Compensation Plans: Targeting Incentives Essay

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Incentive based compensation plans are one of the most conversed topics organizations that have been dealing with for quite some time. There have been several philosophies, formulas, and plans used but in the end, each type of plan has created unfavorable and optimistic results. The questions have always been whether the positive that comes from incentives plans are worth the challenges they create. In examining some of the plans that offer individuals, team based, and long-term incentives, they all vary in different ways that they are applicable, administered and designed, and beneficial to the organization’s objectives. Individual Plan The Balanced scorecard plan could be a feasible option for an individual plan for a General Manager for…show more content…
Team Plan The team plan for Bosch Rexroth Customer Services Representatives (CSR) have conditions ideal for a cash profit sharing plan. The CSR teams long-term team of employees that have a stake in the company’s success and the group have very little turnover in the positions. The employees at times harbor resentment with each because the phone systems are not properly setup so that everyone is covering the phone with customers and able to perform other duties. They are frontline employees who interact with the costumer daily, which adds value to the organization. They process and place orders for the customers, plan shipping dates, and act as a point of contact for all ordering for company. The cash profit sharing plan can promote strong customer focus and reinforce the company goals. This plan has the potential to maintain limited turnover, increase productivity but expand knowledge and create a team environment. The plan can function to create best practices from associates, often employees have creative ideals and innovations that go undeveloped, and under this plan, they can earn compensation for them, which will also promote creativity. Long-Term Incentive Plan Long-term incentives promote organizational growth over an extended period of time and direct employee performance that helps facilitate this growth. Its purpose is to influence employee behavior that is conducive with establishing tenure, accountability, and an ownership mentality. The

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