April 15-17 Speaker's Corner on Staff Incentives

Apr 2008
United States, April, 10 2008 - According to the recent “Banana Skins Survey 2008” among 300 microfinance stakeholders, staffing is one of the biggest and fastest rising risks in microfinance institutions (MFI). Staff incentive schemes (SIS) play a key role in an human resources strategy: not only do they influence who gets hired and who resigns, but they are mainly designed to increase organizational efficiency by enhancing staff productivity and loan portfolio quality.

A worldwide survey on the use of staff incentives conducted by the MicroFinance Network (MFN) and the Consultative Group to Assist the Poor (CGAP) has revealed that most MFIs use incentive schemes and that practitioners’ perceptions are largely positive. Poorly designed systems, however, can quickly backfire and produce negative effects on staff motivation.

Join the dialogue: This Speaker’s Corner attempts to reveal best practices in the design of efficient staff incentive schemes. Co-hosted by the MicroFinance Network and CGAP, it will be moderated by Mattias Grammlin, Martin Holtmann and Martha Ottenbacher.

Each day, participants are invited to share their own experiences, questions and comments in the discussion forum:

  • Day 1 (April 15) – Effectiveness and efficiency of Staff Incentive Schemes. We will discuss the main features of efficient staff incentive schemes: How much should we pay as incentive? What types of incentive schemes are most efficient? What are the factors to consider and how to make it work?

  • Day 2 (April 16) – Staff incentives for different functional levels of staff.  The success of staff incentive schemes largely depends on an accurate performance measurement, but how to assess the performance of credit officers, tellers, branch managers, accountants, and others? Should you have SIS for staff whose individual achievements cannot be measured? How to incentivise savings mobilisation or insurances? How can we design a comprehensive remuneration system that is fair to all positions?

  • Day 3 (April 17) – Social performance dimensions in SIS.  Although MFIs have a “double bottom line”, staff incentives are typically designed to improve efficiency and profitability. Considering the growing interest in balancing social and financial goals, it is surprising that social performance indicators are not yet widely used in staff incentive schemes. Is it necessary to employ social performance measurement indicators in staff incentive schemes in order to achieve social goals? Which social indicators should be used to reward staff?

Source : MicroLinks

Research Analysis Tools

The fund indexes, institution benchmarks and other market information displayed here are all Symbiotics designed analysis tools, created in-house by our analysts and experts. Symbiotics has one of the oldest track records in microfinance investment analysis dating back to the late 1990s; its indexes and benchmarks have been regularly used as markers by investors, asset managers, financial institutions and practitioners. These, as well as several other research products, are available through the Research Account. Click on the link below to find out more.

Learn More