Essay About Company’S Bonus Pool And Compensation Plan

Brainard, Bennis & Farrell
Brainard, Bennis & Farrell (A)Submitted on Aug 20, 2016 byAnkit August 20, 1995Mr. Richard Kincaid, Chairman, Executive committee, Brainard, Bennis & FarrellDear Mr. Richard, Subject: Compensation Plan to divide company’s bonus pool amongst its partnersThe enclosed report contains my recommendation for a new compensation plan, which can be used for distributing company bonus pool amongst the partners for the year 1995. Sincerely,Ankit Executive SummaryBrainard, Bennis & Farrell (BBF) is a law firm based out of Connecticut. Formed in 1963, the firm has built a strong reputation in the industry through its clients and strong team. Recently its profits have decreased, and the dissent within partners over the compensation procedures has increased. The company wants a new compensation plan to distribute bonuses for the next year, which will be acceptable to partners. A new compensation plan for bonus pool distribution has been provided with details at the end of this report.#number of words: 87Table of contentsSituation Analysis…………………………………………………………………………..5Problem……………………………………………………………………………………….7Recommendation……………………………………………………………………………..7Exhibits……………………………………………………………………………………….10Situation AnalysisBrainard, Bennis & Farrell (BBF) is a law firm based out of Connecticut. The three co-founders of the company wanted to establish a business which was away from hyper-competitive Wall Street, and where there was a larger focus on law as a practice than the law as a business. Within a decade or two, the firm was doing well owing to the word of mouth publicity from their existing clients and a strong, coherent team. The harmony that existed between people in the firm slowly started to fade after the late 1980s owing to a lot of factors. Firstly, the company began adding a lot of practices under its offering to become a full service law firm. Secondly, all the founders of the company had retired and to appoint members to executive committee; the electoral system was used. The representation of people increased in executive committee, and it became difficult to accommodate all of their requirements, especially in the area of compensation. (See exhibit-1: Feedbacks received after announcement of bonus points rewards for the year 1994) The demand had been for a compensation system which was more performance-based and had fixed weighted factors leaving little room for subjectivity. And lastly, the competition in the market was increasing, resulting in thinner margins and therefore greater needs to get new business in the market.