Maximize the Effectiveness of Short-Term Incentive Plans

Focus on leveraging a STIP to drive behavior and results, rather than just a necessary cost to running the organization.

Onsite Workshop

STIPs that do not have a tangible impact on the organization and are not aligned with organizational objectives often:

  • Motivate significant spend with a lack of return.
  • Risk becoming viewed as an entitlement rather than an earned reward.
  • Reward employees who do not meet expectations, discouraging desired behavior.
  • Result in significant spend with a lack of return.
  • Risk becoming viewed as an entitlement rather than an earned reward.
  • Confuse rather than drive intended behaviors.

An optimized STIP:

  • Identifies and controls for behavioral risks.
  • Rewards and retains top talent.
  • Clarifies expectations, behaviors, and resulting payouts.

Module 1: Assess the Current Organizational State and STIP

The Purpose

  • Identify the needs of the organization to tailor and optimize the STIP.

Key Benefits Achieved

  • Current state of STIP evaluated. Key objectives and behaviors identified to align the STIP with organizational goals.

Activities: Outputs:
1.1 Assess current state.
  • Assessed current state.
1.2 Evaluate current STIP (optional).
  • Uncovered current STIP pain points.
1.3 Determine organizational objectives that the STIP will support.
  • Decided on key organizational objectives the STIP will support.

Module 2: Define STIP Structure and Eligibility

The Purpose

Design a STIP that is customized to the organization.

Key Benefits Achieved

A focused STIP that drives employee behavior and results.

Activities: Outputs:
2.1 Identify STIP structure.
  • Built STIP structure that is appropriate for the structure of the organization.
2.2 Determine STIP participation.
  • Identified STIP participants.
2.3 Select performance measures.
  • Performance measures selected in alignment with the STIP structure.

Module 3: Plan to Design and Implement the STIP

The Purpose

  • Evaluate risk posed by STIP design.
  • Plan STIP training, communication, and implementation process.

Key Benefits Achieved

  • Incorporate risk mitigation into the STIP.
  • An implementation plan for the STIP that addresses potential risks.

Activities: Outputs:
3.1 Examine potential risk associated with each performance measure.
  • Mitigated potential program risks.
3.2 Identify how to gather data.
  • Determined data sourcing methods and owners.
3.3 Plan to design and implement the STIP.
  • Planned STIP implementation activities.

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Onsite Workshops offer an easy way to accelerate your project. If you are unable to do the project yourself, and a Guided Implementation isn’t enough, we offer low-cost onsite delivery of our Project Workshops. We take you through every phase of your project and ensure that you have a road map in place to complete your project successfully.

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VL Methodology