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Aneta Samkoff
Aneta Samkoff
Bartłomiej Podolski
Bartłomiej Podolski

07. Tackling the complexity of LTIP design - hands-off approach with software

As you can see, the design, implementation, and management of long-term incentive plans is extraordinarily complex. It’s a real headache if you need to keep track of multiple such plans, each with different criteria, controls, and vesting schedules. Basic compensation management tools, with Excel being the most common as it seems, are unable to efficiently administer such plans, but thankfully the whole process can be properly digitalized and automated.

Good LTI software should be able to:

  • track the recipients' employment status
  • report incentive grants and approvals
  • manage KPIs for multiple individuals and use them to calculate the grant
  • follow vesting schedules for multiple concurrent plans
  • support a rules engine to manage eligibility of the awards and exercising of options
  • provide transparency and reporting required to manage programs in accordance with the law
  • administer clawback and adjustments
  • calculate and forecast accruals needed for the deferred payouts
  • support audit and history tracking quality
  • provide insights and graphically appealing grant-related information for the grantees
  • supply role and permission-based secure access to the system and compensation data
  • integrate with the company’s other systems
  • allow flexibility and self-sufficiency in administering the grants