Client Issue: Creating a Long Term Incentive Scheme
Context: Our client is a mid sized business with a number of key management staff they wish to retain over the long term.
The Issue: The current incentive schemes do not provide “Golden Handcuffs” or any form of Long Term Incentive for these Managers to stay.
Our Challenge: The business owner was considering providing equity in the business to key members of the management team. Our challenge was to help the business owner understand the risks associated with this approach. Specifically, the lack of flexibility moving forward, if in the future, these key managers are no longer the best people for the business.
The Solution: Talent Code worked with our client to design a fully flexible long-term profit sharing scheme that met the key objectives of:
- locking in key managers for the long term,
- connecting the scheme to both annual performance and the attainment of long term objectives,
- providing flexibility to move Managers on and off the scheme on an annual basis and;
- creating a sense of ownership by Managers.