Bonus Plan Practices in the Software Games Industry - The Croner Company

The following summarizes our findings on incentive plan prevalence in software games organizations, based on data compiled in the 2012 Croner Software Games Survey.

Short Term Incentive Plans

• The majority of companies, both independent and parent owned companies, offer some type of formal Short Term Incentive (“STI”) plan

• Most companies offer an STI plan to all employees

• When STI eligibility is limited, versus available to all employees, most limit to manager level and above

• Recent trend is to reduce Product Development Plan eligibility and increase general STI eligibility

Long Term Incentive Plans

• The majority of companies, both independent and parent owned, offer a Long Term Incentive (“LTI”) plan

• Most companies limit LTI eligibility to only some employees

• When LTI eligibility is limited to some, versus all, employees, most companies limit to vice president level and above

• LTI is more prevalent in independent than in parent owned companies

• Type of LTI offered varies by ownership model

• Independent companies make greatest use of stock options

• Parent owned companies make greatest use of a mix of stock options, full value shares and other types of LTI