The aim of the science work is to develop methods to assess the innovative activity of the personnel that will provide motivation for employees to be active in the direction of research and introduction of internal reserves for its improvement. Methods. In the study were used: system method and methods of logical analysis – to justify theoretical and practical recommendations on the development of conceptual bases of the formation of the motivational mechanism of personnel management, economic-mathematical modelling and forecasting methods – to assess the influence of motivation factors on the level of labour activity of the personnel. Results. In the work the notion “motivation”, considering the innovative changes of the modern economy, is clarified. In order to foster innovative activity in the enterprise it is proposed to improve organizational structure by controlling the center of innovation activity management, which includes economic, technical and social division. Proposed an establishment of the project teams under the terms of accounting costs, which contributes to more active workers’ involvement in the formation of innovative development plans. The main points that determine their effectiveness are: growth of volumes of output, diminution of expenses of materials and energy resources, timeliness and relevance to the product market, improvement of the quality of work performed. A profit, derived by project teams, is recommended to distribute on: increment of the payroll, innovative development, stimulation and motivation fund. The research of the activity of the enterprises showed that one of the effective methods to stimulate staff is a motivational system based on the use of KPI. Bonuses for the implemented project, which are adjusted to the output of the basic stage, or KPI project as a whole, fixed bonuses as a percentage of the profits, and bonuses in stages of the project are the forms of motivation of project teams. Practical significance. Key performance indicators of innovation activity are distributed into levels and groups of staff that is responsible for carrying KPIs out, which makes it possible to ensure control over the current and longterm performance indicators, to evaluate the personal performance of each employee, to orient staff to achieve the necessary results, and to provide collective and individual responsibility for the results of enterprise activity. Value/originality. The proposed incentive system will be characterized by an address attachment in relation to each individual employee, clarity for executors, measuring simplicity, the interconnectedness of indicators, as well as by individual motivation of each employee. Thus, such system will contribute to the certainty of labour functions and will improve the quality of personnel management organization.