Bailouts, Boondoggles & Bonuses: Getting Our Signals Straight for a Productive Discussion

There's a whole lot of discussion - mostly heated - going on these days about executive bonuses, incentive awards, business meetings and travel, etc., particularly in light of the economic crisis and government bailouts.

To many of us involved or even just observing, these discussions can be very frustrating because of the wide range of topics that are being lumped together and collectively derided as "excessive compensation".  Jumbling together a number of distinct business tactics and different economic scenarios isn't helping us have a constructive conversation on any of them.

So what will?

Here to help us sort the signals from the noise is Paul Hebert of Incentive Intelligence, who has a guest post on this subject up over at The Employee Factor.

From Paul's post:

It is easy to lump executives traveling on corporate jets to far-off resorts for “planning meetings” to the incentive travel earned by employees or independent distribution channels. It’s easy but wrong. We need to make sure that we understand what we’re discussing before we jump in guns-a-blazin’ and start taking pot shots at all travel. So for “discussion’s” sake, let’s at least frame the argument this way…

There are four buckets of discussion:
1. Executive bonuses, salary, stock options, etc.
2. Executive travel – corporate jets, retreats, brainstorming and planning meetings
3. Business Meetings – for employees and channel partners to exchange information, train, etc.
4. Incentive Awards – predominately travel, but could include other non-cash awards.

We need to argue the relative merits of each one – and how they affect both bailed out companies and non-bailed out companies. We cannot lump them together as they are distinct and different things.

From here, Paul proceeds to build a framework for more fruitful discussion.  He also generously shares a set of slides he developed in order to help all of us put a stake in the ground as we work to determine how best to use incentives in our current economic situation.

 

Clarifying The Discussion

View more presentations from Paul Hebert. (tags: bailout compensation)

Comments

[E James (Jim) Brennan]

Paul's slide show is quick, straightforward and well stated. Nice job, in parsing out and addressing the different topics.

For an alternative overview of "good excuses" for high executive compensation, Google the phrase "unreasonable compensation" and view the ancient (but still applicable) short article that comes up first.