Long and short-term incentive plans affect all types of organizations from publicly traded to private to non-profit and government. It's a tool used to to both attract and retain top talent. The following survey data incorporates feedback from various business types to show trends in how each handles their incentive pay practices.
As organizations compete for top talent, incentive and bonus plans can be a critical aspect of an organization’s compensation and total rewards offerings. Incentive programs may target specific employee groups and business goals. At the same time, they also may need to be structured to allow organizations to be cost-effective and flexible, depending on their financial situation. In the recent economic and regulatory climate, many organizations have been regularly evaluating their incentive program design, for example bonus target setting and performance criteria. Understanding competitive incentive pay practices can help shape decisions on effective design aspects.
Government organizations rely on retirement plans as a long-term component of compensation, as do nonprofits to a lesser degree.
Cash continues to dominate the incentive pay landscape at private for profit companies in the United States, according to the most recent survey of private-company incentive compensation plans.
The survey — which is unique in its focus on private companies — is now in its fourth iteration, with prior surveys conducted in 2007, 2011 and 2013. The 2015 results are very consistent with prior-year results, with some long-term trends emerging and some themes unique to this iteration.
