture.)
Done right, bonuses are a great opportunity to recognize success with your team. For a lot of PT practices, though, bonuses mean headaches and financial stress for you, and messy drama with your staff.
When do bonuses go wrong? When they are expected, but not clear.
Standard bonuses that aren’t attached to any particular achievements or outcomes don’t incentivize employees or make them feel appreciated. (Studies like this one reported in Fortune tell us why.) It’s because they’re expected, and not tied to individual performance.
When bonuses lack a clear, transparent system, it sets up a clash of expectations that can create drama within a staff (think: the impression of playing favorites) and make owners feel stressed and resentful, rather than grateful and eager to show appreciation.
With a few simple steps, you can do away with the stress and drama. Here’s how to turn bonus season into a meaningful acknowledgment of your team’s achievement that makes everyone feel good—and want work even harder to fulfill your vision.
Here’s my guide to getting bonuses right:
Know the limits of money as a motivator
Let’s first be honest about what money can and can’t do. Money matters to everyone. But it isn’t the key to developing and retaining a dedicated, motivated staff. Research shows we’re more energized by acknowledgement than by money.
Real, lasting motivation comes from cultivating trust and a sense of purpose and belonging for your team. Those emotional ties can’t be bought. But they can be earned through a practice culture that prioritizes them every day.
Stick to specific, objective measurements
Bonuses determined from subjective criteria are a recipe for trouble. Your bonus calculations should be based on clear, specific, objective targets. For therapists, visits and utilization rates are good metrics for bonuses. When I was a PT owner I used to pay bonuses to PTs who exceeded 85 percent utilization. The higher their utilization above 85 percent, the larger their bonus. This helped PTs know exactly where they stood. It also provided extra motivation for PTs to fill in for each other, and pitch in when we needed extra help.
Take bonuses only from PROFITS
You can eliminate the financial stress of bonus-giving by committing paying bonuses only out of profit. When bonuses are linked to net revenues, it becomes easy to root for your staff to succeed in achieving them. Instead of feeling resentful about the extra outlay of cash, your job becomes to HELP your team reach their bonus goals, knowing that’s a win for everybody.
Tie bonuses directly to each employee’s responsibility
Owners don’t have to give bonuses to their teams. Dinners and gift cards make good end-of-year appreciations. But this objective, metric-driven system of bonuses can work for every member of your staff. They key is to link the bonus to each team member’s individual work. Front desk bonuses can be based on low cancellation rates. Billing staff can receive a percentage of collections. PT aides can gain a flat-rate bonus that’s tied to administrative and clinical staff both receiving their bonuses.
Avoid unrealistic goals
Bonuses are an appreciation for employees who deliver exceptional service to your practice. You can set high goals, but they need to be achievable. Setting a utilization goal of 99 percent, or a cancellation rate goal of 3 percent, sets your staff up to fall short. Aim high, but not so high that your staff can’t reach their goals without burning themselves out in frustration trying.
There should be no surprises about bonuses. A smart bonus system makes clear up front how each individual team member can succeed. Transparency does away with confusion and eliminates drama. It also aligns your bonus system with your team’s performance goals. That allows your staff the opportunity to work throughout the year with their bonus targets in mind.
Your team is your most valuable asset. Get your FREE copy of my guide, the Patient Visit Multiplier, packed with proven strategies for your staff to use in increasing referrals and reducing cancellations.