can any 1 help me out how to draft a variable pay plan for a particluar level. i am a gmgt trainne nd my boss has asked to me draft a variable pay plan and i have no clues how to start it out nd whts the process.and boss has givenme just 1 weeks time.. plzz help me out...

From India, Mumbai
can any one help on out on what performance parameters of the sbu are considered for getting the giving out bonus..
The performance measure of SBU will be as under:
Sl. No. Factors Max. Score Actual Score
1 OTIF 25
2 Sales of Product 35
3 Net Cash Generation 40
its like at the senior manager level the variable pay distribution will be 30% for sbu performance and 70% for individual performance=100%and the amt fixed for variable pay would be 50000 then a person getting a rating of 105% would get 2% increase for every additional increase i.i.e
%age achievement %age payable as Variable Pay
against the budget
>100% 2% additional increase for each %age rise in excess of 100%
100% 100%
95 – 99% 50% + 7.5% additional increase for each %age rise in excess of 95%
so what i want is The performance measure of SBU
QUALIFYING CHART of various companies, so that i can make a comparative analysis of the parameters...
i need the data urgently can you plz help me out

From India, Mumbai
Hi Nisha,
The process as you have described was being followed in my previous organization. We use to term it as APIC and had a defined policy & guideline for calculation of payment of APIC. It was applicable to top management people only, but I fear I can not forward it to you as it is a confidential document of the company.
The question you have asked is relating to performance measure of SBU. I believe you have answered your question in your post itself. SBU performance can only be measured from its predecided target and its achievement (certainly in terms of revenue). I may be able to help you more if you could give me few more insight on your requirement (if your query is not resolved from above explanation).

From India, Hyderabad
thanks anup
well i dunt want any confidential documents (like the numbers or as such) i just want the performance criteria of sbu(apart from revenue).also i am looking at senior manager nd above level.can u just tell me the calculations i.e the performance pay matrix(thats not confidential)..
let me know

From India, Mumbai
Apart from revenue, following could be performance criteria for SBU:
1. C-Sat index
2. New Business opportunity creation
3. Achievement of Quality Goals & Objectives
I am attaching you the computation sheet just for your idea. I hope it may help you.

From India, Hyderabad

Attached Files
File Type: xls variable_pay_calculation_864.xls (240.5 KB, 3239 views)

can you please help me out how will u calculate the individual performance rating factor!..plz explain ...and whts the eva int eh chart..can u explain me?
From India, Mumbai

For Individual Performance rating, we have defined following rating scale:

Rating System

1.0 Results do not meet the stated expectations & no efforts made towards its improvement

1.5 Results do not meet the stated expectations & inconsistent efforts made towards its improvement

2.0 Results do not meet stated expectations despite consistent efforts

2.5 Results do meet some but not all stated expectations

3.0 Results meet all the stated expectations

3.5 Results meet all & exceed some of the stated expectations

4.0 Results exceed all the stated expectations & are exceptional & unique

If you see this rating scale, you will find that rating 3.0 is meeting all expectation. Hence it will be presumed as 100% performance. Hence, to calculate individual performance rating, you have to divide the employee final rating (as per KPA sheet) by 3 to get desired performance rating. Pls refer document again to view KPA structure.

EVA is economic value addition to organization. It is important to check whether organization has actually added any value to its portfolio during the year or not. There is difference in target achievement and economy value achievement. It is decided by the management on EVA rating by looking at balance sheet & company growth in the financial year. For example, if company has achieved all it's targets economically, EVA could be 1. It can also be calculated as per rating scale.



From India, Hyderabad
hi anoop thanks for the info on variable pay.am fresher joined in new company we are establishing hr dept previously it was nt there.i would like to know abt variable pay.is variable pay given monthly or during appraisal of employees.how to cal for marketing excutives.what is sbu .eva.m unable to understand pls help me.can u pls fwd details to my mail id
Thanking you

From India, Hyderabad
Please let me know what components /parameters consists of vairable pay
From India, Gurgaon

If you are knowledgeable about any fact, resource or experience related to this topic - please add your views using the reply box below. For articles and copyrighted material please only cite the original source link. Each contribution will make this page a resource useful for everyone.

Please Login To Add Reply

About Us Advertise Contact Us
Privacy Policy Disclaimer Terms Of Service

All rights reserved @ 2021 Cite.Co™

All Material Copyright And Trademarks Posted Held By Respective Owners.
Panel Selection For Threads Are Automated - Members Notified Via CiteMailer Server