Performensation, founded by Dan Walter, specializes in equity compensation design and administration, offering strategic solutions for both private and public companies. The document outlines key concepts and scheduling strategies for effective compensation planning over various time frames, emphasizing the importance of structured workflow and stakeholder engagement. The company also highlights the significance of tailored communication and program design to align with organizational goals.

1. “Someone is sitting in the
shade today because
someone planted a tree a
long time ago.”
― Warren Buffett
©2013 Performensation 1

2. 3,2,1, Compensation!
A Countdown to Annual Planning
Dan Walter, CEP
Sam Reeve, CCP, GRP

3. DAN WALTER
Performensation was founded by Dan Walter, CEP as a response to
regular requests for better expertise in the area of Equity
Compensation Design and Administration. Dan has more than a
decade of experience in the industry. His work includes both
executive and broad-based programs. He has provided end-to-end
solutions for private and public companies both within the United
States and abroad.
Dan has worked extensively in both the Silicon Valley and New York.
His work with young entrepreneurial companies and established
Fortune 100 companies provides his clients with an unique
DAN WALTER, CEP perspective on compensation issues. His focus is on effective, and at
President and CEO times innovative, company-specific solutions. He also provides post-
TF 1 877 803 9255 ext 700 consultation support to help ensure programs are working as
Office 1 415 625 3406
Mobile 1 917 734 4649
designed.
dwalter@performensation.com Dan is also a highly sought after speaker on a broad range of topics.
Skype: Performensation He is board member for the National Center for Employee Ownership
Twitter: Performensation and the Institute for Human Resources, an award winning member of
the National Association of Stock Plan Professionals and an active
member of World at Work, Global Equity Organization and the Society
for Certified Equity Professionals.

4. SAM REEVE
Sam Reeve is a global certified compensation consultant
(CCP, GRP) with 15 years of experience in Total Reward
Strategies. He is an expert in broad-based compensation
and focuses his talents on enhancing performance through
the effective use of incentive and recognition programs.
Prior to joining the firm, Sam has worked in the corporate
compensation functions of notable firms such as
SAM REEVE, CCP, GRP BlackRock, McKesson and Automatic Data Processing
Executive Vice President (ADP).
TF 1 877 803 9255 ext 702
Office 1 415 625 3088 Sam currently lives in Colorado and aside from his
Mobile 1 970 403 5775 professional life, enjoys numerous outdoor activities with
sreeve@performensation.com his 4 children and wife, Jessica.
Skype: SamReeve
Twitter: @SamReeve3 Sam has a degree in Finance and Economics from California
State University, Sacramento.

5. Key Concepts
• Compensation Planning is about far more than your annual increase percentage
and executive compensation updates
• When should you train yourself? When should you train your staff and
stakeholders?
• You can structure performance appraisals to be more effective with less work
• Variable pay planning requires data analysis and an understanding of business
strategy and goals that starts long before you start talking about dollars a cents
• Smooth out your work flow through efficient scheduling to reduce spikes in work
• Use “slow times” to advance your cause. You can only gain ground when the
avalanche chasing you is at its slowest
• Seasonal vs. Calendar Schedules. Using off-cycle planning to help reduce overlap,
overwork and errors

6. Combination
Code
to
Compensation
Planning
Top Down
and
Bottom Up
Planning
5D-4W-3M-2Q-1Y
©2013 Performensation 6

7. Compensation Planning is all about the numbers
1 Year: Planning for Annual Events
2 Quarters: Process Reviews, Major Projects
3 Months: 10Qs, Performance Reviews etc.
4 Weeks: Monthly closes, Commission Cycles etc.
5 Days: Weekly processes, checks and balances
6 Hours: Maximum amount of scheduled time in a day
©2013 Performensation 7

8. 1 Year =
245 work days (including 3 weeks of vacation)
11,205 work hours (45 hr/week)
25,757 emails (avg*)
*Source: Email Statistics Report 2011-2015, The Radaciti Group
©2013 Performensation 8

