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Hey Ann, this helped alot. Can you give an example of how this would play out in a discussion with the employee? How would you tie it to a performance and pay discussion?


In presenting this kind of performance-award schedule to employees, I don't typically spend time explaining the concept of leverage (which is really a design concept). I think what employees care most about (and so would I, standing in the shoes of a plan participant), is what has to happen in order for me to earn the different levels of award. And then, how am I/are we going to make that happen?

I don't get questions about or sense a lot of interest in plan design issues like leverage. And I tend to think it's because - at least at a fundamental level - the leverage in a plan is self-evident and doesn't require a lot of explanation.

That's my take, anyway. Thanks for the follow-up question.

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About The Author

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    Compensation consultant Ann Bares is the Managing Partner of Altura Consulting Group. Ann has more than 20 years of experience consulting with organizations in the areas of compensation and performance management.

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