In a Balanced Scorecard framework, to ensure that balanced attention is given to all measures, incentive compensation is paid when:
A)expected operational performance of a company meets the actual performance.
B)expected financial performance of a company meets the actual performance.
C)each strategic measure exceeds a prespecified minimum threshold value.
D)each strategic measure equals a prespecified minimum threshold value.

Question

Quizplus · Accepted Answer

In a Balanced Scorecard framework, incentive compensation is paid when each strategic measure exceeds a prespecified minimum threshold value. This ensures that all measures receive balanced attention and that the company is performing well in all areas, not just financial performance. Meeting the actual performance is not enough, as the focus is on achieving strategic goals and objectives. Therefore, options A and B are incorrect. Option D is not feasible or realistic, as it is unlikely for all measures to achieve the exact same minimum threshold value.

In a Balanced Scorecard Framework, to Ensure That Balanced Attention