9. 1 Year
Typical Annual Compensation Committee Schedule
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Fiscal
Executive and CEO Market Pay Year
Analysis End
Compensation Education
& Trends • Review market trends in pay,
short & long-term grants
• Update to remain in line
with continuing • Prepare and review tally sheets
educational requirements for a full view of executive total
rewards
Plan Review
Incentive Payments
• Test effectiveness against Year-End Preparation
• Calculate and deliver actual company strategy
prior year short & long-term • Set goals/targets for next year’s short &
award payments • Review pay and long-term awards
performance linkage
• Evaluate CEO performance
• Prepare preliminary current year
incentive calculations
Implementation Support Issue Support
• Answer feature questions and • Availability during non-
provide guidance during standard events
implementation with service
provider • Support regarding questions
on plan features
©2013 Performensation 9

10. 1 Year
Comp Committee Vs Comp Department
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Fiscal
Executive and CEO Market Pay Year
Analysis
Pay Competitive End
Compensation Education
Market Benchmarking Assessment
& Trends • Review market trends in
• Update•to remain inparticipant
Review benchmark job
matches and
line
• short & long-term grants
pay,Review market
data
with continuing
in surveys • Prepare and review tally sheets
educational requirements •Identify market
for a full view of executive total
rewards
pay concerns
Plan Review
Incentive Payments
Communicate Sales • Test effectiveness against Year-End Preparation
Plans Calculate and deliver actual
• company strategy
• Set goals/targets for next year’s short &
• Calculate and deliver short & long-term
prior year
• Review pay and Year End Performance
long-term awards
actual prior year short & payments
award
performance linkage Reviews
long-term award • Evaluate CEO performance
payments Mid Year Performance
Reviews • Prepare preliminary current year
incentive calculations
• Check in with team on status
of annual objectives
Implementation Support
Goal and Objective Setting Issue Support
• Answer feature questions and
• Company goals cascaded to • Availability during non-
standard events Pay for Performance
provide guidance during
departments
implementation with service
• Support regarding questions • Determine Merit, Market and Incentive
•Comp Tem goal setting to
provider pay decisions
align to the company goals on plan features
©2013 Performensation 10

11. 1 Year
Typical Annual Compensation Department Schedule
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Fiscal
Year
Pay Competitive End
Market Benchmarking Assessment
•Review benchmark job • Review market
matches and participant data
in surveys
•Identify market
pay concerns
Communicate Sales
Plans
• Calculate and deliver Year End Performance
actual prior year short & Reviews
long-term award
payments Mid Year Performance
Reviews
• Check in with team on status
of annual objectives
Goal and Objective Setting
• Company goals cascaded to Pay for Performance
departments
• Determine Merit, Market and Incentive
•Comp Tem goal setting to pay decisions
align to the company goals
©2013 Performensation 11

12. One Year - Planning for Annual Events
Factors that are common to all planning are centered around
resources and expectation setting.
Resources include:
• People on your comp team
• Resources from other departments
• Software and external services
• and of course, time and money
Expectation Setting includes:
• What you expect from your Team Members
• What your Team Members can expect from the Year
"Execution is the ability to mesh strategy with reality, align people
with goals, and achieve the promised results."
— Larry Bossidy
©2013 Performensation 12

13. It takes 6
months to
build a Rolls
Royce and 13
hours to build
a Toyota.
Source: UberFacts
©2013 Performensation 13

14. 2 Quarters What should be done every 6 months?
Sep Oct Nov Dec Jan Feb Mar
Job Analysis | Survey Analysis | Merit Increases | Reporting | Filings
Mar Apr May Jun Jul Aug Sep
Training | Process Review | Stakeholder Meetings | New Plan Design
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15. Two Quarters - Planning for 6 Month Cycles
Thinking Strategically – Planning to Plan …every 6 months
1st Strategic Planning Session
Best time…early in the year
Objective:
• Review Overall Company Goals and Realign Comp Team
Objectives
• Revisit successes and failures of the last cycle
2nd Strategic Planning Session
Best time…second half of the year during your slowest month
Objective:
• Long Term Planning – at least a year and a half ahead
• Revisit successes and failures of the last cycle
• Prepare for the year end process
©2013 Performensation 15

