美国研究生课程-薪酬管理-Incentive-Pay-.ppt

Click to edit Master title style,Click to edit Master text styles,Second level,Third level,Fourth level,Fifth level,*,*,Session 12,Incentive Pay,Chapter 4,1,Learning Objectives,Incentive plan observations,Administrative Plan Terms,Short-Term Incentive Plans(STI),Long-Term Incentive Plans(LTI),2,Are incentive plans the same for all positions in a business?,Are incentive plans the same for all businesses?,What might be appropriate for a new business start-up?,Does the business market impact the incentive plan design?,Example:Pharmaceutical vs.Insurance?,Incentive Plan Observations,3,Base Salary,Beginning Share Price,Beneficiary,Disability or Death,Ending Share Price,Participant,Performance Period,Retirement,Transfers,Promotions,Demotions,Short Term Disability,Family Medical Leave&Military Leave,Plan Terms Impacting,Incentive Pay Plans,For Reference Only,Target Award Opportunity,Termination,Eligibility,Stock Performance Measures,Distribution Elections,4,Short Term Incentive(STI)Funding,Sales Short-Term Incentive(STI)is based on,achieving critical,business and personal,targets.,Budget,for the plan becomes“triggered”,when the business financial threshold of,Integrated Earnings Before Revenue and Taxes(EBIT)is achieved.,Budget amount is influenced by,Regional,measures,which can influence the starting target%up or down.,District and individual,performance measures,are combined for determining a final STI payment.,Sales Plan Example,5,STI,Process,STI BUDGET IS FUNDED,Eligible employee salaries x 20%target,Funded if 80%EBIT achieved,Influenced further by National and Regional KPIs,Minimum budget=0;maximum budget=150%,Sales Plan Example,NATIONAL&REGIONAL FACTORS APPLIED,Factors influence the 20%starting target percentage up,(as much as 150%to reach a 30%target,or as low as 0%).,Factors include:,Integrated EBIT(US),Gross Sales(Regl.),Gross Invoiced Sales (Regl.),Forecast Accuracy (Regl.),Regional Operating Expenses(Regl.),Safety(RTP/Field),DISTRICT&INDIVIDUAL FACTORS APPLIED,District Gross Sales and Individual Performance toward objectives are measured.,These two final measures form a percentage of achievement,and this is applied in the STI payment formula.,STI PAYMENT,6,STI,Process,Sales Plan Example,7,Standard STI Programs-Sample,Example,8,Example,General STI Program,9,Once the bonus pool is determined,how is an individuals bonus determined?,Example,10,Example,11,Example,12,STI Targets Global&Business Components,If Global Gross Cash Flow falls below the minimum threshold of$3,109 million,there will be no Global Budget available.,If Global Gross Cash Flow is above the maximum of$4,337 million,the available STI budget remains capped at 200%of the target.,The 80%of the budget based on the performance of the Business will be determined by the attainment of Businesss Gross Cash Flow targets.,Example,13,Example,Leadership Compensation Plans,14,Aligning long-term leadership rewards,with shareholder interests,The Goal of Long-Term,Incentive Programs,15,2013 Executive Compensation Study,61%reported 2013 payouts above target,(for 2012 results),Slightly down from 2012s payout 68%,66%set higher performance goals for 2013,Performance-based goals,make up the majority,of awards,58%of organizations use Total Shareholder,Returns(TSR)in their LTI plans,50%in 2012,44%in 2011,Goal,align LTI payouts with shareholder results,Source:Meridian Compensation Partners,Survey of 140 companies with median revenue of$3.9 billion&market value of$5.6 billion,16,Incentive Plan Communications,How Leaders Can Work to Create Value,As organization leaders,each of us contributes to the organizations success,Each of us is key to improving a performance-driven culture,Our daily leadership behaviors shape how employees respond to business challenges,Business analysis and decisions you are involved in affect our overall performance,As leaders of the organization,we are all entrusted to drive shareholder value,Our role in creating value is a core reason why you are eligible for the Long Term Incentive Plan(LTI),Example,17,Example,18,Example,Each three year period is referred to as a tranche “The word tranche is French for slice,section,series,or portion”-(Wikipedia),19,Example,20,Example,21,Example,22,Example,23,Example,24,Example,25,Learning Objectives,Incentive plan observations,Administrative Plan Terms,Short-Term Incentive Plans(STI),Long-Term Incentive Plans(LTI),26,Session 13,Person-Focused Pay,Chapter 5,27,