What is the desired outcome of using incentive programs such as profit-sharing?

The desired outcome of using incentive programs such as profit-sharing is to encourage long-term productivity. Profit-sharing ties employee compensation to the company's financial performance, thereby aligning employees' interests with those of the organization. When employees see a direct correlation between their contributions to the company's success and their financial rewards, it motivates them to work more diligently and efficiently. This approach fosters a sense of ownership and boosts morale, ultimately leading to sustained productivity over time.

In addition to increasing productivity, profit-sharing can enhance employee engagement, retention, and teamwork, as individuals understand that their efforts contribute to the overall financial health of the organization. This strategic alignment can result in improved performance outcomes, making it a valuable component of an organization's incentive strategies.