Variable Pay Communications Considerations

Thursday, August 19, 2010

We have implemented our new variable pay plan, we found vendors who can reliably track the driver’s stop times and accidents. We are able to track any absences or missed time via our payroll system and we were even able to have the vendor who manages our customer satisfaction surveys to add a few questions about the assigned driver. What is left is to communicate the plan to the driver and help him understand how it will work for both the organization and the driver. It will be reasonable for the driver to be uncertain about the plan and have a number of questions. The driver may be highly skeptical of the plan and whether or not it will deliver the promised rewards. This may be the first time our driver has worked with any form of an incentive plan, so expect that your communications will need to be very detailed and complete.

90% of all stops on time

During our implementation, we concluded that “on time” was to mean plus or minus 5 minutes of the scheduled stop time. To test the validity of this standard we had our tracking vendor track our driver’s stops for a full business month and were able to confirm that our driver was able to make his scheduled stops within plus or minus 5 minutes 85% of the time. We shared this information with our driver and helped him understand that a mere improvement of 5% would allow him to meet the standard. It is in the organization’s favor that our driver succeed, after all we sent him to driver’s school for two weeks and the route supervisor road with him for two weeks. If he succeeds, the organization succeeds.

No at fault accidents

Although our driver has a number of years of driving experience, it is vital that he operate his truck in a safe and courteous manner. There is more riding on this than just the insurance premiums. Our organizational name is in 6-foot high letters on the sides and rear of the truck. If our driver behaves in an unprofessional manner, other drivers, customers, and the public will lower their perception of our organization, its services, and products. One reason why we elected to send our driver to school for two weeks was to ensure he had both the skill and the knowledge to operate the truck in a professional manner. Our competitors do not train their drivers and they are known for certain unsafe practices, speeding, and accidents. We hope that we have sent a strong message to our driver concerning safety and professionalism.

No more than 3 unexcused absences

The driver’s route supervisor has spent a considerable amount of time discussing the need to report to work daily and on time. The supervisor has explained how our driver is to request time off for such things as funerals, hospitalization, planned vacations, and planned medical treatments. In addition, the supervisor has explained how the driver is to handle unplanned emergencies and unforeseen events. If the driver fails to report to work, the route supervisor must drive the route. This creates a serious problem if more than one driver is out for an unplanned absence at the same time.

Customer satisfaction rating of “Satisfactory”

During the two week period in which the route supervisor road along with our driver, the supervisor was able to introduce the driver to each customer and give our driver an image of the customer’s business, the services, and products sold to the customer and some suggestions on how to build and maintain a relationship with each customer. The driver was fully briefed during the two weeks his supervisor road with him on how his customer interactions will be scored on the monthly customer survey conducted by the outside vendor. Since our driver interacts with our customers on a daily basis, the driver will develop a more detailed understanding of the customer’s needs, even more so than our sales staff. In fact, we have found that our sales staff often reaches out to the drivers for feedback and suggestions.

One reason why, we as an organization are able to recruit and retain employees is that we have a reputation in the community for being a highly ethical employer. The communications to our driver, as well as organizational communications in general, are based on and designed to reflect our ethical standards.