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Solutions for IMM
Byte-Sized Consulting (Team 2)
Lacey Chambers
Tyler Cummings
Alexandra Brand
Katya Kantorski
1
Problem
Employees do not feel as though they are
being compensated based on the
monetary success of the company over
the past 2 years.
2
Symptoms and Causes
• High company turnover rate.
• Large pay difference between IMM and
competitors.
• Semiconductor industry is being taken over by
other alternatives.
• 30-40 positions must be filled by the end of the
year.
• Employees are afraid to tell CEO why they are
leaving.
3
Solution 1 – Employee Stock
Option
• Non-qualified Stock Option and Incentive
Stock Option
• Offered to all employees (NSO)
• Employees receive stock at 15% discount
from market rate
• All levels of company (with primary focus
on assemblers and engineers)
• Current employees will receive a stock
grant and cash bonus
4
5
Solution 2 – Technology Conferences
6
Two Opportunities...
Winter Conference:
Consumer Electronics Show
January 8-11, 2019
Las Vegas, NV
Summer Conference:
SEMICON West
July 9-11, 2019
San Francisco, CA
1)
2)
1) Wikipedia
2) Salland.com
Who Goes?
• Top 5 performers between July and December
(Winter Conference)
• Top 5 performers between January and June
(Summer Conference)
– CEO attends both conferences.
– Can only attend 1 event every 3 years.
– Employees that go must be paired with an employee who needs
to improve when they return.
• Chosen employees get a raise in addition to
going on the trip!
7
CES Convention...
• Convention with a focus on consumer
technologies (info about semiconductor
competitors: blockchain, IoT, etc...)
• Deluxe Conference Pass
– Activities listed in Handout #2
• $1,400 per person (increases to $1,500 on December 17th)
• $8,400 (5 employees + Amanda)
– Jan 8-11
• Jan 12 = day to explore Vegas
• Jan 7 and 13 = travel days
– All Hotels, airfare, passes, and tours paid for by IMM
• Tours/Activities
– Helicopter Tour of the Las Vegas Strip
– ARIA casino
1)
1) Wikipedia
8
SEMICON West...
• Conference specifically aimed at
Semiconductor industry.
• "All-In" Passes
– Activities included listed on Handout #1
– $750 per person
– Convention runs from July 9-11, 2019
• July 8 and 12 = days to explore San Francisco
• July 7 and 13 = travel days
• Hotel, Airfare, Passes, and Tours all paid for by IMM!
– Activities Paid For:
• Alcatraz Day Tour
• Levi Stadium Tour
• UberXL to and from the Golden Gate Bridge
1)
1) Salland.com
9
Employee Raises
• Chosen employees will also get pay raises
for their hard work.
• You MATTER to IMM
10
Engineers $ 12,000.00
Office/Legal Staff
(administrative workers) $ 11,000.00
Assemblers $ 10,000.00
Job Type Approximate Amount
Recommendation
Total Cost
to Solve the
Problem.
Time
Frame to
Solve the
Problem.
How well
will it solve
the
problem?
How easy
will it be to
implement?
Risk
Level.
#1 $1,800,000 Within
several
weeks
• Financial
incentive
• Investment
in company
• Motivation
Relatively
easy, not
too many
steps to
implement
Moderate/
low risk as
long as
stock
keeps
increasing
#2
$133,000 One Week
• Motivation
• Reward
• Financial
Incentive
Very Easy Moderate
Risk
11
Stock
Options
Technology
Conventions
Implementation
Steps
• Top 5 will be chosen by Amanda after her one-on-one
with each employee.
• Top 5 will be contacted and asked if they would like to
attend the conference.
• Buy conference passes.
• Purchase plane tickets.
• Book hotel rooms.
• Pair top 5 with up-and-coming employees with promise
in order to share information from the convention.
