Imagine you are CEO of the bank critically review the proposal of

HR manager and comment whether this proposed incentive plan

would really ensure motivation and increased retention.

The HR manager have prepared the new incentive plan as their

current performance appraisal plan was critically evaluated. As
per that variable pay component in executive compensation in
India to almost 50% from 20-30%. And that too without linking to
company performance alone. It is linked to companys
performance and individual performance.

The benchmark annual salary data in comparable private sector

in the country for marketing executives is of Rs. 6Lakhs while
organization pays today pays 6.25 Lakhs also the calculated
annual cost is 20%.

Also the survey carried out by HR department indicate that 30%

of marketing employees feel they are underpaid 50% of
employees feel they are getting competitive benchmark salary
and remaining 20% feel that they are getting more than market
rate.

As per new plan an incentive bonus will be payable to marketing

executives based on performance reduction in marketing sales
ratio comparing base period and assessment period.

The HR manager believes the following plan will not ensure

optimization of compensation of marketing executives but foster
teamwork.