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Retention Plan Design

Organizations consider retention plans for a number of reasons. In general, the underlying premise is to ensure the organization’s continued success through continuity of leadership. Retention plan development often results from a desire on the part of the board to retain outstanding members of leadership or to minimize disruption of management during a period of change. 

Retaining the services of highly talented and experienced executives long-term or through a transition period:

• Preserves detailed knowledge of current and historic situations
• Maintains organizational stability and limits distraction and disruption of team efforts
• Mitigates a domino effect of departures within the executive team
• Sends a positive message to the community
• Is less costly to the organization (e.g., recruitment costs, delayed long-term goal achievement)

Many of these costs can be avoided by combining a well-designed retention plan with a competitive total compensation program. Integrated Healthcare Strategies has designed numerous successful retention incentive plans. A successful plan positively influences the timing of the executive’s departure, such as delaying retirement to meet succession planning needs or capital planning goals. In turn, the executive is rewarded for leadership and loyalty.