As an owner of a home service company, do you have difficulty retaining your best employees? If you answered “yes,” you are not alone. The struggle is real for private businesses around the world. But making a strategic investment to share your company’s success with the workers who help make it happen goes a long way to turning things around.
The adoption of phantom stock plans indicates that companies are leveraging non-traditional compensation methods to retain talent, especially when financial resources are limited.
In our survey of those considering phantom stock programs, you see replies from mostly small to medium size organizations. Of those, you see some strategies take shape:
• Companies employing 21-50 people were 10% more likely to set aside 15-25% of equity
• Companies with fewer than 10 employees were twice as likely to set aside 5-10% of equity than a higher amount.
• 10% more companies that reported they were interested in profit sharing plan to set aside 15% or more equity for their phantom stock plan.
Bottom-line: those who invest in performance-based incentives REALLY invest. The combination of phantom equity and profit sharing is the best balance between long and short term rewards.
As these methods continue to increase in popularity, we hope to see good employees settle into their jobs for the long haul with a feeling of connection with their company’s success.