16. The S&P 500 has projected it
will have cumulative
QUARTERLY earnings of $6.42
Billon
(as of 1/24/2013 )
Source: Standard and Poors
©2013 Performensation 16

17. Performance
Stakeholder
Metric
3 Months Reviews
Tracking
STI Goals 10Q
Bonus
Reconciliation
Approval
Review Plan Review Comp
Effectiveness Committee Charter
Financial
Communications
Reporting
Quarterly Considerations
©2013 Performensation 17

18. Three Months - Planning by Quarter
Public Firms
Public companies are driven by financial performance and
shareholder disclosure
Private companies are driven by internal metrics and projects
Week 1
Answer questions about last quarter and clean up
Weeks 2 - 3
Finalize plans for all deliverables this quarter
Weeks 4 – 7
Focus on internal Compensation Department deliverables
Weeks 8 – 10
Focus on deliverables with and for stakeholders
Weeks 11 and 12
Finalize results and reporting
Gather quarterly performance numbers for STI and Commissions
©2013 Performensation 18

19. Phases of the moon
There are between 28 and 31 days in a
month, but only 8 Oreo cookies in this picture
Source: http://www.stevespanglerscience.com/experiment/using-oreo-cookies-to-learn-about-the-phases-of-the-moon
©2013 Performensation 19

20. 4 Weeks Monthly processes are the shortest segment of time that allow preplanning
Monthly closes, Commission Cycles etc.
T O O
B U S Y
P R I M E T I M E
T O O
B U S Y
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21. Four Weeks - Planning by Month
Months and quarters are related…
The first and last week of the month are often the busiest
When planning cross functional meetings consider their
business cycle
• Deadlines often loom at the end of each month
• Critical reports are often generated the first week of each
month
Schedule important cross functional meetings in the middle
Leverage the 2nd and 3rd week for the greatest productivity
• Strategic and creative thinking occur when people are
engaged in the discussion
• Meeting participants are more engaged when they are free
from other stresses in their work duties
©2013 Performensation 21

22. Nearly half (48 percent) of executives
surveyed recently said employees hit peak
performance on Tuesdays. Not
surprisingly, Fridays were viewed as the least
productive day of the week.
*Source: AccountTemps 2012
©2013 Performensation 22

23. 5 Days (not 7) in a work week. How can you optimize this time?
(#1: no more Monday meetings)
Monday
Execute your plan
from Friday Tuesday
Strategy Meetings Tactical Meetings
Wednesday
Check relevant Invest in yourself –
Check on your
industry news and Webinars and Thursday
deliverables for
inform network on Training Keep a few hours
the week. Are Friday
findings free on your
you on track?
Complete schedule to Strategy Meetings
deliverables for complete tasks Deliverables to other
Tuesday Tactical that have taken departments
Meetings longer than
Plan, prioritize and
anticipated.
schedule work time for
next week
How are you tracking to
your goals and objectives?
Clean off your desk and
remove work troubles
from your mind. The
weekend is YOURS!
©2013 Performensation 23

24. Five Days - Planning the Week
Tactical Tuesdays and Strategic Fridays
Know how to leverage your week
The Unproductive Days - Monday and Friday
Schedule the bulk of your work time on Tuesday and Wednesday
• Monday – tough mental day
• Friday – Is it over yet?
Tactical Tuesdays – The Most Productive Day
Meet with others and focus on completing the ground level
actions that gets things done.
Strategic Fridays – Make this Day Your Own
It is important to take some time to reflect on what occurred
during the week and to plan for the week ahead
• How are you tracking towards your goals and objectives?
• Your performance appraisal
• Plan, prioritize and schedule work time for next week
©2013 Performensation 24

