A Demonstrational Research On Incentive Mechanism For Executives Of Private Enterprise

With the market economy developing, the function of private economy is increasing. Meanwhile, as the competition getting hard and the coming of Knowledge economy, executires' action becomes more and more important during management. Private enterprise is different from state-owned enterprises and contemporary companies. It is deserved to build a prompting system for executives for development of private enterprise.Based on substitution theory and prompting theory, this paper firstly puts forward that contemporary incentive system can't solve the problem of long term incentive for executives, and we need to research a new incentive way. Secondly the study summarizes several factors that influence the creating of executive prompting system by using positivism. At the same time, the paper brings up the new incentive system in a creative way which is executives of private enterprises must get shares and revest to the company on the basis of management ability (intangible assets such as knowledge, skills and so on). Thirdly, the key of this system is how to evaluate the values of executives. With the case of YYcompany in the background, the study follows up and analyses the process for retaining executives. Fourthly, the method can be extended to the other area of evaluations for manpower. Of couse, it need to be improved.There exist two innovations: One is the paper brings up the shares right&revest onus incentive system on the basis of management blility. The other one is based upon domestic private enterprises'situation, and reference to DDI's Target Selection, the paper evaluates the values of executives' knowledge and skills by "STARs" .On the other hand, it is a question needs to research and improve ulteriorly that how to reduce the subjective influence when evaluating.