2. Incentive Plans
Rainbow group

3. ‘’Rainbow group Members’’
NAME ID
Md. Anishul Islam Shamim
Mahabubul Alam
Akidul Islam
Md. Rabul Hossin
Avishek Chakraborty
Rahul Das
Md. Rahim Uddin
Addul Maleq
Md. Giasuddin
Rafiqul Alam

4. Name: md anishul islam shamim ID NO: MBA 01205865

5. Merit pay: Merit pay's roots lie in behavioural psychology and incentive theory. These theories are based in the belief that people are rational and react to incentives and that you can increase performance with the correct catalyst. One example of a system that uses merit-pay is the Teacher Advancement Program (TAP) created by the Milken Family Foundation in TAP is currently in place in more than 180 schools all across the United states.

6. Merit Guidelines Guidelines for awarding merit raises that are tied to performance objectives
Here a example

7. Merit Pay Guidelines Chart
QUINTILE (POSITION IN RANGE),%
PERFORMANCE LEVEL
Outstanding (5)
Superior (4)
Competent (3)
Needs improvement (2)
Unsatisfactory (1)
MERIT PAY GUIDE CHART

8. Name: md. Rabiul Hossain ID NO: MBA 01205873

9. Problems with Merit Raises
Inadequate funding for merit increases.
Vagueness in how to define and measure performance.
Employees not believing that merit compensation is tied to effort and performance
Allowing organizational politics to influence merit pay decisions.
Failing to differentiate between merit pay and other types of pay increases.
Mistrust between management and employees.
An “overall” merit pay plan that does not motivate.

10. Name: Avishek Chakraborty ID NO: MBA 012058910

11. What Is Motivation ?
Motivation is a psychological and human aspect. It is the act of inspiring employees, peoples to devote maximum effort to achieve organizational objectives and goals. Motivation is defined as the process that initiates, guides and maintains goal oriented behaviors. It involves the biological, emotional, social and cognitive forces that activate behavior.

12. Why Motivation Is Important?
This can summarize by saying that motivation is important both to an individual and a business. Motivation is important to an individual as:
Motivation will help him achieve his personal goals.
If an individual is motivated, he will have job satisfaction.
Motivation will help in self-development of individual.
An individual would always gain by working with a dynamic team.

13. Motivation Through Merit Raises
Develop employee confidence and trust in performance appraisal.
Establish job-related performance criteria.
Separate merit pay from regular pay.
Distinguish merit payment when performance declines.
Withhold merit payments when performance declines.

14. Name: Akidul Islam ID NO: MBA 01205874

15. Sales Incentive plan
Straight salary :- salesperson compensation method in which only a fixed salary (but not commission) in paid. The amount received by a salesperson in a function of time worked and not of performance as reflected in sales volume.

16. This method is used where -
The firm is aiming at long term presence in the market instead of short term sales volume.
2. The firm is aiming at through formalization of a new market or Geographic area.
3. The performance of each salesperson is difficult to measure.

17. Straight commission plan :- Salesperson compensation method in which only a percentage of the sales volume, but no fixed salary in paid. The amount received by a salesperson in a function of his or her performance (and not of actual time worked) reflected in sales volume.

18. This method is used where the objective is to
1. Generate maximum short term sales revenue at the lowest overhead cost.
2. To employee independent sales representative instead of permanent sales staff. see also straight salary plan.

19. Name: md. rahim uddin ID NO: MBA 01205889

20. Incentive Plans for Salespersons:
Straight Salary Plan:
Compensation plan that permits salespeople to be paid for performing various duties that are not reflected immediately in their sales volume.
Encourages building customer relationships.
Provides compensation during periods of poor sales.
May not provide sufficient motivation for maximizing sales volume.

21. Straight Commission Plan
Compensation plan based upon a percentage of sales.
Disadvantages
Emphasis is on sales volume rather than on profits.
Customer service after the sale is neglected.
Earnings tend to fluctuate widely between good and poor periods of business.
Temptation to grant price concessions to get sales.

22. Combined Salary and Commission Plan
A compensation plan that includes a straight salary and a commission component (“leverage”).
Advantages
1. Combines the advantages of straight salary and straight commission forms of compensation.
2. Offers greater design flexibility to develop the most favorable ratio of selling expense to sales.
3. Motivates sales force to achieve specific company marketing objectives in addition to sales volume.

23. Name: Rahul das ID NO: MBA 01205888

24. Types of Long-Term Incentive Plans
Stock Price Appreciation Plans
Stock Options
Stock Appreciation Rights (SARS)
Stock Purchase
Phantom Stock

25. Performance-Based Plans
Types of Long-Term Incentive Plans
Performance-Based Plans
Performance Units
Performance Shares
Formula-value Grants
Dividend Units
Restricted Stock/Cash Plans
Restricted Stock
Restricted Cash

26. Name: Giash uddin ID NO: MBA 01205911

27. Types of Long-Term Incentive Plans

28. Types of Long-Term Incentive Plans:

29. Types of Long-Term Incentive Plans

30. Name: Md. Rafiqul alam ID NO: MBA 01205856

31. Incentives for Professional Employees
Incentive plans are meant to incent employees to perform, not all plans achieve what they were set out to accomplish. That’s why it is important to analyze the advantages and disadvantages of various incentive plan components to determine the plan that will promote the highest levels of performance while at the same time, encourage ethical behavior. This is especially true for salespeople and managers/executives because they work with customers and are responsible for achieving company earnings targets.

32. Managerial and Executive Incentives
Bonuses and merit increases
Double-track wage systems
Performance incentive bonuses
Profit sharing and stock ownership
Executive perquisites (perks)

33. Name: abdul maleq ID NO: MBA 01205886

34. Executive compensation
The Executive Pay Package
Base salary
Short-term incentives or bonuses
Long-term incentives or stock plans
Perquisites (perks)

35. Executive compensation
Executive compensation is a broad term for the financial compensation awarded to a firm’s executives. Executive compensation packages by a company’s board of directors specially by the compensation committee consisting of independent directors.

36. Executives Pay Package
Executive pay package differ substantially from typical salaried or hourly employee compensation because unlike typical employee pay.

37. Short term incentives
The purpose of short term incentives, which are typicalls anural incentives is to compensate executive for achieving the company’s business strategy. Annual objective can be include.
Development of new products.
Increasing revenue or market share.
Expanding to a new market.
Improving profit margin.

38. Long term incentive
Long term incentive plan is a reward system designed to improve employees long term for performance by providing reward that was not be tied to the company’s share price.

39. Perquisites
Executive perquisites constitute additional compensation for senior executives which are not available to other salaried employees. These extra benefit are normally structured to recognize the value of the executive of the company, extra ordinary demands on his or her time and other unique condition.

40. Name: mahabubul alam ID NO: MBA 01205863

41. LUMP –SUM MERIT PAY
Lump-sum: A single payment of an amount rather than several payments of smaller amounts. The money can be paid to the winner in a lump sum or in yearly payments. Merit pay: Merit pay also known as pay for performance. This usually involves the employer conducting a review meeting with the employee to discuss the employee’s work performance during a certain time period.

42. Lump-sum merit program: Program under which employer’s receive a year end merit payment. This is not added to their base pay.
Advantage:
Provide financial control by maintaining annual salary expenses and not escalating base salary levels.
Contains employee benefits costs for levels of benefits normally calculated from current salary levels.
Provide a clear link between pay and performance.