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Redesigned mip
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<blockquote data-quote="interested" data-source="post: 51931"><p>I am with Upsdawg, this is a great discussion. I want to add to the points that upscorpis and Onetoofar have made. I don't think it is any secret that UPS salaries are well below industry standards in many of our disciplines. It has always been the overall compensation that made up for that shortfall. </p><p> </p><p>For years and years, those elgible for the MIP saw a good chunk of their compensation given to them in stock. Management almost never touched this stock. Secondly, the stock would go up year after year after year. Anytime you put away a chunk of your compensation and it compounds annually, (sometimes as much as 20%)-You are going to save some dough. Add a 401k to the mix-you maybe talking about putting away almost 30% of what you make every year. The trade off? You are living on a much smaller stipend than many of your contemporaries in similar fields. But you are a UPS'er. Living under your means and planning for a wonderful retirement is in the bloodline, and having come up in the system, you are acutely aware of the pot at the end of the Rainbow. </p><p> </p><p> Let's not underestimate what that reward was. It was enormous, many, many people left millionaires-That's plural. $2-3 million, no debts, and a PENSION!!!, man! that is nice living. Any wealth mangement professional will tell you, living under your means during your career, means living well at retirement. Until we went public, that was a winning strategy, and you were a fool not to manage your career in a similar capacity. </p><p> </p><p>Times have changed, We are now a publicly traded company. We don't set the stock price anymore, the market does that- and there are more theories than you can shake a stick at as to why the market fluctuates. If you enter into the ranks of mangement in UPS you will still face the old ideaology that says, leave your stock alone and you will be handsomely rewarded. That is no longer the case. Is the stock blue chip-Sure it is. Is it a solid investment-absolutely-as far as stocks go. If we have another work stoppage will the stock go up again, right after the work stoppage(as it did in '97, before we went public)-Not a chance!! Is it incentive for a new management person to have some of his compensation deferred for a period of time? Not if you are already compensated 30-50% under the current market value for your skillset-The situation is complicated if you have an education and even more tenuous if UPS paid for that diploma-because you are a real threat to leave the company. Brain drain is not a good thing when our competition is building their brand. </p><p> </p><p> The Old school hangs on to the theory that the stock will again rise and hold steady, splitting along the way as it climbs ever higher. The new school recognizes that competition, our IPO and a more diversified professional career don't add up to putting all your eggs in one basket, and watching that basket over the next 30 years. </p><p> </p><p>The restructuring of the MIP doesn't have near the effect on someone who already has twenty-five years in management. </p><p> </p><p>This is a tough argument. We want to build shareholder value and confidence in our brand, a brand that has served many of us well over the years. We also want UPS to recognize that they are going to have to align salaries and compensation to keep and find the best possible people available to represent that brand. </p><p> </p><p>I don't have all the answers, but I too would like to continue to hear from all management folks on this subject.</p></blockquote><p></p>
[QUOTE="interested, post: 51931"] I am with Upsdawg, this is a great discussion. I want to add to the points that upscorpis and Onetoofar have made. I don't think it is any secret that UPS salaries are well below industry standards in many of our disciplines. It has always been the overall compensation that made up for that shortfall. For years and years, those elgible for the MIP saw a good chunk of their compensation given to them in stock. Management almost never touched this stock. Secondly, the stock would go up year after year after year. Anytime you put away a chunk of your compensation and it compounds annually, (sometimes as much as 20%)-You are going to save some dough. Add a 401k to the mix-you maybe talking about putting away almost 30% of what you make every year. The trade off? You are living on a much smaller stipend than many of your contemporaries in similar fields. But you are a UPS'er. Living under your means and planning for a wonderful retirement is in the bloodline, and having come up in the system, you are acutely aware of the pot at the end of the Rainbow. Let's not underestimate what that reward was. It was enormous, many, many people left millionaires-That's plural. $2-3 million, no debts, and a PENSION!!!, man! that is nice living. Any wealth mangement professional will tell you, living under your means during your career, means living well at retirement. Until we went public, that was a winning strategy, and you were a fool not to manage your career in a similar capacity. Times have changed, We are now a publicly traded company. We don't set the stock price anymore, the market does that- and there are more theories than you can shake a stick at as to why the market fluctuates. If you enter into the ranks of mangement in UPS you will still face the old ideaology that says, leave your stock alone and you will be handsomely rewarded. That is no longer the case. Is the stock blue chip-Sure it is. Is it a solid investment-absolutely-as far as stocks go. If we have another work stoppage will the stock go up again, right after the work stoppage(as it did in '97, before we went public)-Not a chance!! Is it incentive for a new management person to have some of his compensation deferred for a period of time? Not if you are already compensated 30-50% under the current market value for your skillset-The situation is complicated if you have an education and even more tenuous if UPS paid for that diploma-because you are a real threat to leave the company. Brain drain is not a good thing when our competition is building their brand. The Old school hangs on to the theory that the stock will again rise and hold steady, splitting along the way as it climbs ever higher. The new school recognizes that competition, our IPO and a more diversified professional career don't add up to putting all your eggs in one basket, and watching that basket over the next 30 years. The restructuring of the MIP doesn't have near the effect on someone who already has twenty-five years in management. This is a tough argument. We want to build shareholder value and confidence in our brand, a brand that has served many of us well over the years. We also want UPS to recognize that they are going to have to align salaries and compensation to keep and find the best possible people available to represent that brand. I don't have all the answers, but I too would like to continue to hear from all management folks on this subject. [/QUOTE]
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