How to stimulate a revenue center?

[Rakhirandiseo]

Financial Responsibility Centers
Next, it is worth talking a little about financial responsibility centers, since the entire financial organization is often built on them.

A financial responsibility center is a group of employees who interact with the company's finances in one way or another. By correctly positioning all centers, it is possible to develop an incentive system that will work effectively. As a rule, there are several such centers.

The following types of centers are usually distinguished.

A revenue center is a group of employees who attract money from outside the company. This could be a sales department or a tender group.
Cost center is a group of employees that spends the company's money. It includes production and product departments, whether it is development, design, implementation, logistics, marketing, infrastructure and other activities that require costs.
A profit center is a group of employees who balance costs and revenues to arrive at a bottom line. They determine expense items and make decisions about disbanding departments and creating new ones.
Investment center – directors of new directions or products that first require financial injections and then turn into a new source of income. After reaching self-sufficiency and net profit, such a center ceases to be an investment center.
Interaction with these centers must be built differently, otherwise mistakes and miscalculations in the company's development are inevitable. Below we will tell you how to motivate employees of these four centers.

As mentioned, different centers are motivated in different ways. We will tell you how to interact with each center and motivate its employees to work better.

Let's start with the revenue center. It is easier to tie the motivation of such a center to revenue, since it will be more difficult for them to monitor other figures. There is such a variant of the salary calculation formula.

Income = Salary + (Revenue x 5%)

The percentage can be any, but it is desirable that it is job seekers database to market conditions. The salary itself can be average - the absence of penalties allows the employee to focus on increasing the percentage of revenue and thus develop his financial center. There is also a second version of the scheme.

Income from exceeding the standard = Salary + (revenue above the standard × 10%)
Income from underfulfilling the standard by X% = Salary − (Salary × 5%)

Here the salary is already higher than the market, but there is a system of fines for failure to fulfill the plan. The option is quite uncomfortable - but in a company strictly tied to revenue, such measures can give a positive result, as a result of which the company will not go bankrupt in record time. Again, the bonus for overfulfillment is also quite high, which can serve as a profitable option for careerists and active managers.