Aligning Compensation to Drive Performance

by Erin McCune on June 6, 2006

in BI and Performance Management, Conferences & Meetings

Lauralee Martin, CFO of Jones Lang LaSalle spoke at CFO Magazine's Corporate Performance Management conference in Chicago today. She shared how her company has developed a compensation program that drives performance across a wide spectrum of real estate and money management functions.

The key to Jones Lang LaSalle's success is a balanced approach, simultaneously addressing the needs of all three critical constituencies:


Jones Lang LaSalle is a global professional services firm competing against investment managers, real estate management firms. Their employees have chosen Jones Lang LaSalle over other more entrepreneurial asset management firms, yet they must be paid a competitive wage + bonus in order to stay. In order to balance employee incentives with long term performance Jones Lang LaSalle ties compensation to the business's 5 year strategic plan. As annuity margins increased (per the strategic plan) employees received a greater share of incentive fees. However, the incentives were a mix of short term and long term rewards in order to retain high performers.

Another key to Jones Lang LaSalle's success was to create bonus pools. As employees reach sales targets their bonus funds a group pool. However, if other performance metrics (teamwork, customer satisfaction) are not met the employee may not receive all of their bonus despite having met revenue targets. This ensures that the company's values are fostered.

Key Take Aways

  1. One approach will not fit all – compensation plans must adapt for different functions as well as varying levels of seniority.
  2. Employees must always know exactly what they are responsible for and how they are expected to perform.
  3. Long term plans are critical to sustained performance.
  4. Compensation does drive behavior – so be careful which performance metrics are tied to compensation.

This has been a dispatch from CFO Magazine's CPM Conference in Chicago
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