Suppose you are managing a local golf course. How might you go about developing and implementing an incentive compensation system that will help drive successful strategy execution?
What will be an ideal response?
The following are five guidelines for creating an incentive compensation system that will help drive successful strategy execution:
• Make the performance payoff a major, not minor, piece of the total compensation package.
• Have incentives that extend to all managers and all workers, not just top management.
• Administer the reward system with scrupulous objectivity and fairness.
• Ensure that the performance targets set for each individual or team involve outcomes that the individual or team can personally affect.
• Keep the time between achieving the performance target and receiving the reward as short as possible.
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