The other side of target bonuses

targetsThe recently released proposed new sales targets at BNZ have one aspect that has not attracted much discussion so far, and it is probably because it is so normal that we take it for granted.   So let’s take a second look.   Why do the bonus payments go so high? – up to 400%.Let’s take a look at sales targets for Banking Advisers for example.   A BNZ Banking Adviser at 100% of her or his salary earns $47,743 before getting any incentive payments.

But it is possible for her or him to earn a further $28,000 in incentive payments if she or he sells 400% of their target.

$28,000 on top of your salary sounds fairly good.   Good that is until you realise that the bank has just got the equivalent of four people’s sales done by paying just over 1.5 salaries; a saving to the bank of $115,000 if you follow our logic.

A Banking Advisor who ‘merely’ does the sales work of two people saves the bank nearly $36,000.

Finsec believes the BNZ’s strategy to increase profits at the moment is working because workers do not realise how much free work they are doing for the bank.   Currently many do a second, third or fourth person’s sales job at a fraction of the cost that it could cost the bank to hire new staff.We all know targets keep increasing to drive greater sales and profit for the bank.   When you add increasing targets to decreasing staff levels over recent years you create extra workload. Targets are placing significant pressure on staff to sell more and more products in an increasingly competitive and tight market.

(thanks to chadmill for the photo)

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1 Response to “The other side of target bonuses”


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