Performensation Articles 201201-201206
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Transcript of Performensation Articles 201201-201206
MUSINGS ON COMPENSATION AND PERFORMANCE
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JUNE 19, 2012
JUNE 5, 2012
MAY 21, 2012
MAY 8, 2012
Execu&ve Compensa&on Contradic&on: Differen&ate…But Don’t Innovate?A recent ar=cle in London’s, The Telegraph “Overhaul the role of pay advisers, urges Lord Myners”, pushes for more accountability on the part of the advice provided by execu=ve compensa=on and remunera=on consulta=ons. At issue are recent pay packages that met with shareholder ire, including those at Barclays and Cookson Group.At both companies, CEOs had large compensa=on packages approved by their MORE...
Compensa&on Archery: Aim for the Middle and Adjust as Required?Archery is an interes=ng sport. Great archers hit the center of the target nearly every shot. For those of you who have never shot a bow and arrow, you might be surprised that to hit the target you have to aim somewhere else. Some=mes you must adjust for the wind. Other =mes you must adjust for al=tude. Even on the calmest days at sea level you need to aim higher than the target, just to account for gravity.A key aspect of archery is that you perform in solitary manner. You stand s=ll, MORE...
Like The Auto Industry, Compensa&on Must Create More HybridsI read a recent ar=cle that discussed the annual Rotman Design Challenge. The compe==on pits teams from Design and MBA programs to determine the value of design methods in business problem solving. This got me to thinking about the eternal compensa=on debate of program design, versus business strategy (vs. communica=on.) The argument is whether design is more or less important than understanding the “business data” and whether both of these are trumped byMORE...
What Are Shareholders Really Saying on Pay? “Danny, if I have to tell you one more 4me to stop jumping on the bed, you are going to get it!”
The warning is not enough and Danny jumps on the bed again.“Danny, next 4me you jump on the bed I’m taking away your allowance.”
Shareholders have become much like lenient, but frustrated parents.This is how investors seem to be using Say on Pay (SOP). When you look at their SOP MORE...
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JANUARY-‐JUNE 2012
MUSINGS ON COMPENSATION AND PERFORMANCE
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APRIL 26, 2012
APRIL 4, 2012
MARCH 22, 2012
MARCH 12, 2012
Great Compensa&on Pros are Like Swimmers not RunnersI recently had a medical issue that put me out of commission for a few weeks. Although this gave me some =me to reflect and catch up with friends and colleagues, it also made me realize that, like nearly everyone reading this ar=cle, I really didn’t have the =me to put my work on hold. That is when I realized that being compensa=on professional is ocen like being an open ocean swimmer.Last year a friend came out to visit San Francisco so her 12 year-‐old could par=cipateMORE...
5 Best Prac&ces for Driving Condi&ons and Compensa&on ProgramsSimilar to when we are driving, compensa=on professionals must be acutely aware of the condi=ons around us when we want to implement change. When the weather is nice and the roads are dry, we can speed to our des=na=on with confidence that our vehicles will predictably go where directed. When it gets a bit wet, we take a bit more care and slow down. It may take a liele longer, but we know we will reach our des=na=on. The real trick is gefng someplace when the roads are icy.MORE...
The Top 4 Risks in Pay for PerformancePay for Performance, ("P4P" for us cool compensa=on pros) is all the rage. Those of you who read my pos=ngs regularly know that I’m a big proponent of performance-‐based compensa=on, in its many forms. Despite being a big supporter, or perhaps because of it, I think its important to discuss the major risks involved with these programs. (If you deal with this issue frequently, you might want to skip to #4.)1. Incorrect MetricsMORE...
Execu&ve Compensa&on: The Poli&cal-‐Taxa&on ConspiracyWe hear the cries every day. “Execu=ves make too much money. Let’s raise their taxes!” “Execu=ves are our job creators. Let’s cut their taxes!” Perhaps key members of both sides of this argument are keeping the focus on compensa=on levels to deflect from where taxes and poli=cal contribu=ons come from. Are there underlying reasons for poli=cians to avoid strong support for performance-‐based compensa=on?In this elec=on season, we are all aware that the large contributors to poli=cal racesMORE...