25. “6 hours is only 25% of a full day, but it is 100% of your productively scheduled
time.”
*Source: This presentation, Dan Walter, Sam Reeve
©2013 Performensation 25

26. 6 Hours How should you plan your day?
9 AM
Catch up on Emails
10 AM
11 AM
3,2,1 Compensation Planning Webinar
12 PM
Lunch (not at my desk today)
1 PM
2 PM
3 PM Meeting that other department that needs something by
tomorrow
4 PM
Finish that project up for tomorrow’s meeting
5 PM
©2013 Performensation 26

27. Six Hours- Planning a Day?
How many hours in a day do you actually own?
6 hours? What happened to the other 2?
Plan for Fire Drills!
An inherent part of the Compensation environment
A Calendar is not just for Meetings
Schedule your work time or someone will steal it from you
Schedule Time Wasters – Email and Social Networking
Calendar time to check in on communication
• FOCUS – Multi-tasking is a myth
• Categorize what is important (Now and Later)
• Head of HR, CEO = Now!
• Colleague, Aunt Beth = Later…
The Last Half Hour of the Day
Plan the Perfect Day called “Tomorrow”
• First 3 things to do tomorrow
©2013 Performensation 27

28. Conclusions
6 Hours: Less than half of your days is owned by you. Block that time out and
give it the same respect you would if it was carved out for your CEO
5 Days: Schedule your week to be productive when others aren’t. Focus
strategy meetings on Friday and key tactical meetings on Tuesdays.
Saturdays and Sundays are not work days
4 Weeks: Schedule your important meetings for the middle of the month.
Stakeholders will be less distracted and you will be able to do immediate
follow up to gauge success of any new ideas.
3 Months: Look at each quarter like a hill. Do most of the work in the middle
month so the final month is a downhill coast, with the except of external
stakeholders
2 Quarters: Seasonal cycles will focus critical work away from calendar
cycles.
1 Year: Break your year down into smaller, schedule bites. “What gets
planned, simply gets put on a list”. Things that get scheduled, get done.
©2013 Performensation 28

29. Where to find Performensation
www.performensation.com
Twitter: www.twitter.com/performensation
Compensation Café (blog): www.compensationcafe.com
LinkedIn: http://www.linkedin.com/company/performensation
Facebook: https://www.facebook.com/pages/Performensation-Consulting/371636619516008?fref=ts
Slideshare (presentations and documents): http://www.slideshare.net/performensation
Quora (Q&A): http://www.quora.com/Dan-Walter
514 Precita Ave, Suite 100, San Francisco, CA 94110
877-803-9255 (toll free) ext. 701
info@performensation.com
©2013 Performensation 29

30. Performensation was founded in 2006 in response to the demand for more strategic and
effective compensation programs.
Successful compensation requires four key elements. Each component must be carefully
crafted to your unique goals and culture.
Vision: We understand where you are headed and have the skills to get you there. We are
respected throughout the industry for our forward-thinking perspective and our ability to execute
on it.
Foundation: Long-term solutions are based on evidence, not founded on gimmicks or fads. They
are built to allow for adjustments to organizational and market conditions. Your program’s
foundation must reflect your company and the goals it is designed to support.
Design: A great program combines creativity with practicality. We utilize our broad and deep
understanding of rules, regulations, processes and providers to ensure your program delivers
high- performance results. Our designs are easy to understand, compliant and effective.
Communication: Participants only value what they understand. Communication must be built in
to every step of the process. We ensure that all program elements are relevant and make sense
to your targeted audience.
©2013 Performensation 30

31. We would like to thank Peter Djokovich, of Certain Strategy, for his contribution
to this planning structure. http://certainstrategy.com/
©2013 Performensation 31