National Semiconductor 's Hybrid Incentive Plan

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National Semiconductor’s Hybrid Incentive Plan Overview National Seminconductor saw an issue with the current incentive structure in the organization and they set out to redesign a new incentive structure. The new incentive would be aligned with the strategic business plan. They would organize a company-wide task force that would be inclusive of all levels of the business and all job grades creating a vast array of experience from all levels within the company to create a “fair” incentive plan. The task force subcommittees would have a specific area to research and would include benchmarking, communication, fit and integration, assessment of readiness for incentive plan, and incentive plan design. In the goal setting phase the task force…show more content…
Why? I do not think that the stretch goals are motivating the average 80% of the employee population because they are very challenging goals to achieve with a 20% or less chance of success rate. Most goals that are this difficult to achieve would require the top level management involvement and might not actually be something that they would be able to affect in their current level within the organization. I think that stretch goals normally tend to be top management actions and although it might take many people to complete the task the solution almost always comes from the top and is aligned with the top management goals. I think this type of stretch goal would be very difficult for the employee to make a clear connection between performance and outcome. Question 3 Discuss the payout percentages implemented. Do you see these figures as motivational? Why? National Semiconductor would choose to base the pay on the business unit’s total payroll. The employees could expect to see 2-5% payout for reaching challenging goals and 4-10% could be expected for reaching stretch goals. Guidelines would be set to ensure that the payments would be financially self-funded and large enough to be motivating. I do think that this plan is motivational because it is rewarding the business unit as a whole and therefore should encourage team work and cross functional teams to be created to help accomplish more goals and therefore increase payouts for the

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