Payroll represents a significant expense for most Los Angeles and Southern California businesses. Given this, it’s somewhat surprising how few owners and executives look at compensation from a strategic point of view.
Instead, most business owners simply try to determine what the going salary or wage is in their area for a particular job function or title. Then, they base their compensation on this, either matching it or offering a little more or a little less, depending on their philosophy when it comes to employee compensation. A similar lack of strategic thinking also usually goes into structuring employee bonuses.
…poses a series of four questions, the answers to which help determine the structure of bonus plans. Included is a “what if” scenario for structuring a tiered employee bonus plan tied to customer retention. Also reviewed are five recommendations that contribute to an optimized bonus plan structure.
One of the biggest benefits of bonus plans is that they can help encourage your employees to think and act like business owners, not just employees. A CFO services professional – either as an interim CFO, a part-time CFO, or a one-time project-based CFO – can help you structure a bonus and compensation plan that is aligned with your company’s objectives and provide the necessary incentives for your employees to act in your company’s best interests.