Incentive Plan Design

Incentive plans are a powerful tool to drive performance at organizations of any size. Instead of relying on standard salary increases, employers are uncovering ways to directly align organizational goals with the personal goals of employees by shifting to a pay-for-performance culture.

Employees want to be incentivized, but developing effective incentive plans can be difficult. Whether you’re looking at incentives on an annual basis or as part of a long-term strategy to retain talent, L&A will create an incentive plan design tailored to your company To learn more about incentive plan and design options, click below.

  • Design or recommend the restructuring of annual incentive programs to maximize employee motivation and promote achievement of company goals and objectives.
  • Plan features and recommendations often include formula vs. discretionary targets, thresholds, maximums, payout timing, vehicles, plan metrics, etc.
  • Draft communication documents.

  • Design or recommend the restructuring of long-term incentive programs for public, private and not-for-profit organizations.
  • Plan features and recommendations often include appropriate vehicles, target amounts, vesting, timing of awards, overhang analysis, run-rate analysis, financial modeling, etc.
  • Draft communication documents.

  • Develop sales commission programs to enhance employee motivation and increase company sales and profitability.

  • Assist in assessing equity plan proposals in advance of shareholder votes to increase probability of support.

Designing effective incentive plans

The best incentive plan is one that efficiently aligns performance results with market competitive compensation opportunity to motivate employees. At Longnecker & Associates, we take a holistic approach to incentive plan design that is tailored to your unique business strategies, goals, and internal culture. We examine market data on compensation and job roles within your specific industry to create a custom and competitive incentive plan. We put decades of experience to work crafting an incentive plan that drives performance and meets all the needs of your business.

Important questions to ask when developing an incentive plan

  • What incentive types are appropriate for your organization or industry?
  • What specific goals do you hope to achieve by implementing an incentive plan at your organization?
  • Do these goals produce a win-win scenario for both your organization and your employees?
  • Can you foresee any obstacles that your employees might face in trying to reach these performance goals?
  • How often should measurement and payout occur?
  • How deep into your organization should incentive eligibility go?

Contact us for more information on creating incentive plans.

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