美國(guó)研究生課程-薪酬管理-Incentive-Pay-

Session12IncentivePayChapter41LearningObjectivesIncentiveplanobservationsAdministrativePlanTermsShort-TermIncentivePlans(STI)Long-TermIncentivePlans(LTI)2Areincentiveplansthesameforall positionsinabusiness?Areincentiveplansthesameforall businesses?Whatmightbeappropriateforanew businessstart-up?Doesthebusinessmarketimpactthe incentiveplandesign?, Example:Pharmaceuticalvs. Insurance?IncentivePlanObservations3BaseSalaryBeginningSharePriceBeneficiaryDisabilityorDeathEndingSharePriceParticipantPerformancePeriodRetirementTransfers,Promotions,DemotionsShortTermDisability,FamilyMedicalLeave&MilitaryLeavePlanTermsImpactingIncentivePayPlansForReferenceOnlyTargetAwardOpportunityTerminationEligibilityStockPerformanceMeasuresDistributionElections4ShortTermIncentive(STI)FundingSalesShort-TermIncentive(STI)isbasedon achievingcriticalbusinessandpersonaltargets.

Budgetfortheplanbecomes“triggered” whenthebusinessfinancialthresholdofIntegratedEarningsBeforeRevenueandTaxes(EBIT)isachieved.BudgetamountisinfluencedbyRegionalmeasures, whichcaninfluencethestartingtarget%upor down.

DistrictandindividualperformancemeasuresarecombinedfordeterminingafinalSTIpayment.SalesPlanExample5STIProcessSTIBUDGETISFUNDEDEligibleemployeesalariesx20%targetFundedif80%EBITachievedInfluencedfurtherbyNationalandRegionalKPIsMinimumbudget=0;maximumbudget=150%SalesPlanExampleNATIONAL®IONALFACTORSAPPLIEDFactorsinfluencethe20%startingtargetpercentageup (asmuchas150%toreacha30%target,oraslowas0%).Factorsinclude:IntegratedEBIT(US)GrossSales(Reg’l.)GrossInvoicedSales(Reg’l.)ForecastAccuracy(Reg’l.)RegionalOperatingExpenses(Reg’l.)Safety(RTP/Field)DISTRICT&INDIVIDUALFACTORSAPPLIEDDistrictGrossSalesandIndividualPerformancetoward objectivesaremeasured.Thesetwofinalmeasuresformapercentageofachievement, andthisisappliedintheSTIpaymentformula.STIPAYMENT6STIProcessSalesPlanExample7StandardSTIPrograms-SampleExample8ExampleGeneralSTIProgram9Oncethebonuspoolisdetermined,howisanindividual‘sbonusdetermined?Example10Example11Example12STITargets–Global&BusinessComponentsIfGlobalGrossCashFlowfallsbelowtheminimumthresholdof$3,109million,therewillbenoGlobalBudgetavailable.IfGlobalGrossCashFlowisabovethemaximumof$4,337million,theavailableSTIbudgetremainscappedat200%ofthetarget.The80%ofthebudgetbasedontheperformanceoftheBusinesswillbedeterminedbytheattainmentofBusiness’sGrossCashFlowtargets.Example13ExampleLeadershipCompensationPlans14Aligninglong-termleadershiprewardswithshareholderinterestsTheGoalofLong-TermIncentivePrograms152013ExecutiveCompensationStudy61%reported2013payoutsabovetarget (for2012results)Slightlydownfrom2012’spayout–68%66%sethigherperformancegoalsfor2013

Performance-basedgoalsmakeupthemajority ofawards58%oforganizationsuseTotalShareholder Returns(TSR)intheirLTIplans50%in201244%in2011

Goal–alignLTIpayoutswithshareholderresultsSource:MeridianCompensationPartnersSurveyof140companieswithmedianrevenueof$3.9billion&marketvalueof$5.6billion16IncentivePlanCommunicationsHowLeadersCanWorktoCreateValueAsorganizationleaders,eachofuscontributesto theorganization’ssuccessEachofusiskeytoimprovingaperformance-driven cultureOurdailyleadershipbehaviorsshapehowemployees respondtobusinesschallengesBusinessanalysisanddecisionsyouareinvolvedin affect ouroverallperformanceAsleadersoftheorganization,weareallentrustedto driveshareholdervalueOurroleincreatingvalueisacorereasonwhyyouare eligiblefortheLongTermIncentivePlan(LTI)Example17Example18ExampleEachthreeyearperiodisreferredtoasatranche–“Thewordtrancheis Frenchforslice,section,series,orportion”-(Wikipedia)19Example20Example21Example