Out of control bonuses have been a prime suspect in the recent financial crisis.
At Mint, we took a different approach. Inspired by Love Machine, we've experimented with the following:
Instead of a management-led exercise in reviewing and ranking team members, simply give everyone in the company the same amount of money, and then tell them to give it away to everyone else, in any way they think makes sense.
(To be clear, 50% of the bonus was allocated in this way. The other 50% was given out at a flat rate across Mint, to ensure that everyone got a bonus in the event that the crowd-sourced approach strongly favored the few.)
What have we seen?
1. First and foremost, it has been good fun. It feels powerful and inspiring. It seems to be one of the most popular ideas we've ever tried at Mint. Typical feedback has been along these lines:
It's a nice opportunity to reward people who've been extra helpful.
I really like the idea of the bonus scheme and think this is a great way to divide up the bonus pool
2. The most common strategy has been to split the bonus equally across all staff. This seems to be especially true of the people, such as those above, who are big fans of the scheme.
3. In general, we found similar results to those described by LoveMachine. In particular, the system rewarded 'behind-the-scenes' staff over managers. It helped highlight some unsung heros within Mint.
One minor thing that didn't accord with LoveMachine's experience. They say: "in practice people give ‘farther out’ in the network – to jobs different than theirs, for example". We found the opposite. If a bonus giver didn't spread the bonus widely, they tended to favour their immediate team.
In conclusion, this has been one of Mint's more successful experiments of 2010, along with LivePitch, the Android Challenge and, best of all, the snack kitty. If Mint is ever in the position to give bonuses again, we'll definitely use this method.
Happy holidays, everyone!
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