Bonuses, like year-end bonuses or performance-based are great.  The only problem is that they are taxed at the highest tax bracket so you'll lose about 40% of that cash up front.  As a motivator, I'd say they are a motivator if directly related to your individual performance, ie you sold x amount over your quota and you get a monthly bonus.  If the entire office had a good year and gets a bonus, or you get a Holiday bonus, that's cool, but not necessarily something that gets you pumped to do your job every day.

This could provide a good amount of motivation,provided it doesn't get so competitive as to cause jealousy or divisiveness at the workplace.

Bonuses are a fantastic motovator, if the company does well then the employees should be rewarded. Makes it easier to perform if you know you will benefit from the company's success.

Money is a great motivator, and I take for example my husband's old job. The way they discouraged people from taking off work was to give them all their days off that they didn't use at the end of the year in a form of bonus, or christmas bonus. So a lot of people who wanted that little extra christmas money didn't take off during the course of a year. Not really bonus, but a lot of places don't do this.

Great way to motivate. I wish I got bonuses!! I work for safeway and well there not to good at motivating. The play the guilt card!

Excellent motivator...IF the money is right!

Bonus's are an excellent motivator. Business wouldn't succeed if it wasn't for the employees performances.

Works for me. I'll do what I can to get that bonus.

A very good tool if they are utilized properly. If bonuses become expected and part of the pay rate then they cease to be bonuses.

Bounuses have always been a great incentive for your people. Employees can always use a little extra from time to time. The trick I've found with bonuses is something business school never taught. Sure the Xmas bonus is predictable and even the year end bonus is great to see. But there's another style of bonus giving that beats them all. First everyone gets the same amount, (if you decide the bonus is to be money)from the newest employee to the most senior and trusted V.P. My accountant hates this. The secret is to surprise the employees when they least expect it. Pick a date, say in late spring, make it a friday and around 2:00PM with checks in hand make your rounds to each each employee shake their hands, hand them the check, be sincere look them in the eye and thank them and mean it. Then if it won't cause to much chaos give them the rest of the day off. Sometimes a crisp clean $100 bill clipped to the check is also a lot of fun. If your greedy don't try this sort of program because it will hurt. This business style will without question build loyalty and the smiles are addicting. They help you. . . you help them.

Bonuses can be a very powerful motivator - but only if there is a clear connection between your actions as an employee, and what earns a bonus. It's tricky to structure these things properly, as most bonus plans need to be self funding (ie generate cash to pay out). And how many employees actually impact cash flow?