Bonuses are more effective when based on meeting or exceeding a performance goal,than when based on a time period.

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Bonuses that are tied to performance goals provide a clear incentive for employees to work towards specific objectives and achieve measurable results, whereas bonuses that are purely based on time can be seen as arbitrary and unrelated to individual contributions or accomplishments. Therefore, performance-based bonuses are generally considered to be more effective in motivating employees to improve performance and achieve functional objectives.

Bonuses Are More Effective When Based on Meeting or Exceeding