Generally, a compensation study involves the following work steps:

1. An initial meeting to discuss the current situation, future business plans and the study objectives to enable the preparation of a proposed work plan

2. A project kickoff meeting to:
   • Confirm the project objectives
   • Review and approve the proposed work plan
   • Gather all relevant information (i.e., strategic and operating plans, job descriptions, organization chart, current incentive plan documentation, etc.)
   • Explore and define the competitive market place (peers)
   • Discuss alternative pay philosophies (e.g., low base - high incentive; moderate base - moderate incentive; low base - high incentive)
   • Agree on project timeframe

3. Analyze current documentation and prepare findings and comments on current plan design

4. Research the defined markets to develop pay information for each of the positions included in the study. This will include base salary, annual incentive targets/values, etc.

5. Develop a proposed compensation strategy that addresses:
   • Defined peers/industry sectors
   • Positioning target versus the defined peers (i.e., above, below, at median)
   • Definition of each pay element (e.g., base vs. annual incentive vs. long-term incentive)
   • Mix of pay (i.e., of total compensation package how much is base, annual incentive, long-term incentive, benefits, etc.?)

6. Develop competitive base salary and total cash compensation (base + annual incentive + long-term incentive) information using available published surveys and proxy analysis (if appropriate)

7. Prepare a progress report that addresses:
   • Proposed compensation strategy
   • Comments and analysis of the current program vs. the proposed compensation strategy and ideas for change
   • Proposed base salary ranges and guidelines for managing base pay (frequency, linkage to performance, etc.)
   • Proposed incentive plans (annual, intermediate, long-term)
   • Awards generated from these plan(s) will be linked to the organization's operating and strategic plans

8. Meet to discuss analysis, findings and recommendations

9. Modify recommendations as appropriate and, once approved, prepare all communication material