Any rough ideas on AIP this year? with tariffs dominating the profit margin but still had profits curious if AIP will be good this year or if they'll dip it with taxes to blame.
34 replies (most recent on top)
@5wq the longer you bail water out of the sinking ship, the better Bill Brown's retirement will be.
Boomers and Gen X, just stay put and continue building your pensions. As you already know, the know it all Gen Z’r who told you to move on will be quitting soon and someone needs to keep the ship afloat.
Word is that AIP won't be announced; you'll just get your payout on February 26 with no indication as to how the company did.
Aip will be good. But I strongly encourage boomers to move out. With AI and changes, this is no longer something you’ll be able to keep up with.
@57n That seems low. Normally corporate is an average of the BGs.
@57n that sounds very low when you look at the performance I was expecting 125%+ hmmm.....
108.9% for corporate
Any news?
Still no news on AIP ? Very strange indeed , what are they cooking up ? Beat estimate in every qtr
If those numbers are right, Corp is looking at 116%.
But I'm not sure about those numbers; except for CBG they look identical to last year.
@2zd what about Corp?
Can someone verify the AIP payout ratio?
TEBG- 135%
SIBG- 120%
CBG- 93%
If upper mgmt is putting their thumbs on the scales, then why is the long term payout apparently right around 100% as people here are saying?
@2b5 the AIP payout should be good. Judging how the share price has outperformed vs the earlier year. Hopefully can get 120% or more
Hopefully after next week earnings call they would announce AIP payout ratio
@1r5 the issue with AIP is that it's was expected that it would be an honest calculation based on realistic goals, so that we would typically get the full payout (with some better and some worse years).
The reality is that leadership puts their thumb on the scale and hides things from us so they can personally decide whether we did enough to satisfy them.
My experience and data are very similar to yours, the long term average is very near 100% both for corporate and business units.
@1r5 Of course, AIP varies by BU and division, but here are my stats over 17 years of collecting AIP: only 7 years exceeded 100%, and 3 of those years exceeded 130%. Average AIP attainment over the 17 years is 99.73%. Now, someone with a shorter time collecting AIP would have a different view since 5 of the last 8 years exceeded 100%, with an average of 105% payout. YMMV
Here's something I don't understand. Why is everyone complaining about AIP and acting like it's some big mystery? You knew what it was before accepting a job at 3M. If not, then you didn't read the offer letter and/or ask questions about it. AIP should not be a surprise to anyone.
The offer letters I remember going out to candidates basically said:
Here's your base pay.
Here's your AIP target. The actual amount may vary depending on company and individual performance.
So what's the issue? You knew (or if you didn't, it might be your fault) what the AIP rules are before joining.
Oh, and BTW (recognizing thing may have changed dramatically in the last 2 years), There were way more years when AIP was greater than 100% of plan then there were when it was less. Sometimes a lot more - 130%, etc.
It’s basically a pay cut if there was a difficult year. Sometimes the year following a bad year was good because part of the calculation compared last year to this year.
New to AIP and it already feels like a con. Looks like salary sacrifice marketed as a bonus, no opt-out, and plenty of people saying they end up worse off. Is there any genuine benefit here that I’m missing?
@r4 yeah, numbers have been good every quarter this year, but there's a reason why Bill declared that we weren't going to publish estimates throughout the year, and that reason is so he can adjust it downward whenever he wants.
Dishonest way to handle the bonus that isn't a bonus.
With sales and free cash better than last year I would think AIP will be at least 100% for corporate. We’ve upped our earnings estimates throughout the year and I know my group wasn’t scrambling in Q4 to get sales out the door. We were solid but not overly concerned about every last penny. We didn’t even stop spending to make things look better. We just steam rolled through December.
I was a T3 when they transitioned to one a year AIP. They changed that position from 10 percent at risk to 7.5 at risk. With that came a hard raise of 2.5 percent beyond the usual yearly raise. That was nice but very doubtful anyone would offer an exchange of at risk for hard raise.
Is there an option to switch from the 5/10% bonus structure paid out in the following year to 100% salary YOY? They can have their 1.02 to 1.2 multiplier ontop of my withheld salary.
That sounds like a unique/unusual situation that is special for such transitions.
In every offer letter that went out (at least until a few years ago), the base and incentive pay were clearly differentiated. We had to argue with HR to get them to actually put the whole amount (the sum) in the letter so applicants could compare offers against other companies' offers (which did so the sum). But HR wouldn't since they wanted to emphasize the bonus nature of it.
They call it a bonus, but I went from exempt to non-exempt and kept pay (including AIP). So it is considered part of salary, and not a bonus. I guess if over 100% it might be a bonus. If paid full salary as hourly, how could it be a bonus
I believe showing the quarterly AIP rates is a relatively recent thing (last 5-6 years, maybe?). For most of my time at 3M, there were no rates announced. Info about the payouts would come down from on high sometime after the beginning of the year.
@dp If you are talking about when they switched from quarterly payouts to annual...then your statement is a lie. If you are talking about when they first started the quarterly payouts...well, you need to retire.
When the program first started, everyone got no raises for about three years in order to get this so called bonus.
They used to show the quarterly AIP results, but decided to get rid of it totally. The website is just empty since last year
That's a ridiculous question. First, bonuses are completely standard in many companies. It's profit-sharing, just using other terms.
As with many other companies, you have an at risk portion of your pay, depending on division and company performance.
I'm not saying it's always handled well, but the practice is totally normal and common.
As an outsider it’s a very weird system. The bonus that can’t be called a bonus anywhere but pays out just like a bonus.
@OP When thet hide AIP I am very concerned about the integrity of our senior leaders. AiP already feels illegal to me. They hold back a portion of my salary for 15 months and MAYBE you will get it...no Interest mind you.
But with this years new epr ratings you will see many more 2's than ever before which means you will not get 100% payout no matter what. Anyone ever challenged the legality of 3M's aip scheme?