BALANCED SCORECARDS, PERFORMANCE METRICS and INCENTIVES
Over the last 20 years we’ve worked with literally hundreds of financial institutions to build or revise their measurement and incentive systems. Here are some things we’ve learned along the way:
- Too many systems award money for results to which the recipient has no line-of-sight. It’s critical that incentive programs ensure the individuals being incented have direct ability to impact their desired results.
- Without good measurements, incentives aren’t possible – let’s start with good, solid metrics!
- Too many metrics are as bad, or worse, than no metrics – keep your scorecards simple and focused on your highest priorities
- Without good processes, incentives and scorecards won’t drive the right behaviors – so, let’s define and implement your processes
- Incentives can’t be developed in a vacuum. They need to be developed in consideration of the company’s total compensation, including base salary and benefits plans
- And incentives need to be audited and closely monitored to make sure they are compliant and motivating the appropriate behaviors
Our approach is to assure that our client’s incentive plans and scorecards are built around the philosophies above.
We’ll start with a thorough assessment of your current culture, understand your desired results, and provide specific recommendations on how to get there. We’ll work with you to create the most appropriate environment for your organization and stay with you to make sure the transition is as smooth and effective as possible.
Don’t develop new incentives or scorecards on your own and don’t tinker with what you currently have in place until you get our unbiased, outside, and expert perspective!