In this article, you will learn how to define targets and link these to bonuses.
Define a target
In the Performance section of the employee profile, you can set monthly, quarterly, and annual targets. To create a target agreement, select Target from the drop-down menu on the right side.
Now you can define any number of custom KPIs or select from existing KPIs and add the target agreement. A KPI in Personio may be binary, quantitative, or qualitative.
KPI type Definition Example Binary Target reached or not Sales target Qualitative Not directly measurable Employee satisfaction Quantitative directly measurable Quote-to-Close ratio
Please note that floating point numbers do not work as KPIs. Enter a ratio, such as the Quote-to-Close ratio, as a value between 0% and 100%, so enter a number between 0 and 100 and not between 0 and 1. Values such as 0.25 or 0,25 not work.
Finally, for each added KPI, it can be freely defined whether and how much it should be included in the bonus calculation for the selected period.
Link to the bonus calculation in salary management
First, you must specify the interval at which bonuses are paid under Configure account > Performance > General.
Now, a bonus can be added under the Salary tab in the employee profile. This can be flexible (entered manually) or calculated as a function of pre-established targets from the Performance section. The bonus will be automatically added to the salary. This is done either at the end of the period, after the period, or distributed evenly over the period, depending on the setting.