Case study/ Incentive pay for CEOs

Is it obvious that $3.25 per thousand is too low incentive pay for CEOs? Explain.

Case study/Incentive compensation for CEOs

Does the observation that the stock price increases when firms increase incentive pay for CEOs suggest that most CEOs do not receive enough incentive compensation? Explain.

Measurement system

Evaluate the following statement: The overarching purpose of a measurement system should be to help a team, rather than senior managers, gauge its progress. A team's measurement system should primarily be a tool for telling the team when it must take corrective action.

Piece Rate System

The Green Show Company is considering going to a piece rate system, where manufacturing employees are paid based on their level of output. Discuss what factors the firm should consider in deciding whether this idea should be implemented. How should the initial piece rate be set? Under what circumstances should the company alter the piece rate once it is adopted?

Bonus plan/benefits vs. costs

Your company currently has a bonus plan for its sales managers. If annual sales for a manager's unit exceed $1 million, the manager receives a $10,000 bonus. In a typical year, about 5 of the 10 managers in the firm meet the target and receive the bonus. However, the number receiving the bonus varies from year to year due to the state of the economy, which in turn has an effect on sales. The company is considering replacing the bonus plan with a plan that rewards the top-five selling managers each year with a $10,000 bonus. Discuss the potential benefits and costs of the new plan relative to the old plan.