12
Implementation Costs
(Solution 2)
13
SEMICON West
Expenses Costs
Passes for Conference (6 passes) $ 4,500.00
Hotel (6 Nights) $ 5,160.00
Airfare (6 people) $ 2,484.00
Alcatraz Day Tour (6 passes) $ 231.00
UberXL (visiting Golden Gate Bridge) $ 84.00
Levi Stadium Tour (6 tickets) $ 150.00
Raises (2 Engineers, 2 Assemblers,
1 Office/Legal Staff) $ 55,000.00
Total Expenses $ 67,609.00
Expenses Cost
Passes for Conference (6 passes) $ 8,400.00
Hotel (5 nights) $ 1,095.00
Airfare (6 people) $ 392.00
Helicopter Tour (6 passes) $ 474.00
Casino $ -
Raises(2 Engineers, 2 Assemblers, 1
Office/Legal Staff) $ 55,000.00
Total Expenses $ 65,361.00
CES
Outcomes
• They will get paid more.
– Pay raise will motivate them to stay on board with
the company.
– Getting paid consistently more because of the raise.
• They will have more knowledge about their job
and the Semiconductor industry.
• Be more motivated.
• Whole company will benefit by sharing
knowledge.
14
Thank you!
Byte-Sized Consulting: Team 2
Lacey Chambers- lchambers@su.suffolk.edu
Tyler Cummings- tcummings@su.suffolk.edu
Alexandra Brand- abrand2@su.suffolk.edu
Katya Kantorski- kkantorski@su.suffolk.edu
15
References
16
Alcatraz Cruises. (2018). Choose a Ticket (Alcatraz Cruises). Retrieved October 20, 2018, from
https://store.alcatrazcruises.com/ChooseTicket.aspx?referrer=SearchEventDaySpan.aspx?&&date=10/18/2018&qty=6&q
ty=6&id=3547&date=10-19-2018&time=9:30 am
(n.d.). Retrieved October 20, 2018, from https://www.kayak.com/flights/BOS-LAS/2019-01-07/2019-01-
13/6adults?fs=flexdepart&sort=bestflight_a
Conference Program. (n.d.). Retrieved October 20, 2018, from https://www.ces.tech/Conference/Conference-Program.aspx
Employee Stock Option (ESO). (2017, December 5). Retrieved October 17, 2018, from https://
www.investopedia.com/university/employee-stock-options-eso/#ixzz5UCiiZY1x
Glassdoor.com. (2016, September 6). Intel Corporation Attorney Salaries. Retrieved October 20, 2018, from
https://www.glassdoor.com/Salary/Intel-Corporation-Attorney-Salaries-E1519_D_KO18,26.htm
GlassDoor.com. (2016, September 6). NVIDIA Corporate Counsel Salary. Retrieved October 20, 2018, from
https://www.glassdoor.com/Salary/NVIDIA-Corporate-Counsel-Salaries-E7633_D_KO7,24.htm
Harroch, R. (2016, February 27). How Employee Stock Options Work in Startup Companies. Retrieved October 17, 2018, from
https://www.forbes.com/sites/allbusiness/2016/02/27/how-employee-stock-options-work-in-startup-
companies/#3958efea6633
Indeed. (2018, October 18). Intel. Retrieved October 20, 2018, from https://www.indeed.com/cmp/Intel/salaries
Indeed. (2018, October 15). Intel. Retrieved October 20, 2018, from https://www.indeed.com/salaries/Manufacturing-Technician-
Salaries-at-Intel
Indeed. (2018). NVIDIA. Retrieved October 20, 2018, from https://www.indeed.com/salaries/Hardware-Engineer-Salaries-at-Nvidia
Intel Salaries in the United States. (2018, October 18). Retrieved from https://www.indeed.com/cmp/Intel/salaries
Kayak.com. (2018, October 20). BOS to SFO, 7/7-7/13. Retrieved October 20, 2018, from https://www.kayak.com/flights/BOS-
SFO/2019-07-07/2019-07-13/6adults?fs=stops&sort=bestflight_a
Kruze, V. (2018). How Much Does a 409A Valuation Cost? Retrieved October 17, 2018, from
https://kruzeconsulting.com/kruze_qna/question/409a-valuation-cost/
References (continued)
•Las Vegas Night Flight Helicopter Tour. (n.d.). Retrieved October 20, 2018, from https://www.canyontours.com/las-vegas-night-
flight-helicopter-tour/
• Levi's Stadium. (2018, February 15). Public Stadium Tours Now On Sale. Retrieved October 20, 2018, from
http://www.levisstadium.com/2014/07/public-stadium-tours-now-sale/
