Xcel implanted a program where employees can get paid just for their suggestions and not even if the suggestions where beneficial to the company itself. It is definitely better to pay bonuses based on merit, rather than their suggestions. Suggestions are an excellent way to get employees involved and invested in improving Xcel energy. However, if the suggestions that are being made remotely not dealing with the situations would be useless. Now however, paying employees bonuses for their performance and so on will make them take more pride in their work. They would work hard like they are supposed to. Merit pay can also help to tie performance more directly to Xcel energy's strategy to be a top utility by continuously improving our operations to be the lowest cost, most reliable and most environmentally sound energy provider. This is due to the fact that by rewarding high performers, Xcel is giving incentive to those that actually help it reach its goals.

Xcel should still encourage suggestions. However rewards for these suggestions should be based on how effective they are in the real world and on a cost/benefit analysis after they are implemented. For example, if an employee makes a suggestion that is implemented and saves the company 1000s of dollars, then the employee should be recognized and receive a percentage of the money that the company saves or receives in revenue. This type of program would encourage suggestions and help to