Research On Equity Incentive Of JS Company

Since China joined the WTO in 2001,China’s small and medium-sized enterprises have obtained unprecedented development opportunities.During this period,a large number of excellent small and medium-sized enterprises emerged in China.The value of the final products,services,taxes,jobs and invention patents created by SMEs reached more than 50%of the total.SMEs play an important role in the historical process of rapid economic growth in China.With the diversification of the market environment and increasingly intensified market competition,many enterprises gradually fall into business difficulties.The poor operation of SMEs is mainly divided into internal factors and external factors.For example,core staff turnover,unclear management responsibilities,technical innovation,market changes,etc.Whether internal factors or external factors,the reason for the poor management of enterprises is the lack of talents.How to attract and retain talents is of great significance to the development of SMEs.Listed companies and large state-owned enterprises attract a large number of outstanding professionals and graduates with their own capital,excellent talent training management system and perfect performance appraisal and incentive system.Compared with the small and medium-sized enterprises due to its own resources scarcity,imperfect performance evaluation system and incentive effect is acceptable,entrepreneurs on the road for the development of the company led the following four problems: "how to attract talented people","how to develop staff potential","how to retain talents" and "how to create a benign competition environment".Equity Incentive originated in the United States.As a long-term incentive mechanism,it has been favored by most listed companies and large enterprises,and the talent strategy of enterprises has been effectively developed.In contrast,the talent strategic planning of SMEs has become dwarfed.Especially like petrochemical,optical manufacturing and other traditional industries under the small and medium-sized enterprises are more obvious.Although many small and medium-sized enterprises have established the corresponding incentive mechanism according to their own operating conditions.Because the implementation mechanism is mostly short-term effective measures.For example,compensation and benefits,paid vacation benefits,etc.,do not play a positive role in the long-term talent strategy of enterprises.Incentive measures as an important part of human strategic management,the implementation of incentive measures should help the company to achieve long-term strategic goals.Therefore,SMEs need to build an effective long-term incentive mechanism to adapt to the increasingly fierce talent competition,so as to help enterprises succeed in the talent competition market,which is crucial to the future development of enterprises.JS companies face the same problem.How to use the Equity Incentive theory to help the company solve the existing talent strategy problem,so that the enterprise talent management and enterprise strategic goals tend to be consistent,is the problem of this paper.The author was invited to work as the Equity Incentive researcher of JS company.Starting from August 2019,the author will work with relevant staff of the office of the company’s President to sort out the company’s existing incentive system,human resources and corporate finance.At the same time,interviews with senior managers and questionnaires were used to understand the demands of core employees and the problems existing in the company’s current incentive measures.The research shows that the talent strategy of JS mainly focuses on the single incentive measures without long-term incentive effect.Lack of professional personnel,the need for outstanding professionals;The incentive mechanism is mainly based on material incentive,lacking spiritual incentive;Incentive mechanism is lack of pertinence,need to further improve the incentive system.After clarifying the problem,the author adopts the research method of literature,investigation and historical data analysis to make a deep analysis of the company’s related problems.Combined with the knowledge of Equity Incentive,the corresponding Equity Incentive scheme is designed to solve the above problems.Based on the analysis of the existing factors influencing the incentive effect of the company and the relevant Equity Incentive theory,the author and the board of directors of the company jointly developed a targeted Equity Incentive plan.And was highly recognized by the chairman of the enterprise.It has been approved by the board of directors in December2019 and is expected to be implemented by the end of the first quarter of 2020.The author hopes that the research results of Equity Incentive can play a positive role in JS company’s future talent strategic management and long-term strategic goals.