• Logo Makr. (2018). Retrieved October 20, 2018, from https://logomakr.com/1Zmm22
• Murray, J. (2018, May 7). The Tax Implications of Paying Bonuses to Employees. Retrieved October 17, 2018, from
https://www.thebalancesmb.com/giving-employee-bonuses-know-the-tax-implications-397631
•Nvidia Salaries in the United States. (2018, October 3). Retrieved October 18, 2018, from
https://www.indeed.com/cmp/Nvidia/salaries
• Paul, J. (2018, August 24). Do I Really Need an Expensive 409A Valuation Report to Tell Me That My Startup is Worth
Nothing? Retrieved OctobeUber. (2018). Uber fare estimator. Retrieved October 20, 2018,
from https://www.uber.com/fare-estimate/
• r 17, 2018, from https://www.capshare.com/blog/do-i-really -need-an-expensive-409a-valuation-report-to-tell-me-my-t hat-
startup-is-worth-nothing/
•Registration Information. (n.d.). Retrieved October 20, 2018, from https://www.ces.tech/Logistics/Registration-Information.aspx
• Salary.com. (2017). INTEL CORP Executive Salaries & Other Compensation. Retrieved October 20, 2018, from
https://www1.salary.com/INTEL-CORP-Executive-Salaries.html
• Salary.com. (2018). NVIDIA CORP Executive Salaries & Other Compensation. Retrieved October 20, 2018, from
https://www1.salary.com/NVIDIA-CORP-Executive-Salaries.html
• Salland Engineering. (2018). SEMICON WEST 2018. Retrieved October 20, 2018, from
https://www.salland.com/event/semicon-west-2018/
• SEMI. (1970, March 16). Pricing. Retrieved October 20, 2018, from http://www.semiconwest.org/pricing
• SEMI. (1970, July 13). Agenda At A Glance. Retrieved October 20, 2018, from http://www.semiconwest.org/agenda-glance
• SEMI. (1970, October 01). Events. Retrieved October 20, 2018, from http://www.semi.org/en/events
• SEMI. (2018). Hotel Information. Retrieved October 20, 2018, from
https://www5.cmrhousing.com/semiconwest2018/GP/WEB/Housing/HotelInfo/CMSF
• Wikipedia. (2018, September 08). Consumer Electronics Show. Retrieved October 20, 2018, from
https://en.wikipedia.org/wiki/Consumer_Electronics_Show
•W., R., & R. (2018, February 08). CIRCUS CIRCUS HOTEL CASINO & THEME PARK. Retrieved October 20, 2018,
from https://www.hotelplanner.com/Hotel/HotelRoomTypes.cfm?hotelID=118583&inDate=01/07/19&outDate=01/13
/19&NumRooms=6#HotelName
17
Strengths vs Weaknesses
1. Employee Benefits (flexible
schedule, dental and health
benefits, retirement benefits)
2. Company consistently exceeds
profit estimates
3. Implemented innovative social
and environmental initiative
4. Positive culture and
atmosphere
5. Well liked CEO who checks in
with employees often, good
relationships within company
1. Employees do not feel they
can approach CEO Amanda
Zhou
2. With the increased employee
turnover rate, costs becoming
extremely expensive
3. Need to replace 30-40
positions as well as replace
those that left
4. The company hasn’t done
enough to reward and motivate
the dedicated employees
5. Not hiring and keeping as
many employees on as they
have in past years
18
Opportunities vs Threats
1. Company was founded by 3
MIT alumni and the CEO is an
MIT alumni so they could form
a strong connection with MIT
and grant those students
internships which could lead
to full time jobs
2. Implementation of a complete
employee rewards system
3. Development of new computer
chip which seems promising
4. When IMM attends industry
events, people want to go and
talk to the CEO and learn more
about the company
1. Other competitors can pay
employees more than IMM
2. Intel will cover tuition for an
MBA
3. Intel and Nvidia are hiring
IMM’s employees, and are
working on different and
innovative projects
4. Concerns that semiconductor