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JANUARY-‐JUNE 2012
MUSINGS ON COMPENSATION AND PERFORMANCE
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FEBRUARY 29, 2012
FEBRUARY 13, 2012
FEBRUARY 1, 2012
JANUARY 23, 2012
Follow the Leader is Dangerous, but So is Being the LeaderAs children, we play Follow the Leader with the goal of fifng in. In this game, kids will do whatever the person in front of them does. I have actually seen kids fall down, just because the person in front of them tripped and fell. As adults, we learn that to be a leader, you must worry less about fifng in and more about doing what is right for a given situa=on.As compensa=on professionals, we are constantly asked to build a balance betweenMORE...
Is it Time to Change the Equity Compensa&on Paradigm?Even with the explosion in performance-‐based equity, most equity compensa=on plans look very much like they did almost twenty years ago. Stock op=ons, restricted stock unit and employee stock purchase plans would be familiar to a =me-‐traveler from 1995. The biggest differences are in the size of the payouts and that many par=cipants receive equity as an addi=on to base and bonus pay, instead of as a replacement for some of it. The similari=es now and then are almost too numerous MORE...
Where in the World is Carmen San Diego’s Equity Compensa&on?Some of you may remember the video game and game show “Where in the World is Carmen San Diego” (WITWICS.) It was very popular more than a decade ago. The goal of the game was to find the villain, Carmen San Diego, based solely on key facts about different loca=ons around the world. The players had to know the specific country differences that made it possible to iden=fy each unique loca=on and capture Carmen. Compensa=on around the world is as unique in size, design and structure asMORE...
Don’t Tell Me I’m Great If I’m Not!I have both friends and clients who have been struck by an unfortunate dilemma. I have a couple of friends who have been told one thing for months, and perhaps years, only to find out that the truth they knew wasn’t the “real” truth. I have clients who need to realign pay for people who have been told they were top performers when, in fact, they are less than adequate. In both cases it seems more like senior managers were trying to be nice, rather than sneaky.MORE...
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JANUARY-‐JUNE 2012
MUSINGS ON COMPENSATION AND PERFORMANCE
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JANUARY 13, 2012
JANUARY 4, 2012
Execu&ve Compensa&on and the Great Wizard of OzExecu=ve compensa=on holds as much mystery and magic as the Great Wizard of the Emerald City. Of course, if the curtain were to be pulled back, the real magic would be found in how a lack of informa=on, combined with fear and imagina=on, have colored the pay of all execu=ves with the same brush. Remember that when Dorothy and Toto met the wizard he was just as unhappy and scared as they were.I find it amusing and frustra=ng that there is so much misinforma=on about execu=ve MORE...
Are Your Performance Reviews like an Annual Physical?I don’t know anyone who looks forward to their annual physical. There is very liele about the process that exudes posi=vity. Nearly all of us know that we could have eaten beeer, exercised more or paid beeer aeen=on to our health. Even those in the best of health dread the thought that this might be the year that something “serious” may be found. The poten=al “big-‐=cket” items overwhelm the progress that may have occurred at other points in the year. The process can also a bit too personal, MORE...
COMPENSATION CAFE
COMPENSATION CAFE
JANUARY-‐JUNE 2012
Dan Walter is the President and CEO of Performensa=on an independent compensa=on consul=ng firm focused on the needs of private and public companies. Dan’s unique perspec=ve and exper=se includes equity compensa=on, execu=ve compensa=on, performance-‐based pay and talent management issues, Dan is on the board of the Na=onal Center for Employee Ownership, a partner in the ShareComp virtual conferences and the founder of Equity Compensa=on Experts a free networking group. Dan is frequently requested as a dynamic and humorous speaker covering compensa=on and mo=va=on topics. Connect with Dan on LinkedIn or follow him on Quora or Twieer @performensa=on.
Publica=ons include: “The Decision Makers Guide to Equity Compensa=on”, “If I’d Only Know That”, “GEOnomics 2011”, “Equity Alterna=ves” and “Communica=on: The Key to Winning the Rela=ve TSR Race”.
All ar&cles authored by: Dan Walter, President and CEOPerformensa&on Consul&ng, LLC
514 Precita Ave, Suite 100, San Francisco, CA, 94110 415.625.3406 (direct/mobile) | Toll-‐free 877-‐803-‐9255, ext 700 | 415.821.9883 (fax)
dwalter@performensa&on.com | www.performensa&on.comwww.compensa&oncafe.com | www.linkedin.com/in/danwalter
©2012 Performensa=on Consul=ng LLC. All Rights Reserved