Reward policies for New and Start-up

organisations
 Introduction

• For entrepreneurs issues of reward tend to be low

on the priority list.
• Issues of reward tend to be chaotic, personalised
and often reflective of the fact that those
concerned are more interested in the creation of
long term wealth
 Usual practice of existing managers

• Reward systems from previous employers

• Throwing out the bits of these they found
demotivating
• ‘cherry picking’ from reward policies they
have known or liked from other employers
• Selection of benefits provided on a basis
that suits a small high-powered cadre but
cant be extended to other employees
 Objectives of reward system for a new
company
• Attract and keep people anxious to make
the organisation grow and flourish
• Reward the risk of coming into a new
venture with high rewards
• Provide a sensible basic salary that is
reasonably competitive
• Lock people in to give business stability
• Minimise overheads by keeping benefits to a
decent basic core
• Pay out bonuses or non-cash rewards when
key milestones have been achieved
 Prepare for growth

• Pensions
• Pay relativities
• Executive share options
• Performance rewards
 Reinforcing the culture of success

• Performance rewards which reflect team

and individual achievement
• Consistent and harmonised benefits
• Effective performance management
• Management of the reward system by an
individual who is a wise custodian of both
policy and implementation