sales will decrease in the
future due to other
technologies taking over
5. Innovative chip may not make
it to market on time
19
ESO Implementation
• 409A Valuation
• Shareholder Approval
• Board of Directors Approval
• Administration of ESO will be responsibility
of Board of Directors
20
Outcomes for ESOs
• Mutually beneficial for both IMM and
employees
• Employees stand to benefit financially
based upon stock performance which is
directly correlated to their work
performance
21
NVIDIA Shares
Outstanding
IMM Shares Outstanding
Estimate Value of Stock ($18)
608,000,000 12,160,000 $218,880,000
NVIDIA Total Sales 2018 IMM Total Sales 2018 Shares To Match Bonus
$3,000,000,000 $60,000,000 1,000,000
Shares Needed:
Executives 6,100
Engineers 87,200
Office and Legal 3,700
Assemblers 5,000
22
Increase in Pay Difference
Between IMM and NVIDIA/Intel
Year Executives Engineers
Office and
Legal Staff
Assemblers
2014 0 to -5% -5% to -7% -5% to -7% -5% to -7%
2015 0 to -5% -5% to -8% -5% to -7% -5% to -7%
2016 0 to -5% -10% to -12% -5% to -7% -10%
2017 0 to -5% -10% to -13% -5% to -7% -10%
YTD 0 to -5% -13% to -20% -5% to -7% -10%
23
24
Intel
Salaries
NVIDIA
Salarie
s
IMM
Salaries
Bonus
Amount
5% Total Cost
Bonus
Amount
10% Total Cost
Director $230,000.00
Senior
Manager
$209,000.00 Executives $209,000.00 $10,000.00 $110,000.00 $110,000.00
Component
Engineer
$120,000.00
Hardware
Engineer
$145,000.00 Engineers $106,000.00 $5,000.00 $740,000.00 $10,600.00 $1,569,000.00
Business
Analyst
$66,000.00
Financial
Analyst
$123,000.00
Office and
Legal
$88,000.00 $4,000.00 $66,000.00 $66,000.00
Manufacturing
Tech
$57,000.00
Store
Keeper
$57,000.00 Assemblers $51,000.00 $3,000.00 $90,000.00 $90,000.00
Source:
Indeed.com
$1,000,000.00 $1,800,000.00
25

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IMM Case Study

  • 1. Solutions for IMM Byte-Sized Consulting (Team 2) Lacey Chambers Tyler Cummings Alexandra Brand Katya Kantorski 1
  • 2. Problem Employees do not feel as though they are being compensated based on the monetary success of the company over the past 2 years. 2
  • 3. Symptoms and Causes • High company turnover rate. • Large pay difference between IMM and competitors. • Semiconductor industry is being taken over by other alternatives. • 30-40 positions must be filled by the end of the year. • Employees are afraid to tell CEO why they are leaving. 3
  • 4. Solution 1 – Employee Stock Option • Non-qualified Stock Option and Incentive Stock Option • Offered to all employees (NSO) • Employees receive stock at 15% discount from market rate • All levels of company (with primary focus on assemblers and engineers) • Current employees will receive a stock grant and cash bonus 4
  • 5. 5
  • 6. Solution 2 – Technology Conferences 6 Two Opportunities... Winter Conference: Consumer Electronics Show January 8-11, 2019 Las Vegas, NV Summer Conference: SEMICON West July 9-11, 2019 San Francisco, CA 1) 2) 1) Wikipedia 2) Salland.com
  • 7. Who Goes? • Top 5 performers between July and December (Winter Conference) • Top 5 performers between January and June (Summer Conference) – CEO attends both conferences. – Can only attend 1 event every 3 years. – Employees that go must be paired with an employee who needs to improve when they return. • Chosen employees get a raise in addition to going on the trip! 7
  • 8. CES Convention... • Convention with a focus on consumer technologies (info about semiconductor competitors: blockchain, IoT, etc...) • Deluxe Conference Pass – Activities listed in Handout #2 • $1,400 per person (increases to $1,500 on December 17th) • $8,400 (5 employees + Amanda) – Jan 8-11 • Jan 12 = day to explore Vegas • Jan 7 and 13 = travel days – All Hotels, airfare, passes, and tours paid for by IMM • Tours/Activities – Helicopter Tour of the Las Vegas Strip – ARIA casino 1) 1) Wikipedia 8
