Part 21: Management Compensation Planning/Modeling

by | Oct 25, 2021

By: KHA Consulting Team

The following is part 21 of a multi-part series on The KHA Way, KHA Management Consulting’s Integrated Service Offering. This blog series includes the benefits of using KHA Management Consulting Services and the components included.

Previously, we discussed why it is important to align an individual’s performance metrics with a position’s processes and procedures. Here, we will tie everything together by explaining the importance of compensating to those figures within our Management Compensation Planning.

John E. Jones once said, “What gets measured gets done, what gets measured and fed back gets done well, what gets rewarded gets repeated.” Truer words regarding the Process Alignment subphase could not have been said. By giving individuals processes and procedures along with a metric to target and strive for, the tools are in hand that should give employees the means to get their job done well. However, if you want that success to continue, you must tie that position’s performance to compensation.

This allows employees to clearly know what is expected of them and, as a result, get rewarded adequately for its completion. At KHA, our team typically builds management compensation planning with a bottom-up approach. Every individual in the organization has a goal they must complete, each relating to the individual’s goal above, which ultimately relates to the performance of the organization. The better everyone does, leads to the better the firm does, which leads to higher employee compensation at the end of the year.

Our team at KHA has become experts in building management compensation models such as these for organizations and would love to do the same for you. Don’t miss the opportunity to discuss the unique nature of your business and see if our management compensation program is right for you.

If you engage us for Management Compensation Planning, at the end of your engagement, your condition will be improved. Come try out The KHA Way for yourself.

At KHA Management Consultants, we work with mid-market industry leaders to identify what makes the organization, its stakeholders, and its’ employees tick. We facilitate Process Alignment with your organization’s key constituents to ensure buy-in, ownership, and a new way of thinking about the organization and its stakeholders amongst all levels. From a resource perspective, we primarily use our unmatched experience but also tap into the top-level resources such as those made available by Harvard Business Review, relevant strategic management authors, and MentorPlus. Some of those materials, frameworks, and lessons have been used in authoring this series.

KHA Management Consultants, the consulting department of KHA Accountants, PLLC, based in Flower Mound, Texas, is always looking for opportunities to work with key clients ready to take their organization to the next level. If you have a desire to improve, take the first step toward success with the strategic management experts, and contact us at 972-221-2500.

Two Estate Planning Strategies to Help Protect Wealth

A goal of estate planning is to maximize the wealth that is passed on to one’s heirs. In this video, we’ll discuss how a Spousal Lifetime Access Trust and an Irrevocable Life Insurance Trust may help you minimize estate taxes and protect wealth.

IRS Announces ERC Withdrawal Process

The Internal Revenue Service (IRS) has established guidelines concerning the withdrawal of an Employee Retention Credit (ERC) claim for those employers who now believe they may not qualify. These guidelines, detailed on the IRS’s official website, outline the necessary steps a taxpayer must take to withdraw a claim for the ERC, under certain conditions.

Why the Cost of Customer Acquisition Is So Important

For any business, understanding and effectively managing the cost of customer acquisition is crucial for success. In this video, we’ll explain what it is, how it’s calculated, and how it affects a business’s profitability, cash flow, and overall growth.

IRS releases guidance on Roth catch-up contributions under SECURE 2.0

The Internal Revenue Service (IRS) has recently released guidance on Roth catch-up contributions under SECURE 2.0 Act. This guidance, outlined in Notice 2023-62, provides important information for individuals who are age 50 or older and participating in a retirement plan that allows deferral contributions.

Estate Planning after a Business Sale

After selling a business, it is crucial to update your estate plan to align with your new financial situation. This article provides and overview of common strategies to consider.