As Index Coop evolves, we will continually iterate, improve and strive to redefine best practices of our contributor rewards process. Providing the best guidance and utilizing the most suitable tools where possible. The community shall have a fair, transparent and a decentralized process for determining, distributing and managing contributor rewards.
Contributor Rewards process 2.0 seeks to provide a level of support to the community and nest/pod coordinators in determining consistent contributor reward allocation across all the various nests. In this post we present the option of using two different methods of allocation, Coordinape or an updated version of the current rewards process. We are allowing the nests or individual pods to choose their preference. This guide details a consistent methodology that can be applied across both methods. This is a live document and will be continually revised over time to reflect best practices.
It is worth noting that core hires are excluded from flexible compensation mechanisms. Core hire compensation adequately rewards these members for work across the DAO, they will be paid monthly through automated monthly payments made through Parcel and will not be required to submit a rewards sheet
Why is this worth addressing now?
As the Index Coop currently works through Nest proposals we believe this is the right time to upgrade our current rewards process to reflect this organizational change. Additionally, to introduce a new tool which has been trialed by the Community Nest and the organization as a whole as part of the Christmas Bonus Coordinape circle, which offers a decentralized alternative to allocating rewards to contributors.
Here within, we shall define the following:
- What principles should be followed when allocating rewards?
- Guidelines of reward allocation that is impact led
- What is considered when allocating?
- Discussing work scope
- How Coordinape works
- How will the Index Coop use Coordinape?
- Best Practices
New Updated Contributor Rewards Process
- What has changed?
- Disputes Process
- Next Steps/Ask
The goal is to create an open, transparent compensation system for Index Coop contributors that:
- Encourages impactful contributions to the Index Coop
- Provides transparency to contributors
- Is fair and consistent in allocation of rewards
With the above framing, taken from the original guidance issued at genesis, we now seek to add more granularity to ensure fair and consistent application of contributor rewards.
When evaluating contributions, leads and contributors should reward high quality impactful contributions.
When evaluating a community member’s contribution you should consider:
- What is the impact of this member’s contributions?
- What is the quality of this member’s contributions?
- What is the effort of this member’s contributions?
All of the above are somewhat subjective, impact can be related to the primary objectives of the nest or completing work related to the projects put forward in the nest proposal.
Quality is rather simple, if you would not be pleased to present the work as your own, then the quality is not up to spec. Quality is a hurdle like a prerequisite for determining eligibility. Sub standard quality work is not rewarded, regardless of time spent doing it.
Effort is vastly different from one person to the next, people are more efficient than others in nature. Those with expansive networks/specialized skills can achieve hastily what takes others weeks to achieve. The impact can be the same, but effort can vary. Impact takes precedence over effort, however effort always receives recognition such that IC members are incentivised to continue contributing. If the impact is low, then the reward is low as impact is the biggest value driver.
Here we describe what an ideal contributor rewards round would look like from both a contributor and a nest/pod leads perspective, coupled with who is responsible for each section of the process.
Discussing scope of work (Contributors & Leads)
It is recommended that leads and contributors communicate with each other at the start of the month and periodically through regular nest or pod level calls and async through discord to discuss what the expectations are around contributions. Such discussions should cover the following agenda:
- What capacity does the contributor have for Coop activities?
- What specific deliverables will they be working on?
- What is the objective of their contributions? - Is it helping achieve the primary objectives?
- How will this objective be achieved?
- Expected outcome of the work - What is the success metric and how is it linked to the primary objectives of the nest?
- Expected timeline for deliverables
- Expected Rewards allocation upon completing task/deliverable
- Expected contributors progress updates
- Expected communication relating to challenges that risk impeding prior understandings
- If there is an issue with deliverables within the month, this needs to be discussed with the individual prior to allocating contributor rewards to the contributor for the month
Conversations on work scope and progress are also important if using Coordinape. Regular touch points with your nest/pod teams will ensure visibility of the work each contributor is completing and the impact they are driving, which overall will mean more accurate allocation of rewards in Coordinape.
We understand the time constraints of leads and appreciate there are nests and pods with significantly more contributors within than others. The above does not need to be a 1:1 conversation and can be communicated async or on the specific nest/pod level call or Discord channel’s among other means of communication. We also note, some programs have broader guidelines in place that provide the guide rails for broad widespread contributions, ie:impression mining.
The purpose of open and transparent communication ahead of contributors developing an expectation of receiving rewards will help to avoid duplication of efforts. Contributors who elect to perform tasks without prior dialogue within their nests or pods are at risk of not being remunerated for toil.
Nest/pod leads ultimately control their budget and workflow within their respective area. They have an obligation to try to ensure those within the Nest/pod understand this within reasonable means. As contributors develop deeper relationships within the coop, trust is built and the level of dialogue prior to commencing tasks is expected to taper.
An example of best practice here would be to meet as a group periodically and use Notion to project manage your main projects and tasks for the season, which will help track progress and performance against success metrics. The process may look like this:
- Nest and pod leads responsible for updating projects and deliverables in Notion
- Leads provide context around the primary objectives, projects and success metrics which is imperative for new contributors trying to gain a broader understanding and get up to speed
- Regular updates on tasks, whether this be through weekly syncs or async through Notion or Discord - This will help with realignment and focus
- Leads should provide general reminders to the broader Nest/pod around the contributor reward process from time to time as to ensure no misalignment around how the process of administering rewards is implemented (Coordinape or Normal rewards process).
