Executive Change

Executive Change
Change from Higher Education Manager Corporate Executive Ed?

Hi, how I can make a career change from public to companies. I've been a college administrator in universities, but now I want to pursue a business career. Is there counseling centers that can help in this process? I am based in San Jose, CA.

Hello! I have some ideas, but no clear answer. I'm in the same boat as you. 20 years of higher ed and ready to go to the other side! I tried to craft my resume in a different way to focus on skills and shoot higher ed not the entire page. During my search last job and took another position yielded higher ed though because I could not find anything in my salary range. I think we should be willing to accept a salary lower than currently do and many places assumes that you are "entry level" until you can actually physically see how their skills transfer. The only chance we have is if someone "on the other side" has higher penetration in ed so that they understand the implications of our positions. Good luck!

Are you ready for change?

The annual review and analysis of corporate filings for public companies in full swing. Almost always, This control brings a protest about exorbitant levels of executive compensation and lack of a direct relationship between what some executives made and results his financial enterprises. In addition to articles that highlight some of the more commonly there are reports of the investigation to identify illegal or at best the cases, highly questionable activities. Given the propensity of public investors and retreat on the issue of excessive executive compensation, it is not surprising that these two groups have put considerable pressure on regulators to control and / or reduce the executives in recent years.

Directed by Market

With recent regulations and structural changes as the baseline raises the question of what the future holds. In trying to answer this question, it is important to understand how remuneration levels are set. Assuming that the fundamental purpose is to enable an organization to recruit and hire the best talent to meet their business needs, the natural consequence is that a company is very interested in what the competitive market levels for the vacancy. This places a great emphasis on availability of reliable market data that will be used to determine what an individual should be paid.

The recruitment of executive talent is usually not as competitive as it is for the vendors or in other professions. In the upper levels of the corporate ladder, multiple offers are rare, as fewer companies are competing for same individuals. In addition, ideal candidates typically executives can increase the bet on his total compensation levels, because many times the individual is hiring continues to work elsewhere. The company must then try to entice away with an attractive total compensation package, which often requires the purchase of an existing package. Wives gold "than their previous jobs, put in place to retain executives probably not prevent them from leaving, but have the effect of raising the stakes for the next employer.

If the market is not to dictate the amount of compensation, the design considerations specific programs covering executive pay are equally important. Basic principle of compensation programs for executives, in particular the plans of the capital base, is to maximize the dollar after taxes to the individual while minimizing the negative tax and accounting consequences of the organization, such as those set by the IRS, the FASB and IASB. In addition, executive compensation plans must comply with all regulatory requirements, including Sarbanes-Oxley (SOX) and similar SEC governing bodies.

Roof or soil?

Some experts say the latest requirements, including regulations of the SEC proposal regarding improved information, explaining the use tally sheets, the determination of emoluments to a lower level, and greater transparency – will achieve the much sought after-effect aimed at curbing compensation excessive. Unfortunately, there is a good chance that recent and proposed requirements will have the opposite effect: namely, to show an increase in the reported level total compensation, as the combined value of the various components of compensation surfaced and a total dollar value of the compensation package of executives shown.

In a bumber cases legistation past and changes in the IRS actually had the effect of increasing the compensation, the establishment new "story" instead of "roofs", as originally intended. An example is the famous "rule of millions of dollars" Code Section 162 (m), which requires compensation base of more than $ 1 million to be based on performance for a public company to deduct expenditure for tax purposes.

Instead of lower pay, it actually increased the base salary and expanded the amount of compensation based on performance. Section 162 (m) was one of the main drivers of the increased emission of stock options in the 1990s, as the actions are considered based compensation performance for the calculation of the IRS. In addition, there has been a large increase in the positive potential of annual incentives. Usually based on performance, providing the opportunity to raise the total compensation without negatively affecting the million dollar rule.

Assuming that the performance measures are real, and in fact conduct business – and in turn help to increase shareholder value – additional payment based on performance is a bit like apple pie and motherhood: a concept that few can be discussed. When the above-average performance is achieved by increased compensation and justified, this concept works. However, it only takes one rotten apple to spoil the barrel and raise the red flags of what is perceived as excessive "compensation.

Repeating history?

With this in mind, is destined to repeat history? Will the new generation of regulations have the effect of lowering wage levels as expected? If the past is any indication, probably no. For a time, at least, they will make the Council and the Compensation Committee more aware of their responsibilities to better tie compensation to performance standards and achievements defensible.

But the conclusion is that the market will remain a key driver of what an organization needs to pay to attract the best talent, retain and reward the people tested through payment plans linked to the achievement of appropriate performance indicators.

About the Author

Paul R. Dorf is the Managing Director of Compensation Resources, Inc. He is responsible for directing consulting services in all areas of executive compensation, short and long-term incentives, sales compensation, performance management systems, and pay-for-performance salary administration. He has over 40 years of Human Resource and Compensation experience and has held various executive positions with a number of large corporate organizations. He also has over 20 years of direct consulting experience as head of the Executive Compensation Consulting Practices for major accounting and actuarial/benefit consulting firms, including KPMG, Deloitte Touche Tohmatsu (formerly Touche Ross), and Kwasha Lipton.