Tapping into Salon & Spa Team Bonuses

April 27, 2015 | By Neil Ducoff | 2 Comments

In every conceivable way, business is a competitive endeavor. You compete against other companies for market share. You compete to beat last year’s numbers. You compete to hit monthly and quarterly goals. You compete to improve productivity, efficiency and to reduce costs. You compete twelve times a year to drive profit to the bottom line on your monthly Profit and Loss Statements. As a leader, you compete to maximize your strengths and overcome your weaknesses. And … you compete to keep your team engaged, motivated and inspired to deliver their best every day, because excuses, apathy and indifference relentlessly test the strength of your culture. Business is about teamwork and winning because, in every conceivable way … losing sucks.

In business, there are no trophies for winning. Winning simply means your company survived to fight another day. A track record of winning adds meaning to the term “sustainability” but by no means assures it. Winning is also tied directly to your company’s payroll. When you’re winning, you can reward employee performance with pay raises. Winning also gives you the funds to hire the right talent to strengthen your team. However, no matter how you pay your employees … their personal incomes are about the individual’s performance and contribution. Personal incomes are not about teamwork.

Rewarding your team for a winning performance is where team bonus can be a powerful tool in your leadership toolbox … if you understand the in’s and out’s of building a team bonus into your game plan for winning.

Here are some No-Compromise Leadership insights to help you make the most of a team bonus system:

  • It’s the cause – not the cash: The instant the cash from a win takes precedent over the cause, meaning and purpose of the win, intent of team bonus is compromised and depowered. It is the leader’s responsibility to ensure that cause remains the driver and not the bonus. The cause is the motivator. The cause is what makes teams dig deep to create the shared sense of urgency to win. The win is simply about driving the cause across the finish line. The win is the trigger that releases the team bonus. Champion the cause. Push for the win. The team bonus is reward.
  • Carrots, apples and oranges: Team bonus means different things to different people. To some, winning most certainly is about the cash. To others, the win is about the celebration and shared accomplishment of achieving goal. And to others, the win and team bonus has a very personal meaning that they are part of something special … that they belong. It is the leader’s responsibility to tap into all of the touch points of winning and team bonus. The worst thing a leader can do to take the meaning out of team bonus is to distribute bonus without any expression of the meaning of the win and showing gratitude for a job well done. Otherwise, team bonus can become an entitlement.
  • The “But wait … there’s more” pitch: Too often, like selling ginsu knives on television, leaders make it all about the team bonus. It sounds like, “If we win – you’ll get team bonus.” As detailed in the first bullet point, the cause must always supersede the team bonus. Making it all about the team bonus and the money bypasses the emotional and motivational intent of winning. Leaders lead people. Pitchmen sell ginsu knives.
  • The “But we were so close” trap: Only an authentic win can trigger team bonus. All a near win triggers is another chance to play for a win. The worst thing a leader can do to depower team bonus is to reward a full or partial team bonus for a near win. With all due respect, if the team came close enough for a near win … they played a good game, but not good enough to win. The learning experience is in analyzing and isolating what prevented a win and making the necessary adjustments. Acknowledge the near win – only reward a real win.
  • When the carrots, apples and oranges go bad: There are times when things just go sideways and a win looks more like that dubious light at the end of the tunnel. Business is never about guaranteed wins. Business is about good times and having the tenacity to make it through the tough times. There are times when winning simply means surviving the tough times and regrouping. In these times, dangling an unattainable team bonus does more to demoralize a team than inspire it. The best course is to take team bonus off the table and suspend it until the company regains forward momentum. Focus on what matters most.
  • It’s just about winning: Team bonus is nothing more than acknowledgement for the efforts and performance of your team. Team bonus is about appreciation. It’s a “thank you” from the company. It’s fine to have basic team bonus rules, but never contaminate it with consequences. People don’t willingly deliver their best efforts to avoid consequences. Team wins trigger team bonus. Teams help those that fall behind. Teams fight for what they believe in. That’s the magic that creates wins.

Want to learn more about how to get started with Team Bonuses in your salon or spa? Click here for a complimentary strategies session, or download our free Team-Based Pay White Paper.

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  1. Great, thank you. I just posted goals on a dry board on our fridge.
    I love the reminder not to reward almost goal. That is the great reminder for us all. We often almost make the goal just not good enough in so many ways. I already see a positive change with my staff. It is my fault to not have these up a long time ago. I know open book finances help goals happen. The first thing one needs to do is be clear on goals that will fit into a budget that will equal success.
    It is very important to be true to your culture when making business practice changes. There are times when ideas do not work, it’s ok to try and then change to make successful for your team. This has also made my team stronger.

    Thank you for your encouragement.

  2. I am struggling with what to report to the team to get them excited and motivated for the team goals. Last pay period it took all the money in our accounts just to make it through. Do we let them know this? What is the “cause”? Nothing we have said seems to excite most. We are working with our coach and going through several staff & culture shifts. So it is a challenging point in our business. Any input is appreciated.


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