The process of strategizing the way executives should carry out their duties is called executive planning. It is a very important component for all benefit strategies of any corporate. The success of a business is brought about by proper executive planning as it gives them a drive to focus and also motivates them. An organization or a business may suffer losses or fail if the plan does not offer the incentive of a package as compared to what the competition offers.
Executive planning provides flexibility in the development of strategies concerning benefit compensation which can be used for many purposes. Replacement income at retirement is able to be provided based on total compensation. Rewarding, attracting and retaining of key executives is made possible. It makes it possible to provide enhanced benefits in case of a complete change of power in the business.
Benefit equalization plans, supplemental executive retirement plans and deferred compensation arrangements are examples of executive plans. Lost retirement plans are restored by benefit equalization plans. In order to avoid current taxation, deferred compensation arrangements allow both designated executives and corporate directors to defer additional compensation. These plans are strategized in order to make it possible for key employees to acquire vehicles provided by the business. Supplemental executive retirement plans provide numerous benefits. Credit provision for additional years of providing services is made possible. The rewarding of top employees by the organization based on their overall performance is made possible. It makes it possible for primary executives to get bonuses. It makes it possible for executives who retire at an early age to acquire retirement benefits.
Before an organization can design an executive plan it should consider some factors. Cost objectives and benefits of the business should be taken into consideration. The attitude of the business towards the allocation of benefits based on the overall company performance should also be taken into consideration. conclusively, the issue of how the company would like to apportion its retirement benefits should also be put into consideration.
Executive planning that is well thought out enables a business to attract and maintain key personnel thus ensuring the success of the business. Both the succession of the business when the time is appropriate and availability of exciting incentives to key executives are brought about by effective executive planning. It facilitates the planning for both upcoming and present needs and the leadership of the executives of the said organization.
Effective executive planning is an indispensable component for every business and that ensures its success.