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The BOS
Base Option Stake Motivation Plan
| Most people in the technology field are elevated above Maslow's classic
lower level Hierarchy of Needs. Consequently, the challenge "to
make IT big", to be a part of "the next big thing" and to receive
proper recognition and rewards for their contribution, intellectual
property contributors are drawn like magnets to attractive stock options.
The basic Silicon Valley Stock Option Plan works on assigning an employee the right to purchase a fixed amount of shares after they employee has been with the company for a fixed period of time, generally four years. Employees are attracted to companies with the goal that stock they sign up for when they join, will increase substantially in value over their period of employment. Many millionaires have been made in Silicon Valley with this basic plan, however, it has serious flaws. Once an employee is locked into a traditional Stock Option Plan (SOP), they only have to remain with the company for the term of the agreement to receive all the rights and benefits of the SOP. In other words, the employee simply must make sure that they don't do anything that would get them dismissed. Good or bad performance is given the same reward. Consequentially, Silicon Valley is littered with employees in companies that are simply biding their time. Bad for the company, bad for the employee. At InfoTelesys, we have no employees, we only hire companies with contractors possessing skill sets that meet our requirements. These companies are placed on the InfoTelesys Base Option Stake (BOS) Plan. On contracting with InfoTelesys, each contractor is assigned a fixed number of BOS options for their first three years with the Company. The difference between the BOS and the SOP, is that to the BOS Plan is entirely performance based. Each month, contractors are assigned Personal Performance Multipliers (PPM) values based on their performance for that month. The PPM can vary between zero and two, with one representing expected performance, two representing outstanding performance and zero reflecting poor performance. The number of BOS options for that month is then multiplied by the PPM value. Top performers love the BOS Plan, they are able to double their Options which can make a huge difference in what return they make as a contractor. Conversely, bad performers hate the Plan and are unlikely to stay with the Company. InfoTelesys' integrates the PPM Analysis with an automated reporting and tracing system, where contractors report on a daily basis what they have accomplished for the day. The daily PPM Report helps a contractor to evaluate their own performance and focus more effectively on the next day, while it also serves to ensure contractors receive recognition for their accomplishments. Top performers are regularly lost in most large corporations. Often managers will shield a subordinate's accomplishments from senior management, taking the glory for themselves. The net result is a disgruntled top performer and rewarding of an incompetent manager. The PPM and BOS Plan helps prevent this, by short-circuiting reporting and recognition chains. On a monthly or quarterly basis, managers forward suggested PPM values for contractors working on projects they chair to the InfoTelesys Compensation Committee (IT CC). The IT CC compares suggested PPM Values against the PPM Reports and issues the final PPM Figure for that month or quarter. One of the key benefits of the BOS and PPM Strategy developed by the Founder, is that it provides the ability to manage a highly distributed and autonomous workforce. Intellectual Property contributors are always challenged, always motivated and always rewarded, as their accomplishments are clearly documented. The BOS and PPM Plans at InfoTelesys will ensure that the Company continues to attract the industries best. IT came from InfoTelesys. More on calculating BOS plans and PPM's © 1984 - 2001 Clive Boustred |