  • 9. SEMICON West... • Conference specifically aimed at Semiconductor industry. • "All-In" Passes – Activities included listed on Handout #1 – $750 per person – Convention runs from July 9-11, 2019 • July 8 and 12 = days to explore San Francisco • July 7 and 13 = travel days • Hotel, Airfare, Passes, and Tours all paid for by IMM! – Activities Paid For: • Alcatraz Day Tour • Levi Stadium Tour • UberXL to and from the Golden Gate Bridge 1) 1) Salland.com 9
  • 10. Employee Raises • Chosen employees will also get pay raises for their hard work. • You MATTER to IMM 10 Engineers $ 12,000.00 Office/Legal Staff (administrative workers) $ 11,000.00 Assemblers $ 10,000.00 Job Type Approximate Amount
  • 11. Recommendation Total Cost to Solve the Problem. Time Frame to Solve the Problem. How well will it solve the problem? How easy will it be to implement? Risk Level. #1 $1,800,000 Within several weeks • Financial incentive • Investment in company • Motivation Relatively easy, not too many steps to implement Moderate/ low risk as long as stock keeps increasing #2 $133,000 One Week • Motivation • Reward • Financial Incentive Very Easy Moderate Risk 11 Stock Options Technology Conventions
  • 12. Implementation Steps • Top 5 will be chosen by Amanda after her one-on-one with each employee. • Top 5 will be contacted and asked if they would like to attend the conference. • Buy conference passes. • Purchase plane tickets. • Book hotel rooms. • Pair top 5 with up-and-coming employees with promise in order to share information from the convention. 12
  • 13. Implementation Costs (Solution 2) 13 SEMICON West Expenses Costs Passes for Conference (6 passes) $ 4,500.00 Hotel (6 Nights) $ 5,160.00 Airfare (6 people) $ 2,484.00 Alcatraz Day Tour (6 passes) $ 231.00 UberXL (visiting Golden Gate Bridge) $ 84.00 Levi Stadium Tour (6 tickets) $ 150.00 Raises (2 Engineers, 2 Assemblers, 1 Office/Legal Staff) $ 55,000.00 Total Expenses $ 67,609.00 Expenses Cost Passes for Conference (6 passes) $ 8,400.00 Hotel (5 nights) $ 1,095.00 Airfare (6 people) $ 392.00 Helicopter Tour (6 passes) $ 474.00 Casino $ - Raises(2 Engineers, 2 Assemblers, 1 Office/Legal Staff) $ 55,000.00 Total Expenses $ 65,361.00 CES
  • 14. Outcomes • They will get paid more. – Pay raise will motivate them to stay on board with the company. – Getting paid consistently more because of the raise. • They will have more knowledge about their job and the Semiconductor industry. • Be more motivated. • Whole company will benefit by sharing knowledge. 14
  • 15. Thank you! Byte-Sized Consulting: Team 2 Lacey Chambers- lchambers@su.suffolk.edu Tyler Cummings- tcummings@su.suffolk.edu Alexandra Brand- abrand2@su.suffolk.edu Katya Kantorski- kkantorski@su.suffolk.edu 15
  • 16. References 16 Alcatraz Cruises. (2018). Choose a Ticket (Alcatraz Cruises). Retrieved October 20, 2018, from https://store.alcatrazcruises.com/ChooseTicket.aspx?referrer=SearchEventDaySpan.aspx?