Furthermore, it is worth highlighting the following contributions are NOT compensated. Engagement as described below is expected at a minimum in order to maintain context:
- Snapshot voting
- Meeting attendance/participation
- Discord engagement
- Forum responses and discussion
In general terms, the contributor is expected to attend, participate and be engaged within the community to the extent it enables them to contribute. Meetings/forum discussions are necessary modes of communication that gather intel on how a task is to be performed.
Allocating of Rewards
Coordinape (Leads & Contributors)
How does it work?
Coordinape lets members allocate a set number of tokens to their peers. Coordinape relies on Circles, Epochs, and GIVE tokens.
- Circles are a defined group of people that can participate in a round (you can create a circle for just one pod, or multiple pods in one circle)
- Epochs are time bounded periods in which members of a circle can allocate to each other
- Each member of a circle has a set number of GIVE tokens. They can allocate GIVE to members they would like to reward. For example:
- Elliott has 100 GIVE tokens. He gives 50 tokens to Hammad, 35 to Matt, and 15 to Brad.
- At the end of an epoch, each member of a circle will receive a total amount of GIVE tokens based on what their peers have allocated.
- A reward “pot” is then distributed amongst contributors based on the percentage of GIVE each of them receive out of the total GIVE distributed.
- This reward pot can be fixed monthly (i.e. $20k for all C.Nest contributors) or change month to month based on the overall impact of the team.
- It is also worth highlighting that different members of the circles can be configured to have different GIVE allocations. For example, in C.Nest Gold Owls get 300 GIVE, Silver 200 and Bronze 100.
This makes the process not dissimilar from our current rewards process, but expands the opportunity to input into reward outcomes to all members of a team, not just the Nest Coordinators.
Here is a ‘How to’ video by coordinape themselves for more detail.
How will the Index Coop use Coordinape?
We are giving the nests/pods freedom to decide on how they would like to structure their Coordinape circles. An individual pod may wish to set up a circle for just their contributors, or you may wish to set up a circle for the whole nest, this is the approach Community Nest have adopted. We will work with the nests/pods to help them through the process of setting up a circle and the allocation of GIVE.
- Nest provides F.nest (@hammad1412) with a list of contributors that they would like to add into the coordinape circle and which pods will be participating, the budget for the Coordinape circle should be included in the proposal for the nest
- F.nest starts Epoch to run from 20th to the 27th of the month for each circle
- Contributors login in to Coordinape circle and update profile to give a flavour of what they have been involved in for that month
- Contributors allocate GIVE tokens to other members of the circle
- Epoch closes on the 27th - F.nest collates csv file for each circle and converts to dollar amount to be distributed as INDEX tokens
Community Nest has been using Coordinape to allocate rewards for the last 3 months and have experimented with different best practices, which we will be recommending to the rest of the Index Coop for implementation when using Coordinape as a tool.
- Visibility of what each individual contributor has been working on - Contributors to update profile section on coordinape to provide a short overview of the month
- Amount of GIVE to distribute determined by owl level ( Gold Owls + = 300 GIVE, Silver = 200 GIVE, Bronze & Below = 100 GIVE) - Allows the contributors with the most context to allocate more rewards
Coordinape circle budget = $30,000
Total GIVE allocated in Coordinape circle = 1000
Contributor A receives 150 GIVE
Contributor A % allocation of GIVE : 150/1000 = 15%
Total $ allocation of Contributor A : 15% x $30,000 = $4500
Updated Contributor Rewards Process (Leads)
Finance Nest presents an updated version of the current rewards process. The responsibility of allocation will be on nest and pod leads, who will allocate a reward based on the rewards methodology highlighted at the beginning of the post. Determining how much to reward a contributor is discretionary on the leads as they are ultimately responsible for managing resource capital within their nest or pod, both from a contributor perspective and also financially.
What has Changed?
- Updated simpler contributor rewards sheet to fill out
- ‘’Functional area’ removed, contributions to now be tagged to Nests and a specific pod if applicable
Nest/Pod Leads Perspective
- Master allocation sheet with separate tab for each nest - Easier allocation of rewards with inputs to be made into only one column
- Pod level filter views created
- Budget vs Actual comparison included for each nest to provide the leads visibility of over/under spend when allocating rewards
The below diagram highlights how the rewards process will work from the start to the distribution of rewards with the use of both Coordinape and the updated rewards process.
Feedback & Disputes (Contributors & Leads)
The contributor rewards process master sheet will contain a feedback column for leads to provide any comments regarding their allocation. In Coordinape you are able to provide feedback when allocating GIVE for each contributor. This should be used in addition to discussing directly with the member if there is an issue with the work and should be used to summarize the discussion, aiming to improve the feedback loop for contributors This will allow for any disputes to be resolved and discussed before final payment is made.
If there are any disputes once the final payment has taken place then contributors should fill out this form. Once the form has been filled out the process works as follows:
- Contributor raising dispute is communicated through discord, to confirm receipt, likely next steps and timeline
- Contributor and relevant lead are synced up to communicate through dispute with representative from F.Nest or P.Nest
- Nest/Pod leac feedback to F.nest on output of discussions, if there is a need for a reward to be processed
- F.nest confirms with contributors the output and then processes any reward through the operations account as soon as the final reward is determined. We will not wait until the next month to process disputes, these will be handled in a timely manner
If you would like to implement the use of Coordinape, please make a copy of the spreadsheet below and share with @Hammad1412 by the 18th of February. This will ensure we have enough time to set up the coordinape circles before the start of the rewards round.
Need to fill out the following:
The composition of your coordinape circle? - Which pod/s will it include
Please fill in the owl ID’s using the owl ID tab to provide a list of the contributors that need to be included in the circle (column’s B and C will automatically fill)