Incentive Plans That Drive Accountability
Upcoming SlideShare
Loading in...5

Incentive Plans That Drive Accountability



Presentation given by Warren Dietel, President/Owner of Puff 'n Stuff Catering & Events, at The Special Event conference on January 25, 2011.

Presentation given by Warren Dietel, President/Owner of Puff 'n Stuff Catering & Events, at The Special Event conference on January 25, 2011.



Total Views
Views on SlideShare
Embed Views



0 Embeds 0

No embeds



Upload Details

Uploaded via as Microsoft PowerPoint

Usage Rights

© All Rights Reserved

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
Post Comment
Edit your comment
  • Old infrastructure barely accommodated 1.8 million in sales (pull up old puff floor plan – need to find)Inefficient space and poor equipment Progress energy debacle Close off dates
  • *format link
  • Move higher in the flow
  • Add’l for sales
  • Define “where can I be successful?” creates protection for existing, and opportunity for newcomers
  • Theme different department slides – bground colors

Incentive Plans That Drive Accountability Incentive Plans That Drive Accountability Presentation Transcript

  • Incentive Plans That Drive AccountabilityPresented by: Warren Dietel
  • About the Speaker
    Family business began in Trinidad as pastry shop
    Entrepreneurial from the start
    Professional Experience
    Car Detailing, Puff ‘n Stuff Catering, Disney Weddings, Disney Institute, Scott Kay, back Home!
    Industry Involvement
    ICA Board Member, Regular Speaker for Catersource, The Special Event, and NACE
    What drives me
  • The Puff Story
    Opened in Central Florida in 1980 as a family-owned business
    Purchased in 2003, annual sales of $1.8 million, at operational limit
    Antiquated infrastructure with inefficient space & poor equipment
    Tremendous potential + aggressive growth plan = 267% growth in 3 years
  • It’s all about People & Culture
    40+ Full-Time Team Members and 200+ On-Call
    Diversified business segments and multiple markets
    “When employees think, act and feel like owners… everybody wins.” - Jack Stack
  • Build a culture of employee engagement
    Acknowledgment of individual contributions
    Trained leadership delivers supportive feedback
    Collaborative working relationships
    Empowerment that promotes success
    Expectations that set clear challenging and attainable performance goals
    Show you/the company cares
    Trust and get out of the way
    Before We Get to Carrots and Sticks
  • Inspiration
  • The Principles of The Great Game of Business
    Every Employee…
    Should be given the measures of business success and taught to understand them.
    Know and Teach the Rules
    Should be expected and enabled to act on their knowledge to improve performance.
    Follow the Action & Keep Score
    Should have a direct stake in the company’s success, risk or failure.
    Provide a Stake in the Outcome
  • Open Book Management
    Running a company in a way that focuses everyone on helping the business be successful. 
    Employee goals and accountabilities are tied directly to the success of the company.  
    All employees are taught the Critical Numbers and how THEY can make a difference – both individually and as part of a team.
  • Additional Inspiration
  • Building a Case for Incentive Plans
    • Why do them?
    • What motivates employees?
    • Money
    • Performance pay
    • Recognition/Appreciation
    • Placing value on the behaviors driving company objectives
    • Incentive programs are usually viewed as positive
    • Accountability can be a negative
    • Balance of both is critical
    The role of a good manager/leader is to guide employees to work on what is most important in the most efficient manner.
  • How to do it ... EFFECTIVELY?
    • Clear expectations – upfront
    • Make it measurable
    • Make sure it is right the first time – difficult to change
    • Review by labor consultant/attorney
    • Easy to calculate
    • Campion to manage the process
    • Begin with the end in mind – what is your desired result?
    Wouldn’t it be great if everyone in your organization had a real stake in the outcome and understood how they were individually impacted by company success?
  • KISS
    Keep it simple and special (KISS)
    Good plans = easy to implement and follow
    Be clear about what incentives are and how employees can earn them
    Plans that require tracking performance indicators that are too detailed waste management's time and confuse employees
  • What Not to Do!
    • Programs structure is targeted too broadly/ not focused on individual people or teams
    • “All for one” style programs
    • Unmotivating
    • Enttitlements
    • Causes productive employees to resent poor performers
