how to create barcode in vb.net 2010 THE ROLE OF COMPENSATION in Software

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THE ROLE OF COMPENSATION
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A company s compensation program, along with its benefits package, retirement plan, and performance-management system, are the
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CHAPTER NINE Building Healthy Employee-Employer Contracts
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tools used to define and execute its contract with employees. Each component delivers something of value in exchange for some service, action, or result. Companies should be as explicit as possible about what each component delivers and what is expected in return in other words what are we paying and what are we paying for As Figure 9-2 illustrates the basic components of an employeeemployer contract are defined by compensation and benefit programs. Clearly there are other elements of the contract, and it is beyond the scope of this book to define all aspects of the employeeemployer relationship. The point is that the contract is multifaceted and complex, and stock options or other equity incentives are only one component.
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The Lesson of the Stock Option
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What we ve seen and experienced in the technology and dot-com revolution is the spread of company ownership, albeit through the questionable means of the stock option. The cynical person may dismiss that as only an employee appeasement since executives received the bulk of the options (with some estimates as high as 60 to 80 percent of all the options granted in some broad-based, company-wide plans). Employees were only given a token amount of options, the cynic says, to feel as if they had a piece of the action and to justify the executives getting even more options. The idealist, however, says something has fundamentally changed. Companies have, indeed, recognized the value of the individual employee beyond just a paycheck and the occasional incentive. By offering an ownership stake, companies have made employees a part of the organization. These are two distinct sides of the argument. The question now is should standards for executive compensation apply to mid- and lower-level employees as well The answer is: it depends on the philosophy of the organization. In other words if the purpose of the organization is only to make money or maximize shareholder wealth, then employees are just a means to that end. However if part of the purpose of the organization is to foster the growth, development, welfare, and wealth of the human element of the business transaction, then terms and conditions need to be established for those employees. That may include, over time,
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Types of Compensation
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Type of Compensation Salary Specific Form Fixed amount in equal bimonthly payments; in cash. Subject to annual review and possible increase. Annual, variable payment in cash based on individual, team, and company performance. What Is Provided Challenging work. Clear expectations. Promotional opportunities. Secure, regular, predictable income. Additional increases based on merit and COLA. Variable, lump-sum payments to supplement income, possibly significantly. What Is Expected Performance of basic responsibilities. Growth in skills and competencies. Basic adherence to company culture and norms. Achievement of specific goals, objectives, and results. Contributing above and beyond basic duties to overall company success. Loyalty and commitment. Content, secure workers. Healthy employees. Loyalty and commitment. Long-term retention. Long-term commitment. Long-term focus on performance. Holding company s best interests. Adding value to the company. Continued growth and development, according to career path, of skills and behaviors valued by the company.
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Annual Incentive
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Benefits
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Health-care insurance, vacation, holidays, sick days, etc. Pension Plan or 401(k) plan or profit-sharing plan. Stock options, restricted stock, or other cash-based incentive.
Security for provision of needed health care. Lifestyle maintenance. Peace of mind. Ability to retire. Ease of savings accumulation. Funding for major expense or retirement. Long-term capital accumulation. Retirement enhancement funding. Funding major expenses. Building investment portfolio.
Retirement Plan
Long-Term Incentive
Performance Appraisal/ Management
Annual or semiannual performance Valuable and useful feedback, reviews, feedback, coaching, coaching, development, and training. and training. Promotion opportunities.
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