The proactive healthcare compensation professional -practical tips for reducing compensation cycle time & stress

The Proactive
Healthcare
Compensation
Professional:
Practical Tips for
Reducing Compensation
Cycle Times & Stress
Guest Presenters:
Dan Walter & Sam Reeve
Performensation
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“Someone is sitting in the
shade today because someone
planted a tree a long time ago.”
― Warren Buffett
©2017 Performensation 5

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

DAN WALTER
DAN WALTER, CEP
President and CEO
TF 1 877 803 9255 ext 700
Office 1 415 625 3406
Mobile 1 917 734 4649
dwalter@performensation.com
Skype: Performensation
Twitter: Performensation
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 two
decades 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
perspective on compensation issues. His focus is on effective, and at
times innovative, company-specific solutions. He also provides post-
consultation support to help ensure programs are working as
designed.
Dan is also a highly sought after speaker on a broad range of topics.
He is board member for the National Center for Employee Ownership
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.

SAM REEVE
SAM REEVE, CCP, GRP
Executive Vice President
TF 1 877 803 9255 ext 702
Office 1 415 625 3088
Mobile 1 970 403 5775
sreeve@performensation.com
Skype: SamReeve
Twitter: @SamReeve3
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 BlackRock,
McKesson and Automatic Data Processing (ADP).
Sam currently lives in Colorado and aside from his
professional life, enjoys numerous outdoor activities with
his 4 children and wife, Jessica.
Sam has a degree in Finance and Economics from California
State University, Sacramento.

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

The DNA Code to
Compensation Planning
5D-4W-3M-2Q-1Y

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

Get a Physical once
a year
(whether you think
you need it or not)

13
Typical Annual Compensation Committee Schedule
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Executive and CEO Market Pay
Analysis
• Review market trends in pay,
short & long-term grants
• Prepare and review tally sheets
for a full view of executive total
rewards
Year-End Preparation
• Set goals/targets for next year’s short
& long-term awards
• Evaluate CEO performance
• Prepare preliminary current year
incentive calculations
Incentive Payments
• Calculate and deliver actual
prior year short & long-term
award payments
Plan Review
• Test effectiveness against
company strategy
• Review pay and
performance linkage
Compensation Education
& Trends
• Update to remain in line
with continuing
educational requirements
Fiscal
Year
End
Implementation Support
• Answer feature questions and
provide guidance during
implementation with service
provider
Issue Support
• Availability during non-
standard events
• Support regarding questions
on plan features
1 Year
©2017 Performensation

14
Comp Committee Vs Comp Department
Executive and CEO Market Pay
Analysis
• Review market trends in pay,
short & long-term grants
• Prepare and review tally sheets
for a full view of executive total
rewards
Year-End Preparation
• Set goals/targets for next year’s short
& long-term awards
• Evaluate CEO performance
• Prepare preliminary current year
incentive calculations
Incentive Payments
• Calculate and deliver actual
prior year short & long-term
award payments
Plan Review
• Test effectiveness against
company strategy
• Review pay and
performance linkage
Compensation Education
& Trends
• Update to remain in line
with continuing
educational requirements
Fiscal
Year
End
Implementation Support
• Answer feature questions and
provide guidance during
implementation with service
provider
Issue Support
• Availability during non-
standard events
• Support regarding questions
on plan features
1 Year
Year End Performance
Reviews
Pay for Performance
• Determine Merit, Market and Incentive
pay decisions
Communicate Sales
Plans
• Calculate and deliver
actual prior year short &
long-term award
payments Mid Year Performance
Reviews
• Check in with team on status
of annual objectives
Market Benchmarking
•Review benchmark job
matches and participant
in surveys
Fiscal
Year
End
Goal and Objective Setting
• Company goals cascaded to
departments
•Comp Tem goal setting to
align to the company goals
Pay Competitive
Assessment
• Review market
data
•Identify market
pay concerns

15
Typical Annual Compensation Department Schedule
Year End Performance
Reviews
Pay for Performance
• Determine Merit, Market and Incentive
pay decisions
Communicate Sales
Plans
• Calculate and deliver
actual prior year short &
long-term award
payments Mid Year Performance
Reviews
• Check in with team on status
of annual objectives
Market Benchmarking
•Review benchmark job
matches and participant
in surveys
Fiscal
Year
End
Goal and Objective Setting
• Company goals cascaded to
departments
•Comp Tem goal setting to
align to the company goals
Pay Competitive
Assessment
• Review market
data
•Identify market
pay concerns
1 Year

16
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

What months are busy and
what months are not?

It takes 6
months to
build a Rolls
Royce and 13
hours to build
a Toyota.

20
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

Multiple Sclerosis can be confirmed via
MRI 3 months after the first scan.
Sometimes a more frequent cycle
provides better results.
Source:
https://www.ncbi.nlm.nih.gov/pubmed/16042219?dopt=Abs
tract&holding=npg

22
Quarterly Considerations
Performance
Metric
Tracking
10Q
Bonus
Approval
Review Comp
Committee Charter
Financial
Reporting
Communications
Review Plan
Effectiveness
Reconciliation
STI Goals
Stakeholder
Reviews3 Months

23
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

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

25
Monthly processes are the shortest segment of time that allow preplanning
Monthly closes, Commission Cycles etc.
T O O
B U S Y
T O O
B U S Y
P R I M E T I M E
4 Weeks

26
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

How many hours a week do
you, or a typical person on
your staff, work during your
busiest month?

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
SATURDAY SUNDAY MONDAY TUESDAY WEDNESDAY THURSDAY FRIDAY

29
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
Strategy Meetings
Check relevant
industry news and
inform network on
findings
Complete
deliverables for
Tuesday Tactical
Meetings
Tuesday
Tactical Meetings
Invest in yourself –
Webinars and
Training
Wednesday
Check on your
deliverables for
the week. Are
you on track?
Thursday
Keep a few hours
free on your
schedule to
complete tasks
that have taken
longer than
anticipated.
Friday
Strategy Meetings
Deliverables to other
departments
Plan, prioritize and
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!

30
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
Five Days - Planning the Week

“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

32
How should you plan your day?6 Hours
9 AM
10 AM
11 AM
12 PM
1 PM
2 PM
3 PM
4 PM
5 PM
Catch up on Emails
3,2,1 Compensation Planning Webinar
Meeting that other department that needs something by
tomorrow
Lunch (not at my desk today)
Finish that project up for tomorrow’s meeting

33
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

34©2017 Performensation
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.

AGENDAQ & A
Live Q&A

AGENDAAGENDA
Resources & Support
✓ Resource Library
✓ Vendor & Product Info
✓ Upcoming Events

37
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
548 Market St # 77349
San Francisco, CA 94104-5401
877-803-9255 (toll free) ext. 701

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.

39
We would like to thank Peter Djokovich, of Certain Strategy, for his contribution
to this planning structure. http://certainstrategy.com/

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