&&date=10/18/2018&qty=6&q ty=6&id=3547&date=10-19-2018&time=9:30 am (n.d.). Retrieved October 20, 2018, from https://www.kayak.com/flights/BOS-LAS/2019-01-07/2019-01- 13/6adults?fs=flexdepart&sort=bestflight_a Conference Program. (n.d.). Retrieved October 20, 2018, from https://www.ces.tech/Conference/Conference-Program.aspx Employee Stock Option (ESO). (2017, December 5). Retrieved October 17, 2018, from https:// www.investopedia.com/university/employee-stock-options-eso/#ixzz5UCiiZY1x Glassdoor.com. (2016, September 6). Intel Corporation Attorney Salaries. Retrieved October 20, 2018, from https://www.glassdoor.com/Salary/Intel-Corporation-Attorney-Salaries-E1519_D_KO18,26.htm GlassDoor.com. (2016, September 6). NVIDIA Corporate Counsel Salary. Retrieved October 20, 2018, from https://www.glassdoor.com/Salary/NVIDIA-Corporate-Counsel-Salaries-E7633_D_KO7,24.htm Harroch, R. (2016, February 27). How Employee Stock Options Work in Startup Companies. Retrieved October 17, 2018, from https://www.forbes.com/sites/allbusiness/2016/02/27/how-employee-stock-options-work-in-startup- companies/#3958efea6633 Indeed. (2018, October 18). Intel. Retrieved October 20, 2018, from https://www.indeed.com/cmp/Intel/salaries Indeed. (2018, October 15). Intel. Retrieved October 20, 2018, from https://www.indeed.com/salaries/Manufacturing-Technician- Salaries-at-Intel Indeed. (2018). NVIDIA. Retrieved October 20, 2018, from https://www.indeed.com/salaries/Hardware-Engineer-Salaries-at-Nvidia Intel Salaries in the United States. (2018, October 18). Retrieved from https://www.indeed.com/cmp/Intel/salaries Kayak.com. (2018, October 20). BOS to SFO, 7/7-7/13. Retrieved October 20, 2018, from https://www.kayak.com/flights/BOS- SFO/2019-07-07/2019-07-13/6adults?fs=stops&sort=bestflight_a Kruze, V. (2018). How Much Does a 409A Valuation Cost? Retrieved October 17, 2018, from https://kruzeconsulting.com/kruze_qna/question/409a-valuation-cost/
  • 17. References (continued) •Las Vegas Night Flight Helicopter Tour. (n.d.). Retrieved October 20, 2018, from https://www.canyontours.com/las-vegas-night- flight-helicopter-tour/ • Levi's Stadium. (2018, February 15). Public Stadium Tours Now On Sale. Retrieved October 20, 2018, from http://www.levisstadium.com/2014/07/public-stadium-tours-now-sale/ • Logo Makr. (2018). Retrieved October 20, 2018, from https://logomakr.com/1Zmm22 • Murray, J. (2018, May 7). The Tax Implications of Paying Bonuses to Employees. Retrieved October 17, 2018, from https://www.thebalancesmb.com/giving-employee-bonuses-know-the-tax-implications-397631 •Nvidia Salaries in the United States. (2018, October 3). Retrieved October 18, 2018, from https://www.indeed.com/cmp/Nvidia/salaries • Paul, J. (2018, August 24). Do I Really Need an Expensive 409A Valuation Report to Tell Me That My Startup is Worth Nothing? Retrieved OctobeUber. (2018). Uber fare estimator. Retrieved October 20, 2018, from https://www.uber.com/fare-estimate/ • r 17, 2018, from https://www.capshare.com/blog/do-i-really -need-an-expensive-409a-valuation-report-to-tell-me-my-t hat- startup-is-worth-nothing/ •Registration Information. (n.d.). Retrieved October 20, 2018, from https://www.ces.tech/Logistics/Registration-Information.aspx • Salary.com. (2017). INTEL CORP Executive Salaries & Other Compensation. Retrieved October 20, 2018, from https://www1.salary.com/INTEL-CORP-Executive-Salaries.html • Salary.com. (2018). NVIDIA CORP Executive Salaries & Other Compensation. Retrieved October 20, 2018, from https://www1.salary.com/NVIDIA-CORP-Executive-Salaries.html • Salland Engineering. (2018). SEMICON WEST 2018. Retrieved October 20, 2018, from https://www.salland.com/event/semicon-west-2018/ • SEMI. (1970, March 16). Pricing. Retrieved October 20, 2018, from http://www.semiconwest.org/pricing • SEMI. (1970, July 13). Agenda At A Glance. Retrieved October 20, 2018, from http://www.semiconwest.org/agenda-glance • SEMI. (1970, October 01). Events. Retrieved October 20, 2018, from http://www.semi.org/en/events • SEMI. (2018). Hotel Information. Retrieved October 20, 2018, from https://www5.cmrhousing.com/semiconwest2018/GP/WEB/Housing/HotelInfo/CMSF • Wikipedia. (2018, September 08). Consumer Electronics Show. Retrieved October 20, 2018, from https://en.wikipedia.org/wiki/Consumer_Electronics_Show •W., R., & R. (2018, February 08). CIRCUS CIRCUS HOTEL CASINO & THEME PARK. Retrieved October 20, 2018, from https://www.hotelplanner.com/Hotel/HotelRoomTypes.cfm?hotelID=118583&inDate=01/07/19&outDate=01/13 /19&NumRooms=6#HotelName 17
