PERFORMANCE INCENTIVE PLAN CENTRUMDIRECT LIMITED

Transcription

1 PERFORMANCE INCENTIVE PLAN CENTRUMDIRECT LIMITED 1

2 Performance Incentive Plan SCOPE OF COVERAGE The Incentive scheme is designed at recognizing & rewarding outperformance The scheme will apply to : 1. Individuals 2. Branches 3. Area 4. Region 5. Head Office (H.O.) 2

3 INCENTIVE SCHEME CONSTRUCT FOREX BUSINESS 3

4 Branch/Area/Region/H.O QUALIFYING CRITERIA Incentives shall be payable to each Branch / Area / Region & Head Office subject to crossing the defined Trigger mark of Positive Net Profit Net Profit is defined as NET PROFIT = INCOME MINUS EXPENSE INCOME includes Spread Income, Issuers Incentives/Charges, Service Charges and other income, if any EXPENSE includes Staff cost, Branch Operational cost, Finance cost, Area/Region cost, Head office cost, Commissions paid and other expense, if any 4

5 Branch Level (Excluding Airports) INCENTIVE SLABS TRIGGER % of Net Profit to Total Expense UPTO 10% INCENTIVE % of Net Profit 4% UPTO 30% 6% UPTO 50% 8% ABOVE 50% 10% 5

6 Illustration - Branch Level (Excluding Airports) SALES BRANCH A BRANCH B BRANCH C Amounts in INR Lacs Sales Income (Net of Payouts) Operating Expense 66 Finance Cost 2 Apportioned Area /Regional Cost 1 Apportioned Head Office Cost 1 TOTAL BRANCH EXPENSES 69 Net Profit 7 %of Net Profit to Total Expenses 10% INCENTIVE SLAB 4% INCENTIVE PAYABLE % 8% % 10% x 11x 6

7 Area Level (Excluding Airports) INCENTIVE SLABS TRIGGER % of Net Profit to Total Expense UPTO 20% INCENTIVE % of Net Profit 1% UPTO 50% 2% ABOVE 50% 3% 7

8 Region Level (Excluding Airports) INCENTIVE SLABS TRIGGER % of Net Profit to Total Expense UPTO 20% INCENTIVE % of Net Profit 1% UPTO 50% 2% ABOVE 50% 3% 8

9 Airports INCENTIVE SLABS TRIGGER % of Net Profit to Total Expense UPTO 10% INCENTIVE % of Net Profit 2% ABOVE 10% 3% 9

10 Head Office (H.O.) INCENTIVE SLABS TRIGGER % of Net Profit to Total Expense UPTO 20% INCENTIVE % of Net Profit 2% UPTO 50% 3% ABOVE 50% 4% 10

11 Incentive Allocation BRANCH / AREA / REGION CATEGORY INCENTIVE SALES 65% NON-SALES 35% AIRPORTS CATEGORY CASHIER/S INCENTIVE 50% SUPERVISOR/S 30% MANAGER 15% REGIONAL STAFF 5% 11

12 Individuals QUALIFYING CRITERIA Individual Rewards & Recognition plan already in force Extraordinary Individual performances to be considered on exception basis where a Branch/Area/Region does not accomplish the trigger mark for incentive eligibility. Trigger mark of Net Profit to be considered NET PROFIT = INCOME MINUS EXPENSE INCOME includes net revenue generated by the Individual EXPENSE includes CTC and apportioned cost as defined in the Branch Expenses (Slide 4) Branch Manager/Area Manager/Regional Manager will not be considered under this Individual performance scheme. 12

13 Individuals INCENTIVE CONSTRUCT Income recognition from new and existing business for the purpose of Net Profit calculations will be as : INCOME RECOGNITION SLABS YEAR 1 % of INCOME GENERATED 100% TRIGGER % of Net Profit to Total Expense INCENTIVE % of Net Profit 2 50% UPTO 10% 4% 3 30% UPTO 30% 6% ABOVE 3 YEARS NIL UPTO 50% 8% ABOVE 50% 10% 13

14 INCENTIVE SCHEME CONSTRUCT THIRD PARTY PRODUCTS 14

15 Individuals THIRD PARTY PERFORMANCE INCENTIVE PLAN Leveraging existing group customers through cross-sell of Insurance, Travel Insurance and International calling card products INCENTIVE PAYOUT 20% of the net fee income attributable to CDL (adjusted for expense, if any) will be paid as direct incentive to Individual SALES RECOGNITION PLAN Rewards & Recognition plan will be launched from time to time 15

16 Illustration Third Party Products BSLI INSURANCE SALES BSLI INSURANCE SALES BRANCH A BRANCH B BRANCH C Total Premium collected 200, , ,000 CDL Revenue* 40,000 40,000 40,000 Less: Expenses incurred 5,000 Net Revenue Earned 35,000 2,000 38, ,500 Incentive payable to Individual (20%) 7,000 Reward & Recognition Plan (upto15%) 5,250 Branch P & L (65%) 22,750 *CDL Revenue share 20% with majority of Term plan policies 7,600 5,700 24,700 7,900 5,925 25,675 16

17 Important Points All payments in respect of incentives to the members will be paid after accounting for Individual s Tax Liability for the particular Assessment Year Members must be employed with the Company at the time of disbursement of incentive. Further to qualify for incentive for forex business, member should be in service with company for minimum period of 2 months in respective quarter. Of the total Incentive payable for the quarter for forex business, 50% will be released in succeeding month of the quarter. The balance will be paid in succeeding month of the F.Y. end. If there is a loss in any quarter of the F.Y., the incentive payable at the year end will be adjusted accordingly. For e.g. For quarter ended December, 50% of incentive will paid along with January salary. The balance 50% will be released with July Salary provided the branch posts profits in each quarter of the F.Y. For the quarter ended June, 100% incentive will be paid in July along with residual incentive of previous quarters of F.Y. after adjusting for net loss, if any. 17

18 Important Points Any Branch getting Unsatisfactory compliance rating in any month of the quarter will be penalized 50% of its incentive amount payable. An Incentive committee comprising of Business Head, COO, CFO, and HR Head would finalize incentives on above parameters and recommended for final approval for MD. For Third Party Products, direct incentives will be paid monthly with a lag of one month, subject to receipt of fees from the product partners. i.e. incentives earned in the month of March will be paid along with salary of May. The Management reserves the right to modify/withdraw this scheme without prior notice. 18

19 ALL THE VERY BEST!! 19