In software consulting, people are generally measured against utilization. It isn't as purely formulaic as commission based sales, but there's usually a utiliz

In software consulting, people are generally measured against utilization. It isn't as purely formulaic as commission based sales, but there's usually a utilization target of some kind. If your target is 80%, and you find yourself only 70% utilized, you won't expect a good bonus or raise. If it's 50%, you start looking over your shoulder. I think in general it's a good idea to tie compensation to the benefit people bring to the business. Giving some kind of bonus to people for the profitability they bring to the firm is great. You just have to be careful that you're not screwing up teamwork or getting people too focused on the wrong things. (You don't want to incent short term profitability at the expense of customer satisfaction)