  • 18. Strengths vs Weaknesses 1. Employee Benefits (flexible schedule, dental and health benefits, retirement benefits) 2. Company consistently exceeds profit estimates 3. Implemented innovative social and environmental initiative 4. Positive culture and atmosphere 5. Well liked CEO who checks in with employees often, good relationships within company 1. Employees do not feel they can approach CEO Amanda Zhou 2. With the increased employee turnover rate, costs becoming extremely expensive 3. Need to replace 30-40 positions as well as replace those that left 4. The company hasn’t done enough to reward and motivate the dedicated employees 5. Not hiring and keeping as many employees on as they have in past years 18
  • 19. Opportunities vs Threats 1. Company was founded by 3 MIT alumni and the CEO is an MIT alumni so they could form a strong connection with MIT and grant those students internships which could lead to full time jobs 2. Implementation of a complete employee rewards system 3. Development of new computer chip which seems promising 4. When IMM attends industry events, people want to go and talk to the CEO and learn more about the company 1. Other competitors can pay employees more than IMM 2. Intel will cover tuition for an MBA 3. Intel and Nvidia are hiring IMM’s employees, and are working on different and innovative projects 4. Concerns that semiconductor sales will decrease in the future due to other technologies taking over 5. Innovative chip may not make it to market on time 19
  • 20. ESO Implementation • 409A Valuation • Shareholder Approval • Board of Directors Approval • Administration of ESO will be responsibility of Board of Directors 20
  • 21. Outcomes for ESOs • Mutually beneficial for both IMM and employees • Employees stand to benefit financially based upon stock performance which is directly correlated to their work performance 21
  • 22. NVIDIA Shares Outstanding IMM Shares Outstanding Estimate Value of Stock ($18) 608,000,000 12,160,000 $218,880,000 NVIDIA Total Sales 2018 IMM Total Sales 2018 Shares To Match Bonus $3,000,000,000 $60,000,000 1,000,000 Shares Needed: Executives 6,100 Engineers 87,200 Office and Legal 3,700 Assemblers 5,000 22
  • 23. Increase in Pay Difference Between IMM and NVIDIA/Intel Year Executives Engineers Office and Legal Staff Assemblers 2014 0 to -5% -5% to -7% -5% to -7% -5% to -7% 2015 0 to -5% -5% to -8% -5% to -7% -5% to -7% 2016 0 to -5% -10% to -12% -5% to -7% -10% 2017 0 to -5% -10% to -13% -5% to -7% -10% YTD 0 to -5% -13% to -20% -5% to -7% -10% 23
  • 24. 24
  • 25. Intel Salaries NVIDIA Salarie s IMM Salaries Bonus Amount 5% Total Cost Bonus Amount 10% Total Cost Director $230,000.00 Senior Manager $209,000.00 Executives $209,000.00 $10,000.00 $110,000.00 $110,000.00 Component Engineer $120,000.00 Hardware Engineer $145,000.00 Engineers $106,000.00 $5,000.00 $740,000.00 $10,600.00 $1,569,000.00 Business Analyst $66,000.00 Financial Analyst $123,000.00 Office and Legal $88,000.00 $4,000.00 $66,000.00 $66,000.00 Manufacturing Tech $57,000.00 Store Keeper $57,000.00 Assemblers $51,000.00 $3,000.00 $90,000.00 $90,000.00 Source: Indeed.com $1,000,000.00 $1,800,000.00 25