Business
In this episode, I’m talking with Craig Rutledge who is the lead consultant and one of the managing directors of VIsionLink. With 20 years of experience working with businesses on their compensation planning, Craig has an extensive background in financial services. That’s why he’s here today to talk about breaking down how to build short- and long-term incentive plans in a way that are clear and easy to understand, consist of short term cash bonuses and long term phantom stock and are paid for using the growth in the business’s value based on the hard work and strategies that the executives are responsible for. Craig’s company and team truly understand business, business valuations, financials, and what creates value and detracts from value. This is extremely rare. Professionals who are setting themselves up as executive compensation specialists tend to be insurance sales reps who can’t wait to find a way to sell spit dollar or whole life insurance with big premiums. Owners often know they need to come up with some sort of short term and long term incentive plan to help recruit, keep and motivate the rock stars that are going to accelerate the growth of their company… however the lack of understanding on the different ways to design a plan and often end up with plans that have unintended consequences. The right employee compensation plan will push your results forward so you can achieve your business goals. Craig Rutledge goes over the benefits to giving your top-performing staff a stake in the game and makes a case for the motivational power of equity, with specific examples you can use. What You Will Learn In Today's Podcast Interview What are phantom stocks (or synthetic equity) and how you can make them work for you. How to transform employees into growth partners. Why it’s important to discover your employees’ ideal compensation structure. The benefits of using long-term planning when looking at appreciation awards and what often makes EBITDA the best evaluation metric. How to transaction-proof your compensation plans. The strength of an abundance mindset over a scarcity mindset. How to account for the liability and protect all parties, as well as the difference between funded and naked liability. The value of communication and transparency in planning to draw in the most qualified people who will help you smash your ceiling. How to build and sustain a high-performing culture while getting your executives to pay for themselves. The most common valuation metric for the compensation plans: EBITDA x multiple - debt + cash. Are You Growing The Value of Your Business Take The 2-Minute Assessment To Get Your Intentional Growth Score™ And 1-Page Vision Board. Are you company's current initiatives intentionally designed to increase the value of the business? Do you know what you want from your business long term and why? Do you know what your company is worth? Do you know the differences between Management, Family Transitions, PE Firms, ESOPs and Strategic Buyers? Does the business have a written strategic plan on how to achieve the desired normalized EBITDA and valuation? About the Guest: Craig has been working with businesses and their executives in a compensation consulting role for over 25 years. He currently serves as the lead consultant on many of VisionLink’s projects, specializing in long-term incentive plans and executive benefit programs. In addition, Craig oversees our funding analysis and implementation for the long-term incentive plans VisionLink des