Feb 21, 2011

PREPARING FOR GROWTH | Reward Policies for New, Start-up and High-growth Organizations


Whatever the basic components of the reward system in a 'start-up' they should be developed with an eye to appropriateness in a larger organization. Particular attention will be needed in these areas:
  • Pensions: schemes for small partnerships/groups of professionals or the self-employed will not easily adapt to cover 140 to 200 employees after three years. Professional advice will be needed to achieve this.
  • Pay relativities: starting on a 'spot salary' basis is logical, but internal relativities should always be defensible as the organization grows.
  • Executive share options/employee share schemes: should be capable of extension - again an area for good professional advice.
  • Performance rewards: need to relate to the milestones in the business plan and be based on achievement of agreed objectives/performance standards. Chief executive-driven discretionary bonuses are typically suspect unless the boss really is in the 'tough but fair' (or preferably just the fair) category.


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