    • Provide clear understanding of links between effort and incentive compensation
    • Motivate each department or individual to focus on things they can control
    • Encourage behaviors that create successful results
  • Incentive Plans Discussed Today:
    • Sales Incentive Plan
    • Event Supervisor Incentive Plan
    • Department Manager Incentive Plan
    • Employee of the Month
    Catch employees doing something right and make sure
    everyone in the company sees that management recognizes it.
  • Sales Commission Plan
    Special Event Planners will be assigned annual goals based on market, prior experience, and company needs
    SEPs are assigned to specific vertical markets and venues
    Opportunity to sell outside a defined market is available through relationships
    Commission paid at 8.5% of gross monthly sales
    Non-profitable sales will not be eligible for commission (30% margin required)
    Plan accommodates 2 to 1 administrative support ratio at current sales goals
    Poor performance is addressed from a disciplinary point of view
    Lead rotation/generation will have set parameters
    Vacation and Leave of Absence guidelines
  • Annual Bonus Opportunities
    Additional 5% over annual individual goal bonus paid on excess
    Additional 5% over annual team goal bonus paid pro rata on excess
  • Lead Generation
    Define where individuals can be successful
    Creates protection for existing SEPS
    Creates opportunity for newcomers
    Inbound calls, leads and inquiries “filtered”
    Filtered by market and routed to sales person/event planner
    Relationship is EVERYTHING!
    Outbound marketing encouraged
    Within 24 hours, next SEP in rotation responsible for acknowledging/ accepting the lead, no matter how large or small the scope of work associated with the event
    Dispute resolution
  • Commission Reports
  • Event Supervisor Plan
    Drive behavior through opportunity to earn beyond hourly wage
    Event labor charges must be profitable for opportunity
    Earning opportunity based on desired behavior:
    Staff Profitability
    Customer feedback – survey
    Condition of returned equipment
    Condition of vehicle
    Creativity & execution
    Mystery shopping
    Balanced scorecards are reviewed by direct manager and behavior is graded
  • Calculating the Incentive
    Reviewed weekly by Director of Catering Operations
    Events scheduled to 45% budget
    Labor variance report generated by manager
    30% of positive variance becomes eligible for SIP
    An Example:
    Staffing sold at $1,000
    Budget at 45% or $450
    Actual labor cost of $400 or 40%
    Budget $450 – savings of $50 multiplied by 30% =
    $15 into Supervisor opportunity.
  • Earning the Incentive – Driving Behavior
  • Management Incentive Plan - MIP
    The MIP incentive target is determined as a percentage of base salary
    Management participation in the plan will be at one of three levels:
    25% - Senior Department Leaders & Managers
    20% - Mid-Level Department Managers
    15% - Area Supervisors and Key Leads
    MIP is based upon company annual/monthly revenue targets
  • Management Incentive Plan - MIP
    MIP revenue targets will be calculated based on the following schedule:
    Level 1 = Flat/below 2010 revenue = 25% payout opportunity
    Level 2 = 60% of 2011’s revenue objectives to goal = 50% payout opportunity
    Level 3 = 90% of 2011’s revenue objectives to goal = 75% payout opportunity
    Level 4 = 100%+ of 2011’s revenue objective =100% payout opportunity
    For example:
    Manager salary $50,000
    Mid-level Manager at the 20% salary incentive opportunity or $10,000 maximum incentive
    Company achieves 100% revenue goal - 20% of salary – eligible for $10,000 incentive
    - OR -
    Company achieves 90% revenue goal – 75% of $10,000 opportunity – eligible for $7,500 incentive
  • Earning the Incentive – Driving Behavior
    Individual performance is measured monthly
    Incentive will be paid annually using the goal classification and percentage payout outlined below
  • Employee of the Month
    Peer driven and controlled
    Added to website
    Announced monthly in front of peers
    Dedicated parking space with name
    $100 gift certificate to local restaurant group
  • Final Thoughts
    Employee incentive programs are a very powerful concept when employees can understand and see the connection between their performance and their rewards.
  • “When you give a little respect you get a more effective organization, with reduced turnover and absenteeism and employees at all levels who are engaged, focused, and committed to succeed as a team. In short, you get maximum ROI from your organization’s most powerful resource: its people!”
    Paul Marciano, Ph.D.
  • Thank You!
    Warren G. Dietel | | 407.398.6306