Juhudi Kilimo: Designing Microfinance Staff Incentive Plans (B)

Abstract

In January 2013, Nat Robinson, the 32-year old CEO of Juhudi Kilimo, is faced with the challenge of how to best introduce and implement an incentive plan among the microfinancing institution’s (MFI) 78 employees. Established in 2004, Juhudi Kilimo provides microloans to Kenya’s rural population and had approximately 10,000 customers at year-end 2012. With a new round of capital, Juhudi Kilimo’s present goal is to scale-up and increase its customer base by ten-fold – to 100,000 – by the end of 2015. Robinson now wonders how he can best design an incentive plan – particularly for its 36 loan officers – that will allow the MFI to reach this goal most efficiently and effectively.

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Resources

Exhibit 1: Proposed Volume and Quality Bonus Amounts as Percentage of Salary

Figure

Source: Berkeley-Haas Project Team.

Exhibit 2: Bonus Pool Distribution

Figure

Source: Berkeley-Haas Project Team.

Exhibit 3: Sample Calculation of Proposed Bonus Plan

Figure

Source: Berkeley-Haas Project Team.

Exhibit 4: Non-Financial Incentives

Figure

Source: Berkeley-Haas Project Team.

This case was prepared for inclusion in SAGE Business Cases primarily as a basis for classroom discussion or self-study, and is not meant to illustrate either effective or ineffective management styles. Nothing herein shall be deemed to be an endorsement of any kind. This case is for scholarly, educational, or personal use only within your university, and cannot be forwarded outside the university or used for other commercial purposes.

2023 Sage Publications, Inc. All Rights Reserved

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