Enterprise Incentive Mechanism

Incentive policy is a method that expresses the interaction between incentive main bodies and objects by using a set of rationalization system. In the modern enterprises, human resource has been the most important factor for their development. Whether enterprises build up and implement the incentive policy, activate the human resource, and maximize the margin efforts of employees successfully has been the key factor to achieve the continuable development and win in the competition. But the facts in front of us are: the key staffs are very unstable in many enterprises; they are on job-hopping frequently; the employee's team is lax; the efficiency of enterprises is very low; the creative capability is becoming weaker and weaker, even threat the survival of enterprises. Some leaders of enterprises complain that a lot of money has been spent but the employees don't take it serious and that the employees are becoming more and more difficult to management. Others copied the advanced incentive policy of the foreign and multi-national companies but they don't work. All the reasons that personals lost seriously, or their enthusiasm can't be maintained are related to the incentive policy in the enterprises. The main problems are: first is understanding. They don't fully understand the setting of incentive policy, don't use the incentive theory skillfully, and don't know the human nature deeply. Second is on the operating level. There is lack of human resource system and assistant policy, no formal incentive system, and no cooperate with each other so that the effects have been deducted. Although many incentive policies and methods have been implemented, the result is no good. Because the incentive policy construction is more perfect and advanced than those of Chinese enterprises including SOEs, domestic capital controlling enterprises, this paper focuses on analyzing the status of incentive policy construction in Chinese enterprises . Then it brings the ideas that it is necessary and urgency to build up the incentive policy in Chinese enterprises and that outline the objectives and general requirements for building up them. Finally, the paper tries to make a set of systematic and operational incentive policy formulating methods and countermeasures so as to benefit to the work of incentive policy making and HRM in Chinese enterprises. Considering the aspects of building and circulating the incentive mechanism, the experience got from the United States and Japan are: to insist the management principle of making people the center, to respect employees' needs, and carry out the person-original management; encouraging methods for employees should be multi-levels and various, it is valid to combine material encouragement with spirit encouragement; the incentive mechanism must take raising the quality of employee's job and life as the target, and must consider the cultural background of our country; the build of corporate culture should be regarded. To innovate Chinese private-owned enterprises' incentive mechanism, following jobs should be done: insisting to the person-original principle; innovating the institution of property right of some family enterprises; setting up a perfect incentive mechanism and circulating system of Chinese private-owned enterprises; adopting multi-levels and various encouragement methods; valuing the corporate culture, enhancing the ascription feelings of employees and the agglomeration ability of enterprises.